Small Business Documentation for Families First Coronavirus Response Act

small business documentation for families first coronavirus response act

There is a lot of confusion around what type of documentation should be taken with the new Families First Coronavirus Response Act (FFCRA), employee Paid Sick Leave and Expanded Family and Medical Leave, as well as how any exemptions to the leave should be documented.

The Department of Labor has not released much information in the way of guidance around documentation and record keeping during all of this, other than to make it clear they will be looking for documentation to justify leave decisions and additionally the IRS will be looking for documentation to support any tax credits that were provided to businesses to cover the cost of leave payments. 

Here are some recommendations in terms of documentation and record keeping to try and limit any potential issues down the line should the DOL or IRS have questions.

If an employee is asking for Paid Sick Leave or Expanded Family and Medical Leave under the FFCRA, document the following for the company records:

  • Employee name
  • Dates the employee is asking for leave
  • What is the qualifying reason they qualify for leave: 
    • If it’s because of a quarantine order from a government agency, then specify which agency ordered the quarantine
    • If a health care provider advised the employee to self-quarantine, get the name of the health care provider and any written recommendation or not the health care provider may have given the employee 
    • If it’s to care for an individual subject to a quarantine order or a doctor's recommendation to self-quarantine, then get the name of the government agency who ordered the quarantine, or the name and information of of the health care provider who advised the self-quarantine
    • If it’s to care for a child whose school/child care is closed:
      • Name of the child
      • Name of the school/child care facility/child care provider
      • A statement from the employee that “no other suitable person will be caring for the child during the leave period” 
  • A written statement from the employee that they are unable to work
  • Documentation or records of payments made, and how the amount was calculated, during leave that were used to calculate the the amount of tax credits you are eligible for to recover the cost of the leave to the business 

If you decide to deny school/child care leave based on the small employer (less than 50 employees) exemption, you should document the following for company records:

  • The determination to deny sick leave, and the documentation justifying the decision must be made by and documented by an authorized officer, so if you have HR compile the documentation, remember an owner or C-level employee will need to sign off as the final decision maker approving the decision and justifying the documentation
  • Document the exemption you are using to deny the requested leave:
    • leave would result in the small business’s expenses and financial obligations exceeding available business revenues;
    • Absence of the employee would create a substantial risk to the financial health or operational capabilities of the small business because of the employees specialized skills, knowledge of the business, or responsibilities; OR
    • There are not sufficient workers who are able, willing, and qualified who will be available at the time and place needed, to perform the labor or services provided to allow the company to operate in a minimal capacity.
  • Keep in mind that there may need to be financial projections or documentation needed to support an exemption based on company financial health, and detailed explanations or for exemptions dealing with a lack of specialized skills or sufficient workers.

Record Keeping

To comply with the FFCRA’s paid leave mandates, you must keep all documents regarding leave requests, whether or not leave was granted, on file for 4 years.  

If you have any questions about the Families First Coronavirus Response Act, or want a free consultation about any legal and risk issues in general, contact us

Search Families First Coronavirus Response Act - Small Business Exemptions
What Do You Need to Know About Starting A C-Corporation? Search