Summary of the FFCRA Emergency Paid Sick Leave Act &
the Emergency Family Medical Leave Expansion Act
Note: Updated January 6, 2021 - click here to view the DOL FAQ's
click here to view the IRS FAQ's
Affected Employers
The provisions of these acts apply to employers with fewer than 500 employees. Employers of fewer than 50 employees may be granted a small business exemption. See below for further guidance.
Employers are required to post the attached notice in a conspicuous place on its premises. An employer may also satisfy this requirement by emailing or direct mailing this notice to employees or posting this notice on an employee information internal or external website. Employers are not required to share this notice with laid-off individuals.
Emergency Paid Sick Leave Act (EPSLA)
Effective April 1, 2020, employees may be eligible for up to 80 hours of paid leave if they have a qualifying reason for being unable to work through March 31, 2021. Both full and part-time employees may be eligible for paid sick leave. All employees, regardless of the length of their employment, are eligible for EPSL. The amount of pay that an employee is eligible to receive is based on the reason they are unable to work.
Employees unable to work due to one of the following reasons will receive 100% of their normal pay (subject to a ceiling):
Employees unable to work due to one of the following reasons will receive 2/3 of their normal pay (2 weeks) (subject to a ceiling):
Calculation for part-time workers –
If normal hours are unknown or schedule varies:
- Use a 6 month average to calculate the average daily hours
If they haven’t been employed for 6 months:
- Use the number of hours that you and your employee agreed upon hiring.
If there is no such agreement:
- Calculate the appropriate number of hours of leave based on the average hours per day the employee was scheduled to work over the entire term of their employment.
Other info –
Employers may not require employees to use any other type of paid leave before granting leave under the EPSLA and the emergency paid sick leave must be granted in addition to any other PTO provided.
Employers may not require advance notice that an employee is taking sick leave. If the necessity to take leave related to school/child-care closure is foreseeable, then the employee must provide the employer with such notice of leave as practicable.
If overtime is included in what the employee was normally scheduled to work, it should be included in the paid leave calculation. However, paid sick leave is capped at 80 hours, so they could take 50 hours the first week, but only 30 hours the second week. Overtime pay does not need to include a premium for overtime hours.
If an employer has closed its worksite (before or after April 1, 2020), former employees are not eligible for paid sick leave or expanded family and medical leave. This is true whether the employer closed because of lack of business or because it was required to close under a Federal, State or local directive.
If an employer is open, but furloughs (lays off) workers on or after April 1, 2020 because it does not have enough work or business for employees, those furloughed workers are not eligible for paid sick or expanded family and medical leave.
Emergency Family Medical Leave Expansion Act (EFMLEA)
This act represents an expansion of FMLA to cover employees who are unable to work due to their child’s school or daycare closure as a result of COVID-19. Effective April 1, 2020, employees may be eligible for up to 10 additional weeks of leave if they are unable to work because they must care for a child under 18 whose school/child-care provider has closed due to the COVID-19 public health emergency.
Employees must have been employed for at least 30 days prior to taking leave.
Employees receiving paid leave related to school/child-care closures are paid at 2/3 their normal rate of pay, not to exceed $200/day or $2,000 total. The calculation of pay for part-time individuals is the same as that under EPSLA (above).
If the necessity to take leave related to school/child-care closure is foreseeable, then the employee must provide the employer with such notice of leave as practicable.
Other info –
Expanded family and medical leave due to closure of school/childcare may be taken intermittently, as long as this arrangement is made with the employer’s permission.
Small Business Exemption
Employers of fewer than 50 employees may be granted a small business exemption from the requirements to pay ONLY child-care related sick leave and expanded family and medical leave. A small business may claim this exemption if an authorized officer of the business has determined that:
Substantiation of the Credit
Employer will substantiate eligibility for sick leave or family leave credits if the employer receives a written request for such leave from the employee in which the employee provides:
1) The employee's name
2) The date or dates for which the leave is requested
3) A statement of the COVID-19 related reason the employee is requesting leave and written support for such reason
4) A statement that the employee is unable to work, or telework, for such reason
In case of a leave request based on a quarantine order or self-quarantine advice, the statement should include the name of the governmental entity ordering quarantine or the name of the health care professional advising self-quarantine.
In case of a leave request based on a school closing or child care provider unavailability the statement from the employee should include the name and age of the child (or children) to be cared for, the name of the school or place of care that has closed, and a representation that no other person will be providing care for the child during the period for which the employee is receiving family medical leave.
Employer Tax Credits related to Paid Leave
Paid Sick Leave Credit:
If the employee is unable to work because of Coronavirus quarantine, self-quarantine or has Coronavirus symptoms & is seeking medical diagnosis:
Child Care Leave Credit:
If the employee is unable to work because of the need to care for a child whose school or childcare is unavailable due to COVID-19.
