(703) 369-4738

Author archives: Jessica Perdue

3
Jun
2020

CARES Act Grant Funds Available for Manassas Businesses

The City of Manassas is launching a new small business relief grant program. The City anticipates receiving CARES Act funds from the Federal government which may be used, in part, to provide support for small businesses adversely impacted by the COVID-19 pandemic. The City Council and the Economic Development Authority (EDA) intend to use some of these funds to establish a small business grant program. The grant funds are intended to provide support for small businesses of all types which have seen significant revenue losses due to the COVID-19 Pandemic.

The grant application and guidelines can be found on the City’s economic development website at www.ChooseManasssas.org. Or you can read more about this program in the EDA’s June 1st press release HERE.

VF&N is legal counsel to the Manassas City Economic Development Authority (EDA) and commends the EDA’s efforts for providing resources and support throughout the crisis.

11
May
2020

Can a rescue squad protect itself from local government accountability by becoming a non-stock corporation?

The Local Government Attorneys of Virginia hired Martin Crim of Vanderpool, Frostick & Nishanian P.C. to draft an amicus curiae brief in the Virginia Supreme Court case of Dumfries-Triangle Rescue Squad v. Board of County Supervisors of Prince William County. 

The case started when members of the rescue squad falsified operational records and the County’s Operational Medical Director refused to renew the operating license for the rescue squad. In response, the Board of Supervisors dissolved the Rescue Squad pursuant to statute and the agreement between the County and the Rescue Squad.

The Rescue Squad refused to wind up its affairs, however, claiming that its incorporation as a nonstock entity in 1959 made it immune to dissolution by the County. The Virginia Supreme Court allowed the appeal on the questions of whether the County had the authority to dissolve the Rescue Squad and whether the trial court was right to order the Rescue Squad to distribute its assets to the County.

The appeal presented the novel question of whether a rescue squad can unilaterally protect itself from local government accountability by becoming a non-stock corporation.

The amicus brief pointed out the state law has, since 1970, authorized local governments to regulate and even dissolve volunteer rescue squads, and similar laws apply to volunteer fire companies. Rescue squads are funded in large part with donations from private individuals and local governments, so the amicus brief argued that local governments need to have the ability to supervise, regulate, and, when necessary, dissolve rescue squads. State law has granted local governments those powers since 1970, and such laws affect rescue squads that existed before 1970 because the General Assembly has the power to affect existing corporations with new legislation designed to protect public health and safety.


* NO GUARANTEE OF RESULTS: Our prior results, including successful judgments and settlements, do not guarantee a similar outcome. Each case we handle is different and therefore we cannot guarantee any specific result in your case.

11
May
2020

Exit Strategy: Does your business need a buy-sell agreement?

An exit strategy is the method by which a business will transfer ownership (all or only a portion of it) to a third party at some point in the future. This is often memorialized in a company’s Operating Agreement, Bylaws, or other formal and binding contracts, and is typically referred to as a buy-sell agreement or buyout provision. There is no question that, at some point, every small business owner is going to have to leave his or her business, in one form or fashion.

The following are among the most common “trigger events” that should be considered:

  1. Divorce. This can be between co-owners, or between one of the business owners or LLC members and his or her non-owning spouse;
  2. Deadlock or disagreement amongst the business owners or LLC members;
  3. A business owner of LLC member has a personal bankruptcy;
  4. Default on a loan secured by an ownership interest;
  5. Death, disability, or incapacity of an owner or LLC member; and
  6. An owner or LLC member simply wants to leave the business and move on.

Crafting an exit strategy

Regardless of where it is written, or what it is called, a business’ exit strategy should at least contain the following:

  1. Identification of what events will trigger the provision ( listed above)
  2. Identification of the ways in which a business owner/member can transfer his or her interest in the entity
  3. Details regarding how that interest will be valued.

What are the ways out?

