Employment Law Alert: Second Stimulus Does not Renew Families First Coronavirus Response Act (FFCRA), but Continues Payroll Tax Benefit

As we predicted in our Client Alert last week, the expiration of the Families First Coronavirus Response Act (“FFCRA”) on December 31, 2020 leaves employers nationwide in a lurch, for the most recent pandemic relief package signed by the President does not renew FFCRA or replace its leave requirements. This means that now in the new year, employers are no longer be required to provide up to 80 hours of paid Emergency Sick Leave or up to 12 weeks of paid Expanded FMLA leave under the Act. The relief package extends only the portion of FFCRA entitling employers to dollar-for-dollar payroll tax credits for the cost of providing qualifying FFCRA leave to employees. This credit ends March 31, 2021.

What does this mean for our clients?

For our clients who elected to exempt their employees as “health care providers” under FFCRA, there will be little practical change. Employers may opt to provide FFCRA benefits at the employer’s discretion, but must still do so in a balanced manner. For all others, the expiration means that employees have lost unused FFCRA leave in the new year, at least for now.

How does the payroll tax credit work?

Under the new relief package, employers may provide Emergency Sick Leave and Expanded FMLA leave as if FFCRA had been extended through March 31, 2021—and receive the tax credit. However, employers may not offset costs for leave exceeding FFCRA’s limits on a per-employee basis. In other words, while employers may permit employees to carry over unused FFCRA leave into the new year, or even provide leave in excess of FFCRA, the tax credit is capped at the statutory limit. Employers and clients wishing to explore this option should contact our office for an individualized consultation.

What happens next?

As we transition into the new year, a new Congress, and a new President, we predict additional legislation will circulate that may renew FFCRA or implement a derivative set of pandemic leave requirements. Employers, businesses, and HR departments should continue monitoring developments in this rapidly changing area of law. Stay tuned to Frier Levitt’s blog for real-time updates.

How Frier Levitt Can Help?

Frier Levitt’s skilled employment attorneys are closely monitoring legal developments and changes and are available to help employers work out the complexities and navigate these difficult times. Since there is no “one size fits all” solution for every business, employers should consult a skilled employment attorney to ensure their employment policies and practices are compliant with the current law. Contact us today to speak to an attorney.



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