March 26, 2020;
Updated March 28, 2020 to reflect new guidance from the U.S. Department of Labor
Due to their close proximity, Washington, D.C. (“DC”), Maryland, and Virginia are host to many businesses that cross state lines, with employees located in each distinct jurisdiction that may be subject to differing state orders. Businesses in the DC area face a unique challenge in navigating an ever-changing pandemic response landscape.
Of course, the respective jurisdictions’ directives on these issues are a dynamic proposition and are subject to change
Consistencies in State Orders:
While there are differences that may apply to employers in the DC area, there are also many consistencies in their collective response. All three areas have yet to enact an official Shelter-in-Place order, but have provided guidance on which activities are permitted and which should be limited.
Mass Gatherings:
Initially, DC, Maryland, and Virginia issued orders on mass gatherings both at different times and in different capacities, but as of March 25, 2020, gatherings with more than 10 people are prohibited.
Essential businesses, discussed in detail below, are encouraged to follow social distancing guidelines to the best of their ability while remaining open.
Closed Businesses:
DC, Maryland and Virginia have overall come close to cohesion on many of their requirements for closed businesses, some with more leeway than others. Throughout the DC Metro region, theaters, gyms, salons, and any general recreational facility are closed.
While there are some distinctions between the three, they are generally in agreement in terms of closing establishments that either tend to gather groups of people (such as gyms, and theaters), or by nature require close contact with others (such as hair and nail salons).
Restaurants and Bars:
The DC area has also had a great level of cohesion in their regulation of bars and restaurants to combat the pandemic. All restaurants and bars are permitted to continue take-out and delivery service, although each came to this conclusion at different times.
Essential Businesses:
With some differences in implementation, timing, and specifics, the DC Metro region has largely agreed on the following essential businesses:
- All healthcare related industries, whether suppliers or care providers, including veterinary services and animal shelters
- Essential Government Functions, such as Police Departments and other emergency services
- Grocery stores, food banks, and other food retailers, including liquor stores
- Financial institutions, such as banks
- Gas stations and convenience stores
- Electronics retailers and internet/telecommunications service providers
- Construction, subject to some provisions, to ensure safety
- Home improvement hardware stores and services
- Laundromats and dry cleaners
- Media outlets, such as newspapers and television/radio shows
- Public transportation services - subject to reduced schedules
Important Differences in Closures and Essential Businesses:
The list of essential businesses and provisions guiding their operations is constantly evolving, with some areas jurisdictions providing more clarity than others. The following chart details some important differences in language in each state’s provisions on essential businesses:
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Washington, D.C.
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Maryland
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Virginia
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Construction
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Greatest leeway in terms of essential business designation, with all repair services included, as well as supply stores, with specific allowances for services that are necessary to maintain safety, sanitation, and operation of residences and other essential businesses
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Unclear if construction is considered essential; however, manufacturing of steel, iron, aluminum, engines, construction equipment, medical equipment, and cleaning and sanitation supplies is permitted
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No specific designation, although services for safety and maintaining infrastructure or residences likely permitted
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Essential Infrastructure
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Public works, such as roads, sidewalks, street lighting, traffic control devices, etc., and utilities such as electricity, gas, telecommunications, water, and waste collection
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Utility maintenance is permitted, municipal, community, and other drinking water and wastewater systems and facilities, and telecommunication services
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Utility companies are to suspend service disconnections for 60 days to provide any customer, residential and business, who may be financially impacted by the COVID-19 outbreak
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Social Services
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Essential businesses include those that provide food, shelter, and social services and other necessities of life for economically disadvantages or otherwise needy individuals, and organizations or components of organizations that process eligibility for such services; Medical marijuana dispensaries are also permitted
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Rehab facilities, senior living facilities, medical marijuana dispensaries, bail bondsmen, court reporters, and lawyers and law firms
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Department of Social Services is working with local partners to ensure access to food and essential services for vulnerable populations
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Hotels
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Considered essential, along with all other housing and living facilities. Use of conference facilities, ballrooms, and dining-in facilities are all non-essential
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Lodging services specifically stated as permitted – order did not designate specific restrictions on hotels
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No specific designation; however, likely similar to DC and MD
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Retail Facilities
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Retail clothing stores are considered non-essential
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Portions of enclosed malls must be closed- appears outdoor access stores may remain open with social distancing restrictions
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Dollar stores, electronic retailers, home improvement, lawn and garden equipment retailers are all essential.