As far as a small business is concerned, there are typically four ways that an owner or LLC member can move on:

  1. Sell to a Third Party: While this method typically results in the largest net gain for the selling individual, the downside is that it’s difficult to determine whether the third party buyer will share the business vision of the remaining owners/members.
  2. Sell to a Family Member: Unlike when selling to a third party, individuals tend to be comfortable selling to a family member, as there is an increased likelihood that he or she will run the business with some continuity and degree of care. Leaving a running business to a family member can also be a great gift! Conversely, however, one’s family members may not have any interest in participating in the business and, even if they do have the interest, they may not have the skills to run the business.
  3. Sell to an Employee(s): This option can be great for the selling owner if he or she utilizes an Employee Stock Ownership Plan (ESOP), which will provide him or her with some nice tax advantages. It is important to consider, however, how the employee(s) will pay to purchase your interest, as they may not have large amounts of funds laying around.
  4. Close or Liquidate the Business: This method seems to be used more by closely held businesses, with only one or two owners, and often ends up being the easiest way out. With that ease, however, comes the downside of the owner(s) not receiving a significant, if any, return, and the employees being out of a job.

How will the business be valued?

Finally, an exit strategy should detail how the business, or the various ownership or LLC membership interests in the business, will be valued for sale purposes. The question of valuation is a complex one, often resulting in heated disagreements and sometimes delaying, or even completely interrupting, the sale process. As such, the following is a very brief overview of various things you ought to consider.

Initially, all of the owners or members of a business can agree on a valuation amount each year, however it bears considering that when the triggering event occurs, the actual value of that interest will likely be different from the earlier agreed upon number. Alternatively, upon the occurrence of a triggering event, the value of the business, or a given interest in the business, may be determined by (1) a calculation using historic company data; (2) the company’s Board of Directors after consultation with various financial professionals; or (3) a professional appraisal, which would be guided by a market, asset, or income approach.

Regardless of which valuation approach is used, a business’ value will ultimately be determined by how much the market, or a specific buyer, is willing to pay for an interest in that business.

We’ve discussed all of this, so now what?

Now that you’ve spent a good deal of time contemplating and negotiating the above topics, it is imperative that the final exit strategy – whether it be in the form of a buy-sell agreement or otherwise – be included in your business’ governing documents. As the saying goes – if you fail to plan, then you’re just planning to fail!

If you’re just starting a new business, or have a strong business but no exit strategy, please give us a call to see how our experienced business lawyers can help you draft and execute a buy-sell agreement most favorable to your interests!

By: Attorney Jon Gelber

7
May
2020

Failure to Protect Employees From Covid-19 can Result in Fines or Worse

With a steady increase of reported COVID-19 infections, employers face increased risks regarding their employees’ safety. Risks include potential fines and other penalties from the Occupational Safety and Health Administration (OSHA) for violation of the OSHA Act.

Employers Have an Obligation

Under the OSHA Act, employers have an obligation to “furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.” https://www.osha.gov/laws-regs/oshact/section5-duties

Preparing WorkPlaces

Since many employees working outside of their homes often physically interact with other people, employers should take steps to limit their employees’ risk of infection. To help employers reduce the risk of worker exposure to COVID-19, OSHA recently issued Guidance on Preparing Workplaces for COVID-19. https://www.osha.gov/Publications/OSHA3990.pdf

In addition to this OSHA guidance, the Centers for Disease Control and Prevention (CDC) issued Resources for Businesses and Employers, which also provides guidance on how employers can prepare for and respond to COVID-19. https://www.cdc.gov/coronavirus/2019-ncov/community/organizations/businesses-employers.html

Employers should review both OSHA and CDC guidance and follow recommended procedures, especially if their employees are in jobs classified as high or very high exposure risk. OSHA and CDC guidance discusses different steps employers may take to protect employees, including providing Personal Protective Equipment (PPE). The type of PPE that an employer will need to provide can vary based on the employee’s risk classification or occupation. For example, OSHA does not recommend PPE for workers in the lower exposure group, but workers in a very high risk group would likely need to wear gloves, a gown, face shield, and in some cases a respirator.

