On March 11, President Biden signed into law the American Rescue Plan Act of 2021 (“the American Rescue Plan Act” or “the Act”). The $1.9 trillion COVID-19 relief package will provide continued economic relief to individuals and businesses during the COVID-19 pandemic. The following is a summary of the key employment provisions included in the Rescue Plan.
 
FFCRA Tax Credit Extension
As you are aware, the Families First Coronavirus Response Act (FFCRA) expired on December 31, 2020, however, companies could voluntarily provide paid leave if they chose to and therefore would be eligible for the payroll tax credit. Until now, this option was available until March 31, 2021. The Rescue Plan extends the FFCRA tax credit provisions through September 30, 2021. 
 
Additional Modifications to the FFCRA
The American Rescue Plan Act also makes modifications to the FFCRA, all of which are effective on April 1, 2021:

• Covered Reasons for Sick Leave: The Act includes additional reasons employees can qualify for paid sick leave and family leave. In addition to the six reasons for leave set forth in the FFCRA, employers will also receive tax credits for providing leave to employees who are: (i) obtaining an immunization related to COVID-19 or recovering from any injury, disability, illness or condition related to such immunization; or (ii) seeking or awaiting the results of a diagnostic test for, or a medical diagnosis of, COVID-19, when such employee has been exposed to COVID-19 or the employer has requested such test or diagnosis.
• Reset of Paid Sick Leave: With respect to employees who previously took 10 days of emergency paid sick leave under the FFCRA, the Act permits an employer to provide those employees with an additional 10 days of leave after March 31, 2021.
• Emergency Family and Medical Leave Tax Credit Expansion: Employers may claim tax credits for emergency FMLA leave arising from any of the reasons set forth in the FFCRA. Previously, tax credits taken by employers to cover the cost of providing emergency FMLA leave was only available if the employee was unable to work (or telework) to care for their child whose school or place of care has been closed or was unavailable due to the public health emergency. The Act also removes the two week waiting period on emergency FMLA leave and raises the aggregate cap on emergency FMLA leave from $10,000 to $12,000.
• Non-Discrimination Rules: The Act includes non-discrimination rules for employers who voluntarily provide FFCRA leave and obtain tax credits. Tax credit is only available to employers who uniformly provide leave to all employees, without discriminating against certain categories of workers.

 
100 Percent COBRA Subsidy Through September
Under the American Rescue Plan Act, the federal government will pay 100% of COBRA insurance premiums for employees who lost their jobs due to the COVID-19 pandemic, as well as premiums for their covered relatives, allowing them to stay on their company-sponsored health plan. This coverage will end on September 30, 2021.
 
Stimulus Payments and Vaccine Deployment
The American Rescue Plan Act authorizes a round of stimulus payments up to $1,400 for certain Americans and changes the tax code to benefit families with children. The Act also provides money for schools to reopen, helps state and local governments meet their financial needs, and further expands the coronavirus vaccine rollout.
 
Extended Unemployment Benefits
The American Rescue Plan Act extends unemployment benefits which were set to expire on March 14, 2021, through to September 6, 2021. The Act extends PEUC by providing for up to 53 weeks of additional unemployment benefits to eligible individuals who have exhausted the unemployment benefits available under state law. In addition, the Act provides eligible individuals up to 79 weeks of PUA benefits, an extension from the 50 weeks of benefits provided previously under the CARES Act (the duration of benefits was 39 weeks).
 

What Employers Should Do Now

We anticipate the Department of Labor will provide guidance on the new American Rescue Plan Act and we will monitor and share any developments.  In the meantime, employers should consider whether they will voluntarily opt to provide or continue to provide paid sick leave and paid family leave under the FFCRA until September 30, 2021. Should employers decide to offer the leave, forms and policies must be updated, as necessary, to reflect the extension of FFCRA leave and the additional qualifying reasons for leave. We will continue to provide updates as additional information becomes available. Please contact ALG if you have any questions regarding these changes and how they may affect your business.