Employment Law for Employees and Employers in the Times of the Coronavirus
This is part of an interview between Brian Morris and Jeffrey Gronich of The Office of Jeffrey Gronich.
With business closures and lay-offs happening due to the coronavirus, we want to talk about employment law because that’s one of the main questions that I’m getting. Although we handle business law here at Morris Law Center, and do deal with some employment related matters, I’ve brought in an employment law expert, Jeff Gronich to help sort through some of these questions. He’s an employment law attorney here in Las Vegas.
As an initial matter from the employee side, if somebody gets laid off from a position, like a casino, where they’re expecting to be hired back some time in the near future, is that person eligible to apply for unemployment?
The short answer is yes. If you were laid off from your position as a result of the closures due to Covid-19, or if your business has no work for you, then yes, you should be eligible for unemployment. What they are looking for is if you have not done any work in a specific week and you also have not been paid wages for that week, you would then be eligible for unemployment. If your employer is paying you your normal wages, while you’re in “hold-on” status, then you would not be eligible for unemployment. However, if your employer has ended operations or reduced operations and is not paying you your wages, then you would be eligible for unemployment.
So basically, even if your employer pays you an extra week of pay, is it correct you wouldn’t be eligible for unemployment until that extra week of pay runs out?
Correct. As long as that extra pay is more than what you would have made on unemployment, then you’re not going to get your unemployment for that week.
Is there anything somebody can do if their hours are cut, maybe in half?
It depends, if your hours are cut in half, and as a result the amount that you’re earning is going to be less than what you would otherwise be eligible for at unemployment, then you can apply for unemployment. However, if your hours are cut and you’re still going to be making more than what you would make with unemployment, you’re unfortunately not going to be eligible for unemployment.
Is there any way that you can give a rough number, or a rough estimate of how somebody would know how much that unemployment payment is? Is it a specific amount, or does it vary?
It varies from person to person, there’s a mathematical formula. The maximum amount that most people are going to be eligible for is just over $400, but that can vary. It really depends on how much you’ve worked previously. That is definitely something that you can call the unemployment office about, it’s very standard.
What about on the employer’s side? A lot of the questions I’m getting include: should they furlough their employees, should they lay off their employees, should they give their employees a check on the way out for one or two weeks, like we just discussed. Are there any legal requirements surrounding what the employers should do?
Well, it’s going to be on a case by case basis. Each employer is going to have to decide what is best for their own business. However, there is recent legislation that was just signed last night that covers certain employers who have under 500 employees. So let’s talk about that first. For any employer that has 500 or fewer employees, if they are still operating, but some of their employees are not allowed to be at work because of some kind of isolation order, because they have contracted the coronavirus, because they are caring for someone who has contracted the coronavirus, or because they are caring for a child under 18 whose school is closed, the employer is going to be required to provide payment to employees in that situation.
So we’re going to look at a few different things. If the employer is going to completely cease operations, then they probably would not have to pay any of their employees anything. At least for now, what I’m telling my clients, is that decision should be made before April 2nd which is the day that the new law goes into effect. If you’re going to shut down operations, and by saying that, I mean no online operations, no skeleton crew, just completely, “we are shutting our doors and we’re laying off all the employees”, you can do that, and the employees would then be eligible to file for unemployment. If, however, the company is willing to keep some portion of itself open, but not allow employees to work as a result of the isolation order, or because an employee has tested positive or is caring for someone who has tested positive, then the rules are a little bit different.
If the employee is not allowed to be at work because they’re under an isolation for themselves, or they tested positive, or may have made contact with someone who has the virus, then the employer will have to offer that employee 10 days, basically two weeks of pay. For part time employees, the employer is going to have to figure out an estimate of what two weeks of hours would be and then look at the average amount of hours that employee usually works. They would then pay them that amount of hours at two thirds their normal rate.
Now, the good news for employers is that if they’re going to do that, and in some cases they have to do that, they will be eligible for a tax credit to offset those wages. So each employer’s situation is going to be a little bit different. Whether or not the employee is just choosing to remain home, or is forced to remain home is going to affect that decision. From the employer’s standpoint, if the employer wants to shut down operations, they probably would not have to pay the two weeks. If the employer is willing to stay open, but certain employees are not allowed or able to work because of what I’ll call “the governor’s decree”, then those employee’s would probably be eligible to get the two weeks of pay.
