Q: I'm an employer with fewer than 50 employees. How do I apply for an exemption from the Families First Coronavirus Response Act (FFCRA)?

A: The U.S. Department of Labor (DOL) said in its regulations implementing the FFCRA that an "authorized officer of the business" must document the facts and circumstances that cause an employer to meet the law's exemption requirements.

But first, it's important for employers to understand from which parts of the law they can be exempt. There are two: (1) paid sick leave due to school closure, place of care closure or child care provider unavailability for COVID-19 related reasons; and (2) emergency paid leave under the Family and Medical Leave Act (FMLA). Paid sick leave taken for other reasons — each of which are outlined in the statute — is not included in this exemption.

The authorized officer must use DOL's three-prong test in determining whether the employer is exempt from providing either type of leave. An employer may be exempt if it meets one of the following prongs:

• The leave requested would result in the small business's expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity.
• The absence of an employee or employees requesting such leave would entail a "substantial risk to the financial health or operational capabilities" of the business because of the employee(s) specialized skills, knowledge of the business or responsibilities.
• 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 provided by the employee(s) requesting leave, and these labor or services are needed for the small business to operate at a minimal capacity.

Employers must retain all documentation of FFCRA emergency paid leave requests for four years, regardless of whether the leave request is granted or denied, and regardless of whether they claim an exemption from the FFCRA. The employer should include in this documentation oral statements made by employees supporting a request for paid leave and, if applicable, the authorized business officer's determination that the employer satisfies DOL's criteria for exemption, the agency said.

A small business seeking an exemption should document its revenue and existing payroll costs, as well as what the imposition of additional costs for FFCRA leave would be in the near term, Jim Paretti, shareholder at Littler Mendelson, told HR in an email. He noted that an employer might find it helpful to document whether it is experiencing reduced business compared to, for example, the same time last year.

"An employer may also want to assess its particular workforce to determine whether and how many employees would likely be eligible for leave, and factor that into its calculation," Paretti said.

DOL said in its rule and in guidance that employers should not send the agency materials or documentation. Rather, employers should retain these records for their own files.

In this way, the agency is essentially asking employers to self-certify, Chai Feldblum, partner at Morgan Lewis, told HR Dive in an interview. But she noted that small businesses will need to perform an individualized assessment in determining whether the exemption criteria apply to a leave-taking employee. In other words, the criteria for exemption need to be applied in an individualized manner. This is not the case, however, for employers seeking an exemption from the law as a healthcare provider, which has a different set of criteria, Feldblum said.

One last consideration for employers is the impact of state and local shelter-in-place orders and similar public health emergency orders, according to Paretti. Requirements imposed by these orders might support an employer's argument that it may not be able to operate or would be forced to close entirely if its existing workforce is on leave, he said.

An employee is not entitled to leave if her employer sends her home and stops paying her because it does not have any work for her to do, DOL said in a recent guidance document. This stance drew criticism from some Democratic lawmakers, who argue that the agency guidance on this point is an "inaccurate conclusion."