American Rescue Plan Act Employment-related Provisions

President Joe Biden signed the American Rescue Plan Act of 2021 (ARPA) into law on March 11, 2021. The law generally provides financial relief for individuals, state and local governments, schools, businesses and for other purposes.

In addition, the law contains the following measures of special interest to employers and their employees:

  • A subsidy for COBRA premiums, funded through employer tax credits
  • Extension of employer tax credits for FFCRA employee leave voluntarily provided through Sept. 30, 2021
  • Expansion of employee earnings eligible for the FFCRA tax credit
  • Inclusion of testing and immunization as reasons for FFCRA leave
  • Extension of $300 increase in weekly unemployment benefits
  • Extension of weekly unemployment benefits for workers who otherwise wouldn’t qualify for these benefits
  • Expansion of subsidy for ACA premiums
  • Increase in DCAP contribution limits
  • Extension and expansion of the employee retention tax credit

Employers should review the ARPA’s provisions to identify any requirements and opportunities that apply to them. Employers should also watch for official guidance on the implementation of the law.



NY State is near ready to adopt enforceable legislation protecting employees under the HERO Act.  This is in addition to the March 12th law allowing up to a maximum of 4 hours of PAID time off for COVID19 vaccinations/iinjections (8 hours for 2 vaccines) for employees only.  This time off is not intended for family member vaccinations.
As an employer:
– you may require proof
– you cannot require employees provide advanced noticeSome States and Cities have their own act regarding vaccinations.  In Philadelphia, all employers with 50+ employees must allow for vaccinations and recovery.

If enacted, the HERO Act would require the New York Department of Labor (“NYDOL”) to issue enforceable minimum workplace health and safety standards, and would also impose significant new health and safety obligations on employers in the state. Because Governor Cuomo is expected to sign the bill into law, New York employers should be aware of the HERO Act’s implications and take necessary steps to prepare for compliance.

In additiona, California is considering allowing employees to cover dependent adults on employer sponsored plan coverage.  Dependent Adults must be living in the US and considered dependent under IRS rules.  Stay tuned to see if this has any movement forward.

The Current State of Consumer Driven Health Plans

Health care consumerism has always been about empowering individuals to select more cost-effective, appropriate care. This thesis is the backbone of consumer driven health plans (CDHPs), which aim to make employees active participants in their health care.

A CDHP is simply the combination of a high deductible health plan (HDHP) and a health care account. Since HDHPs have low premiums but high deductibles (i.e., employees must cover a significant portion of incurred health costs), health care accounts are often used to offset these expenses.

CDHPs can be an excellent way for employers to control health care spending, too. In fact, CDHPs are often more effective than traditional health plans at reducing total medical costs. For example, short-term cost savings increased by 20% for employers during their first year of switching to a CDHP, according to a Cigna report. That’s because CDHPs share much of their costs with employees, rather than relying primarily on the employer. Even employers that contribute to employee health accounts can choose how much to do so, providing even more spending control.

Beyond monetary advantages, CDHPs also help improve employee satisfaction with their health coverage. Reach out today to learn more about how CDHPs can benefit your organization.