April 9, 2020 | Covid-19 | Posted by Bob Greene, Senior HR Industry Analyst at Ascentis
FFCRA Webinar Q&A: Your Questions from Our FFCRA, and Subsequent DOL Guidance Webinars, Answered!
For those of you that attended our "Families First Coronavirus Response Act: Keys to Compliance" and the subsequent DOL Guidance Webinars, you might remember that we ran short on time for a Q&A session at the end of the broadcast. There was a lot of material to cover in just a one hour webinar and with the hundreds of questions that came through, there wasn't enough time to get them all answered. With so many questions coming through, it would be impossible to answer every single one. Our Senior HR Industry Analyst, Bob Greene, looked at all of the questions that came through and answered in this blog are some of the common questions that should be helpful to the greatest number of people.
Q: The slides [from the FFCRA webinar of March 25] showed tax credit examples with pay dates and deposit dates in March. Does this mean that the tax credits and leave entitlements under the law are retroactive to March?
A: NO! The example dates we chose were for purposes of illustration of the timing of tax credits being withheld from deposits owed ONLY, and were not intended to imply that the law was retroactive. Since this webinar was broadcast, we have had guidance from both the Department of Labor and the IRS, clarifying that the FFCRA became effective April 1, 2020, was not retroactive, and that no tax credits will be allowed for paid leave for periods prior to April 1.
Q: Our company was not required to follow the conditions of FMLA due to the number of employees within 75 miles of a work location. Will we now be required to follow not only the expanded FMLA but the original act?
A: The FFCRA makes no mention of the work location/employee concentration exemptions under FMLA’93. Therefore, employers will not be exempt from the EFMLEA provisions for the same reason they were exempt from the FMLA. However, the FFCRA does not amend the FMLA’s original 75-mile rule for its own unpaid leave provisions, which remain in place. Finally, remember that paid leave under the EFMLEA provisions of FFCRA can be counted, hour-for-hour, against unpaid leave under original FMLA, so your employee who uses up all of their 12 week allotment under FFCRA (2 weeks unpaid or paid with other leave followed by 10 weeks paid) may not be eligible for any additional FMLA leave, paid or unpaid, if no state or local law mandates it.
Q: What happens if you furlough or layoff an employee prior to the FFCRA effective date of April 1? Does the new law apply to them?
A: The new law does not apply to any employee terminated or laid off prior to its effective date. However, under the CARES Act, that former employee may be eligible for enhanced unemployment benefits (depending on state law.)
Q: What about employers of over 500 employees?
A: The FFCRA leave provisions do not apply to these employers. Such an employer may certainly offer their employees paid leave voluntarily under certain circumstances, but are not required to do so by the terms of the FFCRA, and may not take a tax credit for such leave and its related expenses.
Q: For the EPSL and PHEL payments, do we withhold payroll taxes and any employee benefits from this pay.
A: The payments are fully taxable to the employee just like regular pay, so all payroll taxes should be applied as normal. Note that they are exempt from the employer portion of Medicare tax. Subsequent guidance from DOL clarifies that all health insurance must be continued during these paid leaves, and that employers have the right to make all related pay deductions as they would for similarly situated active employees.
Q: Was it determined if EFMLEA was approved for intermittent leave?
A: Subsequent DOL guidance clarifies that EFMLEA leave must be permitted to be taken by employees intermittently. Although the guidance compares the intermittent leave provisions to those under the FMLA’93, employers should reference the FFCRA DOL Guidance (Q&As 20-22) for further information.
Bob Greene currently serves as Senior HR Industry Analyst at Ascentis. Bob’s 40 years in the human capital management industry have been spent in practitioner, consultant and vendor/partner roles. As practitioner, he managed payroll for a 5,000-person bank in New Jersey. As consultant, he spent 8 years advising customers in HRMS, and payroll and benefits system design as well as acquisition strategies. Bob also built a strategic HCM advisory practice for Xcelicor (later acquired by Deloitte Consulting.)