As the spread of the novel coronavirus (COVID-19) continues, employers are confronting novel challenges. We are juggling the health and safety of our employees with an unpredictable economic landscape and the changing business needs of our customer base. And even though we are in the midst of a global pandemic, we still have to navigate the complex world of federal, state, and local employment laws.
At the present time, for businesses that want to continue operations, the biggest challenge seems to be how to shift employees from one static worksite to widespread remote operations. At GDC we have an additional component to consider – many of our employees work at customer sites. This means that we not only have to implement our own internal response plans, but we also have to implement the response plans of our customers. Like any complex business problem, the answer requires a willingness to be flexible and creative.
Creative Telework Arrangements
Many of our employees already have the ability to telework. To facilitate working from home for prolonged periods of time we have allowed employees to borrow additional items such as docking stations, monitors, and peripherals to increase their comfort and productivity. Accommodating these needs was fairly straightforward.
However, for positions that are traditionally performed in an office setting, such as a receptionist, we had to be more creative. To accommodate our employees in those roles we were able to redirect calls to them using VOIP and VPN technology so they could answer customer calls from home. We also temporarily reassigned some of their other duties (such as mail distribution and accepting deliveries) to employees that came to the office that day.
Redeployment Within The Organization
We also took a creative approach with responding to our customers changing needs. In light of the Governor’s shutdown order and the increasing threat that Covid-19 presents to employees working in close proximity to each other, many customers chose to temporarily close their buildings and directed all employees and contractors to either work from home, or don’t work at all. This has naturally caused a slowdown in some traditional business segments, but other segments of our business have seen an increase in workload because of the adoption of technology for telework arrangements. To meet this challenge, we’ve moved employees into different areas of our business to respond to the increased demand and provided additional equipment and training to the affected employees to help facilitate these temporary reassignments.
Layoffs vs Furlough vs Reduction in Hours
Unfortunately, not everyone can be redeployed or can telework, so active employee numbers needed to be reassessed. Many businesses have had candid discussions with employees in positions that could fall into one of these scenarios and try to find outcomes that work best for both the business and each affected individual.
The good news is that employees that experience a layoff, a furlough, or a reduction in hours are now eligible to file for unemployment. Moreover, Pennsylvania has waived the normal waiting week for unemployment compensation benefits and have also given concessions to employers seeking relief from charges related to COVID-19 claims. Each state has its own rules and provisions for unemployment so please check with the appropriate resources for information specific to your workplace.
Layoff and furlough are words that are sometimes used interchangeably, but they are different. The main difference between a furlough and a layoff is that a furlough implies that workers will return to their jobs when the shutdown order is lifted. During the period of furlough, the furloughed employees are still on the company rolls as an employee but are considered to be on an unpaid leave of absence.
Layoffs, on the other hand, can be in place indefinitely until management decides that there is a business need to recall the employees back to work. As such, layoffs can last for an undetermined period that extends well past the State ordered shutdown. So, if your plan is to reopen your doors as soon as the shutdown order is rescinded, consider declaring your employees to be “furloughed” instead of “laid off.” If your plan is to cease operations for an undetermined amount of time after the shutdown, or if you feel there is a strong likelihood that you will need to reassess which employees will be called back to work, then you should consider declaring a lay off.
Two key considerations when weighing these options:
- Impact on employee benefits – Please refer to your benefit plan documents and your third-party benefits administrators to verify how employee benefits will be impacted. The decision to layoff or furlough could impact employee benefits continuation, potential offers of COBRA, and ACA compliance differently.
- FLSA and exempt/non-exempt employee ramifications – A non-exempt employee is only required be paid for the hours they actually performed work. Exempt employees are paid a salary for an entire week if they performed any amount of work during that week, regardless of the number of hours actually worked, unless there is an allowable deduction. If an exempt employee is furloughed, you should be certain that you are timing the furlough so the exempt salaried employee performs no work in a designated work week. If your intent is to furlough and withhold pay for a salaried exempt employee during the period of the furlough, then it is important to understand that you must release the employee from all duties for the entire workweek – resist the temptation to ask them to come in for an hour or to respond to work emails. If a salaried exempt employee works any amount in a workweek, then the employer is required to pay the salaried exempt employee his or her normal salary for the entire workweek.
Job-Sharing / Reduction in Hours – An alternative to either a layoff or a furlough is a reduction in hours combined with a job-sharing plan with another employee. Job sharing is a strategy to reduce future hiring needs by keeping selected staff employed as part-time employees. In a job-sharing scenario, two employees with similar skill sets each agree to reduce their hours worked, by reverting to part-time status, and together the two employees perform a job normally performed by one person. The benefit to using a job-sharing strategy is that both employees would be able to earn a part-time paycheck, which would enable the employees to pay their insurance premiums and 401(k) contributions through normal payroll deductions. While in a qualified job-sharing role, the participating employees will be eligible to file an unemployment compensation claim and be paid a partial unemployment comp benefit. Pennsylvania has a formal PA Shared Work Program. Click the link for more information.
Disclaimer: Please remember the Greater Chambersburg Chamber of Commerce and GDC IT Solutions are not health or government officials. Our goal is to share helpful information in a timely manner. This is a platform for businesses to share their individual experiences; please seek additional information from other reputable sources.