By Molly Wood, SPHR. SDEA HR Consultant
The American Rescue Plan was signed into law last Friday by President Biden and there are several provisions that impact business operations.
The first is the extension of the tax credits provided by the Families First Coronavirus Relief Act (FFCRA) to September 30, 2021. Employers will continue to receive tax credits if they voluntarily provide Emergency Paid Sick Leave (EPSL) and/or Emergency Family Medical Leave (EFMLA).
The American Rescue Plan provides tax credits for an additional 10 days of EPSL starting on April 1, 2021. So, while the extension ending on March 31, 2021 was only available if an employee had not used EPSL already, now employers can get tax credits for 10 more days in 2021.
Like the previous stipulations in the FFCRA, EPSL can be used if the employee is unable to work because they have COVID-19, if they have been exposed and/or are exhibiting COVID-19 symptoms and are seeking diagnosis, if they have been advised by a health-care professional to self-quarantine due to concerns related to COVID-19, or if they are caring for someone who has been advised by a health-care professional to self-quarantine. In addition, the American Rescue Plan allows for use of EPSL to obtain the COVID-19 vaccine, or if they are recovering from an adverse reaction to the vaccine.
Employers may also voluntarily extend eligibility for Emergency Family Medical Leave if employees are unable to work or telework due to childcare being unavailable as a result of COVID-19, although additional time has not been included. Employers may also allow employees to use EFMLA for EPSL qualifying reasons (at 66% pay and the employer receives tax credits).
Because these leaves are voluntary, the interpretation is that employers can choose which benefits they want to provide for their employees within the FFCRA framework. Of course, care must be taken to ensure that any provisions are consistent amongst employees and not discriminatory in nature.
While our expertise at SDEA is not in finance, the American Rescue Plan does provide various economic relief loans. We recommend you contact your banker or tax professional for more information on what may be available for your business.
It is a relief that the specifics of the American Rescue Plan are not dramatically different from what we have become accustomed to through the FFCRA, however components that were not included in this bill may come to play in further legislation. In the meantime, Stay Calm and Stay Safe.
If you have any questions or need further clarification, please reach out to SDEA at 858-505-0024.