In response to COVID-19 the federal government set up the Families First Coronavirus Response Act (FFCRA) in March 2020. This Act is effective through December 31, 2020 and provides, among other things, paid sick leave to employees. The Act maintains certain requirements to qualify: 

  1. Businesses are granted funds as long as they have less than 500 employees.  
  2. Workers will not have to pick between paychecks and public health measures. 
  3. Workers can receive up to 80 hours of paid sick leave as well as an additional 10 weeks of paid family leave to care for a child.  
  4. Provides business with refundable tax credits.  

Consult your Chamber of Commerce or attorney for more details but, in general, FFCRA requires that employers offer the following: 

  1. Up to 80 hours of paid sick leave if an employee is unable to work because of coronavirus – pay rates differ based on if the employee is sick or quarantined or if the employee needs to care for someone (family member, dependent, etc.)   
  2. For more details, visit the Department of Labor website (https://www.dol.gov/agencies/whd/pandemic/ffcra-employer-paid-leave) 

The complexities of this Act are creating many accounting questions.  How do you account for this required paid sick leave  – which may be in addition to sick leave you already offer? What if the employee is taking care of a family member with coronavirus? The accounting for this pay is up to two-thirds their regular rate of pay.  What steps need to be taken to properly account for this?  

There is a process for tracking this information.  Our team can help you navigate the complexities of FFCRA accounting. Contact us to help you navigate this process.