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Changes to FFCRA Paid Leave: Congress’ Revisions to Employment COVID-19 Leave Benefits Signals the Light is at the End of the Tunnel

Client Alert

Late on December 27th, President Trump signed into law the government’s $900 billion COVID-19 relief package (the “Stimulus Bill”). Among other economic benefits, the Stimulus Bill implements changes to the Families First Coronavirus Response Act (“FFCRA”).

It is still set to expire on 12/31/2020; however, employers can voluntarily extend and take advantage of payroll tax credits until March 31, 2021.

In April of 2020, the FFCRA began providing paid leave to employees who missed work as a result of an actual or suspected COVID-19 illness or to care for a child when their school or childcare service was closed because of COVID-19. For a full review of the FFCRA, please see our posts from March and April, including https://www.bmdllc.com/resources/blog/ffcra-update-implementation-date-accelerated-from-april-2-to-april-1/

In short, employees could receive up to 80 hours of paid sick leave and another 12 weeks of family leave (with 10 weeks paid). Employers received payroll tax credits/refunds for the paid leave. That law is set to expire on December 31, 2020.

The Stimulus Bill extends eligibility for employer payroll tax credits/refunds for leave payments made to employees on or before March 31, 2021 under the FFCRA, signaling to the American people that Congress believes many of the employed public will be vaccinated by this time, the light at the end of the tunnel. The Stimulus Bill does contain a caveat that employers are no longer required to provide FFCRA leave benefits after December 31, 2020, but if they do, they will receive the payroll tax credits, up to the maximums provided in the FFCRA, for payments made prior to April 1, 2021.

Below we provide a list of questions and answers we received to date following the passage of the Stimulus Bill. We expect the U.S. Department of Labor (“DOL”) to issue additional questions and answers as the Stimulus Bill is implemented, and we will update this Client Alert as these are received.

  1. Where can I find additional information on eligible employees, eligible employers, and the maximum benefits that are eligible for reimbursement as payroll tax credits?

Answer: Please use this link to access our original publication on the specific details, requirements, and eligibility criteria for the FFCRA. https://www.bmdllc.com/resources/blog/ffcra-update-implementation-date-accelerated-from-april-2-to-april-1/

  1. Are employers required to continue to offer FFCRA COVID-19 leave benefits to employees after December 31, 2020?

Answer: No. The Stimulus Bill only extends the payroll tax credit eligibility date to March 31, 2021. Meaning, employers are not required to give FFCRA leave benefits to employees after December 31, 2020. However, if they do, employers will continue to be eligible for payroll tax refunds, up to the maximums provided, for any payments made to employees under the FFCRA between January 1, 2021 and March 31, 2021. This also means that employers may choose which parts of the FFCRA they will utilize for leave benefits. For example, employers can choose to allow employees to take sick leave under the Emergency Paid Sick Leave Act (“EPSLA”), but do away with the leave benefits provided under the Emergency Family and Medical Leave Expansion Act (“EFMLEA”). Employers will need to carefully consider which benefits they will continue to offer, if any.

  1. Should employers revise their COVID-19 employment leave policies to reflect the changes in the Stimulus Bill?

Answer: Yes. Once employers determine which leave benefits they will continue to offer, they will need to revise all COVID-19 employment leave policies to reflect these changes and their effective dates. Even if an employer will continue to offer all benefits, we recommend revising the leave policies to reflect that such benefits will automatically terminate on March 31, 2021 as this is the final date employers will be eligible to receive payroll tax credits for the leave payments made to employees.

