When an employee needs to take time off, you may start asking what you need to do as an employer. What are the different types of leave? Do you need to offer FMLA leave? What about PFL? Or, does the FFCRA come into play? With so many different laws (and acronyms!) about sick leave, your role as the employer can be confusing. So, when should you give FMLA vs. PFL vs. FFCRA?
What are the different types of leave?
Before you know which kinds of leaves you should offer to your employee, you need to know what the types of leave are:
- FMLA stands for Family Medical Leave Act. This federal program requires most employers to offer unpaid leave to employees for specific reasons.
- PFL is Paid Family Leave. Only some states require employers to provide PFL for certain circumstances. You may need to offer PFL to employees if you are in a state that requires PFL.
- FFCRA is the Families First Coronavirus Relief Act. The federal government signed the FFCRA into law in 2020. The temporary law applies only to eligible employers for COVID-19-specific reasons.
Here’s a rundown of these three different types of employee leave you should know before granting leave to your employees.
|What is it?||Unpaid medical leave for specific reasons||Paid family leave for specific reasons||Paid medical leave for COVID-19-related reasons|
|Is it federal or state?||Federal law for most employers||State law in some states||Temporary federal law|
|How much time does it provide?||Up to 12 weeks of job-protected leave||Amount of time off varies by state||Length of leave depends on the reason for leave|
|How’s it funded?||Not funded through a tax||Funded through a tax deduction and/or contribution||Employer-paid leave comes with federal tax credits|
What is FMLA?
The Family and Medical Leave Act protects an employee’s job if they must take unpaid time off work for reasons such as:
- The birth, adoption, or foster placement of a child
- Caring for a spouse, child, or parent with a serious health condition
- An employee’s serious health condition that makes them unable to perform their job
- Situations concerning the military deployment of an employee’s spouse, child, or parent
FMLA specifically provides up to 12 weeks of unpaid leave for employees who qualify.
FMLA: The basics
Employees can use FMLA continuously or intermittently for no more than 12 weeks in a 12-month period. Before an employee can use FMLA, they must:
- Work for a covered employer
- Have worked for at least 1,250 hours in the 12 months before taking FMLA
- Be employed with the same employer for at least 12 months, and the employment does not need to be consecutive
- Work for an employer who has at least 50 employees in a 75-mile radius
Full- and part-time employees are eligible for FMLA if they meet the requirements.
Not all employers must offer FMLA to their employees. So, you should make sure you are a covered employer before giving FMLA leave to your employees.
Because FMLA is unpaid, you do not pay taxes to fund the program.
What is PFL?
PFL is paid family leave required by select states. Depending on the state, employees can use state-mandated paid leave for specific reasons, such as to:.
- Bond with a new child
- Care of family members who are ill
In many cases (but not all), states pair PFL and Paid Medical Leave (PML). PML is paid time off for employees to use when they have a serious illness. Paid medical leave does not typically cover paid time off for caring for a relative who is ill. Do not use PFL or PML for temporary sickness (e.g., the common cold).
Both PFL and PML are different from paid sick leave. Some states have paid sick leave laws separate from any business paid time off (PTO) policies.
PFL: The basics
States with paid family leave generally require that employers or employees pay into a mandatory fund. You must deduct and/or contribute a specific percentage of the employee’s wages to the fund. The state defines the rate, and you calculate the taxes on your payroll.
If you live in a state with mandated paid family leave, notify your employees and post a notice. States with PFL include:
- Colorado (coming soon)
- New Jersey
- New York
- Oregon (coming soon)
- Rhode Island
The states with PFL have specific laws regarding:
- The length of leave
- Reasons for paid leave
- Who pays (e.g., employer-paid taxes)
- Tax rate
- Paid family leave benefit amount
- Qualifications for paid leave
Some cities may have their own paid family leave requirements (e.g., San Francisco). And, some states have unpaid family leave laws that apply to more employers than FMLA (e.g., Vermont). Check your state and local laws to make sure you are compliant.
What is the FFCRA?
The Families First Coronavirus Relief Act is a temporary federal law that required some employers to offer paid sick leave to their employees for COVID-19 related reasons in 2020. Paid leave under the FFCRA is optional in 2021, so employers do not have to provide this. FFCRA leave has specific payroll rules as well as tax credits for paying employees who use the leave.
FFCRA: The basics
Employers with fewer than 500 employees can choose to pay the FFCRA leave between January 1, 2021 and September 30, 2021. There are three types of leave under the FFCRA:
- Employees may take up to 10 days of leave if they are under quarantine or isolation order from the government, must self-quarantine under doctor’s orders, have COVID-19 symptoms and are seeking a diagnosis, are receiving the vaccination, or are experiencing symptoms from the vaccination. The employee receives their full regular rate of pay.
- Employees may take up to 10 days of leave if they must care for someone who must quarantine or self-isolate due to healthcare or government orders. Pay the employee at ⅔ of their regular rate of pay.
- Employees can use up to 12 weeks of FFCRA leave if they must take care of a child who is out of school, daycare, or other childcare services due to COVID-19. The employee is paid at ⅔ their regular rate of pay.
Full-time employees are entitled to the maximum amount of leave. Part-time employees have a prorated number of hours available. Base their hours on the average number of hours the employee works.
The maximum daily rate for employees taking FFCRA leave for themselves is $511. Employees using FFCRA leave for the other two reasons have a maximum daily rate of $200.
FFCRA tax credits
Unlike PFL, you do not have to pay into a mandatory fund for paid leave under the FFCRA. Instead, the FFCRA gives tax benefits to employers who pay employees for COVID-related leave. The tax benefits allow employers to be reimbursed, dollar-for-dollar, for the cost of providing paid leave.
Here are some details about what employers receive for providing FFCRA leave:
- A tax credit for 100% of paid leave wages for the eligible period to offset the cost (until September 30, 2021)
- Waived employer Social Security taxes for the paid leave wages
Report all FFCRA paid wages on your quarterly Form 941 and complete Worksheet 1 with the employer portion of the Social Security taxes.
When to choose FMLA vs. PFL vs. FFCRA
When choosing which leave your employee qualifies for, consider why your employee needs leave. The three types of leave from work are different, but there is some overlap. Remember:
- FMLA, PFL, and FFCRA do not cover temporary illness (with the exception of FFCRA COVID-19 paid sick leave).
- Serious health conditions may fall under FMLA, but your state might require PFL instead.
- COVID-19-related reasons fall under FFCRA.
- The birth or placement of a child into an employee’s care may fall under PFL or FMLA.
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