FFCRA Leave Benefits End but Tax Credits Extended

December 30, 2020

The Families First Coronavirus Response Act (the FFCRA) required most private employers with less than 500 employees and certain public employers to provide paid leave benefits to eligible employees for specified qualifying reasons related to COVID-19.  Full-time employees, unable to work or telework for qualifying reasons, were eligible to receive a total of up to 80 hours of paid sick leave.  Another 10-12 weeks of paid expanded family medical leave was available to eligible employees unable to work or telework because of school or daycare closures related to COVID-19.  The leave benefits became effective April 1, 2020, with a sunset date of December 31, 2020.  The leave benefits have not been extended beyond December 31, 2020, under the recently signed COVID-19 relief bill, meaning that employers will not be required to provide paid leave under the FFCRA after December 31, 2020.

However, despite the fact the FFCRA’s leave provisions were not extended into 2021, the relief package does extend tax credits available to private employers for the costs of providing FFCRA-type leave through March 31, 2021. The tax credits are available through March 31, 2021, provided the leave is available “as would be so required to be paid if [the FFCRA] were applied”.  As a result, beginning on January 1, 2021, employers are no longer required to provide FFCRA leave; however, covered employers who voluntarily offer such leave may utilize payroll tax credits to cover the cost of benefits paid to employees through the end of March. The relief package does not change the qualifying reasons for which employees may take leave, the caps on the amount of pay employees are entitled to receive, or the FFCRA’s documentation requirements.

The law also does not change the total amount of leave that employees are entitled to take under the FFCRA. If any employee has already used the employee’s full allotment of paid sick leave and/or expanded family medical leave during 2020, the employee is not entitled to another 2 weeks or 10-12 weeks, respectively, in 2021, and there are no tax credits available to an employer who provides an employee additional leave.  It is only “leftover” FFCRA leave benefits that may be used and qualify for a tax credit, if an employer elects to offer those paid FFCRA benefits through March 31, 2021.

Even though FFCRA leave will no longer be mandatory, employers must still comply with leave requirements under the Americans with Disabilities Act, the Family Medical Leave Act, and any other leave requirements under state and/or local law, applicable to individual situations.  It is also important to continue to adhere to and enforce quarantine, isolation, and workplace safety and health guidelines, practices, and policies, requiring time away from the workplace, even if the time off is not covered by a paid leave mandate, program, or policy.

Leslie Sammon
Leslie Sammon