Why Companies Need to have FFCRA Leave Policies in Place (UPDATED)
On December 28, 2020, the President signed into law the Consolidated Appropriations Act of 2021 which included COVID-19 Relief. Among the many items covered for COVID-19 relief is an extension of the paid leave first created by the Families First Coronavirus Response Act (FFCRA). Though the FFCRA expired at 11:59 PM on December 31, 2020, the paid leaves and the tax credits for businesses have been continued. The two important changes are the removal of the mandate that businesses with 500 or fewer employees provide this leave (providing it is now optional) and that the leave can be offered only through March 31, 2021.
The forms for policies businesses will want to have at the ready have been updated (below) to reflect the optional nature of these paid leaves and the expiration at the end of March. They are free for download and may be adapted to fit your business and company culture. All other information contained in the below article, originally posted on April 6, 2020, remains accurate as of today. We will continue to update as new information becomes available.
ORIGINAL ARTICLE (Published April 6, 2021):
The recent outbreak of COVID-19 has been especially dangerous and disruptive to individuals, families, businesses, and the entire national and global economy. There is no playbook for a crisis of this magnitude. As a result, many companies, even with the best planning and policies in place, have been caught flat-footed. As business leaders, the challenge of balancing the best interest of customers, employees, and the viability of the business as an ongoing concern has become far more complicated, and it requires a collaborative effort.
The Families First Coronavirus Response Act (FFCRA), which went into effect on April 1, 2020, is a short-term step towards helping us through this crisis. The law ends December 31, 2020 [now extended to March 31, 2021], and provides essential relief to both employers and employees. The FFCRA specifically impacts businesses with 500 or fewer employees. According to the IRS, FFCRA provides employers refundable tax credits that reimburse them, dollar-for-dollar, for the cost of providing paid sick and family leave wages to their employees for leave related to COVID-19. Click here for eligibility, and an overview of the Paid Family Leave Refundable Credit and Paid Sick Leave Refundable Credit Program from the IRS and how to claim them.
It counts full-time, part-time, temporary, seasonal, contract, and gig workers within that total. The act creates two types of leaves that businesses are required to offer employees: Expanded Family & Medical Leave Act (FMLA) Leave, and Emergency Paid Medical Leave. Because one of the two leave types are an expansion to the FMLA, the subset of businesses under 50 employees that were not previously covered under FMLA are now required to comply with a narrow subset of FMLA relating specifically to COVID-19.
A critical business step is to have a formal and compliant policy for each of the two leave types at the ready. This policy will serve to guide management in the administration of the leaves created by the FFCRA and transparently communicate the available leave options to employees who may be impacted as a result of this crisis and therefore need to take leave to care for themselves or a family member. With the proper policies in place, it will be much easier to understand the compliance requirements, ensure they are met, and reduce the risk of noncompliance for businesses during this crisis.
You are no doubt inundated with information on COVID-19, and being away from the office and your team in a remote setting makes it difficult. However, it is important to communicate this to your people. If you do not yet have a policy in place, on file, and communicated to your employees, BEST Human Capital & Advisory Group has developed a compliant template of each policy for companies to utilize. We are offering this at no charge in support of your efforts during this time.
Templates for Your Use
The following editable Word DOCX files may be used by your organization with your people or as a part of your employee manual (NOTE: This information was sourced from the U.S. Department of Labor, FFCRA, and government agency information):
If you would like to personalize the template to reflect specific aspects of your culture, BEST can help you do so with a time-efficient 20-minute phone conversation. Please reach Todd Downing at EMAIL or Michael Maggiotto at EMAIL and let us know if you would like to customize this for our organization, and they will provide support accordingly.
For additional information, visit the U.S. DEPT. OF LABOR FFCRA INFORMATION website.
ADDITIONAL INFORMATION ON CLAIMING YOUR FFCRA AND CARES ACT TAX CREDITS: There is a lot of information to dig through to find the tax credits for which you would qualify. JD Supra LLC. provides an excellent visual aide to receiving tax credits for paid leave required under the FFCRA. Click here to download the PDF from their website.
Click here for our Special Section on Coronavirus Business & Leadership Response Resources, which is updated daily with the latest news, and how you, as a business leader, can best respond.