The American Rescue Plan Act of 2021: Key Aspects for Employers
On Thursday, March 11, 2021, President Biden signed into law the COVID-19 Relief Stimulus Bill, also known as the American Rescue Plan Act of 2021 (ARPA). Employers should be aware of the following key aspects of the ARPA.
Families First Coronavirus Response Act (FFCRA)
Signed into law in March 2020, FFCRA required employers with fewer than 500 employees to provide paid leave to employees for certain COVID-19-related reasons. While the mandatory aspect of FFCRA expired under its own terms on December 31, 2020, legislation passed in December 2020 permitted employers to voluntarily extend FFCRA’s paid leave benefits, and obtain tax credits for that leave, through March 31, 2021. ARPA will continue to provide tax credits to employers with fewer than 500 employees who voluntarily choose to extend FFCRA benefits through September 30, 2021. In addition, recognizing changing circumstances over the last year, ARPA expands the qualifying reasons for FFCRA leave as follows.
Emergency Paid Sick Leave (EPSL)
In addition to the standard reasons for EPSL (see additional information on those reasons in this MEA FFCRA alert from last March), the ARPA allows for paid time off for employees to obtain a COVID-19 vaccine or to recover from an illness related to vaccination. Importantly, the ARPA also resets 10 days of Paid Sick Leave for all employees.
Emergency Family Medical Leave (EFML)
Originally, EFML was available only if the employee was unable to work or telework due to the COVID-related unavailability of a child’s school or childcare. Under ARPA, EFML leave is now available for all of the qualifying uses of EPSL as discussed above.
Unemployment Insurance Expansion
The ARPA also extends the federal unemployment insurance payments of $300 per week, which is in addition to an individual’s unemployment insurance payments administered by the state. The federal unemployment benefits now expire on September 6, 2021, instead of the previous date of March 14, 2021.
ARPA offers a one hundred percent subsidy to qualifying employees and their family members who experience a loss of group health coverage due to reduced hours of employment or involuntary termination of employment from April 1, 2021 through September 30, 2021. The subsidy is available to those who become COBRA eligible during this six-month period as well as those currently enrolled and those who are within their COBRA continuation window but who failed to elect or previously dropped coverage. Employers will obtain the subsidy, to be passed along to COBRA enrollees, through a payroll tax credit against employers’ quarterly taxes.
Employers should consult with experienced human resources professionals and/or labor and employment counsel with questions regarding the ARPA or any pandemic-related policies or practices. For MEA members, the Hotline and a Member Legal Services attorney are available to provide this assistance.
Amy G. McAndrew, Esquire
Director of Legal and Compliance Services
MidAtlantic Employers’ Association
*This Alert is provided for general informational purposes only and does not constitute legal advice.