January 26, 2021
Jeffrey A. Calabrese
Member, Stoll Keenon Ogden PLLC
Danielle M. Day
Attorney, Stoll Keenon Ogden PLLC
In March 2020, Congress passed the Families First Coronavirus Response Act (FFCRA), requiring certain small and midsized employers to provide emergency paid sick leave and emergency expanded family and medical leave for employee absences caused by the COVID-19 pandemic. Since April 1, 2020, all qualified wages paid by an employer towards this paid sick leave or expanded family and medical leave, including the cost of health insurance premiums during leave, were and will continue to be, reimbursed by a dollar-for-dollar payroll tax credit.
Shortly before the FFCRA’s December 31, 2020 expiration date, Congress passed the Consolidated Appropriations Act (CAA). The CAA did not extend the paid leave requirements of the FFCRA, but it did extend the employer tax credit until March 31, 2021. Employers are no longer required to provide paid sick leave or expanded family medical leave. Nevertheless, if an employer continues to provide paid leave on a voluntary basis, they are entitled to a payroll tax credit to offset any qualified wages and health insurance premiums paid during the leave. The qualifying reasons for paid leave, the amount of pay an employee is entitled to while on leave and the documentation requirements remain the same as under the FFCRA. For a reminder of the FFCRA requirements, refer to our previous article, “Families First Coronavirus Response Act Signed into Law” (March 18, 2020).
Under the FFCRA and CAA, full-time employees are entitled to take a one-time allotment of eighty hours of paid sick leave and twelve weeks of expanded family medical leave. If an employee used their entire allocation of leave in 2020, the employee is not entitled to further paid leave nor is their employer entitled to further payroll tax credits in 2021.
These changes, enacted in the CAA, affect employers across the country. Each should consider their industry, customer base and work force, among other things, to determine whether to continue offering paid leave to their employees on a voluntary basis. Although Congress did not provide explicit guidance on this point, employers should be entitled to offer paid sick leave, paid expanded family and medical leave or both.
There are a few considerations applicable to all employers when deciding whether to continue offering paid leave. First, if an employer chooses to discontinue paid leave, it should provide notice to employees currently on paid leave regarding the employee’s options for leave going forward. Second, despite changes to the federal requirements, employers may have a continuing obligation to offer unpaid leave under federal, state or local laws (e.g., the Americans with Disabilities Act and Family and Medical Leave Act), or paid leave under state or local laws. Finally, employers who continue to provide paid leave should comply with FFCRA documentation requirements and provide leave consistently to avoid discrimination claims.
Stoll Keenon Ogden understands that these are trying times for our clients and our country. Our firm operations have continued uninterrupted and our attorneys are equipped to serve as we always have – for more than 120 years.
The firm’s Labor, Employment & Employee Benefits practice has a proven record of being trusted advisors and effective advocates. We help employers solve their problems through proactive counseling, employee training and, where possible, cost-efficient litigation, including alternative dispute resolution. We know the employment laws thoroughly, and we make it our goal to acquire a comprehensive knowledge of our clients and their business, so we can provide tailored solutions for each of their needs.
Please also be sure to consult the Stoll Keenon Ogden Coronavirus Resource webpage for additional articles and information related to the latest information on new laws and directives enacted by federal, state, and local governments in response to the Coronavirus pandemic.