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FFCRA FAQS and Sample Forms

By Higginbotham on April 09 , 2020

We have continued to see more and more FAQs related to the EPSLA and EFMLEA being released by the DOL to assist employers, along with 66 (and growing) FAQs released by the IRS related to claiming the payroll tax credit for providing leave. To help you sift through this information, we’re sharing some of the most common FAQs we have received over the past two weeks. In addition, we’re resending our EPSLA/EFMLEA decision flowchart and including some sample forms that employers can use for documenting leave requests and designations — sample EFMLEA Request Form, EFMLEA Notice of Leave Designation, EPSLA Request Form and EPSLA Notice of Leave Designation.

Q: I am a small employer and want to claim an exemption from having to provide EPSLA/EFMLEA leave; where do I request or file for this exemption?

A: Employers do not apply for an exemption and do not file anything. Employers will need to make a determination based on the below criteria, document and retain it in their files for at least four years:

“… a small employer is exempt from the requirement to provide such leave when:

  1. Such leave would cause the small employer’s expenses and financial obligations to exceed available business revenue and cause the small employer to cease operating at a minimal capacity;
  2. The absence of the employee or employees requesting such leave would pose a substantial risk to the financial health or operational capacity of the small employer because of their specialized skills, knowledge of the business, or responsibilities; or
  3. The small employer cannot find enough other workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services the employee or employees requesting leave provide, and these labor or services are needed for the small employer to operate at a minimal capacity.”

    See Q&A 58 and 59.

    Also, small employers will still have to display the required FFCRA notice and keep records of any request for leave/EFMLEA (whether approved or denied) for four years.

Q: I have employees who do not want to come in to work or are staying home because they do not feel well or believe they cannot work due to a shelter-in-place rule. We have offered to continue to pay them, but do we have to give them EPSLA leave, and can we claim the tax credit for paying them?

A: You could pay them if you choose to, but you would not be eligible to claim the tax credits for doing so. The way the regulations are written, they would only be eligible for the paid sick leave if they are under a quarantine or self-isolation order from a medical provider. You would need the order itself, or the name of the provider, to be able to claim the tax credit. Employers must document the following when receiving a request for leave (whether orally or in written form), regardless of whether they grant or deny a request for paid sick leave or expanded family and medical leave:

  • The name of the employee requesting leave;
  • The date(s) for which leave is requested;
  • The reason for leave; and
  • A statement from the employee that he or she is unable to work or telework because of the reason.

If employees request leave because they are subject to a quarantine or isolation order or to care for an individual subject to such an order, they should additionally document the name of the government entity that issued the order. If employees request leave to self-quarantine based on the advice of a health care provider or to care for an individual who is self-quarantining based on such advice, they should additionally document the name of the health care provider who gave the advice.

Also, regarding shelter-in-place orders, the regulations state that “the question is whether the employee would be able to work or telework 'but for' being required to comply with a quarantine or isolation order” – i.e. – if your business is open and exempt from the shelter-in-place order due to being an “essential business” and the employee is otherwise able to work or telework, he or she would not be eligible for EPSLA leave, and you could not claim a tax credit for paying the employee while on leave.

Q: We believe we are a health care provider; how do we claim an exemption from having to provide ESLA/EFMLEA leave to our employees?

A: Employers do not apply for an exemption and do not file anything. Employers will need to make a determination based on the below criteria, document it retain it in their files for at least four years: 

“For the purposes of employees who may be exempted from ESPLA/EFMLEA by their employer under the FFCRA, a health care provider is anyone employed at any doctor’s office, hospital, health care center, clinic, postsecondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, employer, or entity. This includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions. This definition includes any individual employed by an entity that contracts with any of these institutions described above to provide services or to maintain the operation of the facility where that individual’s services support the operation of the facility.”

They will still have to display the required FFCRA notice and keep records of any request for leave/EFMLEA (whether approved or denied) for four years.

Remember – the DOL has stated that “to minimize the spread of COVID-19, the Department encourages employers to be judicious when using this definition to exempt health care providers and emergency responders from the provisions of the FFCRA.”

Q: How does the unpaid part of EFMLEA leave work with EPSLA leave?

A: As a reminder, EMFLEA leave is only for childcare needs. As such, employees with childcare needs would most likely be eligible for the EPSLA and EFMLEA leave and should apply for both. They would start at the same time and run concurrently. The first 10 days of EFMLEA leave would be unpaid, but would be covered by the 80 hours of EPSLA leave (and cannot be substituted with an employee’s PTO balance). After the EPSLA leave is exhausted, employees would begin EFMLEA leave, but their employers can substitute any accrued PTO they have for pay under the EFMLEA until all PTO is exhausted. At that time, they would begin receiving normal payments under the EFMLEA until EFMLEA leave is exhausted. 

Q: What type of documentation should we be requesting when leave is requested?

A: Employers will need to request, and retain for four years, sufficient documentation to submit to the IRS to substantiate that the leave was eligible under the FFCRA and that the employer is eligible to receive tax credits for providing the leave. Please see the sample leave request and designation forms linked above. 

Q: What if a leave request is made orally?

A: Employers must document the following when receiving a request for leave (whether orally or in written form), regardless of whether they grant or deny a request for paid sick leave or expanded family and medical leave:

  • The name of the employee requesting leave;
  • The date(s) for which leave is requested;
  • The reason for leave; and
  • A statement from the employee that he or she is unable to work because of the reason.

Employers that provide paid sick leave and expanded family and medical leave required by the FFCRA are eligible for reimbursement of the costs of that leave through refundable tax credits. If they intend to claim a tax credit under the FFCRA for payment of the sick leave or expanded family and medical leave wages, they should retain appropriate documentation in their records. This is due to the fact that the IRS guidance makes clear that an employee’s eligibility for paid sick or paid family leave should be based on a written request from the employee.

If claiming the tax credit, the employer will need:

  • Documentation to show how the employer determined the amount of qualified sick and family leave wages paid to employees who are eligible for the credit, including records of work, telework and qualified sick leave and qualified family leave. This documentation will obviously include salary information. Additionally, the Emergency Family and Medical Leave Expansion Act (contained within the FFCRA) requires employers to pay an employee for hours the employee would have been normally scheduled to work (even if more than 40 hours in a week). This documentation should therefore include substantiation regarding how many hours the employee was scheduled to work. If the employee’s hours varied by week, this documentation should include substantiation of the hours the employee worked in the prior six months. 
  • Documentation to show how the employer determined the amount of qualified health plan expenses that the employer allocated to wages.

Given the current circumstances and access limitations, not all employees may be able to easily get the medical assistance required (such as testing), written medical orders or childcare certification. Under those circumstances, employers may want to take a more flexible approach and err on the side of providing the leave of absence. Employers should approach these issues cautiously, and if in doubt, consult with legal counsel prior to making a determination.

Finally, employers may want to advise their employees that, even if the employer is not requesting documentation at the time of granting the leave or the employee does not possess such documentation at that time, the employer reserves the right to request those documents at a later date or when the employee has access to them. This can potentially deter employees from taking advantage and abusing leaves of absence under the law. Employers should further advise their employees that a failure to provide the required documentation may result in disciplinary action, up to and including termination.

Tags: Compliance

  
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