Joy Einstein May 11, 2021 11:31:00 AM 19 min read

COVID Vaccine & Legislative Updates for Restaurants

To help our restaurant clients stay current with ongoing legislative and industry developments, we have partnered with leading law firm Shulman Rogers and the Restaurant Association of Metropolitan Washington to provide regular updates. Here are highlights from a recent conversation with Shulman Rogers Attorney Joy Einstein and Kathy Ogilvie of Restaurant People Cloud.

COVID Vaccine Protocols for Restaurants

Q1. Can Restaurants Mandate Vaccines?

A1. Yes, restaurants can mandate that employees get them, so long as you have exceptions for strongly held religious beliefs and disabilities, including pregnancy and breastfeeding. You must provide reasonable accommodations to these people unless it would pose an undue hardship to your business.

Other legal issues to consider:

  • If you are mandating that employees be vaccinated, then you should pay employees for time spent getting the vaccine
  • Accommodations for pregnancy, disabilities, religious accommodation
  • Engage in the interactive process if someone says they have a disability and cannot get the vaccine

Q2. Should restaurants require that employees get the vaccine?

A2. If you don’t require employees to get the vaccine, employees might be able to claim that you have failed to provide a safe and healthy work environment, which is required by OSHA. This has never happened before, though, and it would be groundbreaking to hold employers liable for not requiring vaccinations. Other issues you need to take into consideration are employee morale, how this might affect staffing and union requirements.

Q3. Can restaurants require that employees provide proof of vaccination?

A3. Yes. However, you should instruct your employees not to provide any additional health information along with proof of vaccination status. Some are requiring that employees email HR when they’ve received the vaccine so restaurants can track when they’ve reached herd immunity — that is probably the better approach.

Q4. What are the pros and cons of creating a vaccine incentive program?

A4. According to an article in Washingtonian Magazine, Knead Hospitality and Design, one of DC’s fastest-growing hospitality companies, offers its 320-plus employees paid time off or four hours of pay to get the vaccine. Knead, which currently operates Mi VidaSuccotash National Harbor and Penn Quarter, the Grill, and Mah Ze Dahr DC, will give its 320-plus employees paid time off or four hours of pay to get the vaccine. 

“It’s just the right thing to do. You have employees who have to choose between going to work and making money and their health,” says Knead cofounder, Jason Berry. “Even if you’re strictly looking at it from a business perspective, not an ethical one, you’ll spend less money keeping your employees healthy than, say, closing a section of your restaurant because an employee gets sick.”

Berry and fellow co-founder Michael Reginbogin say the group is working closely with the Restaurant Association of Metropolitan Washington for the latest restaurant industry Coronavirus updates. Under Knead’s plan, tipped employees and hourly staff will get four hours of minimum wage or higher (around $60 to $80), while salaried staff will get a bonus day of paid time off. 

Voluntary incentive programs could trigger ADA rules regarding voluntary wellness programs. If employees cannot get vaccinated due to disability, for example, it is unclear whether you must give them the same incentive. Depending on how the incentive is crafted, it could create wage and hour implications. For example, non-discretionary bonuses must be factored into the employee’s regular rate of pay for purposes of calculating overtime under the FLSA.

Q5. Can restaurants advertise that their employees are vaccinated?

A5. No, not as to specific employees. Restaurants cannot force employees to wear a badge that says, “I’m vaccinated,” for example. However, restaurants can advertise their vaccine incentive programs or their vaccination policies.

Legislative Updates for Restaurants

As we work to help restaurants revitalize, we will provide ongoing COVID legislative updates. On March 11, 2021, the Biden Administration enacted the American Rescue Plan Act (ARPA) of the 2021 COVID Relief Package. Here’s a quick composite of FFCRA (Trump 1 and Trump 2) and ARPA.

American Rescue Plan Act Leave Provisions

The American Rescue Plan Act applies to all companies with fewer than 500 employees. First, let’s review the legislation passed by the Trump Administration. The Families First Coronavirus Response Act (FFCRA) was passed on March 18, 2020 under the Trump Administration at the start of the Pandemic (aka “Trump 1”). 

FFCRA provided: 

  1. Two weeks of emergency paid sick leave.
  2. A temporary expansion of coverage under the FMLA to allow employees to take 12 weeks of FMLA leave for school and child care closures associated with COVID-19, including a 10-week paid leave component (although employees could use their two weeks of sick leave to get paid for these two weeks).
  3. This was mandatory and employers got reimbursed for this cost through a tax credit.

