Recalling Furloughed Employees and Unemployment Benefits: TN Return to Work

by Sarah E. Stuart

As many businesses in Tennessee begin the process of reopening, the Tennessee Department of Labor and Workforce Development (“TDLWD”) has issued clarification on employees’ obligation to return to work if called back.  Subject to COVID-19 related qualifying exceptions, if an employer recalls its employee, the employee must return to work or else he or she will not qualify for unemployment benefits.  As employers experience pushback from employees that may be receiving increased unemployment benefits or are dealing with COVID-19 related concerns, it is important for employers and employees alike to understand the implication of a refusal to return to work, both with or without a qualifying COVID-19 related reason.

For an employee currently receiving unemployment benefits through TDLWD, when an employer notifies an employee of a recall or reopening, the employee must report the offer of work during their weekly certification to the TDLWD.  If the employee refuses to return and is not the subject of a qualifying exception, they will no longer qualify for unemployment benefits.  Any benefits received after the employee’s recall are considered an overpayment of benefits, which must be repaid.  If overpayments are deemed to be the result of fraud (i.e. intentionally not certifying a recall offer to the TDLWD), the employee could be subject to penalties and interest, including potential criminal prosecution for fraud in the most serious circumstances.

Should an employee refuse to return to work once recalled, the employer should first evaluate whether he or she is clearly subject to a qualifying exception.  If not, or if the employee’s eligibility for an exception is unclear or questionable, the employer should notify the TDLWD by submitting a “Refusal to Work ticket” on the TDLWD website.  The TDLWD will evaluate, based on employer and employee documentation, whether the employee is subject to a qualified exception such that they may remain eligible for benefits.  The TDLWD will also consider whether the employee was offered to return to the same position and rate of pay.

Generally speaking, an employee will not be required to return to work and will remain temporarily eligible for unemployment benefits through the federal CARES Act Pandemic Unemployment Assistance Program while:

  • They are diagnosed with COVID-19 or have COVID-19 symptoms and are seeking diagnosis;
  • A member of their household is diagnosed with COVID-19;
  • They are providing care for a family or household member diagnosed with COVID-19;
  • They are the primary caregiver for a child whose school or care facility closed due to COVID-19; or
  • They are subject to an imposed quarantine or were advised by a medical provider to self-quarantine, due to COVID-19

We anticipate that one of the challenges for employees in moving forward with return to work may be for those who are primary caregivers with a child whose school or care facility remains closed.  The TDLWD has indicated that an individual may be permitted to remain out of work for a limited time and collect benefits after recall if they are a primary caregiver without reliable childcare, but this exception will only apply until the date the school year was scheduled to end prior to the COVID-19 pandemic.  Further, if the employee has access to reliable childcare, this exception will not make the employee eligible for benefits should they refuse to return to work.  The TDLWD will analyze reliable childcare issues for a primary caregiver due to COVID-19 on a case-by-case basis.

Finally, to qualify for an exception based on a quarantine order, an employee must supply both their employer and TDLWD with documentation.  Because some of the qualified exceptions may require a case-by-case determination, please reach out to our firm to discuss how to handle questionable refusals to return.