The FFCRA is now voluntary, not mandatory
The Families First Coronavirus Response Act (FFCRA) was enacted for the period April 1 - December 31, 2020, meaning we all expected it to sunset on December 31st. However, on December 27th, the Consolidated Appropriations Act 2021 (CAA) changed that. The CAA gives covered employers (generally those with fewer than 500 employees) the option to continue to provide FFCRA leave (emergency paid family leave and emergency paid sick leave) between January 1 and March 31, 2021, and still take the tax credit for providing that paid leave. This means that employers are no longer required to provide FFCRA leave, but they can do so if they wish, and the CAA provides an incentive for doing so by extending the employer dollar-for-dollar tax credit for the cost of the leave through March 31, 2021.
Some things to keep in mind:
· The CAA does not provide new or additional FFCRA time – it simply allows employers to choose to let employees use the FFCRA time they had left over from 2020. So, if an employee has already used up the 2 weeks of FFCRA paid sick time in 2020, the employee has nothing left to use in 2021 and the employer cannot take the tax credits for any paid sick time it provides to the employee in 2021, even if the reasons qualify for FFCRA leave. However, if the employee had used only 1 week of FFCRA paid sick time in 2020, and needs to take sick time again for an FFCRA-qualifying reason after December 31 (but before March 31), the employer can permit the employee to use that remaining week and the employer can take the tax credits for that week. The same is true for the FFCRA 12 weeks of extended family leave for time away from work due to COVID-19 related school and childcare closures.
· Employees may not be discriminated against or retaliated against for taking FFCRA leave, and this is true regardless of whether the leave was taken in 2020, or taken between January 1 – March 31, 2021, when providing FFCRA is voluntary for employers.
· Under the CAA, the tax credits for voluntarily providing FFCRA leave will expire on March 31, 2021 (unless Congress takes further action before that date).
Next steps: Employers should:
· Decide whether to provide FFCRA paid leave through March 31st, and then notify employees of the decision and apply that decision consistently.
· Employers choosing to continue FFCRA through March 31st who are also covered by the regular FMLA (generally employers with 50 or more employees), will want to look at their FMLA policies to learn whether they use a calendar year basis for determining leave availability, or a rolling year basis. Most employers identify the rolling year in their FMLA policies (and therefore don’t have to concern themselves with this issue), but any employers using the calendar year will want to consider the impact of that on continuing FFCRA extended family leave into 2021.
· If not offering FFCRA into 2021, when notifying employees of the decision, employers should also notify employees what, if any, paid leave benefits are available to employees who need time off for COVID-related reasons. Given the continuing surge of the virus, the need for leave and the need to mitigate exposure and spread of the virus will continue throughout the first quarter of 2021, especially in light of the phased roll-out of the COVID-19 vaccines.
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