New Stimulus Extends FFCRA Tax Credits -- But Not Leave Mandate
Updated: Jan 11
Employer Credits Available for Leave Offered Through March 2021
An appropriations bill passed by Congress on Dec. 21, 2020, and expected to be signed into law by President Donald Trump does not extend the paid sick leave and expanded family and medical leave mandates created by the Families First Coronavirus Response Act (FFCRA). These leave requirements expire on Dec. 31, 2020. However, the bill does extend the time limit for employer tax credits for FFCRA employee leave. As a result, tax credits will be available to fund FFCRA leave offered by employers through March 31, 2021. The FFCRA’s leave mandates require businesses with fewer than 500 employees to provide employees up to 80 hours of paid sick leave for their own health needs or to care for others. The act also requires an additional 10 weeks of paid family leave to care for a child whose school or place of care was closed, or child care provider was closed or unavailable due to COVID-19. The FFCRA employer tax credits cover certain costs of the employee leave required by the law; specifically: employee wages, health plan expenses allocable to those wages, and the employer’s portion of the Medicare tax related to the wages.