In an effort to keep clients and friends of Elkins Employment Law current on the most recent information, below you will find additional guidelines and resources to assist during this difficult period of time.
LAYOFFS, FURLOUGHS, TERMINATIONS & WARN ACT NOTICE REQUIREMENTS
Employers are faced with having to adjust their workforce by furloughs, placing employees on “inactive” status, temporary or short term layoffs or termination due to temporary or permanent closure of the business. A “furlough” is a change in status which involves reducing the days or weeks that an employee may work; a “layoff” involves a temporary or permanent removal of the employee from payroll, much like a termination.
Separation Documents: As a layoff is essentially the same as a termination (e.g. separation) the employer would need to process all of the normally required paperwork for any other termination, including paying out final wages, and any earned and accrued vacation/PTO, and providing COBRA notice if the employee is covered by the employer’s health insurance.
EFFECTIVE IMMEDIATELY, THE CALIFORNIA WARN NOTICE REQUIREMENTS HAVE BEEN SUSPENDED BUT OTHER CONDITIONS REMAIN
On March 17 Governor Gavin Newsom issued Executive Order N-31-20 which, in addition to other provisions, provides employers with some relief from strict compliance with the WARN Act for the period from March 4, 2020 “through the end of this emergency.”
The Order suspends portions of the Cal-WARN Act relating to the requirement to provide 60-day advance notice and the imposition of liability for damages, and the imposition of a civil penalty, on the condition that an employer does the all of following:
- Orders a mass layoff because of COVID-19-related business circumstances that were not reasonably foreseeable as of the time that the 60-day notice would have been required;
- Gives as much notice as practicable of the layoffs, providing a brief statement of the basis for reducing the notification period along with the information required by the federal WARN Act for notices; and
- Includes the following statement in its notice: “If you have lost your job or been laid off temporarily, you may be eligible for Unemployment Insurance (UI). More information on UI and other resources available for workers is available at labor.ca.gov/coronavirus2019.”
The Order directs the Labor & Workforce Development Agency (LWDA) to provide, by March 23, guidance to the public on how the Order’s provisions are to be implemented.
Notice of Layoffs Still Required:
The Executive Order provides guidance for California employers to conduct layoffs without exposure to WARN liability IF they follow the steps laid out in the Order. Specifically, employers should do the following if a WARN NOTICE would have been required due to a mass layoff:
- Prepare documentation that you are ordering the mass layoff because of COVID-19-related business circumstances that were not reasonably foreseeable as of the time that 60-day notice would have been required.
- Give written notice of the mass layoff to:
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- Affected employees who are not union-represented;
- All unions representing affected employees (if any);
- The California Employment Development Department;
- The local workforce investment board; and
- The chief elected official of each city and county government within which the mass layoff occurs.
- Give the notice as soon as practicable. Notice can be provided after layoffs begin or occur.
- Ensure that the written notice contains the following information:
For employees who are not union-represented:
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- A statement as to whether the planned action is expected to be permanent or temporary (and, if the entire plant/facility is to be closed, a statement to that effect);
- The expected date when the mass layoff (or facility closing) will commence and the expected date when the individual employee will be separated;
- An indication whether or not bumping rights exist; and
- The name and telephone number of a company official to contact for further information.
For employees who are union-represented:
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- The name and address of the employment site where the mass layoff (or plant/facility closing) will occur, and the name and telephone number of a company official to contact for further information;
- A statement as to whether the planned action is expected to be permanent or temporary (and, if the entire plant/facility is to be closed, a statement to that effect);
- The expected date of the first separation and the anticipated schedule for making separations; and
- The job titles of positions to be affected and the names of the workers currently holding affected jobs.
- Consider including additional information suggested by the regulations, such as information on available dislocated worker assistance, and, if the planned action is expected to be temporary, the estimated duration, if known.
- Ensure that the written notice includes a brief statement of the basis for reducing the notification period.
- Include the following statement in the written notice: “If you have lost your job or been laid off temporarily, you may be eligible for Unemployment Insurance (UI). More information on UI and other resources available for workers is available at labor.ca.gov/coronavirus2019.”