OSHA has Received Thousands of Complaints

If an employee feels that their working environment threatens physical harm or an imminent danger, the employee can make a complaint to OSHA. https://www.osha.gov/as/opa/worker/handling.html. Since the onset of the pandemic, OSHA has received thousands of complaints against employers related to COVID-19, and OSHA recently provided data showing an increase in the number of OSHA complaints and inspections. https://www.osha.gov/enforcement/covid-19-data#complaints_selected. If an employer does not furnish a place of employment free from recognized hazards, that employer can be subject to civil penalties for each violation (and/or imprisonment of up to six months if willful). https://www.osha.gov/laws-regs/oshact/section_17.

Employers Face Risks Beyond OSHA Violations

Employers face risks from COVID-19 beyond OSHA violations, as employees can bring lawsuits against their employers for claims including negligence and wrongful death. Since the start of the pandemic, employees have already begun filing claims against employers stemming from COVID-19, including lawsuits against retailer Walmart.

Employers should take actions recommended under OSHA and CDC guidance to minimize employee risks related to COVID-19. An employer’s failure to protect its employees can result in potential fines, lawsuits, or even imprisonment.


Please note that this summary is designed to provide general information, is not intended to constitute legal advice, and should not be utilized as a substitute for professional services in specific situations.  If legal advice or other expert assistance is required, please consult with an attorney.

By: Attorney Brendan Cassidy

20
Apr
2020

Does the FFCRA (Families First Coronavirus Response Act) apply to my business?

The FFCRA was enacted in response to the Corona virus and, in part, requires all private for-profit and not-for-profit employers with fewer than 500* employees along with government employers (“Covered Employers”) to provide certain paid sick leave and paid family and medical leave to employees. To determine whether the FFCRA is applicable to your business, you must count the number of employees that are working for you.

How do you calculate your number of employees under FFCRA?

  • Calculate the number of employees on the day employee’s leave would start
  • Include
    • employees on leave
    • full-time and part-time employees within the U.S.
    • temporary employees & day laborers who are jointly employed by you and another employer (regardless of where payroll is maintained)
  • Calculation does not include independent contractors

By: Kris Spitler, Esq.

Do you have more Coronavirus related questions? Visit our Covid-19 business resource page HERE or call us at (703) 369- 4738. We are open and ready to assist new and existing clients.

17
Apr
2020

What should you do to best protect your business from litigation arising out of the Covid-19 crisis?

What should you do to best protect your business from litigation arising out of the Covid-19 crisis?

  • Stay up to date.  The federal government is passing a significant number of new laws in response to the crisis, especially related to employment.  Additionally, governors, administrative agencies, and courts are issuing orders changing how a business or individual can act, in light of public health concerns related to Covid-19. Some of these changes are intended to create new opportunities for businesses to keep operating without risking public health, but others create potential liability for businesses and individuals that don’t comply with the new laws and orders.
  • Document as much as possible.  You may not remember in a year why you did something, even though it seemed very important at the time.  Also keeping contemporaneous records helps protect your business against losing knowledge about an event because an employee leaves and helps protect against claims that someone in your organization is misremembering or lying about what happened.  Most litigation does not take place until months or years after the event at issue and people rarely realize that something could turn into litigation at the time it is happening. Keeping clear, consistent, and detailed records can often either prevent litigation or allow it to be resolved more quickly and for less cost than if records are minimal.
  • Don’t overpromise.  Whether dealing with customers, vendors, contractual partners, or employees the natural tendency is to try to make the other party happy or to emphasize the strengths and benefits of your product, service, or business.  But when this natural salesmanship goes too far it often leads to litigation. When a party feels like they have been “lied” to, even if that was not your intention, they are less likely to be reasonable in finding a solution.  Set reasonable expectations for both your business and those you deal with, especially in light of the known and likely future impacts of Covid-19.
  • Communicate clearly and document those communications.  Businesses are often asked by their customers, vendors, contractual partners, or employees for things they have no obligation to provide, either because it is not called for under the contract or the law does not require it.  This is especially true during an unusual or significant event like the Covid-19 crisis. In the interest of maintaining good relationships, many businesses will try to accommodate the request. Likewise, when ending or changing a relationship with vendors, contractual partners, or employee the instinct often is to soften the blow by being vague.  While it is not necessary to be rude, communications should be clear and not leave room for the other side to come up with their own interpretation of what you meant. If you are going to try to do something, but may not be able to, you should be clear about that. Likewise, if you have a contract, make sure you are clear about if what is being discussed is or is not intended to modify the contract.  If you do intend to modify the contract, make sure you review the contract and any amendment is done in accordance with its terms.  

