Interpretation of the DOL’s FFRCA and IRS Regulations: What Documentation is Required?

April 3, 2020

The DOL issued more regulations on April 1 providing additional interpretation of the FFRCA.  One of the issues addressed was the notification employers can require for an employee requesting leave under either the additional paid sick leave or the expanded FMLA provisions.

For both forms of leave, an employer may require employees to follow reasonable notice procedures.

Notice is required “as soon as practical” which can be after the first workday or portion of a workday for which an employee receives paid sick leave in order to continue to receive such leave.

For sick leave for the employee, the employee must submit a signed statement containing:

  • The employee’s name.
  • The date(s) for which leave is requested.
  • The coronavirus-qualifying reason for leave.
  • A statement that the employee can’t work or telework because of this reason.

For leave caused by a quarantine or isolation order, an employee must provide the name of the government entity that issued the quarantine or isolation order.

For leave due to self-quarantining, the employee must provide the name of the health care provider making the quarantine recommendation.

For leave to care for a person who is quarantined, the employee must provide either the government entity that issued the quarantine or isolation order or the name of the health care provider who advised the individual to self-quarantine.

For leave caused by an employee’s own serious health condition related to the coronavirus, or to care for the employee’s spouse, son, daughter or parent with a serious health condition, the normal FMLA certification rules apply.

For leave under the expanded FMLA, the employee must provide:

  • The name of the child being cared for.
  • The name of the school, place of care or child care provider that closed or became unavailable due to coronavirus reasons.
  • A statement representing that no other suitable person is available to care for the child during the period of requested leave.

If an employee fails to give proper notice, the employer should give him/her notice of the failure and an opportunity to provide the required documentation prior to denying the request for leave.

IRS Guidance

In order to claim a tax credit for leave paid under the FFCRA, an employer must submit proper documentation of the leave.  The new IRS regulations provide some details about what documentation is required.

The IRS Regulations say that employers “must retain records and documentation related to and supporting each employee’s leave to substantiate the claims for the credits,” as well as retain:

  • Form 941, Employer’s Quarterly Federal Tax Return.
  • Form 7200, Advance of Employer Credits Due to COVID-19.
  • Any other applicable flings made to the IRS requesting the credit.

The information an employee must produce, to be maintained by the employer to substantiate eligibility for sick leave or family leave credits, is:

  • His or her name.
  • The date or dates for which leave is requested.
  • A statement of the COVID-19 reason the employee is requesting leave and written support for such reason.
  • A statement that the employee is unable to work, including by means of telework, for such reason.

If the leave request is based on a quarantine order or self-quarantine advice, the statement from the employee should include the name of the governmental entity ordering quarantine or the name of the health care professional advising self-quarantine. If the person subject to quarantine is not the employee, that person’s name and relation to the employee shall be provided.

If the leave is due to a school closure or unavailability of a child care provider, the statement from the employee should include:

  • The name and age of the child or children.
  • The name of the school that has closed or place of care that is unavailable.
  • A representation that no other person will be providing care for the child during the period for which the employee is receiving family medical leave.
  • With the care of a child older than 14 during daylight hours, a statement that special circumstances exist requiring the employee to provide care.

Finally, additional documentation must be maintained, including:

  • Documentation to show how the employer determined the amount of qualified sick and family leave wages paid to employees that are eligible for the credit, including records of work, telework, qualified sick leave and qualified family leave.
  • Documentation to show how the employer determined the amount of qualified health plan expenses that the employer allocated to wages.

This information is accurate as of April 3, 2020, and is subject to change based on any new legislation.

Anne-Marie L. Storey, Attorney at Law, Rudman Winchell
Anne-Marie Storey, Esq
Rudman Winchell
207-947-4501