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COVID-19 Supplemental Emergency Paid Sick Leave and Emergency Family Medical Leave under American Rescue Plan Act

This leave requirement expired 9/30/2021

June 04, 2021 7910

The paid-leave requirements of the FFCRA expired on December 31, 2020. Employers no longer have an obligation to provide paid sick (EPSL) or emergency Family and Medical Leave Act (EFMLA) leave to employees for absences related to the coronavirus. Under the Consolidated Appropriations Act (CAA), employers could choose to continue providing FFCRA-like leave voluntarily through March 31, 2021 and receive an employer tax credit.

The American Rescue Plan Act (ARPA) further extended this tax credit for voluntarily provided FFCRA-like paid leave by employers through September 30, 2021.

Employers who choose to allow employees to use such leave (and receive the related tax credits) must make it available to all employees who qualify. This means that employers cannot limit their employees’ eligibility for EPSL or EFMLA leave based on seniority, pay level, or full-time status, for example.

It’s important to note that CA employers of more than 25 employees are required to provide up to 80-hours of Supplemental COVID Paid Sick Leave under SB 95. Please see California Supplemental COVID-19 Paid Sick Leave Fact Sheet for guidance on paying and coordinating federal and state COVID-related paid sick leave.

EPSL and EFMLA Paid Leave

While the ARPA does not require employers to provide paid leave for employee absences related to COVID-19, it does extend the tax credit allowed for voluntarily extending leave from April 1, 2021, through September 30, 2021. These new credits are in addition to the credits for ten days of EPSL that were originally provided under the FFCRA and its subsequent extension. Under the Rescue Plan, an employer that claimed tax credits under the FFCRA for employees who exhausted their ten days of EPSL before April 1, 2021 can now allow those same employees to take ten additional days of EPSL, and the employer may be eligible to claim to receive an additional ten days’ worth of related tax credits.

  • As of April 1, 2021, employers may voluntarily offer another 10 days (up to 80 hours) of EPSL to employees who previously exhausted leave and receive a tax credit for doing so.
  • EPSL benefits are available to all employees up to a maximum cap of $511 per day.
  • Employers may now also offer emergency FMLA leave (EFMLA) for all “FFCRA-qualifying reasons” for leave (i.e., those previously only offered for emergency paid sick leave), including the newly added reasons stated below, and receive a tax credit. Previously under the FFCRA, EFMLA was only available for leave needed to care for a child whose school was closed or whose caregiver was unavailable due to COVID-19.
  • Employees are eligible for EFMLA leave if they have been employed for at least 30 calendar days by the employer.
  • The first two weeks of EFMLA may now be paid at 2/3 the regular rate of pay (previously unpaid) and eligible for the tax credit. This raises the maximum tax credit limit for EFMLA from $10,000 to $12,000 per employee.

Qualifying reasons for EPSL and EFMLA leave:

Under the Rescue Plan, employees may take paid EPSL leave (subject to caps of $511/day or $200/day, depending on the reason for leave) or EFMLA leave (subject to a cap of $200/day) for the following reasons:

  • The employee is obtaining the COVID-19 vaccine
  • The employee is recovering from an illness, injury or condition related to the COVID-19 vaccine
  • The employee is seeking or awaiting the results of a diagnostic test for, or a medical diagnosis of, COVID-19 if the employee has been exposed, or the employee’s employer has requested such test or diagnosis
  • The employee is subject to a federal, state or local quarantine or isolation order related to COVID-19
  • The employee has been advised by a health care provider to self-quarantine due to COVID-19
  • The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis
  • The employee is caring for an individual who is subject to a quarantine or isolation order due to COVID-19
  • The employee is caring for his or her son or daughter if the child’s school or place of care has been closed or is unavailable due to COVID-19
  • The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretaries of Treasury and Labor

Tax Credit

An employer that voluntarily provides employees with paid leave as previously required under the FFCRA can claim a tax credit for qualifying leave provided from April 1, 2021, through September 30, 2021. The employer will take a dollar-for-dollar tax credit by retaining the amount of payroll taxes equal to the amount of qualifying sick and family care leave that it paid (up to statutory maximums), rather than deposit them with the IRS. For an overview of FFCRA requirements for tax credit eligibility, see COVID-19-Related Tax Credits for Paid Leave.

Information on claiming this tax credit is available from the IRS.

Employers should obtain a written request for leave as documentation for IRS tax credits.

Additional FAQ’s

If I choose to provide leave under ARPA, do I need to provide both EPSL and EFLMA?

While the DOL has not provided guidance on this, there does not appear to be any requirement to offer both types of paid leave in order to receive the tax credits. It is likely employers may offer one or the other, or both types of paid leave after April 1, 2021, and still receive a tax credit.

If I choose not to provide leave under ARPA, how do I handle COVID-related absences?

While the requirement to provide paid leave under the FFCRA is expired, the need for coronavirus-related employee absences continues. To ensure employees are able to take time off from work when sick and/or when needed to care for a family member, employers will need to decide whether to continue providing FFCRA-like leave voluntarily and, if not, determine what other leave options are available for employees. Consider state COVID-19-specific and other paid-sick-leave laws, leave as an accommodation under the Americans with Disabilities Act, CFRA leave for serious health conditions, and internal policies for paid time off when determining how to respond to employees who are unable to work for coronavirus-related reasons. Employers should avoid placing employees in a situation where they may feel forced to report to work when ill.