Posted by Christine Hinnerichs, Total Absence Management on April 7, 2020
Mandatory FFCRA expired on December 31, 2020. Beginning January 1, 2021, covered employers may voluntarily provide emergency paid sick leave or emergency paid FMLA under FFCRA and take the tax credit associated with the paid leave for leave taken through March 31, 2021. If you plan to voluntarily continue with this plan, please follow the documentation requirements outlined below.
The Internal Revenue Service issued guidance on documentation requirements for Emergency Paid Sick Leave (EPSL) and FMLA expansions effective April 1, 2020 and The Partners Group is here to break it down.
As a recap, companies with fewer than 500 employees are required to pay for the use of EPSL and FMLA+. Leave wages are paid for time taken between April 1 and December 31, 2020.
Employers who pay qualified leave wages can fund the amount of the wages paid by retaining the following federal employment taxes: federal income taxes withheld from employees, the employees’ share of social security and Medicare taxes, and the employer’s share of social security and Medicare taxes with respect to all employees.
In guidance issued on March 31, 202o, the IRS makes clear that those credits won’t be issued without some hefty supporting documentation. Read on for an outline of employee obligations and please consult with your tax experts for additional detail on what tax forms are necessary.
If the leave is taken for an employee’s serious health condition, family member serious health condition related to COVID-19, revert to your usual practices for obtaining certification from the health care provider under FMLA.
Employers covered by FFCRA should create an FFCRA request form for both EPSL and FMLA+. This will assist employers in collecting the necessary information for tax credits. The Partners Group will be publishing a template request form shortly.
All documentation must be maintained for 4 years. This includes detailed oral statements, the information outlined in the IRS guidelines below, and the Authorized Officer’s Determination if you are providing a denial under the small business exemption.
Located in questions 44-46 of the IRS FAQs, employees should provide a signed written statement containing the below. However, to the extent that an employee isn’t immediately able to provide written documentation, employers should accept verbal request to initiate the benefit.
- Employee Name
- Date or dates of leave requested
- Statement of the COVID-19 related reasons the leave is being requested and written support for each reason
- Statement the employee is unable to work or telework
The written support requirements vary depending upon the reason for leave.
Leave for Self (Emergency Paid Sick Leave)
- Name of the governmental entity ordering quarantine or isolation.
- Name of the health care professional advising self-quarantine
Care for Others (Emergency Paid Sick Leave)
- Care for an individual* who is subject to quarantine or isolation order, or who is following advice from the health care provider to self-quarantine:
- Either the name of the governmental entity ordering quarantine or isolation, or the name of the health care provider who is advising self-quarantine; and
- The name and relation to the employee of the individual who is subject to the quarantine order or has been advised to self-quarantine.
*The DOL clarified in its final ruling that an “individual” is defined as “an immediate family member, roommate, or a similar person with whom the employee has a relationship that creates an expectation that the employee would care for the person if he or she self-quarantined or was quarantined.”
School or Daycare Closure (Emergency Paid Sick Leave and FMLA+)
- Name and age of the child (or children) to be cared for, the name of the school/daycare 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 paid leave.
- If the inability to work or telework is because of a need to provide care during daylight hours for a child that is older than 14, the IRS requires the employee provide a statement that “special circumstances” exist. “Special circumstances” may include care for a child over 14 and incapable of self-care because of a mental or physical disability. The DOL defines a child, for the purposes of FMLA, as under the age of 18. Due to this variance, we anticipate additional interpretation from the DOL on the age limit.
The Partners Group’s COVID-19 Resource Hub provides updated, relevant tools to help you navigate absence, employee benefits, legislative, and workplace challenges during this unprecedented time. The TPG Total Absence Management Team is working to ease the burden many employers face in the interpretation and application of this ever-changing information. Please contact firstname.lastname@example.org for additional information about our services.