What you need to know for your business
In March of 2020, the Families First Coronavirus Response Act (FFCRA) required private employers with fewer than 500 employees to provide emergency paid sick leave and expanded family leave for issues directly related to COVID-19.
But when the FFCRA expired on December 31, 2020, this employer mandate was not a part of the new stimulus package. However, the tax credits to reimburse employers for emergency paid leave were extended through March 31 of this year.
Essentially, if any qualified employer continues to offer the emergency paid leave from the FFCRA—even though they don’t have to—they can continue benefiting from the tax credits until the end of March.
What to know about offering continued emergency paid sick leave:
- If an employee used all of their FFCRA sick leave as of December 31, 2020, employers are not eligible to receive additional FFCRA tax credits for leave voluntarily offered in 2021.
- If an employee did not use the full two weeks of leave by December 31, 2020, they can use their remaining leave until March 31, 2021, and employers can receive the tax credits for this leave.
If you want to continue offering emergency expanded family leave, you’ll need to know exactly how this policy interacts with your current FMLA policies.
What to know about offering continued emergency paid family leave:
- If your company’s Family Medical Leave Act (FMLA) policy says each employee’s 12-month FMLA period resets at the beginning of the year, the employee may be entitled to an additional 12 weeks. The last 10 weeks of leave, if paid, would be eligible for the tax credits.
- You can claim the tax credit on this leave until March 31, 2021. However, your company already claimed tax credits on the full 12 weeks of family leave for this employee in 2020, then you cannot claim any more in 2021.
For more information on expanded emergency FMLA benefits, you can consult the IRS website.
As COVID-19 cases in North Carolina and across the country continue to rise, offering these reassurances to your workforce may result in more than just tax breaks. You could find more productive and loyal employees on the other side of this pandemic.