22 December 2020

FFCRA Not Fully Extended into 2021 But Small Private Sector Employers Can Still Receive Tax Credit for Paid Sick/Family Care Leave

With the FFCRA set to expire on December 31, 2020, many of us have been carefully watching to see if Congress would extend the FFCRA.  Back in March, Congress passed the Families First Coronavirus Response Act (FFCRA). Under the FFCRA, most public-sector employers and private sector employers with fewer than 500 employers must provide up to two weeks of Emergency Paid Sick Leave (EPSLA) to employees unable to work for one of six COVID-19 virus related reasons and up to 10 weeks of paid leave under expanded Family and Medical Leave Act coverage to care for a child whose school or place of case is closed because of the pandemic.

Monday night, the House and Senate reached agreement on an emergency coronavirus relief and omnibus package. That package clarifies that:

  • Mandated FFCRA leave ends on December 31, 2020
  • As of January 1, 2021, covered private-sector employers may voluntarily provide paid leave that otherwise would have qualified for FFCRA if the FFCRA had not expired, and if they do, they may take the tax credit associated with this leave
  • The tax credit may only be taken for leave through March 31, 2021

This means that private sector employers with fewer than 500 employers may voluntarily continue to provide FFCRA benefits through March 31, 2021 and when they do, will remain eligible to take the tax credit for the leave. (Note: Public sector employers may also voluntarily continue to provide FFCRA benefits through March 31, 2021, but are not eligible for the associated tax credits.)

It’s also important for employers to recognize that under this legislation, employees are not entitled to (nor could an employer voluntarily provide) additional FFCRA leave after December 31, 2020.

Also important for employers to remember: Many state and local governments have enacted COVID-19 –related leave laws and ordinances this year to further assist employees dealing with health and care responsibilities during the pandemic. Absent a sunset provision under those laws, an employer’s compliance obligation does not end on December 31st.

For Michigan employers: An amendment to Public Act 238 of 2020 has been passed in the Michigan House and Senate. As currently written, the amendment more closely aligns with federal Centers for Disease Control and Prevention (CDC) guidance in various respects. If the bill becomes law, we will notify you and fill you in on the details.

We hope you join us for webinars in the new year that will focus on these changes to COVID-related employment laws, and that you are taking some well-deserved time for yourselves this week and next week.  Until our next webinar, we will notify you via email of important employment law developments.  Please reach out to any Miller Johnson employment attorney with specific or time-sensitive questions.