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Guidance for The Families First Coronavirus Response Act

The Families First Coronavirus Response Act (FFCRA) was signed into law on March 18, 2020. The law takes effect on April 2, 2020 and will provide paid sick and family leave during the COVID-19 pandemic. Two key components of the FFCRA are 1) Emergency FMLA and 2) Emergency Paid Sick Leave. Tax credits are being offered by the IRS to offset these additional costs to nonprofit organizations.

Emergency Family & Medical Leave Expansion

What Nonprofits Does This Apply To?
Nonprofits with fewer than 500 employees. Those with fewer than 50 employees will be eligible for an exemption from the leave requirements relating to school closings or child care unavailability where the requirements would jeopardize the ability of the business to continue.
Who Can Take This Emergency Leave?

Any employee who has been employed with the nonprofit for at least 30 calendar days is considered eligible. Eligible employees may take up to 12 weeks of job protected leave due to

  1. The employee being unable to work (and/or not be offered telework options),
  2. The employee is required to care for their son or daughter (under 18 years of age) where the place of care has been closed, or the childcare provider is unavailable.
What is the Obligation to Pay The Employee While Out?
The first 10 working days of the 12 week leave is unpaid, unless the employee elects to use their Emergency Sick Time (see section below) or other forms of paid leave. The remaining 10 weeks of the 12 weeks is paid at two-thirds the employee’s regular rate of pay up to $200 per day, or $10,000 in aggregate. Employees may choose to use other forms of paid leave during weeks 10-12 to ensure full rate of pay.
Does My Nonprofit Need to Hold The Job and Reinstate the Employee?
The same reinstatement provisions apply as under traditional FMLA; the employer must make reasonable attempt to return employee to work for up to a year following leave. However, the job restoration rights apply to nonprofits with more than 25 employees; those with less than 25 employees are generally excluded from this requirement if the position no longer exists due to economic downturn or other circumstances.
What Documentation Is Required?
At this time, FFCRA has not clarified what type of documentation/certification an employer may request. However, in light of the overwhelming demand on healthcare providers, both the Centers for Disease Control (CDC) and the Department of Labor (DOL) have recommended that employers consider suspending any certification requirements.

Emergency Paid Sick Leave

What Nonprofits Does This Apply To?
Nonprofits with fewer than 500 employees. Those with fewer than 50 employees will be eligible for an exemption.
What Employee Are Eligible?

Paid sick leave is available to employees who are unable to work or telework because:

  1. The employee is quarantined or isolated by Federal, State or local order;
  2. The employee is advised to self-quarantine by order of a health care professional;
  3. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
  4. The employee is caring for an individual subject to quarantine or isolation by Federal, State or local order or by order of a health care professional (akin to #1 and #2 above);
  5. The employee is caring for a child because the child’s school or childcare facility is closed; or
  6. The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of Treasury and Secretary of Labor.
What is the Obligation to Pay The Employee While Out?
Employees will receive 10 days of pay when taking Emergency Paid Sick Leave. The amount of wage replacement benefits varies based on the reason for the employee’s leave. Employees seeking Emergency Paid Sick Leave for reasons #1-#3 will be paid at 100% their regular rate of pay, which may be capped at $511 per day, or $5,110 in aggregate. By contrast, employees seeking Emergency Paid Sick Leave for reasons #4-#6 above will be paid at two-thirds their regular rate of pay, which may be capped at $200 per day, or $2,000 in aggregate.

Tax Credits

What Are Tax Credits Available For Nonprofits?

The IRS will provide tax credits for both Emergency FMLA and Emergency Paid Sick Leave. In addition, nonprofits are entitled to an additional tax credit based on costs to maintain health insurance coverage for the eligible employee during the leave period. A summary of the caps are as follows:

  1. Emergency FMLA: Up to $200/day or $10,000 in aggregate
  2. Emergency Paid Sick Leave:
    1. Up to $511/day or $5,110 in aggregate
    2. Up to $200/day or $2,000 in aggregate
How Do I Receive These Credits?
Under guidance that will be released next week, eligible employers who pay qualifying sick or child care leave will be able to retain an amount of the payroll taxes equal to the amount of qualifying sick and child care leave that they paid, rather than deposit them with the IRS. The payroll taxes that are available for retention include withheld federal income taxes, the employee share of Social Security and Medicare taxes, and the employer share of Social Security and Medicare taxes with respect to all employees.

For More Information See Below:
https://www.dol.gov/agencies/whd/pandemic/ffcra-employer-paid-leave
https://www.dol.gov/agencies/whd/pandemic/ffcra-questions