By: Brett Callahan, Esq.

Do you have more Coronavirus related legal questions? Visit our Covid-19 business resource page HERE or call us at (703) 369- 4738. We are open and ready to assist new and existing clients.

13
Apr
2020

Who bears the risk if a contract can’t be fulfilled due to a Covid-19 hardship?

Who bears the risk if a contract can’t be fulfilled due to a Covid-19 hardship? It is important for businesses to review any existing contracts they believe could be affected by these disruptions.  When reviewing your contracts consider these measures:

  • Identify the “choice of law” or “governing law” provision in the contract. Does the contract provide that a particular state’s laws will be used to interpret the agreement?
  • If there is a force majeure clause, review the language to see whether specific applicable terms are included. In general, Virginia courts will not allow more general “act of God” language to completely relieve a party of their contractual obligations unless the nonperformance was completely outside of the party’s control. Consider whether there are alternative means to perform contractual obligations or proactive steps that can be taken to minimize the potential consequences of a breach and/or default.
  • And make sure to comply with the contractual terms regarding notice requirements that have been provided to preserve your ability to invoke that clause
  • No force majeure clause? An agreement may contain a provision having the same effect as a force majeure clause without using those words. For example, a contract might contain a section called “Termination” or another catch-all provision that may list events that will allow nonperformance. If your contract does not contain such a clause, Virginia courts may still be willing to excuse non-performance or delay if it is impossible to perform or the whole purpose of the contract is frustrated.  
  • Consider negotiating a written amendment to the contract to reflect a commercially reasonable resolution.
  • If you are entering into new contracts, keep in mind what you can actually accomplish and when you can accomplish your contractual obligations if there continue to be Covid-19 related impacts for the next several months or over the next year.  You will likely not be able to use the Covid-19 impacts going on longer than expected to excuse performance for contracts entered into after the crisis started.
  • Act consistently and adopt well-developed legal strategies. Consider how your response may impact your long-term relationship with your contract partners.  Also consider how taking different approaches depending on what side of the transaction you are on may impact your ability to defend your positions later on.

By: Brett Callahan, Esq.

Do you have more Coronavirus related questions? Visit our Covid-19 business resource page HERE or call us at (703) 369- 4738. We are open and ready to assist new and existing clients.

1
Apr
2020

VF&N Welcomes New Attorney

Vanderpool, Frostick & Nishanian, P.C. is pleased to announce Jonathan S. Gelber, Esq., formerly of Gelber & Associates, PLLC, has joined our firm.

Mr. Gelber comes to Vanderpool, Frostick, & Nishanian, P.C. as Of Counsel with over 35 years of experience and practice in collections and in civil litigation within the Commonwealth of Virginia. Mr. Gelber will focus his practice in the areas of litigation, collections, commercial law, civil defense matters, arbitration, and Guardian ad litem matters.

