How Work Sharing Saves Labor Costs and Confronts Uncertainty

Emery Gullickson Richards

“Work sharing” allows employers to reduce employee wages or hours instead of doing a layoff or furlough by reducing the hours of retained employees subject to a specific plan created by the employer. Work sharing enables employees to keep their jobs while simultaneously receiving unemployment benefits to supplement the lost income. At present, 27 states have enacted work sharing programs (oui.doleta.gov/unemploy/docs/stc_fact_sheet.pdf), though the requirements and benefits vary from state to state.

What is work sharing? Work sharing, also called “short-term compensation,” should not be confused with job sharing, which allows two part-time employees to share one full-time job. Instead, “work sharing” refers to cutting workers’ hours to avoid cutting workers’ jobs, effectively sharing the burden across employees when an employer has to scale back labor costs due to financial pressures, such as those presented by the coronavirus COVID-19 pandemic. Reducing hours instead of reducing headcount saves money, saves morale, and saves the maximum number of employees for when business levels later return to pre-emergency levels. Continue reading “How Work Sharing Saves Labor Costs and Confronts Uncertainty”

New York Passes COVID-19 Relief for Affected Employees

Anthony A. Mingione

On Wednesday, Governor Cuomo signed into law a bill providing paid sick leave and job protections for employees in New York who are unable to work due to coronavirus COVID-19. The new law prohibits employers from terminating or penalizing employees who are absent from work while the government is recommending or mandating that people stay home to slow the spread of COVID-19.

The specifics of the leave available to employees will vary depending on the size and net income of the employer, although regardless of employer size, all employees subject to a mandatory or precautionary order of quarantine or isolation due to COVID-19 will be entitled to job protection during their absences.

      • Businesses with at least 100 employees must provide at least 14 days of paid sick leave during any mandatory or precautionary order of COVID-19 quarantine or isolation.
      • Businesses with between 11 and 99 employees (or with 10 or fewer employees but more than one million dollars in net income) must provide five days of paid sick leave. Once that is exhausted, those employers must provide their workers with access to short-term disability benefits and paid family leave for the period of quarantine/isolation.
      • Finally, employers with 10 or fewer employees and less than one million dollars in net income are not obligated to provide paid leave but must give their workers access to short-term disability benefits and paid family leave for the period of quarantine/isolation.

Continue reading “New York Passes COVID-19 Relief for Affected Employees”

Uncharted Territory: Restaurant Survival Guidance Amid COVID-19 Pandemic

Alix L. Udelson

Across the United States, everyday life is being upended by the coronavirus COVID-19 pandemic. Due to a combination of strong advice from health officials for all Americans to practice social distancing measures, and similar laws and directives from state and local governments, businesses are being forced or called upon to shutter their doors for the foreseeable future. The restaurant industry—an industry especially dependent on daily cash flow and known for operating on low profit margins—is on the front line of this crisis, directly and instantaneously feeling the widespread ramifications of the current crisis.

In this unprecedented time, restaurants are looking to creative solutions to help blunt the impact of this pandemic on their businesses, employees, and communities. Continue reading “Uncharted Territory: Restaurant Survival Guidance Amid COVID-19 Pandemic”

Coronavirus Update: Senate Passes Virus Relief Bill, Plans for Even Bigger Stimulus

Jason E. Reisman and Andrew I. Herman

The Senate cleared the second major bill responding to the coronavirus pandemic, with lawmakers rushing to follow up with an additional economic rescue package that President Donald Trump’s administration estimates will cost $1.3 trillion. The 90-8 vote Wednesday, following House passage on Saturday, sends Trump a measure providing paid sick leave, food assistance for vulnerable populations and financial help for coronavirus testing. As the Senate voted, Republican and Democratic leaders were already working on the next proposal.

For the latest updates, please visit Blank Rome’s Coronavirus (“COVID-19”) Task Force page. 

Coronavirus Update: House Passes Bill for Paid Leave and Other Emergency Relief

Jason E. Reisman and Andrew I. Herman

On March 14, 2020, the U.S. House of Representatives passed legislation in response to the increasing disruption that coronavirus (“COVID-19”) is having on businesses and daily life. The Emergency Families First Coronavirus Response Act (H.R. 6201) includes several measures to address the significant impact of COVID-19 on employment for American workers and their families, including provisions for emergency paid leave and sick time, as well as funds and support for state unemployment compensation programs. To protect against the creation of “permanent” paid leave benefits and limit it to addressing the COVID-19 impact, this bill sunsets at the end of 2020.

