COVID-19 Overwhelms North Carolina’s Ill-equipped Employment Law Protections


North Carolina has always offered weak stew when it came to statutory employment law protections. Lacking a state non-discrimination statute and enforcement agency, North Carolina residents have been forced to rely primarily on federal statutes that often leave gaping holes in coverage. Legislatures in more progressive states eagerly have filled these gaps—for instance, by prohibiting discrimination by employers with fewer than 15 employees.

Thankfully, starting with the seminal case, Sides v. Duke University, 328 S.E.2d 818 (1985), North Carolina courts bolstered workplace protections with a common law tort, prohibiting terminations that violate North Carolina “public policy.” Unfortunately, it took a deadly chicken plant fire in 1991 to prompt the General Assembly to pass the N.C. Retaliation in Employment Discrimination Act (REDA), which prohibits retaliation against employees who make complaints related to workplace safety or wage and hour issue or pursue workers’ compensation claims. Further, North Carolina has a “baby ADA,” the N.C. Persons with Disabilities Protection Act (NCPDPA), a statute that handicapped itself by severely limiting its remedies, essentially rendering it useless.

COVID-19 has overwhelmed the federal and spotty North Carolina employment law protection scheme, just as it has overwhelmed our balkanized healthcare system. To our pleasant surprise, the federal government acted decisively—albeit with loopholes through which one could fly all the grounded aircraft—to expand protections under the Family Medical Leave Act, but the focus of this column is to highlight what Gov. Roy Cooper can achieve with the stroke of a pen to supercharge the North Carolina wrongful discharge tort and bring needed relief to our suffering workforce.

The feds set a fast but deeply flawed example with the Families First Coronavirus Response Act (FFCRA).

The Family and Medical Leave Act (FMLA) was enacted in 1993 and has applied only to employers with 50 or more employees within a 75-mile radius. Additionally, employees were eligible for FMLA only if they worked more than a calendar year and at least 1,250 hours for their current employer. Eligible employees could take up to 12 weeks of unpaid leave, with company-paid medical benefits, to take care of their own “serious health conditions,” or that of their spouse, child, or parent. While the unamended FMLA likely covered COVID-19 infected individuals as having a “serious health condition,” it failed to address workers who were not infected but needed to self-quarantine, or those who needed to be absent from work due to lack of childcare options, for example.

Recently passed by Congress, the FFCRA takes effect on April 2. It contains two acts that work in concert together: the Emergency Paid Sick Leave Act (EPSLA) and the Emergency Family Medical Leave Expansion Act (FMLEA). Both acts apply to employers with fewer than 500 employees.

EPSLA is straightforward: qualifying employers must provide two weeks of paid sick leave regardless of how long the employee worked for the employer if the employee: (i) is subject to a federal, state, or local quarantine or isolation order related to COVID-19; (ii) has been advised by a health care provider to self-quarantine due to concerns related to COVID-19; (iii) is experiencing symptoms of COVID-19 and seeking a medical diagnosis; (iv) is caring for an individual who is either (1) subject to a Federal, State, or local quarantine or isolation order related to COVID-19 or (2) has been advised by a health care provider to self-quarantine due to concerns related to COVID-19; (v) is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the child care provider of such son or daughter is unavailable, due to COVID-19 precautions; or (vi) 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.

Finally, the paid sick leave must be: (1) at the employee’s regular rate, not to exceed $511 per day and $5,110 in total for qualifying conditions under (i), (ii), and (iii), or (2) at two-thirds the employee’s regular rate, subject to a maximum of $200 per day, and $2,000 in total for qualifying condition (iv), (v), and (vi).

The FMLEA expands the FMLA but only in a very narrow way—employees who have worked at least 30 days are now entitled to take up to 12 weeks of job-protected leave if needed to care for their child under the age of 18, if the school or place of care for the child has been closed, or the child care provider of the child is unavailable, due to a public health emergency. The FMLEA picks up after the EPSLA’s initial two weeks of paid leave by requiring up to an additional 10 weeks paid leave at a minimum of two-thirds an employee’s regular rate of pay, capped at $200 per day or $10,000 in the aggregate. Employers are prohibited from mandating that an employee use other sick time provided by the employer prior to using the paid sick time provided for by the act.

However, there are more problems here than solutions. First, employers with more than 500 employees get a free pass. For example, those brave and low-paid cashiers at Harris Teeter and Publix don’t receive any of these protections. Additionally, the U.S. Department of Labor may exempt businesses with fewer than 50 employees from both acts if the requirement would jeopardize the business. The statute will also sunset on December 31, 2020 without further congressional action.

There are huge gaps even for those covered by the statute. Unfortunately, defeating a COVID-19 infection will not resolve in a neat 14-day window contemplated by EPSLA. It’s difficult to even get a test in 14 days, let alone defeat the virus and be cleared to return to work; we’re talking a month at least. Folks who are home anyway to care for school-age children are still covered, but what about everybody else? Childless workers or empty-nesters will be back to square one with the original FMLA, where many will fall through the coverage cracks because they have not been employed for a full year or their employer is too small. The leave would be unpaid in any event, and thus a pyrrhic victory.

The EPSLA may also have an unintended flaw in its enforcement provision. On its face, it prohibits discrimination or retaliation against employees who took leave “and” who engaged in protected activity by making a complaint alleging a violation of that law. This could be a drafting error, but employers are likely to argue there is no recourse for terminating an employee who took the leave, but never lodged a complaint. The poorly worded enforcement section also cross references the remedy for denial of paid leave to the federal minimum wage instead of specifying the pay rate articulated in the statute. Most surprisingly, the provision appears to apply a “willfulness” standard for the employer’s intent in a retaliation action, which is usually reserved only for awarding punitive damages. In short, employers may be poised to pounce, arguing this tiger is toothless.

The North Carolina wrongful discharge tort is built to adapt immediately to new pronouncements of “public policy,” and an executive order should do the trick.

The wrongful discharge tort was born out of desperation to address a paucity of legislative action in the 1980s. It is perfectly positioned to on-board a new public policy during this pandemic. Gov. Cooper can generate an executive order proclaiming that it is a violation of North Carolina public policy for any employer (regardless of size) to retaliate against an employee for:

  • Following a COVID-19 governmental directive such as a “stay-at-home” order that was issued in Mecklenburg County;
  • Quarantining under medical advice;
  • Staying at home to care for themselves or an immediate family member with COVID-19; or
  • Making safety-related complaints associated with the COVID-19 pandemic, such as requesting personal protective equipment or adequate sanitation.

It would be preferable for the General Assembly to also act. In fact, the General Assembly could give a booster shot to our beleaguered workforce by adding just a few sentences to statutes already on the books by, for example, amending:

  • the NCPDPA to specify that COVID-19 is a disability and eliminating the two-year lost wages cap;
  • the N.C. Occupational Safety and Health Act to explicitly mandate that our brave cashiers, delivery drivers, and agricultural workers be provided personal protective equipment;
  • REDA to make taking COVID-19-related leave protected from retaliation just like filing a workers’ compensation claim; and
  • the N.C. Workers Compensation Act to extend those benefits to employees working in pandemic critical industries, such as food production and grocery retailers, who contract COVID-19 while performing their duties.

But for now, let’s start with what we know Gov. Cooper has the power to do. An executive order can help fill these gaps.

If you are interested in learning more about your legal rights during the outbreak, take a look at our additional COVID-19 employment law resources for employees.