Many have considered Mr. Gelber a source and resource of practical advice and knowledge of the law in these areas. As an experienced attorney in the Northern Virginia area, Mr. Gelber has taught Continuing Legal Education courses for lawyers, lectured at the annual meetings of the Virginia Creditors Bar Association and other organizations, is a Guardian ad Litem for Incapacitated Adults in both Arlington and Fairfax counties, and has been a member of the Arlington County Judicial Bar Selection Committee in the past. Mr. Gelber has also been a member of the Virginia State Bar Fourth District Subcommittee, Section 1, which meets to hear cases regarding attorneys charged with various acts by the Virginia State Bar.  

The firm of Vanderpool, Frostick, & Nishanian, P.C. is honored to have Mr. Gelber in-house and available to its clients.  Mr. Gelber is excited about the prospect of practice with Vanderpool, Frostick & Nishanian, P.C., and anticipates the ability to serve an even broader range of clients.

About Vanderpool, Frostick & Nishanian, P.C.

Vanderpool, Frostick & Nishanian, P.C. is a law firm located in Manassas, VA. Established in 1986, we have served clients for over 30 years in business law, commercial real estate, litigation, lending, IP, employment law, land use and zoning, municipal law and criminal defense.

To learn more about Vanderpool, Frostick & Nishanian, P.C., visit our about us page.

30
Mar
2020

Virtual Meetings and Consultations Now Available

In efforts to continue to serve our clients in a safe and CDC compliant manner, we are now offering virtual meetings and consultations.

If you are interested in scheduling a virtual consultation or meeting with your attorney, please call 703-369-4738 and one of our legal assistants will schedule a zoom appointment.

23
Mar
2020

Resources to Help Employers Respond to Workplace Issues From COVID-19 (Corona Virus)

By: Kristina Keech Spitler, Esquire

FOR THE MOST UP TO DATE INFO, PLEASE VISIT OUR COVID-19 PAGE

DOWNLOAD REPORT FOR PRINT

Given the fast-paced and changing nature of the impacts of the COVID-19 (Corona Virus) pandemic, businesses are working to respond in the best manner possible for the safety of their employees and customers while remaining in compliance with various employment laws and evaluating their ability to keep their businesses viable. On the evening of March 18, 2020, President Trump signed Families First Coronavirus Response Act (“FFCRA”) which amongst other provisions, includes the Emergency Family and Medical Leave Expansion Act, the Emergency Paid Sick Leave Act, and the Tax Credits For Paid Sick and Paid Family and Medical Leave that generally apply to all employers with fewer than 500 employees.

Businesses are evaluating how to respond to this pandemic which includes dealing with the following challenges (to name just a few of the many issues and concerns):

  1. Determine how to keep their employees safe and comply with various federal, state and local mandates, laws, and guidance.
  2. Determine how to comply with the Occupational Safety and Health Act.
  3. Evaluate if they can continue business operations by allowing employees to work remotely, and if so, which employees can work remotely. Ensuring that employees have the technology in place to effectively work remotely, and determine what policies and practices need to be put in place or amended.
  4. Determine what leave they should or must offer to their employees and whether they need to amend their existing leave and vacation policies and practices. Determine how to continue to comply with existing Family Medical Leave Act (FMLA) requirements (generally applicable to employers with 50 or more employees) and now comply with the new Emergency Family and Medical Leave Expansion Act and Emergency Paid Sick Leave Act requirements pursuant to the FFCRA.
  5. Determine how to comply with laws that prohibit discrimination based upon disability.
  6. Determine how to correctly pay employees (exempt and nonexempt) under the Fair Labor Standards Act given all the variables in play.
  7. Evaluate whether they should just close down and conserve resources with the hope of being able to reopen in the future.
  8. Evaluate what unemployment benefits can employees who have been terminated, laid off, or furloughed may be eligible for through the Virginia Employment Commission.

To help businesses with these challenges, I have provided some helpful information, a summary of some applicable employment laws, and identified where you can find additional useful resources.

