What a Restaurant Owner Needs to Know About the FFCRA

As we all are working through the new "normal," I wanted to share the information below that may be helpful as you navigate your restaurant and employees.

Families First Coronavirus Response Act 

The President signed into law the Families First Coronavirus Response Act (FFCRA) late last week. The Department of Labor issued FAQs and additional information about the Act, which can be found here. The IRS also issued a press release on how the IRS plans on implementing the new law. Importantly, specific regulations, notices, and procedures are still pending.

Frequently Asked Questions about FFCRA:

• I can't afford to pay my employees paid sick leave and emergency FMLA. How can employers obtain prompt payment from the federal government for funds we pay out under the new law?

• Generally, employers must withhold federal income taxes and the employee's share of Social Security and Medicare taxes. The employers then deposit these taxes, along with the employer's portion of Social Security and Medicare taxes. The IRS will be letting employers keep the portion of their payroll taxes equal to the amount of paid sick leave and child care leave the employer will be paying out. The IRS will be releasing guidance later this week on when employers can start retaining these tax payments.   

• What if the wages I paid employees under the new law exceed my employment tax liability?

• The IRS will reimburse employers as quickly as possible. The IRS will be releasing guidance later this week on how employers can obtain a refund from the IRS if their reimbursement exceeds their payroll taxes.  

• When does this new law go into effect?

• April 2, 2020

• Do I have to pay employees paid sick leave prior to April 2, 2020?

• No, employers do not have to pay employees federal paid sick leave until April 2, 2020. However, many states and local governments have paid sick leave requirements. Employers should still comply with those applicable laws.