Paid Sick and Family CARE Leave - Employer Obligations Expanded and Refundable Tax Credits Granted

Legal Alert

April 13, 2020

This is just a quick note to call to your attention another program of the federal government’s response to the corona virus that may affect all cooperative and condominium buildings, and their management companies, in their capacity as employers.

The “Families First Corona Response Act” (“FFCRA”) signed into law on March 18, 2020, requires employers with 500 or fewer workers to provide up to two weeks of sick leave at full pay up to a $511-per-day cap if they're directly affected by COVID-19, and at partial pay up to $200 a day to care for affected family members. FFCRA also grants a refundable federal income tax credit to the employer for the required pay. Refundable tax credits are of value even to entities that pay little or no federal income tax because any excess of the credit amount, above the tax obligation, is reimbursed to the employer by the Department of the Treasury.

You will find the more detailed explanation of this program prepared by Smith Gambrell & Russell’s labor and employment law group here. The Department of Labor regulations as to the paid leave may be found here: https://www.govinfo.gov/content/pkg/FR-2020-04-06/pdf/2020-07237.pdf The IRS FAQ as to the tax credits may be found here: https://www.irs.gov/newsroom/covid-19-related-tax-credits-for-required-paid-leave-provided-by-small-and-midsize-businesses-faqs The requirements are complex and you will want to discuss this program with your management company and accounting firm as to the computation of the required pay and credit and as to any required documentation and records.

Please contact your Smith Gambrell & Russell cooperative and condominium group attorney for further assistance.