Separately from that, there’s also a portion of the new legislation which expands the use of FMLA. Now most employers know that if they have fewer than 50 employees, FMLA generally does not apply. However, the new legislation changes that, now any employer with fewer than 500 employees has to follow this new set of rules. What that entails is, any employee who has to stay home in order to care for a child under 18, because their school has been closed, may take FMLA. The first 10 days of that under the FMLA rule don’t have to be paid, although they probably will have to be paid under the rule I just talked about. So there’s a little bit of an overlap, but following those 10 days, the employee has to be continued to be paid, which is different from the normal FMLA rules. So normally, FMLA is unpaid. In this situation, the FMLA would continue to be paid up to two thirds of their pay, a maximum of $200 per day with a maximum total amount of $10,000. Again, the employer would then be eligible for a tax credit on those. It’s a little bit complicated.
So there’s a lot going on.
Each employer is going to have to figure out what’s best for them. For some employers, because of the tax credit, it may make sense for them to pay their employees as best they can. And for others, it may make sense to cut the operations and have their employees collect unemployment.
One of the things you mentioned to me when we were talking about this earlier, is that it all comes down to being patient in the sense of things developing really quickly. So we need to see how a few things play out. Does that still stand?
It does. One of the other things about this new legislation is that there is a provision for the secretary of labor to issue some guidelines on exemptions for small businesses. That would be employers with fewer than 50 employees, and that hasn’t happened yet. So there are still some businesses that might find themselves exempt from these new laws depending on their need and their business liability. So we definitely want to make sure that we’re still paying attention to any changes.
But, as far as decisions that need to be made now, what I would suggest to employees if you have not had any contact from your employer other than they’re going to lay you off or they’re closing and you haven’t heard anything, don’t be afraid to file for unemployment. They are encouraging people to apply online. (you can get that information here http://ui.nv.gov/) The procedure is relatively self explanatory. Obviously if you’re having any trouble, any questions, you would give us a call, we’ll help you out. Make sure that you’re taking care of yourself and getting the money that you need in order to pay your bills.
For employers, what I would say is again be patient but also be understanding that your employees are going to need an answer. They need to know what to do. They need to know, am I still an employee here? Am I laid off? Am I laid-off temporarily? Can I work from home? And I would say that to the extent possible and practical for all employers is to allow employees to work from home, not just because of the decree, but it’s probably the smart thing to do right now anyway.
There’s some good business practices involved as well, in other words.
Exactly. One of the other things you want to be mindful of is the goodwill. We don’t want to see employers who are leaving their employees out in the dust without any recourse. There’s a lot of employers in town who are making sure that their employees are going to be taken care of and knowing it’s going to cost them a little bit of money. But, ideally that’s something that everybody understands, taking care of your employees is a cost of business. So from, maybe not a legal standpoint, but certainly from a practical standpoint, you always want to make sure that you’re taking care of the people that help your business run and, to the extent that is practical and to the extent that it’s possible, that you’re able to make sure that people being paid to the best of your ability.
Our firm has been open a little over four years and it’s taken us that amount of time to build the team we have, there’s a lot of value there for us. Is there anything else that you’re hearing a lot about or that we would want to be sure to mention today?
A couple of other things. As far as employers who are forcing employees to come to work despite the governor’s decree, do they have any recourse? The reality is, unfortunately, it depends. At this point, if your employer asks you to continue to come to work, unless you have to stay home in order to care for a child under 18 years old because schools are closed, or if you have to stay home because of doctor’s orders or because you are caring for someone under a doctor’s order, you may still have to go into work. There really isn’t a lot of clarity as far as not going to work because you’re afraid that you might come into contact with somebody who has something. At this point, unfortunately, there is no legal protection for that. There are some exceptions. There are certain OSHA regulations, regarding a credible fear of imminent danger. For example, if your boss knows that someone at the office has tested positive and that person is still working at the office and your boss is making you come into the office and interact with that person that’s tested positive, I would argue that that’s probably an imminent danger issue. But other than that it’s going to vary situation by situation, again, as a suggestion to employers I would not recommend that you force anybody to come to work that’s not comfortable doing so. As far as whether you have to pay them, if they don’t want to come into work, that’s really up to you at this point. I wouldn’t recommend firing them. That, again, we’re talking about best business practices whether legal or not. Show your employees that you care about their safety, emotional wellbeing, physical wellbeing, and financial wellbeing during this time.
Regardless of what happens going forward, remember that employees must still be paid for all work performed. A lot of times an employee’s payday will be after their last work day, so make sure that even if you’re shutting down operations, you’re still paying your employees for all days worked. If you have any questions about your specific situation, you can call me or Brian. The information that we’re giving today is very generalized, every situation is going to be a little bit different in nature. I can help you, Brian can help you, we can all help you figure that out.
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