Click here for a copy of the Executive Order: https://www.gov.ca.gov/wp-content/uploads/2020/03/3.17.20-EO-motor.pdf
Federal WARN Act: Requires employers of 100 or more workers to provide 60 days’ advance notice to covered employees, unions, and government officials prior to a plant closing or mass layoff exceeding 6 months or an employment action that results in the effective cessation of production or work performed by employees in a work unit at a single site of employment during any 30 day period for 50 or more employees, if the shutdown results in:
Is there an exception to WARN for COVID-19?
The Federal WARN Act notice period can be reduced if the trigger event is caused by business circumstances that were not reasonably foreseeable 60 days before the mass layoff or plant closing such as a natural disaster, including flood, drought, earthquake, storm, tidal wave or other similar disaster.
Under the current circumstances relating to COVID-19, it is not clear if a Federal WARN notice would be required or the “similar disaster” language would apply.
PAYMENT OF WAGES DURING FURLOUGH AND LAYOFFS & CHANGE IN STATUS FROM EXEMPT TO NON-EXEMPT
Payment of Wages to Non-Exempt Employees: At this time there is no legal obligation to continue to pay non-exempt employees if they are on layoff or furloughed regardless of whether the employees would have been scheduled to work those hours.
Non-exempt employees may file immediately for Unemployment Insurance Benefits. In addition, non-exempt employees may opt to use their earned and available PTO/Vacation time during the period of furlough; however, such use of these benefits might impact their EDD benefits but that is a decision for the EDD to make. If an employee is laid off, they should be paid all final wages and any earned and accrued vacation/PTO benefits.
Payment of Wages to Exempt Employees: If an exempt employee performs any work during the week, they are to be paid their full weekly salary. This includes working remotely, checking and responding to emails, etc. If no work is performed during a full 7 day work week, then no wages need to be paid.
Change in Exempt Status Due to Performing Non-Exempt Work: If non-exempt employees are laid off or on furlough and the non-exempt employees’ work is being performed by an exempt employee, then the exempt employee likely should be re-classified as a non-exempt employee. This would be necessary as it is likely that more than 50% of the exempt employee’s time is going to be spent on non-exempt duties.
ADDITIONAL QUESTIONS AND ANSWERS:
The below guidance and information has been obtained from various state and federal governmental agencies’ websites on how to respond to the ever-changing situation.
Can an employer require employees to stay home if they’re sick?
- Any employee with coronavirus symptoms should leave the workplace and go home. As the threat of the virus is serious, requiring an employee to leave the workplace would be permitted by the ADA to prevent harm to others.
Must an employer pay employees who are sent home sick?
- Exempt employees must continue to be paid if they worked any day during a full workweek. If no work is performed, the employee need not be paid.
- Non-exempt employees do not need to be paid during an absence due to COVID-19 just as they would not need to be paid for any other absence relating to an illness.
Employees are entitled to the following benefits during a COVID-19 related absence:
- Paid Sick Leave: Employees who are ill due to COVID-19, or whose family member is ill, or who have been exposed to the virus and are in self-isolation or quarantine can use whatever paid sick leave they have available. If the employee chooses, they may draw of any earned and available vacation or PTO benefits.
- State Disability Insurance: Employees may apply for State Disability Insurance if the employee is ill.
How much information may an employer request from an employee who calls in sick, in order to protect the rest of its workforce during the COVID-19 pandemic?
- During a pandemic, employers may ask employees if they are experiencing symptoms of the pandemic virus. For COVID-19, these include symptoms such as fever, chills, cough, shortness of breath, or sore throat. Employers must maintain all information about employee illness as a confidential medical record in compliance with the ADA and HIPAA.
When may an ADA-covered employer take the body temperature of employees during the COVID-19 pandemic?
- Generally, measuring an employee’s body temperature is a medical examination. Because the CDC and state/local health authorities have acknowledged community spread of COVID-19 and issued attendant precautions, employers may measure employees’ body temperature. However, employers should be aware that some people with COVID-19 do not have a fever.
Can employers require employees to stay home if they have symptoms of the COVID-19?
- The CDC states that employees who become ill with symptoms of COVID-19 should leave the workplace. The ADA does not interfere with employers following this advice.
