THE FAMILIES FIRST CORONAVIRUS RESPONSE ACT - EMPLOYER RESPONSIBILITY & HOW A BUSINESS CPA CAN HELP
Updated: Apr 27, 2020
The Families First Coronavirus Response Act (FFCRA) requires private sector employers with fewer than 500 employees to provide expanded family and medical leave.
The paid leave provisions of the FFCRA are effective April 1, 2020 and apply to leave taken between April 1-December 31, 2020. Employers must provide up to 80 hours of paid sick leave and expanded childcare leave for qualifying reasons related to COVID-19.
Employers will receive dollar-for-dollar reimbursement through tax credits for all qualifying wages paid under the FFCRA. In addition to wages, tax credits also apply to company costs incurred maintaining an employees’ health insurance during FFCRA qualified leave.
To take immediate advantage of the paid leave credits, businesses can retain and access funds that they would otherwise pay to the IRS in payroll taxes. If those amounts are not sufficient to cover the cost of paid leave, employers can seek an expedited advance from the IRS by submitting a streamlined claim form. You can contact a business CPA to learn about further actions to take.
QUALIFYING LEAVE:
Under the FFCRA, an employee qualifies for expanded family and medical leave if the employee is unable to work (or unable to telework) because the employee:
1. Is subject to a Federal, State, or local quarantine or isolation order related to
COVID-19.
2. Has been advised by a health care provider to self-quarantine related to COVID-19.
3. Is experiencing COVID-19 symptoms and is seeking a medical diagnosis.
4. Is caring for an individual that has been infected and/or has been ordered to self- quarantine.
5. Is caring for a child whose school or place of care is closed (or childcare provider is unavailable) for reasons related to COVID-19.
6. Is experiencing any other substantially-similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.
For specific information on reason for leave and corresponding pay, visit the Department of Labor’s website at:
https://www.dol.gov/agencies/whd/pandemic/ffcra-employer-paid-leave
SMALL BUSINESS RELIEF
Small businesses with fewer than 50 employees may qualify for exemption from the requirement to provide leave due to school closings or childcare unavailability if the leave requirements would jeopardize the viability of the business as a going concern.
To elect the small business exemption, document why your business meets the criteria set forth by the Department of Labor. We are expecting more details about the exemption in the coming weeks.
Fines and/or penalties will be enforced for failure to comply with the provisions set-forth in FFCRA.
Contact a Business CPA Today
As always, FAL is here to answer any questions you may have as you implement the provisions of the Act. Please reach out to a business CPA on our team for support or email us at info@falcpa.com. For more details about FFCRA, please visit the Department of Labor’s website at: https://www.dol.gov/agencies/whd/pandemic/ffcra-employer-paid-leave