The new small business guidelines for paid sick leave and expanded family medical leave provided in the FFCRA include gathering supporting documentation from the impacted employee(s).
The following 2 questions from the FAQ's provided by the Department of Labor provide insight into the information employers should have on file to support their payroll tax credit requests for these types of paid leave.
15. What records do I need to keep when my employee takes paid sick leave or expanded family and medical leave?Regardless of whether you grant or deny a request for paid sick leave or expanded family and medical leave, you must document the following:
If your employee requests leave because he or she is subject to a quarantine or isolation order or to care for an individual subject to such an order, you should additionally document the name of the government entity that issued the order. If your employee requests leave to self-quarantine based on the advice of a health care provider or to care for an individual who is self-quarantining based on such advice, you should additionally document the name of the health care provider who gave advice.
If your employee requests leave to care for his or her child whose school or place of care is closed, or child care provider is unavailable, you may must also document:
Private sector employers that provide paid sick leave and expanded family and medical leave required by the FFCRA are eligible for reimbursement of the costs of that leave through refundable tax credits. If you intend to claim a tax credit under the FFCRA for your payment of the sick leave or expanded family and medical leave wages, you should retain appropriate documentation in your records. You should consult Internal Revenue Service (IRS) applicable forms, instructions, and information for the procedures that must be followed to claim a tax credit, including any needed substantiation to be retained to support the credit. You are not required to provide leave if materials sufficient to support the applicable tax credit have not been provided.
16. What documents do I need to give my employer to get paid sick leave or expanded family and medical leave?When requesting paid sick leave or expanded family and medical leave, you must provide your employer either orally or in writing the following information:
If you request leave because you are subject to a quarantine or isolation order or to care for an individual subject to such an order, you should additionally provide the name of the government entity that issued the order. If you request leave to self-quarantine based on the advice of a health care provider or to care for an individual who is self-quarantining based on such advice, you should additionally provide the name of the health care provider who gave advice.
If you request leave to care for your child whose school or place of care is closed, or child care provider is unavailable, you may must also provide:
In addition to the above information, you must also provide to your employer written documentation in support of your paid sick leave as specified in applicable IRS forms, instructions, and information.
Please also note that all existing certification requirements under the FMLA remain in effect if you are taking leave for one of the existing qualifying reasons under the FMLA. For example, if you are taking leave beyond the two weeks of emergency paid sick leave because your medical condition for COVID-19-related reasons rises to the level of a serious health condition, you must continue to provide medical certifications under the FMLA if required by your employer.
HCP will continue to share additional information related to the FFCRA and CARES Act as it becomes available.
HCP provides the information in this blog for general guidance only. The content does not constitute legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other advisers. The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied.