U.S. Rep. Tom Reed (R-NY) on May 28 introduced a bipartisan bill that would provide a payroll tax credit for certain bonuses paid to employees who worked continuously during the COVID-19 pandemic.
“This country should be doing everything it can to make it clear workers’ commitment to their employers and communities are economically and culturally valued,” said Rep. Reed on Monday.
The congressman sponsored the Rewarding American Workers Act of 2020, H.R. 7058, with lead cosponsor U.S. Rep. Josh Gottheimer (D-NJ) to retroactively give low and middle-income workers on the front lines of the response to COVID-19 additional economic support, while also addressing concerns regarding unemployment insurance, according to a bill summary provided by Rep. Reed’s office.
“I care about rewarding workers who have persevered through this crisis and showed up to work because the American people and our economy rely on their services,” Rep. Reed said. “While it is important that the federal government provide unemployment assistance for those unable to return to work, it is equally important essential workers are financially rewarded for doing their jobs.”
If enacted, H.R. 7058 would provide businesses with an advanceable and refundable tax credit that they then could use to provide their workers with a one time, immediate payment. The size of the bonus would be structured to decrease as income rises, with payments limited to those earning below $99,000, according to Rep. Reed’s bill summary.
For instance, for a fast-food worker or store cashier earning a wage of $25,000, the bill would provide them with a bonus of approximately $2,880, which is equal to about 30 percent of wages earned during the crisis, the summary says.
Comparatively, H.R. 7058 would allow a licensed practical nurse or hospice caregiver earning a wage of $45,000 to receive a bonus of roughly $2,500, which is equal to 15 percent of wages earned during the pandemic, while the credit would cover a payment of $600 for individuals earning between $55,000 and $99,000 per year, according to the summary.
The bill is supported by the International Franchise Association and the National Association of Convenience Stores.