Obtaining the Credit/Cost of Providing Leave:
Employers who pay qualifying sick or childcare leave will be able to retain an amount of federal payroll taxes equal to the amount of qualifying sick and childcare leave that they paid, rather than deposit them to the IRS. The eligible payroll taxes include:
Example: An Eligible Employer pays $10,000 in qualified sick leave wages and qualified family leave wages in Q2 2020. It does not owe the employer’s share of social security tax on the $10,000, but it will owe $145 for the employer’s share of Medicare tax. Its credits equal $10,145, which include the $10,000 in qualified leave wages plus $145 for the Eligible Employer’s share of Medicare tax (this example does not include any qualified health plan expenses allocable to the qualified leave wages). This amount may be applied against any federal employment taxes that Eligible Employer is liable for on any wages paid in Q2 2020. Any excess over the federal employment tax liabilities is refunded in accord with normal procedures. Eligible Employer must still withhold the employee’s share of social security and Medicare taxes on the qualified leave wages paid. (Sample from IRS FAQ's)
There is no credit for the employer portion of the social security tax because the qualified leave wages are no subject to this tax.
If there aren’t sufficient payroll taxes to cover the cost, employers may request an advance of the credits by completing Form 7200, Advance Payments of Employer Credits Due to COVID-19.
The full amount of the credits for qualified leave wages and allocable expenses must be included in the employer's gross income.
Self-Employed Individuals
These credits are available for self-employed individuals and credits will be claimed on their income tax return and will reduce estimated tax payments.
For additional information, visit the Department of Labor's website - https://www.dol.gov/agencies/whd/pandemic
click here to view the IRS FAQ's
Affected Employers
The provisions of these acts apply to employers with fewer than 500 employees. Employers of fewer than 50 employees may be granted a small business exemption. See below for further guidance.
Employers are required to post the attached notice in a conspicuous place on its premises. An employer may also satisfy this requirement by emailing or direct mailing this notice to employees or posting this notice on an employee information internal or external website. Employers are not required to share this notice with laid-off individuals.
Emergency Paid Sick Leave Act (EPSLA)
Effective April 1, 2020, employees may be eligible for up to 80 hours of paid leave if they have a qualifying reason for being unable to work through March 31, 2021. Both full and part-time employees may be eligible for paid sick leave. All employees, regardless of the length of their employment, are eligible for EPSL. The amount of pay that an employee is eligible to receive is based on the reason they are unable to work.
Employees unable to work due to one of the following reasons will receive 100% of their normal pay (subject to a ceiling):
- Subject to a federal, state or local quarantine or isolation order
- Health care provider has advised employee to self-quarantine (requires doctor’s note)
- Employee is experiencing COVID-19 symptoms and is seeking diagnosis
Employees unable to work due to one of the following reasons will receive 2/3 of their normal pay (2 weeks) (subject to a ceiling):
- Employee is caring for someone who is sick or has symptoms of COVID-19
- Care for a child whose school is closed
- Care for a child whose child-care provider is unavailable for COVID-19 related reasons
- Employee is experiencing substantially similar conditions as yet to be defined by the Secretary of Health & Human Services
Calculation for part-time workers –
If normal hours are unknown or schedule varies:
- Use a 6 month average to calculate the average daily hours
If they haven’t been employed for 6 months:
- Use the number of hours that you and your employee agreed upon hiring.
If there is no such agreement:
- Calculate the appropriate number of hours of leave based on the average hours per day the employee was scheduled to work over the entire term of their employment.
Other info –
Employers may not require employees to use any other type of paid leave before granting leave under the EPSLA and the emergency paid sick leave must be granted in addition to any other PTO provided.
Employers may not require advance notice that an employee is taking sick leave. If the necessity to take leave related to school/child-care closure is foreseeable, then the employee must provide the employer with such notice of leave as practicable.
If overtime is included in what the employee was normally scheduled to work, it should be included in the paid leave calculation. However, paid sick leave is capped at 80 hours, so they could take 50 hours the first week, but only 30 hours the second week. Overtime pay does not need to include a premium for overtime hours.
If an employer has closed its worksite (before or after April 1, 2020), former employees are not eligible for paid sick leave or expanded family and medical leave. This is true whether the employer closed because of lack of business or because it was required to close under a Federal, State or local directive.
If an employer is open, but furloughs (lays off) workers on or after April 1, 2020 because it does not have enough work or business for employees, those furloughed workers are not eligible for paid sick or expanded family and medical leave.
