COVID-19 has touched every corner of the world, leaving no business or industry immune to impact. Abrupt changes to supply and demand have upended 2020 business forecasting, resulting in unimaginable production pressure for some, and for others, heartbreaking foreclosure considerations.
If you are a current OMNI client, we encourage you to lean on your Senior Consultant for guidance and direction. If OMNI services are new to you, we invite you to review our calendar of online events and information sessions or contact us at 913-341-2119 to learn about our ad hoc consulting services.
As the world looks forward to getting back to business, there are concerns many workers may avoid returning to work, choosing to remain on their more ‘lucrative’ unemployment benefits. Consider the following, as the semantics are important.
1.) If you ‘furloughed’ staff, (a ‘layoff while retaining employee benefits,’) you’ve essentially kept them on your payroll with no wages but have not formally terminated your employment relationship. Anyone refusing a recall back to work puts themselves at a double risk. Refusing avail-able work risks not only losing state unemployment benefits but could also be considered a ‘voluntarily resignation’ from their employment relationship all together.
2.) If you ‘terminated’ staff, (ending the employment relationship) you are basically in ‘recruit and re-hire’ mode. Your previously terminated staff members have no obligation to return to work with you, and you have no ‘obligation’ to re-hire anyone. The principles of supply and demand will apply, and you might need to become creative in your hiring. Perhaps this is a time to reinvent your teams.
3.) A refusal to accept employment under either situation may risk continued unemployment benefits. In either case, documenting and delivering your ‘recall’ or ‘re-hire’ offers would be a good way to demonstrate your efforts to re-employ staff and to mitigate your future unemployment costs.
On April 16th, the stay-at-home order for Jackson County was extended through May 15th, 2020. The order requires that Jackson County essential businesses that choose to remain open, develop a social distancing protocol before April 20th using the form provided online. To learn more, please visit the Jackson County Missouri website at https://www.jacksongov.org/civicalerts.aspx?aid=747
The Families First Coronavirus Response Act (FFCRA) went into effect on April 1st, 2020 to help employees and employers make the right decision related to caring for themselves and family impacted by COVID-19. The FFCRA requires employers with less than 500 employees to provide their employees with sick leave or expanded family and medical leave for reasons related to COVID-19.
In simple terms, the ACT states:
Additional details on FFCRA Employer and Employee rights, including an Employee Rights Poster and a detailed FAQ can be found on the U.S. Department of Labor/Wage and Hour Division site: https://www.dol.gov/agencies/whd/pandemic
As employers consider their staffing needs and constraints in the current environment (e.g. sales, employee availability), they may determine that they cannot provide enough work for their current employee schedules. At OMNI, we believe it’s best for our clients to consider and manage several of these decisions independently to provide a clear path forward. Employers who cannot sustain their current staffing levels have a few options:
We recommend that employers consult with their human resources advisor to best understand the implications of each of these options on pay, benefits, unemployment compensation, etc.
To assist with hard business decisions, on Friday, March 27th, 2020, the President signed into law the CARES Act, which included an initial $376 billion in relief for the nation’s workers and small businesses. While this fund is expected to deplete quickly, additional contributions are under consideration. In addition to traditional SBA funding programs, the CARES Act established the following temporary programs that may assist you in making those tough staffing decisions.
OMNI strongly recommends that employers consult with their human resource advisor to best understand the implications of a staffing decision and the assistance being offered through the FFCRA and CARES acts. While these programs are designed to support you and your employees through the COVID-19 storm, there is a double-dip agenda to consider. Educate yourself and make informed decisions to avoid penalties and year-end headaches.
There are many challenges presented by the COVID-19 pandemic for employers, including the potential unintended consequences of employer decisions regarding staffing decisions. This blog post will discuss several recent challenges our clients have experienced along with some practical solution considerations.
FLSA Wage and Hour
As employers balance their staffing levels and the economic realities of declining sales, some have elected to reduce employee schedules and pay until sales improve and work returns. For employees paid hourly, the impact is straight forward – less hours worked and less pay. For salaried employees who are exempt from overtime, the situation can be more challenging.
If an employer reduces the pay rate for a salaried employee, they must be sure that the adjusted salary rate at least meets the new FLSA minimum salary rate requirement to maintain the employee’s exempt from overtime status. This is especially true if the salaried employee works more than the federal or state hours threshold for overtime – typically 40 hours/week, but some states have daily thresholds. If the employee’s adjusted pay rate falls below the FLSA minimum salary rate, and the employee works more than the overtime threshold, they could owe the employee 1.5 times their hourly rate for overtime pay.
We recommend that employers consult with their human resources advisor to best understand the implications of each of these options. The following US Department of Labor Fact Sheet is also a helpful reference for employers: https://www.dol.gov/agencies/whd/fact-sheets/70-flsa-furloughs
The current COVID-19 situation is challenging to say the least. I continue to be amazed by our clients and their employees’ extraordinary resilience during this challenge, working together to lift their fellow employees, partners, customers, clients, and their communities. I’m so very proud and feel privileged to be their human resources partner.
Like many of you, a typical week for me over the past several years has consisted of numerous coffees, lunches, breakfasts, etc. to visit with potential clients, candidates, and new network connections. I thrive on these meetings and as a result have built a professional network of people who, in turn, have become friends.
The impact of COVID-19 has necessitated a new approach for keeping in touch and rethinking the process. A few ways I’ve been continuing to build, develop and cultivate my network are simple. They include:
This is an ideal time to expand your professional network and not let it stall or stagnate. The connections made now will be of mutual benefit in the longer term for both parties.