New Congressional Stimulus Bill on State and Local Government

On Sunday evening, President Trump signed into law a new Congressional bill intended to further blunt the economic impact of the COVID-19 pandemic continues to dominate the news. While the new law provides for roughly $900 billion in economic stimulus, it does not address some provisions that will directly impact state and local government employees.

In particular, the bill only partially amends the Family First Coronavirus Relief Act (FFCRA) by extending through March 31, 2021 the tax credits available to private employers. This has caused some confusion as the bill extends the tax credits, but does not extend the federal mandates to provide paid leave under the Emergency Paid Sick Leave Act (EPSLA or “Paid Sick Leave”) and the Emergency Family Medical Leave Expansion Act (EFMLEA or “Expanded FMLA”). Without the extension of the FFCRA paid-leave mandates, state and local governments will no longer be required to provide Paid Sick Leave or Expanded FMLA to their employees beginning in 2021. It also means the 6-reason framework of both the EPSLA or EMFLEA (see Overview of Leave Laws Related to COVID-19) which provided allowances of up to 2 weeks of Paid Sick Leave, and up to 10 weeks of paid FMLA at two-thirds a full-time employee’s regular pay, will no longer be required after December 31, 2020.

Funds allocated through the CARES Act to Kentucky’s Coronavirus Relief Fund may not be available to cover a city’s paid sick leave expenses after December 30, 2020. Cities should plan accordingly to ensure payroll expenses meet expected levels.

As a reminder, government employers are still subject to the standard FMLA requirements and should continue to grant unpaid medical leave for FMLA-eligible employees who are unable to work because of their own serious health condition or because they have to care for a family member with a serious health condition, including COVID-19. What remains unclear is whether an employee with caretaking responsibilities for a child whose school remains closed to in-person instruction will qualify for FMLA leave.  KLC will continue to monitor these developments and post updated information on the COVID-19 Resources Page.

Key Takeaways:

• The paid leave requirements and framework under the FFCRA will expire at the end of the year. 
• State and local governments should not expect reimbursement from Kentucky’s Coronavirus Relief Fund (CRF) for COVID-related payroll expenses after December 30, 2020.

Guidance for our Members:

• Inform supervisors and managers of how the expiration of Paid Sick Leave and Expanded FMLA may impact city employees. 
• Continue to inform and train supervisors and managers how to respond to an employee’s request for leave due to COVID-19 – both before December 31, 2020, and after. 
• Be aware of the status of your employees who may currently be receiving paid leave. If applicable, communicate to affected employees that they will no longer receive paid leave after December 30, 2020. 
• Consult with your city attorney on any extenuating circumstances. 
• Continue to follow the standard FMLA leave requirements even after Expanded FMLA expires at the end of this year.  For more information on administering standard FMLA leave, see Does My City Have to Provide FMLA?, What Types of Events Qualify for FMLA, Part 1 and Part 2.