FLSA Implications When Telecommuting Due to Illness

Q: I received an email from an employee stating that he is sick, but will be working from home.  Should I allow my employee to work remotely while sick?  What are the FLSA implications of allowing an employee to work from home while sick?

A: The practice of working remotely or telecommunicating has become increasingly popular given technological advancements like smart phones, videoconferencing, and instant messaging services.  While telecommuting provides several benefits for employers and employees, it can also create new challenges such as when employees opt to work from home while sick.

The Fair Labor Standards Act (FLSA), requires employers to pay employees for all time spent completing productive work, regardless if the employer knew that the work was being performed. Although this rule applies to both exempt and non-exempt employees, an employee’s exempt status determines how one’s payment will be calculated when he or she is working from home while sick.

If an exempt employee works remotely while sick, then the employer must pay the employee for a whole day of work, even if the employee only works for an hour or two. However, if a non-exempt employee works from home while sick, then the employer is only required to pay the employee for the actual amount of time worked.  Thus, under the FLSA, even if an employer prohibits employees from working from home while sick, employees must be paid for any productive work they complete.

Whether a company should allow its employees to work remotely while sick depends on a number of factors, including but not limited to the extent of the employee’s sickness and the nature of the employee’s work. For example, working from home with a sprained ankle is different from working with the flu.  Moreover, certain jobs do not lend themselves to working from home, such as face-to-face customer service, working a cash register, working at a food establishment or a construction site.

If an employer decides to allow employees to work from home when they are sick, it is recommended that the employer create and implement a remote work sick policy. This policy should discuss when a sick employee can work from home, which positions the policy applies to, the types of assignments that can be worked on (i.e. responding to emails, or participating in conference calls), and how employees should track their time.  It is also recommended that the employer include language in the policy that gives it the discretion to limit an employee’s ability to work from home if the employee submits subpar work.  If an illness turns into a qualified disability under the ADA, the employer would need to engage in the interactive process to determine whether a telecommuting arrangement would be a reasonable accommodation.  For more information on telecommuting as a reasonable accommodation, see our blog post here.

For assistance drafting a remote work sick policy, contact a labor and employment attorney.

– Renee C. Manson

 

New York City Employers will be Subject to a New Accommodation Law Effective October 2018

Q: I am a New York City employer.  What do I need to know about the amendments to the law regarding accommodations?

A: Effective October 15, 2018, employers in New York City will be required to engage in a “cooperative dialogue” with a person who has requested accommodation or who the employer has notice may require an accommodation.  This new requirement stems from an amendment to the New York City Human Rights Law (“NYCHRL”).

While most employers are under an existing duty under the Americans with Disabilities Act (“ADA”) to engage in an interactive process with employees about accommodations, the expansion of the NYCHRL affects NYC employers in two key ways. First, the ADA applies to employers with 15 or more employees.  The NYCHRL has broader coverage, applying to employers with 4 or more employees.  Second, the NYCHRL amendments greatly expand the duty to engage in a cooperative dialogue beyond disability-related accommodations.

Employers will be required to engage in a cooperative dialogue for accommodations relating to: (1) disability; (2) religious needs; (3) pregnancy, childbirth, or a related medical condition; and (4) a person’s status as a victim of domestic violence, sex offenses, or stalking.

“Cooperative dialogue” is defined as a good faith written or oral dialogue concerning the person’s accommodation needs, potential accommodations (including alternatives to a requested accommodation), and the difficulties that potential accommodations may pose for the employer. This is similar to the interactive process under the ADA, which generally requires employers to request information about limitations, identity the barriers to job performance, and explore types of accommodation.  However, unlike the ADA, the NYCHRL requires that once a final determination is reached, employers must document it in writing, regardless of whether or not the accommodation is approved.

To prepare for the new law, NYC employers should ensure that all managers and other employees who may deal with accommodations are aware of the new requirements. In particular, employers should emphasize that the requirement to engage in cooperative dialogue extends beyond disability-related accommodations.  Employers should also develop internal processes for accommodation requests, dialogues, and determinations, so that all requests are addressed in a timely manner and properly documented.

Jessica X.Y. Rothenberg

Interplay of FMLA and ADA Precludes Employers from Automatically Terminating Employees at End of FMLA Leave

Q: Can my company fire an employee once the person has exhausted his or her FMLA leave entitlement?

A: Many employers are surprised to learn that they may not necessarily terminate an employee if he or she does not return to work at the end of FMLA leave.  Under the Family Medical Leave Act (FMLA), an employee is eligible for up to 12 weeks of unpaid job-protected leave.  Upon returning from FMLA leave, except in a few limited situations, an employee is guaranteed the right to return to the same position or to an equivalent position with equivalent benefits, pay, and other terms and conditions of employment that the employee held before the leave commenced.  Under FMLA regulations, however, an employee does not have a right to return to work if he or she is unable to perform the essential duties of the position.

