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Paid Leave: Fed’s Rescue Plan Will Protect Workers, Families

Some workers who are sick or have to care for family members will have protection against financial losses, thanks to provisions in the American Rescue Plan.

A man in a warehouse working on a piece of equipment.
(Shutterstock)
One in four working Americans does not have access to paid sick leave, nor do almost 1 in 3 of those who work at private companies with less than 100 employees. Low-wage and minority workers are least likely to be covered and most likely to feel financial pressure to stay at work and to have front-line jobs with high risk for COVID-19 exposure.

Coming to work sick is a bad idea at any time, but it’s less of a “personal” decision than ever during a pandemic. The American Rescue Plan (ARP) continues and adjusts provisions of previous stimulus bills designed to expand the availability of paid leave that workers can use to quarantine, recover from illness or care for family members.

The ARP does not address the needs of all workers. Private-sector measures apply to companies with 500 or fewer employees, which account for about half of private-sector payrolls. The public-sector funds appropriated in the bill are for federal government employees.

Much Needed Support


In all, the ARP appropriates almost $700 million to fund up to 15 weeks of emergency paid leave for federal workers. The money will be available through September 2021, or until it is all spent.



Leave can be used to obtain a vaccination or recover from its side effects, to quarantine or to care for sick family members, family members 55 or older who are not capable of self-care or children whose schools are closed. Guidance for issuing the aid is forthcoming. “Judging by the number of people who’ve made inquiries about it, it’s much needed,” says Jacqueline Simon, director of public policy for the American Federation of Government Employees (AFGE).

Time spent on emergency leave is not counted toward length of service for retirement. Still, it’s “a lifesaver” for those who don’t have access to child care or sufficient annual leave saved up to care for a relative, says Simon.

Another important benefit for federal workers is that the ARP establishes a presumption that COVID-19 illness is the result of workplace exposures. Federal employees who work on the front lines and contract the disease won’t have to fight to prove that they contracted it on the job, and they and their survivors will automatically be eligible for workers’ compensation benefits.

In the early days of the pandemic, health-care workers at Veterans’ Affairs (VA) hospitals were not provided with personal protective equipment (PPE), and transportation security officers at airports were forbidden to wear masks by the administrator of the Transportation Security Administration (TSA) at the time because he felt masks would “scare passengers,” says Simon. Past policies such as this increased the danger to federal workers, but the new administration has introduced mask mandates and vaccination programs for Department of Homeland Security (DHS) and VA workers.

“It’s a finite amount of money and it’s got a finite shelf life,” says Simon of the new emergency leave funding. “It runs out at the end of the fiscal year, so we’ll see if it’s enough.”

Tax Credits for Employers


According to the Bureau of Labor Statistics, workers at companies with 500 employees or less receive an average seven sick days a year, even after 10 years of service — not enough to cover a quarantine period, much less an extended illness. Fewer than 1 in 5 of those who work for businesses of this size have paid family leave.



These benefits could never be expected to ensure resilience during an event as widely disruptive as the pandemic. The U.S. is the only industrialized nation in which citizens don’t have universal access to paid sick leave; before the pandemic, researchers estimated that 3 million workers go to work sick each year, primarily women in low-wage jobs who have children.

The Families First Coronavirus Response Act, passed in March 2020, required employers with fewer than 500 employees to provide up to 80 hours of paid sick leave and an additional 10 weeks of family or medical leave to employees unable to work for specified pandemic-related reasons.

Employers were to be “repaid” through tax credits equivalent to 100 percent of the wages they paid to those on leave. These tax benefits were originally intended to continue through Dec. 31, 2020, but as the pandemic and its impact on workers lingered, they were extended from Jan. 1, 2021, to March 31, 2021.

During the extension, it became voluntary for employers to provide these benefits. Voluntary participation will remain the rule under the guidelines of the American Rescue Plan. If employers choose to participate, the ARP allows tax credits for another 80 hours of paid sick leave and 12 weeks of paid family leave between April 1 and Sept. 30 (unused hours from previous periods do not carry over).

New qualifying reasons for leave include obtaining a vaccine or recovering from a condition or illness related to it and seeking a COVID-19 diagnosis or test, or awaiting results from one. Tax credits for paid leave are also available to those who are self-employed.

At this point in time, businesses are increasingly focused on a return to some semblance of “normal” operations, says Lisa Frydenlund, an HR knowledge adviser for the Society for Human Resource Management (SHRM). Some HR professionals are finding it necessary to remind leadership why it’s necessary to continue offering paid leave at the levels outlined in the ARP.

There’s a tension between the desire to get workers back to work and the reality that they are still likely to need time away, she says. “Bless all the HR professionals of the world — they’re have to manage a new element of this pandemic yet again.”

Frydenlund points to a recent uptick in cases in Oregon as an example of the fact that it’s too early to assume that workers’ troubles are behind them. The pandemic has forced employers to reconsider what they offer to sick workers and the best ways to help them moving forward, including how remote and hybrid workplaces fit into the picture.

“Who knows what comes next?” she says. “It’s going to be interesting to see how the landscape plays out and how employers are going to be able to continue to accommodate leaves of absence or sick time.”
Carl Smith is a senior staff writer for Governing and covers a broad range of issues affecting states and localities. He can be reached at carl.smith@governing.com or on Twitter at @governingwriter.
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