10 Things Employers Should Know About the Latest COVID-19 Federal Stimulus Package

Miller & Martin PLLC Alerts | March 12, 2021

Author: Stacie Caraway

  1. Many employers have been wondering how the latest COVID-19 federal stimulus package, “The American Rescue Plan,” as the first such package signed into law by President Biden, would address the paid “COVID leave” which was provided under the Families First Coronavirus Response Act (FFCRA), which will be celebrating its one-year birthday on April 1, 2021.

The answer is providing paid “COVID leave” under the FFCRA remains optional for all employers through September 30, 2021.

  1. If you are a large employer, having at least 500 employees nationwide, you will not receive the tax credits that were provided under the FFCRA even if you decide to provide paid “COVID leave” to your employees. Employers with fewer than 500 employees nationwide will still be eligible to use the tax credits through September 30, 2021.

    The new maximum tax credit is $200 per day, and $12,000 total per employee for family leave wages.

  2. The American Rescue Plan also expands the definition of qualifying paid family leave under the FFCRA so as to allow employers to use family leave payroll tax credits for all qualifying uses of paid sick time, including for paid leave used by an employee who is subject to a quarantine or isolation order due to COVID-19 or who is caring for someone who is under such an order.

  3. The second most pressing question for employers regarding an additional extension of paid “COVID leave” was whether the new stimulus package would “refill employee paid leave buckets,” so to speak, by providing any additional paid leave beyond what was provided under the original FFCRA last year.

The answer here is yes, Congress did “refill employee paid leave buckets” starting on the original FFCRA’s “one-year birthday” of April 1, 2021. They only get 10 more days of paid leave though if they have already used all of the paid leave which was provided under the original FFCRA. They still may use any remaining paid leave they have not used under the original FFCRA until September 30, 2021 if their employer decides to continue allowing this, subject to the new daily and total caps which are described in item 2 above.

  1. The new 10 days of paid leave can be used for any of the purposes the original 80 hours (for full-time employees) of paid COVID leave which was provided under the original FFCRA could be used including when the employee

(a) is subject to a federal, state, or local quarantine or isolation order related to COVID-19;

(b) has been advised by a health care provider to self-quarantine related to COVID-19;

(c) is experiencing COVID-19 symptoms and is seeking a medical diagnosis;

(d) is caring for an individual subject to an order described in (a) or self-quarantine as described in (b);

(e) is caring for a child whose school or daycare provider is closed or otherwise unavailable due to COVID-19; or  

(f) is experiencing any other substantially-similar condition specified by the U.S. Department of Health and Human Services.

  1. Additionally, starting April 1, 2021, employees may use the new 10 days of paid COVID leave in order to take paid time off to get a COVID-19 vaccine and to recover from any side effects from the same. (Remember, all this is OPTIONAL for employers to allow, however.)

  2. As with the original 80 hours (for full-time employees) of paid COVID leave provided under the original FFCRA, covered employees may only use the new 10 days of paid leave once – they do not get “a new 10 days of paid leave” to use for each of the purposes described above.

  3. There is no waiting period for employees to be able to use the new 10 days of paid COVID leave with employers who choose to allow employees to use it starting April 1, 2021.

  4. Be mindful that “optional” does not mean you get to “choose” who gets to use paid COVID leave starting April 1, 2021 and who does not. The tax credits are not available for covered employers who only allow highly compensated or full-time employees to use the leave or base its use on time of service.

  5. And for the really curious, there will be a $300/week federal unemployment subsidy starting April 1, 2021 and extending through Labor Day (September 6, 2021).

This is our “top 10 list” based on the most common questions we are receiving from clients who have been following the twists and turns of this latest stimulus package. Feel free to review the new stimulus law on your own in order to develop your own list. Enjoy!

One thing there was much speculation about which did not make the list (because it did not make the law!) is a nationwide increase in the federal minimum wage (at least for now. . .).

For those of you with employees in multiple states, continue to monitor the “COVID leave laws” there, as many of them were extended past December 31, 2020 into at least June of 2021. Thankfully, there are no such laws in Tennessee and Georgia (or any state south of Washington D.C.) – coincidence??? You be the judge. . .

As always, should you have any questions regarding The American Rescue Plan – or need any other form of “rescue” as you continue to navigate the challenging waters of running a business hopefully on the tail-end of a world-wide pandemic, please feel free to contact any member of our Labor & Employment Practice Group. It is hard to believe this weekend will mark a full year that most of us have been navigating these waters. Keep paddling!

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