On March 16, 2020, the House passed a “technical corrections” bill by unanimous consent, which included changes intended to address concerns that the legislation’s provisions for emergency paid leave and sick time would be devastating to small and midsize businesses.  

THE EMERGENCY FAMILY AND MEDICAL LEAVE ACT

The bill amends the Family and Medical Leave Act (“FMLA”) to provide employees of employers with fewer than 500 employees with the ability to take up to 12 weeks of job-protected leave on a partially paid basis under the FMLA if the employee is unable to work (or telework) due to a need to care for a child due to the closure of a school or place of care, or a childcare provider is unavailable, because of COVID-19 public health emergency.

Who is eligible for COVID-19 leave?

Any employee who has been employed for at least 30 calendar days by an employer with fewer than 500 employees. There is no minimum hours threshold like the normal FMLA eligibility requirement that an employee have worked at least 1,250 hours over the preceding 12 months.

How much must an employee be paid for COVID-19 leave?

The first 10 days of COVID-19 leave is unpaid. An employee can choose to use vacation or other paid time off during this period. A provision restricting employers from requiring employees to do so was removed in the bill’s “technical corrections.”

Employers must pay two-thirds of an employee’s regular rate of pay after the first 10 days of COVID-19 leave, but such pay is not to exceed $200 per day or $10,000 in the aggregate.

Please click here for the full client alert. 

Colorado Goes “Wage & Hour” Crazy—Enhances Employee Protections a la California

Jason E. Reisman and Alix L. Udelson

For all of those employers with employees based in Colorado, we wanted to update you on some sweeping changes to Colorado wage and hour laws that went into effect on March 16, 2020. As you know, employers generally must comply with both state and federal wage and hour laws—essentially meeting the requirements that are most protective of employees. To date in Colorado, the state law’s applicability has been limited—but that’s not going to be the case any longer.

The new law, known as the Colorado Overtime & Minimum Pay Standards (“COMPS”) Order #36, replaces all prior Colorado Minimum Wage Orders. The most significant changes include: (1) extending Colorado’s wage and hour laws to even more employers than before; (2) adjusting the salary thresholds required for eligibility under the federal overtime exemptions for executive, administrative, and professional employees; (3) changing employee rest period requirements and requiring meal periods; (4) clarifying the definition of “time worked” for purposes of being considered “compensable time”; (5) imposing new posting and distribution requirements that will require changes to employee handbooks; (6) creating new earnings statement requirements that may require payroll to update your earnings statements; and (7) modifying the calculation of overtime so that it is based not only on a weekly basis, but on a daily and consecutive hourly basis too. More details are below, and a copy of the COMPS Order can be found here. Continue reading “Colorado Goes “Wage & Hour” Crazy—Enhances Employee Protections a la California”

Coronavirus Guidance for Employers: Pandemic Declaration and Government Action

Mara B. Levin, Brooke T. Iley, and Taylor C. Morosco

COVID-19 (commonly referred to as the “coronavirus”) was declared a global pandemic by the World Health Organization (“WHO”) on March 11, 2020, and continues to impact businesses and public life around the world. The U.S. Center for Disease Control and Prevention (“CDC”) is monitoring the status of the coronavirus, and various state and local governmental agencies are issuing states of emergency and quarantine directives. The virus continues to spread without containment, creating a host of new real-time issues for employers to address as the general duty to provide a safe working environment has significantly increased.

WHAT IS A PANDEMIC?

WHO has described a pandemic as the worldwide spread of a new disease. For a general discussion of what constitutes a pandemic, review WHO’s general guidance here.

What did WHO say about the COVID-19 pandemic?

WHO’s Director General made his remarks in a briefing to the media about the pandemic and, among other things, outlined general steps that countries should take, which are available here.

WHAT IS THE LATEST FEDERAL RESPONSE TO COVID-19?

On March 11, 2020, President Trump issued a ban on travel from Europe (minus the United Kingdom) to the United States beginning Friday, March 13, 2020, at midnight.

Please click here for the full client alert. 

 

How to Approach Coronavirus-Related Workplace Scenarios

Mara B. Levin, Brooke T. Iley, and Taylor C. Morosco

COVID-19 (commonly referred to as the “coronavirus”), a respiratory illness that was first diagnosed in Wuhan, China, in late 2019, has hit the United States. The World Health Organization (“WHO”) has declared the outbreak a public health emergency of international concern and the virus is being classified as an epidemic. With the spread of the virus, employers face a series of constantly evolving questions regarding their competing legal obligations to provide a safe workplace.

