Opinion: New tax law may hold surprise for employers

Atlanta employers might be surprised to learn about one of the least publicized outcomes of tax reform. The Tax Cuts and Jobs Act (H.R. 1), passed by Congress on December 20 and signed into law by President Trump, contains several obscure provisions that will directly impact employers and workplace law. One of the more far-reaching provisions is the paid leave credit.

This aspect of the new law offers businesses a tax credit if they offer up to 12 weeks of paid family leave to certain eligible workers. This law is the first federal law affecting private employers that addresses and encourages paid family leave. By way of background, the federal Family and Medical Leave Act provides for 12 weeks of unpaid leave for eligible employees of covered employers (in addition to job protection and benefits continuation).

Under this new provision, eligible employers must have a written policy that provides not less than two weeks of annual paid family and medical leave for full-time employees, and a pro-rata amount provided at the same ratio for part-time employees. The employer’s policy must provide payment at a rate not less than 50 percent of the wages normally paid to employees on leave.

Further, the leave must specifically state that the employer will not interfere with, restrain, or deny the exercise of, or the attempt to exercise, any paid leave right, and will not discharge or in any other manner discriminate against any individual for opposing any practice prohibited by the policy.

This new type of paid leave opens the door to more generous and expansive federal paid family leave laws into the future. Interestingly enough, a number of states have already been experimenting with various types of paid and unpaid leave laws.

In fact, the Georgia Legislature made its first foray into the family leave arena last year when it passed the so-called “kin-care law.” Ivanka Trump and others have been vocally outspoken in support of federal paid family and medical leave programs.

Time will whether these new laws are part of a greater trend across the country of more protections to come for the families of America.

However, this paid leave credit does have limitations. Among others, it only lasts two years before it has to be re-evaluated by Congress.

While the accountants and tax professionals study the tax aspects of the new tax law, human resources managers and labor and employment law professionals will need to get up to speed on these workplace law provisions and adjust their policies and procedures accordingly.

D. Albert Brannen is regional managing partner of Atlanta-based Fisher Phillips LLP, a firm that represents employers nationwide in labor, employment, civil rights, employee benefits, safety and health and business immigration matters.

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