The mandates under Trump 1 expired on December 31. The stimulus bill passed on December 22, 2020 permitted employers to voluntarily allow employees to use any remaining emergency paid sick leave or emergency family and medical leave and still receive the tax credit through March 31, 2021 (aka “Trump 2”). The American Rescue Plan Act expands and extends Trump 1 and Trump 2.

ARPA Emergency Paid Sick Leave (EPSL) Updates

Employees now get a new 10-day bank of emergency paid sick leave, starting April 1. This means if employees already used 10 days under Trump 1 or Trump 2, they get a new 10-day allotment.

Six Reasons Employees Can Take Emergency Sick Leave

Under Trump 1 and Trump 2, employees could take emergency paid sick leave for six reasons:

  1. Self-isolation because of a COVID-19 diagnosis 
  2. To obtain a medical diagnosis or care when experiencing COVID-19 symptoms 
  3. Because a health official or health care provider has recommended quarantine
  4. To care for a family member with COVID-19 or who is seeking diagnosis/care 
  5. To care for a family member in quarantine 
  6. When a child’s school or childcare provider is unavailable because of COVID-19

ARPA Adds Three New Reasons:

  1. To get a COVID-19 vaccine
  2. To recover from adverse reactions to the vaccine, and for seeking or awaiting the results of a COVID test
  3. Whether to give employees this 10-day new bank of leave is voluntary, as it was under Trump 2, but if you decide to give employees this leave, you can claim a tax credit 

Emergency Family and Medical Leave Act Leave (EFMLA)

Originally, EFMLA was only available — and the tax credits claimed — if the employee was unable to work or telework due to the COVID-related unavailability of a child’s school or childcare. 

Under ARPA, the family leave payroll tax credits may now be claimed for all of the qualifying uses of EPSL listed above. 

Moreover, FFCRA originally provided that the first two weeks of EFMLA were unpaid, with the remaining (up to) 10 weeks paid at 2/3 the employee’s regular rate, up to $200 per day and a total maximum of $10,000. ARPA has deleted that unpaid two-week provision, meaning that the entire (up to) 12 weeks of EFMLA is paid. And, accordingly, the per-employee EFMLA tax credit limit has been increased to $12,000.

The new law also contains a non-discrimination provision which provides that you cannot pick and choose among groups of employees in deciding who can use this leave — either sick leave or emergency family and medical leave. 

How to Calculate Pay for Emergency Sick Leave and EFMLA Taken by Tipped Employees 

Using a six-month look-back period, calculate employee’s total compensation for the six months prior to their leave.

Calculation guidelines:

  1. Include tips only to the extent that they are applied towards your minimum wage obligations (so include the tip credit amount in your calculations) and don’t include overtime premiums in your calculation (so use the tipped minimum wage plus tip credit divided by hours worked)
  2. Do not include leave time or PTO in your calculation.
  3. Divide this total by the total number of hours the employee worked during the six-month time period (not including any leave or PTO hours)
  4. If the EE has not been around for six months, use the longest period of time you can.

American Rescue Plan Act COBRA Provisions

Under COBRA, an individual who was covered by a group health plan on the day before the occurrence of a qualifying event (like termination of employment or reduction in hours that causes loss of coverage under the plan) can elect COBRA continuation coverage upon that qualifying event. 

COBRA is expensive and many people cannot afford it, especially since they’ve just lost their job or had their hours reduced, but the middle of a global pandemic is not the greatest time to be without health insurance, so the federal government thought maybe it should address this.

The ARPA provides COBRA premium assistance to eligible individuals — eligible individuals are now not required to pay their COBRA continuation coverage premiums for periods of health coverage from April 1, 2021 through September 30, 2021. Employers now have to pay these on the employee’s behalf, and they can take a tax credit for the amount of premium assistance.

Employees qualify for this new benefit if they are eligible for and elect COBRA continuation coverage because of their or a family member’s reduction in hours or involuntary termination from employment from April 1, 2021 through September 30, 2021; or if they were terminated from Oct 1, 2019 forwards and declined coverage, or dropped coverage, and now elect that coverage during a new 60-day window.

This new COBRA law applies to individuals who have been involuntarily terminated — but we don’t know exactly what that means. This COBRA requirement is not triggered for involuntary terminations for gross misconduct.

Employees are not eligible if they are eligible to get health insurance through a new employer’s plan or through a spouse’s plan, or if they are eligible for Medicare.

Notice requirements under this new COBRA law include:

  1. Required to send out notice of this new law. This can be via separate form or included with your regular COBRA notice for employees who are terminated between now and the end of September
  2. Required to give notice to anyone who had a qualifying termination before April 1 but is still within their COBRA period (generally anyone who was terminated from October 1, 2019 forwards). For these people, you have 60 days from April 1 to provide the notice, so May 31, 2021.

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