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Guide to the Families First Coronavirus Response Act

Guide to the Families First Coronavirus Response Act

UPDATED AS OF: APRIL, 1, 2020

The U.S. Department of Labor (DOL) has made major updates to its Families First Coronavirus Response Act (FFCRA) Questions and Answers page for the second time, unveiling  both revisions to previously existing Q&A (numbered 1-37) and 22 completely new Q&As (numbered 38-59.)  The FFCRA is effective April 1, 2020 through December 31, 2020.  We recommend you check out the up to date DOL guidance via : https://www.dol.gov/agencies/whd/pandemic/ffcra-questions

If you have further questions, please feel free to reach out to a member of your Herbein Team.

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On Wednesday, Mar. 18, 2020, President Donald Trump signed into law the Families First Coronavirus Response Act  (H.R. 6201 or “FFCRA”) to provide much-needed and wide-ranging assistance during the COVID-19 crisis.

The FFCRA has multiple provisions intended to assist people, and free up the federal government resources to do so, during the public health emergency caused by coronavirus. Download our guide to the Families First Coronavirus Response Act by clicking on the image below:

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Importantly, the Act provides employees with paid sick leave with two brand new laws: the Emergency Family and Medical Leave Expansion Act (EFMLEA) and the Emergency Paid Sick Leave Act (EPSLA).

What employers need to know: Emergency Family and Medical Leave Expansion Act (EFMLEA) and the Emergency Paid Sick Leave Act (EPSLA)

Emergency Family and Medical Leave Expansion Act (EFMLEA)
The Act provides eligible employees of employers with fewer than 500 employees and government employers, who have been on the job for at least 30 days, with the right take up to 12 weeks of job-protected leave under the Family and Medical Leave Act. This emergency leave is to be used to care for a child of an employee if the child’s school or place of care has been closed, or the child-care provider is unavailable, due to coronavirus.

The Act does provide some breaks for small employers. Employers with less than 25 employees are not required to restore the employee to the same or equivalent position upon return to work if the employee’s position no longer exists following the leave. Additionally, employers with fewer than 50 employees may petition to receive an exemption from providing leave if it would jeopardize the viability of their business.

Emergency Paid Sick Leave Act (EPSLA)
This Act requires employers with fewer than 500 employees and government employers to provide employees two weeks of paid sick leave, if the employee is unable to work due to a need for leave because:

  • The employee is subject to a federal, state, or local quarantine or isolation order related to coronavirus;
  • The employee has been advised to self-quarantine by a health care provider due to concerns related to coronavirus;
  • The employee is experiencing symptoms of coronavirus and seeking a medical diagnosis;
  • The employee is caring for a quarantined individual;
  • The employee is caring for a child if the child’s school or place of care has been closed, or the child-care provider is unavailable, due to coronavirus.

What employers need to know: Payroll Tax Credits
Employers who provide emergency paid sick leave or paid family and medical leave to employees under this Act are entitled to payroll tax credits.  The credit allows the employer to claim a credit against the employer’s portion of social security and Medicare taxes for each calendar quarter in an amount equal to 100% of the qualified sick leave wages.

The credit is subject to certain limitations.  For starters, the credit is limited to $511 per day if the employee is taking sick leave for themselves and $200 per day if the employee is taking sick leave to care for a family member or child whose school is closed.  In addition, the credit is only available for up to 10 days of qualified sick leave wages per employee – putting the cap at $5,110 if the employee is taking sick leave for themselves and $2,000 if the employee is caring for someone else.

While the Act provides tax credits for eligible self-employed individuals, it does not provide credits for federal or state government employees. 

The window for these tax credits is temporary.  They are available for wages paid for the period beginning on the date selected by the Secretary of the Treasury (which will be within 15 days of March 18, 2020) and ending on December 31, 2020.  Depending on the date selected, the credit could be available for the entire second quarter of 2020.

Other key provisions of the law include:

  • Free coronavirus testing
  • Enhanced unemployment insurance – Provides financial assistance for states for activities related to processing and paying unemployment insurance benefits under certain conditions.
  • Additional funding for nutritional programs
  • Protections for health care workers and employees responsible for cleaning at-risk places
  • Additional federal funds for Medicaid

Effective date: The Act will take effect within fifteen (15) days of enactment and will be in effect until Dec 31, 2020.

COVID-19 UPDATES

If you have any questions relating to any aspect of the Act, or any other coronavirus concerns, please contact your local Herbein professional at info@herbein.com

Families First Coronavirus Response Act Guide created by Stacy A. Weller, CPA.

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