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American Rescue Plan Act Brings More Financial Relief

On March 11, 2021, President Joe Biden signed into law the $1.9 trillion American Rescue Plan Act (ARPA), creating a third stimulus package since the COVID-19 pandemic started one year ago.

The ARPA focuses on several employment-related economic benefits such as paid sick leave, financial support for small businesses and enhanced unemployment benefits. Here’s the main ARPA points that employers should know.

Emergency Paid Sick Leave Updates

One of the first COVID-19-related federal bills passed last year, the Families First Coronavirus Response Act (FFCRA), created a new emergency paid sick leave (EPSL) and expanded the Family and Medical Leave Act (EFMLA). Together, these leave entitlements helped provide paid leave to workers for several COVID-19-related reasons, including to isolate and get tested as well as school and childcare closures, while employers benefitted from a tax credit for paying for the leave.

As previously reported, the mandate to provide FFCRA leave expired on December 31, 2020, but the second stimulus bill, the Heroes Act, allowed employers to continue voluntarily providing EPSL and EFMLA that employees didn’t use in 2020 and receive the tax benefit through March 31, 2021.

The ARPA goes a little further than the Heroes Act, but stopped short of reinstating the employer mandate. Some of the key changes taking effect on April 1, 2021, that ARPA made to the EPSL and EFMLA leaves include:

  • Continuing to let employers voluntarily provide EPSL and EFMLA and extending their ability to claim tax credits through September 30, 2021, as long as they follow the rules.
  •  Allowing employers who provide EPSL to now offer it for employees taking time off to obtain a vaccine; recover from a vaccine-related injury, illness or other condition; seek a COVID-19 test or diagnosis due to an exposure; or at the employer’s discretion.  Read More

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