Any brick and mortar retail businesses not specifically listed may continue to operate but must limit all in-person shopping to no more than 10 patrons per establishment
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Office Supply
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Not specifically stated in the order; however, household consumer product sales are permitted
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Not specifically stated
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Printing and office supply stores considered essential
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Commercial Facilities
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Vaguely stated, sales not involved in essential services and professional services not devoted to assisting essential business operations are prohibited
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Lodging, building and property maintenance companies, janitorial services, and self-storage facilities permitted
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No specific designation; however, businesses providing professional services may remain open, but should utilize telework as much as possible. Where telework is not feasible, such businesses must adhere to social distancing recommendations, enhanced sanitizing practices, and follow any other relevant workplace guidance from state and federal authorities
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Door-to-Door Solicitations
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Any sale not involved in essential services is prohibited, and touring guides and touring services are non-essential
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As solicitation is likely to violate social-distancing guidelines, even for essential businesses, this is prohibited
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No designation
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Child Care
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Essential, but priority to providing services for essential employees. Facilities must follow OSSE Guidance for Childcare providers and Families related to COVID-19
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Child care services available for providers of health care, medical services, and law enforcement personnel while schools are closed. Childcare has strict social distancing guidelines and rules to keep children in small groups and enhanced hygiene regimes
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Child care providers should limit capacity to 10 total individuals per room and prioritize care for children of essential personnel
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Educational Institutions
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Facilitation of distance learning is permitted, as well as modification of facilities to provide for support for addressing COVID-19;
K-12 educational institutions are closed in the District at least through April 24
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Maryland K-12 education institutions are closed at least through April 24
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Virginia K-12 education institutions are closed for the remainder of the school year
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Maryland Price Gauging:
In addition to the above regulations to combat COVID-19, Maryland has enacted price-gauging measures to prohibit price increases on goods and services that would cause the retailer to profit by more than 10%. These industries include, but are not limited to:
- Food and beverage Sales
- Fuel
- Medicine and medical supplies and equipment
- Hygiene and personal care products
- Cleaning products
- Pet food and veterinary care
- Motor vehicle parts and repairs
- Building supplies and equipment
- Home improvement and maintenance
- Electronic devices
- Internet, telephone, and other telecommunications
- Child care
Employment Regulations:
Affected employers and employees have access to many services, which are only increasing, to make it through the COVID-19 outbreak. These services and programs are available through both state and federal regulations. Below is a breakdown of what is available in the DC area.
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Washington, D.C.
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Maryland
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Virginia
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General notes
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- DC has provided additional protections for those suffering from COVID-19, including adjustments to FMLA leave and initiatives for small businesses
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- Businesses which paid their Maryland Sales & Use Taxes for March early may request a refund of their payment
- The Maryland Department of Labor is now accepting applications for the COVID-19 Layoff Aversion Fund, which can provide funds to help businesses with 500 or fewer employees purchasing remote access equipment and software to allow employees to work from home, provide on-site cleaning and sanitation services or other creative strategies to mitigate potential layoffs or closures
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- Employers which slow or cease operations will not be financially penalized for an increase in workers requesting unemployment benefits
- Rapid response funding is available through the Workforce Innovation and Opportunity Act, for employers eligible to remain open during the emergency. Funds may be used to clean facilities and support emergency needs
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WARN Act
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Follows Federal WARN Act
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- Federal WARN Act applies
- Maryland additionally has a voluntary law, entitled the Maryland Economic Stabilization Act, which applies to employers in the industrial, commercial, and business industries with 50 or more employees
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Follows Federal WARN Act
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FMLA
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- The one year employment requirement and 1,000 hour work requirement shall not apply to an employee who has been ordered or recommended to quarantine or isolate due to COVID-19
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- No known designated differences for COVID-19
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- No known designated differences for COVID-19
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Small Businesses
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- DC small business recovery microgrants are available
- SBA Disaster Assistance Loans
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- Maryland is offering Maryland Small Business Loan and Grant funds, as well as funding for manufacturers who are producing PPE
- State of Maryland has qualified for SBA assistance, and businesses may apply with the SBA for low-interest loans through the Economic Injury Disaster Loan program
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- Virginia received a statewide Economic Injury Disaster Loan declaration from the U.S. Small Business Administration (SBA)
- Small businesses and non-profit organizations located throughout the state can now apply for a loan of up to $2 million from the SBA to pay fixed debts, payroll, accounts payable, and other expenses
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Unemployment Benefits
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- No updates due to COVID-19 outbreak as of March 25, 2020
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- Those who are temporarily unemployed may file for unemployment
- If subject to reduced hours, employees may be eligible for partial benefits
- May be some relaxation of requirements to search for other employment, and temporarily unemployed individuals have no requirement to search for a new position
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- No waiting for unemployment – usual one week waiting period has been waived
- Enhanced eligibility - If a worker has been issued a notice to self-quarantine by a medical or public health official and is not receiving paid sick or medical leave from their employer, they may be eligible to receive unemployment benefits
- In addition, a worker may be eligible for unemployment benefits if they must stay home to care for an ill family member and are not receiving paid family medical leave from their employer
- For individuals receiving unemployment insurance, the Virginia Employment Commission is giving affected workers special consideration on deadlines, mandatory re-employment appointments, and work search requirements
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The Federal WARN Act
The Worker Adjustment and Retraining Notification (WARN) Act guides employers through the requirements for giving advance notice of closings and mass layoffs to employees.
