The American Rescue Plan And Human Resources For Small and Medium Business
This article briefly discusses the provisions impacting the HR departments of small and medium businesses.
The American Rescue Plan Act (ARP) went into effect April 1 and will continue until Sept. 30, 2021.
Emergency Paid Sick Leave
Emergency Paid Sick Leave (EPSL) was created last year as part of the Families First Coronavirus Response Act (FFCRA) and has been included, with some changes, in the ARPA. The law provides tax credits for private-sector employers with 499 or fewer U.S. employees for qualifying leave taken anytime between April 1, 2021 and September 30, 2021. The same tax credit caps created in the FFCRA on the amount of tax credit reimbursements continue to apply in the ARP.
The ARPA version of EPSL is different from the FFCRA version in several respects. First, it is a voluntary program as it was with the extension that was announced for the beginning of 2021, rather than being mandatory as it was originally. In addition, the ARP version of the EPSL adds three more qualifying reasons for using the leave, which are:
The employee is subject to a federal, state, or local quarantine or isolation order related to COVID–19.
The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID–19.
The employee is seeking or awaiting the results of a diagnostic test or medical diagnosis for COVID-19, or the Company has requested such a test or diagnosis.
Plus the original qualifying reasons for leave under the FFCRA:
The employee was subject to a federal, state, or local quarantine or isolation order related to COVID-19;
The employee’s health care provider advised the employee to self-quarantine due to concerns related to COVID-19;
The employee experienced symptoms of COVID-19 and sought a medical diagnosis;
The employee was caring for an individual who was subject to either scenario #1 or #2 above;
The employee had to care for a child, whose school or place of care closed, or the employee’s childcare provider was unavailable due to COVID-19 precautions; or
The employee experienced other conditions similar to COVID-19 (as identified by the Secretary of Health and Human Services).
Emergency Family Medical Leave Expansion
The original FMLA law covered COVID-related leave if an employee became ill due to the virus, but only allowed for the 80-hours of reimbursable wages using ESPL. After that, employees were limited to the standard paid time off provided under company policy. The FFCRA expanded the qualifying reasons for FMLA as part of the Emergency Family Medical Leave Expansion Act (EFMLA). EFMLA provided paid leave for employees needing to care for a child whose school or place of care had closed, or whose childcare provider was unavailable due to coronavirus precautions.
The ARP reintroduced EFMLA and further expanded it. The paid leave provisions now will cover all of the same scenarios that are covered under EPSL. Note that the expansion does not cover the employee is taking FMLA for a reason that is not COVID-19 related.
In addition, if an employee takes EFMLA leave, the entire period of leave is paid. This eliminates the previous initial unpaid period and the need to transfer time from an employee’s EPSLA bank to the EFMLA bank. Tax credits for EFMLA leave are two-thirds of the employee’s regular pay rate, capped at $200 per day. Accordingly, the total EFMLA reimbursement will be capped at $12,000, which is $2,000 higher than was previously provided.
COBRA Subsidy: Employer Responsibilities
The ARPA mandates that employers subsidize COBRA premiums for certain former employees. The new law states that potentially eligible people for the subsidies are employees, spouses, and dependents who lost healthcare coverage from November 2019 through the present time due to a reduction in hours or involuntary termination. Employees that were terminated for gross misconduct will not qualify for the subsidy. If an employee is Medicare eligible or has another employer’s group health plan available, for instance through a spouse’s health plan, then the company is not required to subsidize COBRA payments.
Employers must notify eligible former employees about the new COBRA subsidy by May 31, 2021. The Department of Labor released Model Notices which can be found here: U.S. DOL-EBSA-Cobra Premium Subsidy
The Affordable Care Act and The American Rescue Plan
Extimates are that 4 out of 5 who enroll in an ACA (Obamacare) plan can find a plan for $10 per month, with financial assistance.
We will make sure that you and your employees and contractors get the maximum amount of financial relief that you’re entitled to.
You probably qualify for low or zero-premium healthcare with the lowest deductibles, lowest out-of-pocket costs, and the lowest cost to see your doctor.
This is full coverage and covers everything from the private health insurance companies that you can choose like Anthem, Blue Cross, Blue Shield, Cigna, Aetna, United Healthcare, and all the brand name carriers that you know and trust.
Call us at (877) THE HALO to make sure you get every dollar this new law wants to give you.
Discuss how the new law impacts you
Review your coverages
Show you all your options
Help you complete your application
Calculate your subsidy and get you the maximum
Submit it to the federal government
Get you approved within minutes!
Call (877) THE HALO