Despite optimism that there would be an extension of paid emergency sick and family leave available under the Families First Coronavirus Response Act (“FFCRA”), the COVID-19 relief bill signed by President Trump yesterday fails to extend the FFCRA’s leave mandate beyond December 31st. However, it does extend tax credits until March 31, 2021 for employers that voluntarily extend qualifying paid leave for their employees beyond the expiration date.
What it Means for Employers
FFCRA-covered employers will no longer be required to provide FFRCA leave after December 31st. Employees who are already on a FFCRA leave or who may need one in the future will have to explore alternative options including potentially applicable state laws or regulations that may provide job protection during a qualifying period of absence or through their employer’s company leave plans.
Congress did provide an incentive for private employers subject to the Emergency Paid Sick Leave Act and the Expanded FMLA to voluntarily continue providing leave for FFCRA-qualifying reasons to eligible employees. Effective January 1, 2021, eligible employers that voluntarily continue to provide emergency paid sick leave or emergency family leave for FFCRA-qualifying reasons remain eligible to receive the existing tax credit under the FFCRA. However, the tax credit will reimburse employers only for employee leaves taken through March 31, 2021, unless extended. State and local government employers are excluded from the tax credits.
How Should Employers Prepare for Expiration of the FFCRA Leave Mandate
Employers that decide not to extend leave should review their existing policies and practices to determine the options available to employees who are either still on a FFCRA leave or in need of leave going forward. Some employers may already have a company leave plan to which eligible employees can be transitioned. Also, in some instances, an employee may be entitled to leave as an accommodation under the Americans with Disabilities Act (“ADA”) and/or a state counterpart if the requested leave is related to the employee’s own disability.
If an employer decides to continue offering leave for FFCRA-qualifying reasons, the employer should take into account that the tax credit will be available only until March 31, 2021. After that date, the employer will need to review other options for their employees if the employer’s financial ability or willingness to provide paid leave is dependent upon the federal tax incentive.
Finally, employers should carefully review the state and local laws applicable to employees who require leave in 2021. Many states and municipalities have passed laws in response to the pandemic and employees may be eligible for job protection under such laws if their absence is necessitated by circumstances arising from the pandemic.
What ReedGroup Is Doing
ReedGroup will continue to analyze the impact of the expiration of the FFCRA’s leave mandate. We anticipate the Department of Labor issuing more guidance in the coming weeks and will update our content with any new developments. ReedGroup clients with questions regarding how the expiration may affect their leave programs should contact their Account Executives for additional information.
If you are looking for assistance managing claims or to ensure compliance across your organization, ReedGroup has solutions for you. Check out our offerings here.
Information provided on this blog is intended for general educational use. It is not intended to provide legal advice. ReedGroup does not provide legal services. Consult an attorney for legal advice on this or any other topic.