Employers may take FFCRA tax credit for leave through March, Labor Department says

Dive Brief:

Employers are not required to provide paid leave under the Families First Coronavirus Response Act (FFCRA) this year, but they may continue to do so on a voluntary basis in exchange for a tax credit, the U.S. Department of Labor (DOL) said in guidance updated Dec. 31, 2020.
December's emergency coronavirus relief law, signed by President Donald Trump in the final days of 2020, extended IRS tax credits for FFCRA leave provided voluntarily to employees through March 31, 2021. But the law did not extend eligible employees' entitlement to FFCRA leave past Dec. 31, DOL said.
In a separate section, DOL confirmed that its Wage and Hour Division would continue to enforce the FFCRA for leave taken or requested between April 1 and Dec. 31, 2020. The statute of limitations for both types of FFCRA leave is two years from the date of alleged violation or three years in cases involving alleged willful violations. Employees may also have a private right of action for alleged violations, DOL said.

Dive Insight:

The agency's statement confirms what management-side sources previously told HR Dive at the time of the emergency relief bill's publication.

It may also serve as a reminder to employers about DOL's active and ongoing enforcement of the law's provisions moving forward. The department has already undertaken several enforcement actions alleging unpaid FFCRA leave, including one against a Best Western Plus hotel in Kansas, netting more than $5,000 in back wages.

Though the legislation and subsequent DOL guidance may spell an end to the nation's first-ever federal paid leave mandate for the private sector, advocates may point to the FFCRA in future paid leave discussions at the federal level. A research paper published in Health Affairs found that states where workers gained access to paid sick leave through the law saw statistically significant decreases in the number of new COVID-19 cases, compared to a control group of states where workers already had access to paid sick leave.

DOL itself has signaled interest in gathering input from stakeholders on the subject of paid leave after passage of the FFCRA. In July, the agency's Women's Bureau issued a request for information asking employers to identify "the features of an ideal paid leave program" as well as barriers to paid leave and insights from the FFCRA.

As the pandemic continues, it remains to be seen whether Congress will be able to overcome recent barriers to implementing paid leave at the federal level. Employer advocates, for instance, have voiced concerns about how a federal law might conflict with state and local paid leave laws as well as where funding for a national program would come from. In 2017, Pew Research Center published survey data indicating that while most U.S. respondents supported various forms of paid leave, they were largely divided on whether the federal government should mandate paid leave.