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.
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.
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:
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.
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.
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.