A WARN notice is required when a business with 100 or more full-time employees is laying off at least 50 people at a single site of employment, or employs 100 or more workers who work at least a combined 4,000 hours per week, and is a for-profit business, private non-profit organization, or a quasi-public entity separately organized from the regular government.
Exceptions to Notice Requirement:
Exceptions to the 60-day notice requirement exist for unforeseen business circumstances and natural disasters. The exception for unforeseen business circumstances applies when there is a sudden, dramatic, and unexpected action or condition beyond an employer's control that was not foreseeable when notice ordinarily would have been required. This may include unanticipated and dramatic major economic downturns and government-ordered closings of employment sites without prior notice. The exception for a natural disaster typically applies when a closing or mass layoff is the direct result of a natural disaster. While it is more likely that the first exception would apply in a pandemic, it is worth keeping the second exception in mind due to the fact that President Trump has activated emergency powers under the Stafford Act, which most often involves natural disasters. In addition, these exceptions may not fully eliminate the obligation to provide notice but may serve to shorten the notice period. Employers should provide as much notice as practicable under the circumstances.
It is additionally important to note that WARN does not supersede laws or collective bargaining agreements that require additional notice, rights, or remedies.
New Federal Sick Leave Law
The Families First Coronavirus Response Act ("FFCRA") becomes effective April 1, 2020.
- Employers of up to 500 employees (see below for calculation method) must provide 80 hours of paid sick leave for full time employees (average hours worked over two weeks for part time) if there is work for the employee available and the employee is unable to work (or telework) because:
- The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19. (This includes any government order directing people to remain at home unless they work for an essential business);
- The employee has been advised by a healthcare provider to self-quarantine due to concerns related to COVID-19;
- The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
- The employee is caring for an individual who is subject to an order as described in subparagraph 1 above or has been advised as described in paragraph 2 above; or
- The employee is caring for a child of such employee if the school or place of care for the child has been closed, or the childcare provider for the child is unavailable, due to COVID-19 precautions.
- If your business closed before or after April 1 due to lack of business, or if required to close pursuant to Federal, State or local directive, sick leave is not due.
- Intermittent sick leave is permitted with the consent of the employer (it is not required).
- If business closes while an employee is on FFCRA sick leave, they must be paid for leave through the date of closure.
- Businesses with less than 50 employees are potentially exempt from providing sick leave pursuant to reasons four and five above (as amended by the CARES Act) and should document any hardship presented by providing this leave (after considering the impact of potential tax credits) and wait for further guidance from the DOL.
- Employees may use FFCRA paid sick leave before using state or local paid sick leave, or accrued PTO.
- Paid leave provided prior to April 1, 2020, does not count to fulfill obligations under the FFCRA.
- Employers must require documentation in support of the reason for leave and include:
- Employee’s name, qualifying reason for requesting leave, statement that the employee is unable to work, including telework, for that reason, and the date(s) for which leave is requested; and
- Documentation including a copy of the Federal, State or local quarantine or isolation order related to COVID-19 applicable to the employee (reason 1 above) or written documentation by a health care provider advising the employee to self-quarantine due to concerns related to COVID-19 (reasons 2 to 4 above) or notice that has been posted on a government, school, or day care website, or published in a newspaper, or an email from an employee or official of the school, place of care, or child care provider (reason 5 above).
