H.R. 7117 - Essential Pay for Essential Workers Act

SEC. 2. MANDATORY ESSENTIAL PAY FOR HEALTH CARE EMPLOYEES DURING PUBLIC HEALTH EMERGENCIES.

(a) EMPLOYER REQUIREMENT. — During an emergency period, an employer of an essential employee shall pay the employee at a rate equal to the sum of the regular rate of pay of the employee and $15.

(b) ENFORCEMENT. — A violation of subsection (a) shall be deemed a violation of section 7 of the Fair Labor Standards Act of 1938 (29 U.S.C. 206) and unpaid amounts shall be treated as unpaid overtime compensation for the purposes of sections 15 and 16 of such Act (29 U.S.C. 215 and 216).

(c) DEFINITIONS. — In this Act:

(1) FLSA TERMS. — The terms "employer" and "employ" have the meanings given the terms in section 3 of the Fair Labor Standards Act of 1938 (29 U.S.C. 203).

(2) ESSENTIAL. — The term "essential employee" means an employee identified as an essential critical infrastructure worker in the memorandum entitled, "Advisory Memorandum on Identification of Essential Critical Infrastructure Workers During COVID–19 Response" issued by the Director of the Cybersecurity and Infrastructure Agency on March 28, 2020, or a successor memorandum.

(3) EMERGENCY PERIOD. — The term "emergency period" has the meaning given such term in section 1135(g) of the Social Security Act.

(4) REGULAR RATE. — The term "regular rate" has the meaning given the term in section 7 of the Fair Labor Standards Act of 1938 (29 U.S.C. 207).

SEC. 3. PAYROLL CREDIT FOR CERTAIN MANDATORY ESSENTIAL PAY.

(a) IN GENERAL. — In the case of an employer, there shall be allowed as a credit against the tax imposed by section 3111(a) of the Internal Revenue Code of 1986 for each calendar quarter an amount equal to 100 percent of the qualified essential pay wages paid by such employer with respect to such calendar quarter.

(b) LIMITATIONS AND REFUNDABILITY. —

(1) CREDIT LIMITED TO CERTAIN EMPLOYMENT TAXES. — The credit allowed by subsection (a) with respect to any calendar quarter shall not exceed the tax imposed by section 3111(a) of such Code for such calendar quarter (reduced by any other credits allowed against such tax for such quarter) on the wages paid with respect to the employment of all employees of the employer.

(2) REFUNDABILITY OF EXCESS CREDIT. —

(A) IN GENERAL. — If the amount of the credit under subsection (a) exceeds the limitation of paragraph (1) for any calendar quarter, such excess shall be treated as an overpayment that shall be refunded under sections 6402(a) and 6413(b) of such Code.

(B) TREATMENT OF PAYMENTS. — For purposes of section 1324 of title 31, United States Code, any amounts due to an employer under this paragraph shall be treated in the same manner as a refund due from a credit provision referred to in subsection (b)(2) of such section.

(c) QUALIFIED ESSENTIAL PAY WAGES. — For purposes of this section, the term "qualified essential pay wages" means wages (as defined in section 3121(a) of the Internal Revenue Code of 1986) paid by an employer which are required to be paid by reason of section 2.

(d) SPECIAL RULES. —

(1) DENIAL OF DOUBLE BENEFIT. — For purposes of chapter 1 of such Code, the gross income of the employer, for the taxable year which includes the last day of any calendar quarter with respect to which a credit is allowed under this section, shall be increased by the amount of such credit.

(2) ELECTION NOT TO HAVE SECTION APPLY. — This section shall not apply with respect to any employer for any calendar quarter if such employer elects (at such time and in such manner as the Secretary of the Treasury (or the Secretary's delegate) may prescribe) not to have this section apply.

(3) CERTAIN TERMS. — Any term used in this section which is also used in chapter 21 of such Code shall have the same meaning as when used in such chapter.

(e) REGULATIONS. — The Secretary of the Treasury (or the Secretary's delegate) shall prescribe such regulations or other guidance as may be necessary to carry out the purposes of this section, including —

(1) regulations or other guidance to prevent the avoidance of the purposes of the limitations under this section;

(2) regulations or other guidance to minimize compliance and record-keeping burdens under this section;

(3) regulations or other guidance providing for waiver of penalties for failure to deposit amounts in anticipation of the allowance of the credit allowed under this section;

(4) regulations or other guidance for recapturing the benefit of credits determined under this section in cases where there is a subsequent adjustment to the credit determined under subsection (a); and

(5) regulations or other guidance to ensure that the wages taken into account under this section conform with the wages required under section 2.

(f) TRANSFERS TO FEDERAL OLD-AGE AND SURVIVORS INSURANCE TRUST FUND. — There are hereby appropriated to the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund established under section 201 of the Social Security Act (42 U.S.C. 401) amounts equal to the reduction in revenues to the Treasury by reason of this section (without regard to this subsection). Amounts appropriated by the preceding sentence shall be transferred from the general fund at such times and in such manner as to replicate to the extent possible the transfers which would have occurred to such Trust Fund had this section not been enacted.