Emergency Family Medical Leave Expansion Act (EFMLEA)
This act represents an expansion of FMLA to cover employees who are unable to work due to their child’s school or daycare closure as a result of COVID-19. Effective April 1, 2020, employees may be eligible for up to 10 additional weeks of leave if they are unable to work because they must care for a child under 18 whose school/child-care provider has closed due to the COVID-19 public health emergency.
Employees must have been employed for at least 30 days prior to taking leave.
Employees receiving paid leave related to school/child-care closures are paid at 2/3 their normal rate of pay, not to exceed $200/day or $2,000 total. The calculation of pay for part-time individuals is the same as that under EPSLA (above).
If the necessity to take leave related to school/child-care closure is foreseeable, then the employee must provide the employer with such notice of leave as practicable.
Other info –
Expanded family and medical leave due to closure of school/childcare may be taken intermittently, as long as this arrangement is made with the employer’s permission.
Small Business Exemption
Employers of fewer than 50 employees may be granted a small business exemption from the requirements to pay ONLY child-care related sick leave and expanded family and medical leave. A small business may claim this exemption if an authorized officer of the business has determined that:
- The provision of paid sick leave or expanded family and medical leave would result in the small business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
- The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
- There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.
Substantiation of the Credit
Employer will substantiate eligibility for sick leave or family leave credits if the employer receives a written request for such leave from the employee in which the employee provides:
1) The employee's name
2) The date or dates for which the leave is requested
3) A statement of the COVID-19 related reason the employee is requesting leave and written support for such reason
4) A statement that the employee is unable to work, or telework, for such reason
In case of a leave request based on a quarantine order or self-quarantine advice, the statement should include the name of the governmental entity ordering quarantine or the name of the health care professional advising self-quarantine.
In case of a leave request based on a school closing or child care provider unavailability the statement from the employee should include the name and age of the child (or children) to be cared for, the name of the school or place of care that has closed, and a representation that no other person will be providing care for the child during the period for which the employee is receiving family medical leave.
Employer Tax Credits related to Paid Leave
Paid Sick Leave Credit:
If the employee is unable to work because of Coronavirus quarantine, self-quarantine or has Coronavirus symptoms & is seeking medical diagnosis:
- Employers may receive a refundable sick leave credit for sick leave at the employee’s regular rate of pay, up to $511 per day and $5,110 in aggregate, for a total of 10 days.
- Employers may claim a credit for 2/3 of the employee’s regular rate of pay, up to $200 and $2,000 in aggregate, up to 10 days.
- Eligible employers are entitled to an additional tax credit determined based on costs to maintain health insurance coverage for the eligible employee during the leave period.
Child Care Leave Credit:
If the employee is unable to work because of the need to care for a child whose school or childcare is unavailable due to COVID-19.
- Employers may receive a refundable childcare credit equal to 2/3 of the employee’s regular pay, capped at $200 per day or $10,000 in aggregate. Up to 10 weeks of qualifying leave can be counted towards the childcare leave credit.
- Employers are entitled to an additional tax credit determined based on costs to maintain health insurance coverage for the eligible employee during the leave period.
Obtaining the Credit/Cost of Providing Leave:
Employers who pay qualifying sick or childcare leave will be able to retain an amount of federal payroll taxes equal to the amount of qualifying sick and childcare leave that they paid, rather than deposit them to the IRS. The eligible payroll taxes include:
- Federal withholding
- EE share of SS & Medicare
- ER share of Medicare & SS (NOTE: paid leave under this act is not subject to the employer portion of the SS tax)
Example: An Eligible Employer pays $10,000 in qualified sick leave wages and qualified family leave wages in Q2 2020. It does not owe the employer’s share of social security tax on the $10,000, but it will owe $145 for the employer’s share of Medicare tax. Its credits equal $10,145, which include the $10,000 in qualified leave wages plus $145 for the Eligible Employer’s share of Medicare tax (this example does not include any qualified health plan expenses allocable to the qualified leave wages). This amount may be applied against any federal employment taxes that Eligible Employer is liable for on any wages paid in Q2 2020. Any excess over the federal employment tax liabilities is refunded in accord with normal procedures. Eligible Employer must still withhold the employee’s share of social security and Medicare taxes on the qualified leave wages paid. (Sample from IRS FAQ's)
There is no credit for the employer portion of the social security tax because the qualified leave wages are no subject to this tax.
If there aren’t sufficient payroll taxes to cover the cost, employers may request an advance of the credits by completing Form 7200, Advance Payments of Employer Credits Due to COVID-19.
The full amount of the credits for qualified leave wages and allocable expenses must be included in the employer's gross income.
Self-Employed Individuals
These credits are available for self-employed individuals and credits will be claimed on their income tax return and will reduce estimated tax payments.
For additional information, visit the Department of Labor's website - https://www.dol.gov/agencies/whd/pandemic