Preventive Actions Do Not Trigger Temporary Disability Benefits In Comp and New Paid Emergency Sick Leave Act For Coronavirus For Employers With Less Than 500 Employees Effective April 1, 2020

Let me begin with a correction to a prior blog.  A few weeks ago I wrote in a blog about a hypothetical scenario where an employer requires an employee to be quarantined because the employee was exposed to a fellow employee who tested positive for COVID-19.  Several readers wrote to disagree that the period of lost time should be paid in workers’ compensation, even if the quarantined employee ultimately tested negative and no other workers’ compensation benefits were due.  These comments led me to rethink the issue.  Having reviewed case law in different states on preventive actions and workers’ compensation, I believe the readers are right that temporary disability benefits should not be paid in this situation.

The argument that the employee would make to the judge is that he or she was required to go out of work for a health condition occurring at work.  The employer would counter that if the quarantined employee tested negative, then there is no workers’ compensation issue. This is the better argument: the employer’s action was simply preventive and therefore no temporary disability benefits should be paid.  Any decision on payment of workers’ compensation temporary disability benefits and other workers’ compensation benefits should await the outcome of testing, appropriate investigation and the individual proofs in each case.

Many employers are paying full salary to quarantined employees, eliminating the issue completely.  As of April 1, 2020 there is also a new law that addresses this situation. It is known as the Paid Emergency Sick Leave Act. This law helps employees get paid in precisely the situation addressed in the hypothetical scenario. The law only applies to companies with 500 or less employees.   Attorneys Ralph Smith and Lara Ruggerio of Capehart Scatchard’s Labor Department have written on this subject.  The following is an excerpt from their recent HR Blog.  The purpose of the Act is to provide sick time to employees who are unable to work due to the following situations:

• Quarantine or isolation relating to COVID-19  
• Self-quarantine ordered by a health care provider
• Employee experiencing symptoms of COVID-19 and seeking medical diagnosis
• Employee who is caring for an individual who is quarantined or is self-quarantined
• Employee is caring for a son or daughter due to school of child care closure due to COVID-19 precautions
• Employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of Treasury and the Secretary of Labor

The Act applies to all public and private sector employees with less than 500 employees.  Full-time employees are entitled to 80 hours of paid sick time.  A part-time employee is to receive required compensation for two-thirds of the amount of their usual pay.  However, in no case shall the paid sick time exceed the amounts below:

1. $511.00 per day (and $5,110.00 in the aggregate) if the employee is out due to:
   1. Quarantine or isolation relating to COVID-19
   2. Self-quarantine ordered by a health care provider
   3. Employee is experiencing symptoms of COVID-19 and seeking medical diagnosis
2. $200.00 per day (and $2,000.00 in the aggregate) if the employee is out due to:
   1. Employee is caring for individual who is quarantined or is in self-quarantine
   2. Employee is caring for a son or daughter due to school or child care closure due to COVID-19 precautions
   3. Employee is experiencing any other substantially similar conditions specified by the Secretary of Health and Human Services in consultation with the Secretary of Treasury and the Secretary of Labor

Employers are to receive a tax credit for payments made to employees under this law. Moreover, employees may opt to use other forms of paid leave instead of this leave but the employer cannot require that use.  A business with 50 or fewer employees may ask the DOL to exempt it from following this law if compliance will jeopardize the viability of the business as an on-going concern.  The United States Department of Labor recently issued a guidance on what an employer must show to meet these requirements to obtain a potential exemption. The Department of Labor also has the discretion to exclude health care providers and emergency responders from eligibility.

Tags: Coronavirus, Emergency Sick Leave, Quarantined Employees