But what if the employee asks for more time off after the FMLA leave period has expired?

Once an employee has exhausted his or her FMLA leave, the Americans With Disabilities Act (ADA) requires employers to consider whether an extension of leave is warranted as a reasonable accommodation of a disability. An extended leave may be a reasonable accommodation if it is for a finite period of time to receive treatment or to recover from a disability.  Employers must consider each situation on a case-by-case basis, engaging in the interactive process with the employee to determine whether the employee has a disability within the meaning of the ADA, and whether an extended leave would be a reasonable accommodation to enable the employee to perform the essential functions of the job once he or she returns to work.  Employers also must determine whether there are any applicable state laws or worker’s compensation laws that are implicated.

In addition to considering the application of the ADA to each employee’s situation, employers should ensure that their employee handbooks do not contain return to work policies that violate the law. Language that calls for automatic termination after the employee has been absent for a certain period of time may give rise to liability for failure to consider the impact of the ADA.

–Renee C. Manson

 

U.S. Department of Labor Endorses More Flexible Unpaid Intern Test

Q.  Our company wants to establish an internship program and host student interns to work alongside our employees. Do we need to pay the interns?

A.  Possibly. Over the past few years, courts and the Department of Labor (“DOL”) have carefully examined the relationship between businesses and unpaid student interns to determine whether students working at a company are more properly classified as unpaid interns or employees protected by the Fair Labor Standards Act (“FLSA”).  Under the FLSA, if an individual is deemed a non-exempt employee, that employee must be paid at least a minimum of $7.25 per hour and one and a half times their regular rate of pay for all hours worked in excess of 40 in a workweek.  The minimum wage is higher in many states, including New York and New Jersey.

Previously, the Department of Labor required employers to meet a six-part test to prove that an individual was properly classified as an unpaid intern. One of the benchmarks employers were required to prove under the prior test was that the employer providing the internship opportunity “derives no immediate advantage from the activities of the intern . . . and on occasion its operations may actually be impeded.”

Citing four separate appellate court rulings that had rejected DOL’s six-part test, the DOL recently announced that it would use a more flexible “primary beneficiary” test in order to determine the “economic reality” of whether an individual is an intern or an employee. Going forward, the DOL will consider the following seven factors to determine whether an individual is an intern:

  1. The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa.
  2. The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.
  3. The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.
  4. The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar.
  5. The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.
  6. The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.
  7. The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.

No single factor described above is determinative and DOL cautions that whether an individual is properly classified as an unpaid intern will depend on the unique facts of any particular case.  Employers should also be aware that some states have their own test for determining whether an intern must be paid. For example, the New York Department of Labor lists eleven separate factors relevant to determining whether an unpaid intern should be considered an employee under New York law.

Before establishing an internship program or allowing a student to intern at a business, companies should examine the “economic reality” of their relationship with interns, review the new DOL Fact Sheet on interns, and consult with a qualified employment lawyer to ensure that the internship program complies with both federal and state wage and hour laws.

Lee E. Tankle

Job Ads Distributed to Younger Recruits May Be Discriminatory

Q.  My company wants to target on-line recruitment ads for certain jobs to specific age groups. Is that legal?

A.  In most circumstances, the answer is no. Unless an employee’s age is a bona fide occupational qualification (i.e., hiring an applicant under a certain age is reasonably related to an essential operation of the business), a policy targeting recruits under an age limit likely will be considered age discrimination.

The Age Discrimination in Employment Act (ADEA) states that, generally, it is unlawful for employment notices or advertisements to include age preferences, limitations, or specifications.  Thus, advertisements that state that the company is seeking applicants who are “age 25 to 35” or “recent college graduates,” for example, violate the ADEA. Employers also may not base hiring decisions on stereotypes about a person because of his or her age.  Likewise, an employer may not use an employment test that excludes older applicants unless the test is based on reasonable factors other than age.

But, what if, instead of soliciting a certain age group in the text of the advertisement, the company uses technology, such as micro-targeting, to limit the population receiving the job ad? In a recent class action case filed in Northern California, a group of plaintiffs claimed that such a practice also violated ADEA. The plaintiffs sued several large companies and a defendant class of “hundreds of major American employers and employment agencies,” claiming that the companies used Facebook’s ad platform to routinely exclude older workers from receiving their recruiting ads on Facebook, “thus denying older workers job opportunities.”  The lawsuit seeks to certify a class of older applicants who were excluded from receiving employment ads, and seeks injunctive and monetary relief for what it calls a pattern and practice of age discrimination.

The class action is in the early stages, and it will be interesting to see whether the court agrees with plaintiffs’ argument that using technology to limit the pool of applicants to certain age groups is discriminatory.  In the meantime, employers should take heed and avoid targeting younger recruits, both on the face of the job ads and by limiting the population receiving them, absent a bona fide occupational reason to do so.

–Tracey E. Diamond