- If you intend to claim a tax credit under the FFCRA for payment of sick leave wages, you should retain the FFCRA documentation in your records.
How Much to Pay – Employees must be paid based on their required compensation as follows:
- Regular rate of pay subject to a limit of: $511 per day and $5,110 in the aggregate for a use described in paragraph (1), (2), or (3) above; or
- Two-thirds of the regular rate of pay subject to a limit of: $200 per day and $2,000 in the aggregate for a use described in paragraph (4), (5), or (6) above.
Emergency Federal Medical Leave Expansion Act
The Emergency Federal Medical Leave Expansion Act ("EFMLE") becomes effective April 1, 2020.
- The EFMLE applies under the following circumstances:
- The EFMLE applies to employers with fewer than 500 employees (see below);
- Employees must be employed at least 30 calendar days at the time leave is requested;
- The need for leave must be a Qualified Need Related to A Public Health Emergency (“PHE”);
- A PHE exists when declared by a Federal, State or local authority due to COVID-19; and
- The employee must be restored to their position upon return from leave.
- An employee can request this leave for a very narrow reason: if there is work for the employee and they are unable to work (or telework) due to the need to care for their child under 18 years of age if the child’s elementary or secondary school or place of care is closed, or the care provider of such child is unavailable, due to a PHE.
- Intermittent expanded medical leave is permitted with the consent of the employer (it is not required).
- If your business closed before or after April 1 due to lack of business or if required to close pursuant to Federal, State or local directive, expanded medical leave is not due.
- If your business closes while an employee is on expanded medical leave, employees must be paid for leave through the date of closure.
- Businesses with less than 50 employees are potentially exempt from providing sick leave pursuant to reasons four and five above (as amended by the CARES Act) and should document any hardship presented by providing this leave (after considering the impact of potential tax credits) and wait for further guidance from the DOL.
If you intend to have employees remain on staff who would be eligible for EPSL, contact one of our attorneys so we can guide you through how much to pay. Your business may be entitled to tax credit for providing this type of leave.
As this law applies to employers with up to 500 employees, you may have questions about how this total is calculated. If under the FMLA, your company and subsidiaries are considered integrated then it is true for FFCRA. FMLA follows Title VII guidance for whether subsidiaries are integrated. The factors to consider are:
- Interrelation of operations, i.e., common offices, common record keeping, shared bank accounts and equipment;
- Common management, common directors and boards;
- Centralized control of labor relations and personnel, i.e., hire and fire employees; and,
- Common ownership and financial control.
The factors are not evaluated as stand-alone.The entire relationship is to be reviewed in its totality.
Options for Employers:
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Option
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Description
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Important Information
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Remote Work
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Employee remains in the workforce and gains access away from the office to employers systems through a virtual desktop
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- Employers may have to pay for incurred expenses to working from home
- Allows business to continue as normally as possible without extensive in-person contact with co-workers or clients
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Reduced Hours/Pay
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Reduction in hourly rate or prospective salary
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- Minimum wage is still required
- Special requirements applicable to exempt employees must be fully considered before reducing their hours or salaries
- May only reduce going forward, not retroactively
- Consider giving at least 7 days advanced notice
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Furlough
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Employee remains employed, but pay is suspended
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- Employees must not work
- Employees keep health insurance and other benefits
- Employer may restrict use of PTO
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Termination
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Total removal from the workforce, with no guarantee of returning to work
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- If employer is subject to WARN, notice may be required
- Final pay due on last day of work, including pay out of vacation/PTO
- Paid through the final day of work
- Sick leave does not need to be paid out
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Making a Decision:
When deciding how to handle a financial crisis, employers have more to consider than a reduction in their work force. Cost is associated with each route discussed above, that can be dependent on a number of factors.
Furloughed employees are able to keep their benefits package, which can be costly to employers, and, under new sick leave policies, employers may also be required to pay for additional leave. Terminated employees are able to have their vacation time paid out, which, particularly for long-term employees, may be more costly than a reduction in hours or furlough. These are only a few of the many considerations employers need to evaluate prior to making any staffing decisions.
Visit our COVID-19 Hub for ongoing updates.