- On March 26, 2020
By: Paula E. Pitrak
The Families First Coronavirus Response Act (FFCRA) provided sick leave and expanded the breadth of paid family and medical leave for COVID-related reasons, and it created the refundable paid sick leave credit and the paid child-care leave credit for eligible employers. Eligible employers are businesses with fewer than 500 employees, with few exceptions.
The FFCRA authorizes the Secretary of Labor to issue regulations for good cause to exclude certain health care providers and emergency responders from the definition of eligible employee and to exempt certain small businesses with fewer than 50 employees from the Emergency Paid Sick Leave Act or Emergency Family and Medical Leave Expansion Act when enforcement would jeopardize the viability of the business as an ongoing concern.
On March 20, 2020, the Department of Labor, Internal Revenue Service, and Treasury Department announced their joint Plan to Implement Coronavirus-Related Paid Leave for Workers and Tax Credits for Small and Midsize Businesses to Swiftly Recover The Cost of Providing Coronavirus-Related Leave so “that small and midsize employers can begin taking advantage of two new refundable payroll tax credits, designed to immediately and fully reimburse them, dollar-for-dollar, and the cost of providing Coronavirus-related leave to their employees. . . . All American businesses with fewer than 500 employees will be provided funds to provide employees with paid, leave, either for the employee’s own health needs or to care for family members.”
Below are excerpts from the agencies’ joint guidance, accessible at the above link.
- Paid Sick Leave for Workers
For COVID-19 related reasons, employees receive up to 80 hours of paid sick leave and expanded paid child care leave when employees’ children’s schools are closed or child care providers are unavailable.
- Complete Coverage
Employers receive 100% reimbursement for paid leave pursuant to the act.
- Health insurance costs are also included in the credit.
- Employers face no payroll tax liability.
- Self-employed individuals receive an equivalent credit.
- Fast Funds
Reimbursement will be quick and easy to obtain.
- An immediate dollar-for-dollar tax offset against payroll taxes will be provided
- Where a refund is owed, the IRS will send the refund as quickly as possible.
- Small Business Protection
Employers with fewer than 50 employees are eligible for an exemption from the requirements to provide leave to care for a child whose school is closed or child care is unavailable in cases where the viability of the business is threatened.
- Easing Compliance
- Requirements subject to 30-day non-enforcement period for good faith compliance efforts.
The Wage and Hour Division of the Department of Labor has also issued helpful fact sheets and questions-and-answers regarding the pandemic available at the Division’s COVID-19 and the American Workplace webpage. It also has made publicly available a model FFCRA Poster for federal (accessible via link) and non-federal employers. It’s Field Assistance Bulletin No. 2020-1 further explains the Department will not bring enforcement actions against any public or private employer for violations of the Act occurring within 30 days of the enactment of the FFCRA, i.e. March 18 through April 17, 2020, provided that the employer has made reasonable, good faith efforts to comply with the Act.
For more information regarding your company’s compliance with the FFCRA and other applicable federal, state, and local employment laws regarding COVID-19, contact Fletcher & Sippel’s Labor & Employment Group.