Labor and Employment
The Small Business Exemption for the Emergency Paid Sick Leave Act and the FMLA Expansion Act
April 8, 2020
The Department of Labor (DOL) has provided us with regulations governing the application of the small business exemption for both the Emergency Family and Medical Leave Expansion Act (FMLA Expansion Act) and the Emergency Paid Sick Leave Act (Paid Sick Leave Act). Under both enactments, employers with fewer than 50 employees may be exempt, but only if they meet the specific criteria established by the DOL. The DOL’s newly-crafted regulations require small employers to meet one of the following three criteria for the exemption:
- The leave request would result in the small business’s expenses and financial obligations exceeding available business revenues and would cause the small business to cease operating at a minimal capacity; or
- The absence of the employee or employees requesting the leave would entail a substantial risk to the financial health or operational capabilities of the business because of the employees’ specialized skill, knowledge of the business or responsibilities; or
- There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services needed for the small business to operate at a minimal capacity.
It will be very important for an employer relying on this exemption to fully document its bases for invoking the exemption. Employers should remember that employees who are denied leave under these laws may file a claim with the DOL challenging the decision. And if the exemption is used, employers will want to review and update documentation supporting its use on a regular basis. It may apply one week, but not the next, and employers will need to be ready to address that fact in their documentation.
Click here for more information on the Paid Leave Under the Families First Coronavirus Response Act.
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Chris M. Mason | Read Bio
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