Please note that this summary is designed to provide general information, is not intended to constitute legal advice, and should not be utilized as a substitute for professional services in specific situations. If legal advice or other expert assistance is required, please consult with an attorney.

Employers have a number of issues to consider in this difficult time. If you need legal counsel, please feel free to contact me at 703 369 4738 or kspitler@vfnlaw.com. In addition, please stay safe and healthy.

Employee and Customer Safety

Employers should frequently review the website for the Center for Disease Control (CDC) regarding guidance and regular updates including its Interim Guidance for Businesses and Employers. https://www.cdc.gov/coronavirus/2019-ncov/index.html https://www.cdc.gov/coronavirus/2019-ncov/community/guidance-business-response.html

Employers should also frequently visit the website for the Virginia Department of Health. http://www.vdh.virginia.gov/coronavirus/

Occupational Safety and Health Act (“OSHA”)

“The Occupational Safety and Health Act requires employers to comply with safety and health standards and regulations promulgated by OSHA or by a state with an OSHA-approved state plan. In addition, the Act’s General Duty Clause, Section 5(a)(1), requires employers to provide their employees with a workplace free from recognized hazards likely to cause death or serious physical harm.” This statement is contained in OSHA’s Guidance on Preparing Workplaces for COVID-19. Employers should review this resource at the website referenced below. https://www.osha.gov/Publications/OSHA3990.pdf

Remote Working/Telecommuting

While working remotely (also called telecommuting or teleworking) is not new and many employers (both small and large) have been allowing employees to do so and/or providing it as a benefit to employees for flexibility and work/life benefit reasons, the COVID-19 pandemic is forcing all employers to consider this as an option for business continuity reasons. If you already allow remote working, you should review and if necessary, amend existing policies – particularly if you previously only allowed remote working for limited periods such as one day per week. If you are new to teleworking or who have previously been reluctant to allow it, there are many resources available on the internet that can help you manage teleworking employees. Below is a site for an article from Harvard Business Review on how to manage newly remote workers. https://hbr.org/2020/03/a-guide-to-managing-your-newly-remote-workers

Employee Leave

Employee leave is not a simple issue and involves various laws (and now including the newly enacted Emergency Family and Medical Leave Expansion Act and Emergency Paid Sick Leave Act as part of the Families First Coronavirus Response Act). Employers should consult with legal counsel to ensure compliance with leave laws.

Generally, employers will need to comply with their current policies or amend them regarding any paid or unpaid leave to provide employees. Employers should also look at their vacation policies. Employers will need to decide if they are going to allow employees to take advance leave/vacation and/or go into the negative if employees need to take leave related to the Corona virus or other illnesses. Employers may need to amend various policies to address these issues. In addition, please see the FFCRA summary below as the Act requires paid sick leave related to the Corona virus under certain conditions for all employers with fewer than 500 employees.

Employers will also need to comply with existing FMLA laws and regulations. Generally, the FMLA applies to employers with 50 or more employees within a 75-mile radius and would not apply to smaller employers. However, please see the FFCRA summary below as the Act amends the FMLA to deal with the Corona virus and applies to all employers with fewer than 500 employees.

For convenience, I have included the website below for Department of Labor’s “COVID19 or Other Public Health Emergencies and the Family and Medical Leave Act Questions and Answers” which was published prior to the enactment of FFCRA. https://www.dol.gov/agencies/whd/fmla/pandemic

Leave Under the Families First Coronavirus Response Act (FFCRA)

The FFCRA was enacted quickly in response to the Corona virus and, in part, requires all private for-profit and not-for-profit employers with fewer than 500 employees along with government employers (“Covered Employers”) to provide certain paid sick leave and paid family and medical leave to employees. It also provides that these employers will get a tax credit as described below. There are a lot of unanswered questions about this new legislation. As of the date of this article, DOL has not published any regulations or guidance on compliance with FFCRA. Stay tuned as guidance is expected. Both the Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act provide that they “shall take effect not later than 15 days after the date of the enactment of this Act.” As part of FFCRA, it was signed by President Trump on March 18, 2020 so that it would go into effect under the Act by April 2, 2020 at the latest. Both acts end on December 31, 2020.

