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Tax Credits Extended for FFCRA Paid Sick Leave and Expanded Family Medical Leave

The Families First Coronavirus Response Act (FFCRA) has not been extended. This means that after December 31, 2020, employers with fewer than 500 employees are no longer required to provide special paid sick leave and expanded family medical leave related to COVID-19. 

However, the recently signed Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA or COVID Relief Bill) does extend certain FFCRA tax credits for employers through March 31, 2021.  As a result, employers who, between January 1, 2021 and March 31, 2021, voluntarily provide paid sick leave and expanded family medical leave will receive tax credits in same fashion had the leave been provided before December 31, 2020.   

The tax credit extension does not change or increase the amount of paid sick leave or expanded family medical leave available under FFCRA. If an employee has used all available FFCRA paid sick leave and expanded family medical leave in 2020, the employee does not receive additional FFCRA leave despite the extended tax credit period. Also, the qualifying COVID related reasons for when an employee may take leave, the caps on the amount of pay an employee may be entitled to receive, and all documentation requirements of FFCRA remain the same.  

Management should consider whether to continue to offer the coverage, should notify staff, and update any FFCRA coverage notices accordingly. Careful recordkeeping should also be maintained to ensure FFCRA-related leave limits are not inadvertently exceeded. WBA is hopeful the Department of Labor will release updated guidance regarding the voluntary coverage, including to clarify that carryover of expanded family medical leave from 2020 into 2021 is permissible if an employer’s FMLA year resets during the extended period and the employee has unused FFCRA-related leave. WBA will share any updated guidance if it becomes available. 

By, Ally Bates