When employees return to work, can employers require doctors’ notes certifying their fitness for duty?
- Such inquiries are permitted. As a practical matter, however, doctors and other health care professionals may be too busy to provide fitness-for-duty documentation. Therefore, new approaches may be necessary, such as reliance on local clinics to provide a form, a stamp, or an e-mail to certify that an individual does not have the pandemic virus.
May an employer force an employee to come to work during the coronavirus pandemic?
- While there is no state or federal guidance that specifically addresses this issue, at this time, forcing an employee to come to work if they fear being exposed to the virus would not be a recommendation of this office. If the employee has expressed fear of reporting to work, taking any adverse action against the employee could result in a claim of retaliation.
UNEMPLOYMENT INSURANCE, DISABILITY, AND PAID FAMILY LEAVE
The California Employment Development Department has developed guidelines for those who are ill, caring for sick family members, or whose job has been disrupted by the Coronavirus. The guidelines address quarantine-related reduction of hours, missing work due to school closure-related childcare needs, and work loss due to age/underlying health-related isolation, among others. Learn more at https://www.edd.ca.gov/about_edd/coronavirus-2019/faqs.htm
SMALL BUSINESS ADMINISTRATION (SBA) DISASTER LOANS NOW AVAILABLE
Small Business Loans may be available for those who have been impacted financially by the COVID-19 pandemic. The application link is now open for any California business wishing to apply for a disaster loan related to economic damage from the COVID-19 health crisis. Click Here to learn more: https://disasterloan.sba.gov/ela.
The SBA has published a resources and business guide. Click here: https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources
The SBA can provide up to $2 million to help meet financial obligations and operating expenses that could have been met had the disaster not occurred. Learn more at https://disasterloan.sba.gov/ela/Information/EIDLLoans.
ORANGE COUNTY IMPLEMENTS CITY WIDE BAN ON PUBLIC GATHERINGS
The Orange County Health Officer issued a county-wide ban on all gatherings, public or private, in addition to closing the county’s bars and breweries and prohibits dining in at restaurants in an effort to curb the transmission of the coronavirus.
The county order lasts through March 31. It does not apply to “essential activities” including emergency responders, health care providers, grocery stores, banks, gas stations and homeless shelters.
Click Here for the Order: https://1ccaxf2hhhbh1jcwiktlicz7-wpengine.netdna-ssl.com/wp-content/uploads/2020/03/EOC-Press-Release-7-Public-Health-Order.pdf
VENTURA COUNTY IMPLEMENTS SHELTER IN PLACE
In an order similar to the one implemented State-wide and in Orange County, the Ventura County Health Officer Issued an order on March 17, 2020 ordering the following types of businesses to close from March 18, 2020 to April 1, 2020.
- Bars and nightclubs that do not serve food.
- Movie theaters, live performance venues, bowling alleys and arcades.
- Gyms, and fitness centers, and aquatic centers.
- Wineries, breweries, and tap rooms that provide tastings.
All permanent food facilities may only prepare and offer food that is provided to customers via delivery service, via pick-up for takeout dining, and via drive-thru.
It was further ordered that all “individuals currently living within Ventura County, equal to or older than 75 years of age, or equal to or older than 70 years of age with an active or chronic disease or condition are ordered to shelter at their place of residence from March 18, 2020 to April 1, 2020”.
Click here for the full order: https://vcportal.ventura.org/CEO/VCNC/2020-03-17_Ventura_County_Public_Health_Order.pdf
ADDITIONAL RESOURCES:
EEOC Guidance: https://www.eeoc.gov/eeoc/newsroom/wysk/wysk_ada_rehabilitaion_act_coronavirus.cfm
Los Angeles Economic Development Corporation: https://laedc.org/coronavirus
Ventura County Emergency Resources: https://www.vcemergency.com/at-work
This Newsletter is intended as a brief summary of employment law. While every effort has been made to ensure the accuracy of the information contained herein, it is not intended to serve as “legal advice,” or to establish an attorney-client relationship. If additional information is needed on any of the topics contained herein, please contact our office. All rights reserved. ©2020.