  1. Does the Stimulus Bill provide additional leave time to employees who exhausted all previous COVID-19 leave time?

Answer: No. If employees previously exhausted all leave time under EPSLA (up to 80 hours) and EFMLEA (up to 10 weeks), they are no longer eligible for benefits under the FFCRA. Therefore, these employees will need to utilize PTO/sick time or an unpaid leave of absence if they need to miss work because of COVID-19. The only caveat to this is for employers that have Family Medical Leave Act (“FMLA”) policies. If one of these employers uses a calendar year benefit renewal, rather than a rolling year benefit renewal, employees are going to receive additional time under the FMLA beginning on January 1, 2021. Meaning, if these employers continue to allow leave under EFMLEA through March 31, 2021, employees would receive an additional 10 weeks beginning on January 1, 2021. If you have additional questions regarding this caveat, please contact us directly.

  1. Are any states implementing their own versions of COVID-19 employee leave policies that must still be followed after December 31, 2020?

Answer: The following states have implemented with specific COVID-19 employee leave laws and/or guidance. If you employ employees in these states, please consult with your employment counsel to discuss requirements under these state laws. Please also be advised that a number of large cities within these states have also implemented their own COVD-19 employee leave laws and/or guidance.

Arizona, California, Colorado, Connecticut, Maine, Maryland, Massachusetts, Michigan, Nevada, New Jersey, New Mexico (Bernalillo County only), New York, Oregon, Rhode Island, Texas (Austin, Dallas, San Antonio only), Vermont, Washington, Washington D.C.

For questions, please contact Jeffrey Miller at jcmiller@bmdllc.com or 216.658.2323 or Bryan Meek at bmeek@bmdllc.com or 330.253.5586, or contact any member of the BMD Employment & Labor Law Practice Group.


Valley National Bank/Trulieve Loan: A Big Step Out of the Shadows

In a late December press release, Trulieve announced that it had secured a $71.5 million commercial bank loan. In addition to the amount of the loan, which may be the largest commercial bank loan to date to a cannabis company, the release prominently identified Valley Bank and featured both a quote from Valley’s Senior Vice President, John Myers, and a description of the Bank’s service platform and commitment to the cannabis industry.

The End of Non-Competes? The Impact It Will Have on the Healthcare Industry

On January 5, 2023, the Federal Trade Commission (“FTC”) announced a proposed rule that, if enacted, will ban employers from entering into non-compete clauses with workers (the “Rule”), and the Rule would void existing non-compete agreements. In their Notice, the FTC stated that if the Rule were to go into effect, they estimate the overall earnings of employees in the United States could increase by $250 billion to $296 billion per year. The Rule would also require employers to rescind non-competes that they had already entered into with their workers. For purposes of the Rule, the FTC has defined “worker” to also include any employees, interns, volunteers, and contractors.”

2022 Healthcare Recap and 2023 Healthcare Check-Up

As the country begins to return to a new “normal” following the COVID-19 pandemic, there are many healthcare rules changing on both the federal and state levels as a result. Thus, it is important for healthcare providers and their employers to be aware of these changing rules, and any implications they may have on their practice. Look back on healthcare in 2022 and find a checklist for 2023.

Direct Support Professional Retention Payments

On December 15, the Ohio Senate and House passed House Bill 45, which authorizes the Department of Developmental Disabilities (DODD), in conjunction with the county boards of developmental disabilities, to launch their initiative to issue retention payments to Direct Support Professionals (DSPs). These retention payments will be distributed quarterly to participating home and community-based waiver providers to address the workforce crisis in the direct provider sector. Governor DeWine needs to sign the Bill to begin the payments, but he is expected to do so by the end of 2022.

Real Estate Investors Position for 2023 Opportunities

Real estate investors weathered another year in a post-pandemic world, with the year closing with yet another interest rate increase coupled with both uncertainty and heightened interest carrying into 2023. Just last Wednesday, the Federal Reserve raised its benchmark interest rate 0.50 percentage points, shifting the target range to 4.25% to 4.50%. The new level is the highest the fed funds rate has been since December 2007 and marks the seventh rate hike this year. So what does this mean to investors, brokers, lenders, and others in the real estate world? Read a few perspectives below from stakeholders familiar with our BMD clients and the markets in which they do business.