With new “stay in place” orders being executed in more cities and states every day, employers like you are, understandably, concerned about how they will continue to pay employees. And given that your employees might be twiddling their thumbs with no customers able to come to your location, are you on the hook to continue to pay them if there’s nothing for them to do? Here are the answers to some employer questions about COVID-19.
While you may not have legal counsel on your staff to guide you through the uncertainty we’re living in, you should be aware of employment laws (some with ink that hasn’t even dried yet) that will impact what you can and can’t do as an employer right now.
What is the Families First Coronavirus Response Act?
Let’s start with the biggest change to employment laws and one of the questions about COVID-19: on March 18, 2020, President Trump signed the Families First Coronavirus Response Act (FFCRA) into law. It impacts private employers with fewer than 500 employees and public sector employers with one or more employees.
Under this new law, employers cannot:
- Refuse to provide a proportional amount of sick leave to part-time employees
- Require the use of other paid leave before the employee uses the paid sick time available.
Employers can cap sick pay at $511 per day or $5,110 total for leave taken due to employee illness, suspected illness, or isolation, and they can cap sick pay at $200 per day or $2,000 total for leave taken to care for someone else who is sick.
Additionally, employers with fewer than 50 employees may be exempt from this law if following these requirements would jeopardize the viability of the business. However, it is still unclear how this exemption will be applied.
Is The Government Going to Help Me Stay in Business?
The U.S. government is aware of the impact that coronavirus has already had on small businesses and employees alike, and has been working ‘round the clock to come up with an economic stimulus bill that will, among other aims, help businesses stay afloat through SBA low-interest loans specifically designated for this purpose.
As of this writing, details on resources for small businesses haven’t been fully fleshed out.
Can I Fire Employees without Legal Repercussions?
Letting staff go may be what keeps your business going. Generally, yes you can fire employees without legal ramifications, but make sure you’re operating in an at-will state. In most states, at-will employees may be terminated at any time for (almost) any reason.
Keep in mind, however, that firing employees may not make it easy for them to qualify for unemployment benefits. If you believe you will be able to bring staff back on once your business is back up and running, consider laying them off for the time being instead.
Also, be aware of the contractual status of your employees and the laws of your state. Because every state is different, you should consult with an experienced employment attorney in your state with specific questions.
Can I Find a Different Role for an Employee?
Possibly.
This is one of the big questions about COVID-19. Doing so could potentially violate individual employment agreements, but many employees would rather shift roles and continue to work during these troubled times than not work at all. An employee must be notified of any reduction in pay.
Also, make sure your company is covered, should that role change trigger potential liability issues.
If, for example, you run a restaurant that is no longer able to serve customers in-house, you might consider having your employees serve as delivery drivers. Check with your insurance company to see if you can insure them first because you will be liable for them while they’re operating their vehicles for company business.
Can I Check Employees for Signs of Coronavirus?
If you’re still operating, naturally, your first priority is the health of your staff. Employers have started taking the temperature of employees, and while that isn’t failproof at identifying those who have the virus, it can reduce the risk of infecting your entire team.
If an employee comes to work with any signs of illness at all, send them home. It’s better to be short-handed by one person today than an entire team tomorrow.
How Do I Keep Spirits Up?
This is one of the most important questions about COVID-19 you should be asking and is possibly the most critical for businesses, since we have no idea how long this strain will last. For employees who are working remotely for the first time, it can be isolating and challenging to stay upbeat with a barrage of negative news popping up on their feeds by the hour.
As the leader of your business, remember that your staff looks to you for guidance on how to feel and act. If your attitude is “the sky is falling,” they’ll be right there with you, cowering under their desks. But if you provide moral support and reassure them that this, too, shall pass, it will be easier for everyone to focus on work rather than what’s going on outside.
Please keep in mind this information is changing rapidly and is based on our current understanding of the programs. It can and likely will change. Although we will be monitoring and updating this as new information becomes available, please do not rely solely on this for your financial decisions. We encourage you to consult with your lawyers, CPAs and Financial Advisors. To review your real-time funding options with one of Nav’s lending experts, please contact us.
This article was originally written on March 23, 2020 and updated on March 31, 2020.
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