FFCRA Emergency Paid Sick Leave Act

Covered Employers shall provide employees for immediate use (regardless of how long they have been employed) with up to 10 days of paid sick leave if the employee is unable to work or telework for the following reasons:

  1. The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
  2. The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
  3. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
  4. The employee is caring for an individual who is subject to a quarantine or isolation order as described in (1) above, or has been advised as described in (2) above;
  5. The employee is caring for a son or daughter whose school or place of care has been closed, or the childcare provider is unavailable, due to COVID-19 precautions; or
  6. The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.

The amount of hours of paid sick time for full-time employees is up to 10 days (80 hours). Part time employees are entitled to “a number of hours equal to the number of hours that such employee works, on average, over a 2-week period.” Unused paid sick leave may not be carried over from one year to the next.

The amount Covered Employers must pay to an employee who is unable to work or telework for one of the above reasons will be the following:

  • paid at the employee’s regular rate, up to $511 per day ($5,110 in the aggregate), to quarantine or seek a diagnosis or preventive care for COVID-19 (reasons 1, 2 or 3 above); or
  • paid at two-thirds the employee’s regular rate, up to $200 per day ($2,000 in the aggregate), to care for a family member for such purposes or to care for a child whose school has closed, or whose child care provider is unavailable, due to COVID-19, or the employee is experiencing any other substantially similar condition specified by the U.S. Department of Health and Human Services (reasons 4, 5 and 6 above).

Covered Employers may not require an employee to use other paid leave provided by the employer before the employee uses the paid sick leave provided under this Act. The Act does not address how to handle if the employer has already provided sick or other type of leave to employees prior to its enactment.

It shall be unlawful for employers to discharge, discipline, or in any other manner discriminate against any employee who takes leave under this Act and who has filed any complaint related to this Act or has or will testify about any such proceeding. Violations of this Act will be considered violations of the Fair Labor Standards Act and employees may be entitled to unpaid wages, liquidated damages, and attorneys’ fees and costs.

Covered Employers are required to post and keep posted in conspicuous places on their premises a notice regarding the rights under this Act. This notice will be prepared by the Secretary of Labor and available at a later date. Secretary of Labor shall make a publicly available model notice within 7 days of enactment.

Covered Employers of health care providers or emergency responders may elect to exclude such employees from the application of this subsection.

In addition, the Secretary of Labor shall have the authority to issue regulations to: 1) exclude certain health care providers and emergency responders from the definition of employee, including allowing employers of such health care providers and emergency responders to opt out; 2) to exempt small businesses with fewer than 50 employees from the requirements of providing paid sick leave under reason #5 above (the employee is caring for a son or daughter whose school or place of care has been closed, or the childcare provider is unavailable, due to COVID-19 precautions) when the imposition of such requirements would jeopardize the viability of the business as a going concern; and 3) as necessary to carry out the purposes of this Act.

FFCRA Emergency Family and Medical Leave Act

This Act amends the existing Family and Medical Leave Act of 1993. The Act provides that Employees who have been employed for at least 30 days with a Covered Employer will be entitled to take up to 12 weeks of job-protected Emergency FMLA leave for a qualifying need related to a public health emergency of COVID-19. The Act defines this to mean that the employee is unable to work or telework in order to care for a child (under the age of 18) if the child’s school or place of care has been closed or the childcare provider is unavailable due to COVID-19. The first two weeks of the Emergency FMLA leave are unpaid under this Act. During this time, Employee sick leave may be under the Emergency Paid Sick Leave described above or the employee may elect, but may not be required, to substitute any accrued vacation leave, personal leave, or medical or sick leave already provided by the employer. Thereafter, the remaining 10 weeks would be paid Emergency FMLA leave. The amount of pay shall be no less that two-thirds (2/3) of the employee’s usual pay, up to $200 per day ($10,000 total). When the need for such leave is foreseeable, employee shall provide the employer with such notice as is practicable.

