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How FFCRA and CARES Act Affect Business Owners

woman wearing mask due to covidThe Families First Coronavirus Response Act became a law in March 2020, and a few weeks later, the United States government passed the CARES Act. The purpose of the FFCRA is to provide relief to both employers and employees in small businesses who may be suffering from hardships caused by COVID-19. Employers should be aware of the acts’ provisions so that they remain in accordance with Indianapolis business law.

Under the FFCRA, eligible employees who cannot work for specific reasons related to COVID-19 are allowed 12 weeks of unpaid leave. These reasons are not limited to having the virus or a child with the virus but also include COVID-related school closures or lack of the child’s regular caretaker that could mean a parent must stay home to care for the child. An employee who becomes ill with COVID-19 is entitled for up to two weeks of sick leave pay by the employer. An Indiana business lawyer may be able to explain the precise parameters.

The Acts provide for up to $10 million in loans to cover small business payroll and some other expenses. Limited refundable tax credits are also available to match 100% of wages paid. These credits have been amended by the CARES Act to eliminate the process of application and reimbursement. Instead, employers get the credits in real time.

The expanded eligibility provided by the CARES Act means that employees only need to have worked for 30 days to be eligible. It also expands eligibility to employees who were let go after March 1 and then rehired as long as they have worked 30 of the previous 60 days.

Overall, the two acts working in tandem offer broad protection from some of the economic effects of coronavirus to both employees and employers. A business attorney in Indianapolis such as McClure McClure & Davis can help with any questions about the acts.      

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