March 11, 2021

American Rescue Plan Act (ARPA) – More Options for Employers

On March 11th, President Biden signed the ARPA. Like the Consolidated Appropriations Act (CAA), the ARPA extends the Families First Coronavirus Response Act (FFCRA) and corresponding tax credits. The ARPA’s extension is effective April 1st through September 30th.  The extension continues to be voluntary. Employers may but are not required to offer the FFCRA’s Emergency Paid Sick Leave (EPSL) or leave under the Emergency Family and Medical Leave Expansion Act (EFMLEA) (enough alpha soup, already!).  The ARPA, however,  modifies the FFCRA in some significant ways. If you choose to continue to offer EPSL, EFMLEA, and expect to receive the corresponding tax credits, be aware of the following (and consult with your company’s employment counsel).

EPSL – the ARPA provides ten days or up to 80 hours of paid sick leave (capped at $200/day . These are without regard to hours an employee did or did not use prior to April 1st. In addition to the same qualifying reasons under the FFCRA, an eligible employee may also receive EPSL if:

  1. the employee is seeking or awaiting the results of a diagnostic test for, or a medical diagnosis of, COVID–19 and such employee has been exposed to COVID–19;
  2. the employee’s employer has requested such test or diagnosis, or the employee is obtaining immunization related to COVID–19; or
  3. the employee is recovering from any injury, disability, illness, or condition related to such immunization.

– the first two weeks are no longer unpaid. An employee is paid 2/3’s of the employee’s regular rate of pay up to $200/day for up to 12 weeks, not to exceed $12,000. All of the reasons for which an employee may now qualify for EPSL, also qualify for EFMLEA leave.

In General. Employers may not discriminate “in favor of highly compensated employees…full-time employees, or employees on the basis of employment tenure with such employer.” Remember that unlike EPSL, the EFMLEA leave does take in account good ole’ fashioned FMLA leave the employee may have previously taken.

NOTE: Since every reason that previously qualified only for EPSL, now also qualifies for EFMLEA leave, it appears that an employee may now qualify for up to 14 weeks of COVID-19-related leave, such as for the employee’s own illness, caring for family member, isolation, or quarantine order, etc.

Stay tuned.  You may want to bookmark the U.S. Department of Labor’s FFCRA FAQ page here as well as the IRS’ related page regarding documentation employers should obtain and retain for the related tax credits. Check them periodically for any ARPA-related updates. As of this writing (3/31/21) neither webpage has been updated.