It is unclear at this time whether or how employer-provided paid leave would run concurrently with this Emergency FMLA leave and how it would interact with the traditional FMLA leave benefits.

As this is job-protected leave, this means that the employer must restore the employee to the same or equivalent position when s/he returns to work from such leave. However, for Covered Employers who employ fewer than 25 employees, the Act provides that this job restoration provision shall not apply if 1) the position does not exist due to economic conditions or other changes in operating conditions of the employer that affect employment and are caused by a public health emergency during the period of leave; and 2) the employer makes reasonable efforts to restore the employee to an equivalent position during the year following the conclusion of the leave period.

Similar to the Emergency Paid Sick Leave Act, Covered Employers of health care providers or emergency responders may elect to exclude such employees from the application of this subsection. In addition, the Secretary of Labor shall have the authority to issue regulations to 1) exclude certain health care providers and emergency responders from the definition of employee; and 2) to exempt small businesses with fewer than 50 employees when the imposition of such requirements would jeopardize the viability of the business as a going concern.

FFCRA Tax Credits for Employers Providing Emergency Paid Sick Leave and Emergency FMLA Leave

Covered Employers who provide Emergency Paid Sick Leave and Emergency FMLA Leave will be eligible for refundable tax credits on their payroll tax payments equal to 100% of the amount paid (up to the maximum amount authorized by each Act) during each quarter.

Americans with Disabilities Act (“ADA”)

For employers who are covered by the Americans with Disabilities Act (15 or more employees), the U.S. Equal Employment Opportunity Commission (“EEOC”) has provided guidance on complying with the ADA and Rehabilitation Act, including requirements for reasonable accommodations and rules about medical examinations and inquiries. On March 19, 2020, the EEOC clarified that while both Acts continue to apply, they do not interfere with or prevent employers from following the guidelines and suggestions by the CDC or state/local public health authorities. See the EEOC’s webpage and the EEOC’s Pandemic Preparedness in the Workplace and the Americans With Disabilities Act below. https://www.eeoc.gov/eeoc/newsroom/wysk/wysk_ada_rehabilitaion_act_coronavirus.cfm https://www.eeoc.gov/facts/pandemic_flu.html

Fair Labor Standards Act (“FLSA”)

Employers need to be careful to ensure that they are complying with the FLSA when evaluating how to correctly pay their employees (exempt and nonexempt) given all the variables in play during this pandemic. Employers should consult with legal counsel to ensure they are complying with the FLSA. In addition, please see the guidance that the Department of Labor has provided: “COVID-19 or Other Public Health Emergencies and the Fair Labor Standards Act Questions and Answers.” https://www.dol.gov/agencies/whd/flsa/pandemic

Closing Your Business, Terminating Employees, and Unemployment Benefits

Evaluating whether a business should close down now and conserve resources with the hope of being able to reopen in the future is a complicated and difficult decision. The decisions regarding whether to terminate, layoff or furlough some or all employees is equally as difficult. Both issues are beyond the scope of this article. In the event that employers do terminate employees and/or significantly reduce their hours, generally the employees may apply for unemployment benefits with the Virginia Employment Commission. Note that beginning March 15, 2020, the one week waiting period and the requirement to conduct a weekly job search has been suspended by the Governor in response to the pandemic. See the Virginia Employment Commission website below. http://www.vec.virginia.gov/

Businesses should also be aware of the Worker Adjustment and Retraining Notification Act (“WARN Act”) which generally requires that employers with 100 or more employees provide certain notices of intention when closing a facility with 50 or more employees and/or laying off 50 or more employees. The Virginia VEC has established a rapid response team to help in this situation. See VEC website above.