Center for American Progress

Coronavirus Paid Leave Exemptions Exclude Millions of Workers From Coverage

Coronavirus Paid Leave Exemptions Exclude Millions of Workers From Coverage

State and national data show that millions of private sector workers are excluded from emergency paid leave protections due to exemptions in federal legislation and regulations.

The sun sets over the U.S. Capitol in Washington, D.C., January 2020. (Getty/Samuel Corum)
The sun sets over the U.S. Capitol in Washington, D.C., January 2020. (Getty/Samuel Corum)

The ongoing COVID-19 pandemic has dramatically altered the day-to-day workings of the U.S. economy, businesses, the education system, and families. Individuals who would otherwise be working may be unable to do so because they are sick or need to quarantine, are caring for someone who is sick or quarantining, or are caring for their child whose school or place of care is closed due to the coronavirus. While some states and cities had existing programs in place to provide paid family and medical leave and paid sick days when the pandemic began, none guaranteed the full two weeks of paid sick leave necessary to meet quarantine recommendations, and no existing statewide paid leave program covers caregiving leaves associated with school or place-of-care closures.

Congress has addressed this gap through provisions in the Families First Coronavirus Response Act (FFCRA) that provide funding for up to two weeks of paid sick days to address illness, quarantining, or caring for a family member, as well as funding for 12 weeks of emergency child care leave—10 weeks paid—to care for a child whose school or place of care is unavailable. These actions are necessary to ensure that workers are able to take the time they need to protect their own health and the health of their families and community members, while maintaining their ties to employment and their income.

Supports for unemployment insurance have also been expanded to provide higher wage replacement and to cover more workers who have lost their jobs or income due to the coronavirus. But it is in the best interests of workers and employers for individuals to remain employed so that businesses do not unnecessarily lose qualified workers and individuals can maintain their benefits and workplace seniority. While early versions of the FFCRA  included all workers, many were eventually excluded from the paid leave provisions during negotiations for the act, amendments included in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and the final rule published by the Department of Labor (DOL).

In the end, Congressional Republicans, big business lobbyists, and the Trump administration established exemptions that exclude all workers in businesses with more than 500 employees from any of the paid leave provisions. This means, for example, that more than 2 million workers who are employed in grocery store chains with more than 500 employees are not covered by paid leave protections, in spite of being essential workers who are potentially exposed to the coronavirus every time they report to work. Businesses with fewer than 50 employees can exempt themselves from providing paid child care leave if they believe it “would jeopardize the viability of their business,” although they are still required to provide two weeks of paid sick days. Employers can make this decision on their own; the DOL does not oversee the decisions or require employers to report whether they are choosing to exempt their workers or not. Employers can also choose to exempt “employees who are health care providers or emergency responders” from both paid sick days and paid child care leave requirements, a category that the DOL defined so broadly that it includes not only health care providers but also virtually anyone else who works in any health care facility—from janitorial staff to cafeteria workers. The DOL explicitly acknowledges that it took a similarly broad approach to defining emergency responders, including workers who “provide essential services relevant to the American people’s health and wellbeing.” What constitutes an “essential service,” however, is not defined. The expansiveness of the regulations is currently being challenged in the courts, as the state of New York has filed a lawsuit to argue that the final rule runs counter to Congress’ intent and unlawfully limits workers’ rights by using overly broad exclusions of employees’ eligibility for paid leave protections.

The federal COVID-19 response excludes up to 106 million workers from paid leave protections

The end result is that a legislative package with the stated intent of protecting the physical and economic well-being of the American public instead undermines those very principles by excluding the majority of private sector workers. Based on the author’s analysis, under even a conservative estimate, somewhere from 68 million to 106 million private sector workers will be excluded from paid leave protections. In other words, under a best-case scenario where small employers or employers of health care responders or emergency responders do not choose to exempt their businesses, only 47 percent of private sector workers will have guaranteed COVID-19-related emergency paid leave. In the worst-case scenario where every employer who can take an exemption does, only 17 percent of the private sector workforce would be covered.* The table below provides state-level detail for the numbers of workers excluded under different exemption rules.

Table 1 Coverage of COVID-19 emergency paid leave provisions

While some businesses may have few other options than to close during the pandemic, those that are able to remain open—either by providing essential services or shifting their employees to remote work—should be supported. Providing paid leave to workers when they need it so that they can maintain ties to their jobs, their income, and their health insurance rather than separating from employment and receiving unemployment benefits is in the best interests of workers and employers. But the data make clear that the exclusions pushed by the Trump administration and its allies in Congress have resulted in far too many workers potentially disqualified from the paid leave protections in the FFCRA. Future legislation needs to address these shortfalls in order to support workers, the health of communities, and the economic stability of the nation.

Sarah Jane Glynn is a senior fellow at the Center for American Progress.

* The data used for this analysis were collected in 2017 as part of the U.S. Census Bureau’s Statistics of U.S. Businesses and represent the latest year for which data are available. While increasing unemployment as a result of the pandemic has changed the landscape of the labor market, these data are thought to reasonably approximate conditions in early 2020, before the coronavirus affected the economy. These data establish estimates of the numbers of private sector workers excluded from guaranteed emergency paid leave provisions enacted through federal legislation; they do not include potential coverage through state and local paid leave programs or employer-sponsored paid leave plans.

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Sarah Jane Glynn

Senior Fellow