As in every troubling circumstance, there is opportunity if you have a growth mindset. In the current Covid-19 crisis, the government has provided employers with an opportunity to help their employees get through the next several months without economic devastation and to incentivize employee observation of Covid quarantine measures taken by the employers. Two laws passed by Congress last week help facilitate this if you are in an industry that is shrinking due to the current, hopefully short term, crisis.
The Emergency Paid Sick Leave Act obligates and empowers employers to pay up to 80 hours of sick leave over a 2 week period and get reimbursed on the spot by the Government. That sick leave is funded through contemporaneous tax credits. This provides an opportunity for employers to enforce “zero tolerance to illness symptoms“ by reminding employees that they will be paid sick leave if they are out of work, strictly enforcing the no illness policy during the ongoing crisis when any cold symptoms may mean Covid until tested (which is still extremely difficult to get done) This will reduce their financial incentive to work through an illness that may or may not be Covid related, and, thus, protect the remaining workforce from potential exposure.
If an employer is still in business making payroll for his remaining employees, this sick leave benefit is truly pain free and cost free. The only valid excuse for not taking advantage of this benefit is a total shut down of your company.
The Emergency FMLA Expansion Act presents an even better opportunity to manage your labor costs with minimal disruption IF a segment of your workforce has children whose schools have been closed or day care canceled due to the crisis. If that is the case, you have a tool in your arsenal to retain your workforce on a reduced work basis with minimal layoffs. This is how that works:
1) The Act provides for paid leave, funded through contemporaneous tax credit, for employees with children whose schools or daycare have been closed.
2) The Department of Labor ‘s Guidance on this aspect of FMLA permits wide use of Intermittent Leave as a means of keeping payroll costs under control. Intermittent Leave is when an employee works a reduced work schedule, typically to accommodate a chronic health condition (before this change)
3) This intermittent leave can be used in lieu of reducing employee hours. Instead of reducing a 40 hour per week employee to 20 hours, you can put them on intermittent FMLA for 20 hours and pay them for the other half (subject to the 2/3rds and 200 per day limitation) through tax credit funded government money. It is important to note however that this strategy is only available if the employees have school or daycare aged children.
4) While you cannot force employees to take FMLA, you can educate them about how it is to their advantage, especially when the alternative is a reduction in their work week and pay. It is likely that a parent with school children will relish an opportunity to have more free time at home to spend with their bored to tears children.
5) In my opinion, this presents a real opportunity for an employer to help their employees without damaging their own bottom line. It is a lot better alternative to a layoff. I am available to help you determine if this arrangement is best for you and your workforce.