For the last nine months, most employers with fewer than 500 employees have been required to provide employees with emergency paid sick leave and emergency family and medical leave under the Families First Coronavirus Response Act (FFCRA) for certain COVID-19 related absences.
Employers have been able to take a payroll tax credit to offset the amount of leave paid to employees by retaining Social Security, Medicare, and federal income taxes that would otherwise be due to the federal government.
When the FFCRA was passed in March 2020, it included a sunset date of December 31, 2020. Since Congress has not extended the FFCRA, as of January 1, 2021, employers are no longer required to provide paid leave to employees under the FFCRA. Under the recent stimulus bill, however, employers may voluntarily choose to continue to provide paid leave under the FFCRA and take the accompanying payroll tax credit through March 31, 2021.
While employers are no longer required to provide paid leave under the FFCRA, employers may want to continue to provide FFCRA leave for the next three months. Even without the FFCRA, employees may be entitled to other paid or unpaid leave for COVID-19 related absences. For example, employers may need to provide leave under state or local laws, the Family Medical Leave Act, or unpaid time off.
This post was written by Rachel Felton