While the immediate risk of contracting COVID-19 in most workplaces remains low, many federal agencies, including the U.S. Centers for Disease Control and Prevention (“CDC”), have issued specific guidance for employers to respond to the disease. This client alert discusses recommended approaches and alternatives to specific situations affecting employees in the workplace. Implementation of these recommendations may need to be tailored to your particular business, with consideration being given to workplaces with employees who work in concentrated spaces; employees who have greater exposure on a daily basis with the public; employers who can easily transition to remote working arrangements; and employers who can afford to pay healthy employees to stay home.

WHAT SHOULD AN EMPLOYER DO IF AN EMPLOYEE…

…is sheltering a self-quarantined person?

The CDC does not recommend testing, symptom monitoring, or special management for people exposed to asymptomatic people with potential exposures to the virus. These people are not considered to be exposed and therefore are categorized as having “no identifiable risk.” As a result, there are no extraordinary precautions that need be taken other than those imposed on all employees, which is to stay home if they are feeling sick. Of course, employers can take extra precautions that they deem necessary.

…is exposed to a symptomatic person?

Please click here for the full client alert. 

Guidance for Employers to Address Coronavirus in the Workplace

Brooke T. Iley, Jason E. Reisman, Susan L. Bickley, Anthony B. Haller, Mara B. Levin, and Taylor C. Morosco

COVID-19 (commonly referred to as the “coronavirus”), a respiratory illness that was first diagnosed in Wuhan, China, in late 2019, has hit the United States. The World Health Organization (“WHO”) has declared the outbreak a public health emergency of international concern and the virus is being classified as an epidemic. With the spread of the virus, employers face a series of constantly evolving questions regarding their competing legal obligations to provide a safe workplace, while protecting the privacy rights of their employees, and without violating anti-discrimination laws.

WHAT LAWS ARE POTENTIALLY IMPLICATED?

Before an employer responds to these challenges, they should be familiar with the laws implicated with an epidemic like the coronavirus:

Occupational Safety and Health Act (“OSHA”)

OSHA’s General Duty Clause requires employers to maintain a safe workplace for all workers and to distribute information and training about workplace hazards. It also bars employers from retaliating against employees for exercising their rights to safe workplaces.

The situation is constantly evolving. Employers must monitor the developments about the ongoing outbreak and assess government notifications to formulate appropriate workplace responses and preventative measures.

Americans with Disabilities Act (“ADA”)

The ADA protects employees from discrimination based on their disability, record of a disability, or perceived disability. “Disability” has a broad definition, which could cover the coronavirus. This means that those who have or are suspected of having the coronavirus could be covered by the ADA, depending on its impact on the employee, or, for instance, if an employee is perceived to be disabled. Employers must be sensitive to the risk of discrimination under the ADA. The ADA also requires employers to keep employee medical information and records confidential and in a separate folder from the employee’s personnel file.

Employers must balance these competing legal requirements as they adjust business practices to address coronavirus concerns. Employers should act to protect their workforce, with an eye toward discrimination laws, all the while maintaining tact and sensitivity towards those who have or may be suspected of having contracted the virus. This is not a science and often involves a case-by-case determination.

Please click here for the full client alert. 

California Corner: The Employee v. Contractor Saga Continues as Uber and Postmates Face First Defeat in Attempt to Enjoin AB5

Caroline Powell Donelan and Natalie Alameddine

The hopes of California gig economy companies to retain the flexibility to classify workers as independent contractors were dashed this week when a federal district court judge refused to enjoin Assembly Bill 5 (“AB5”), which codifies the “ABC” test for most independent contractor classifications.

Governor Gavin Newsom signed AB5 into law last fall, effecting a seismic change on California’s legal landscape. Effective January 1, 2020, the law makes it nearly impossible for companies to lawfully classify most workers as independent contractors (rather than employees). The bill expands on California Supreme Court’s three-prong “ABC” test from its 2018 Dynamex decision for determining how workers can be classified, which you can read about here. With certain limited statutory exceptions, AB5 provides that, to properly classify a worker as an independent contractor in California, an employer must demonstrate that the worker: (A) is free from the company’s control and direction; (B) performs work outside of the company’s usual course of business; and (C) is customarily engaged in independent work of the same nature as the work performed. There is no balancing, as all three factors must be met. Continue reading “California Corner: The Employee v. Contractor Saga Continues as Uber and Postmates Face First Defeat in Attempt to Enjoin AB5”