Among the multitude of challenges employers face due to the ongoing coronavirus crisis, deciding how people are paid (or not) is arguably the most daunting.
While Congress and the White House currently are trying to come up with agreement on an economic solution to help American workers–particularly those who work for hourly pay and have no paid sick leave–many employers are left with confusing and potentially costly decisions.
The Washington Post reports that some large employers–Walmart, Apple, Olive Garden, among them–have updated their leave policies for workers negatively affected by the coronavirus and its repercussions. But for the bulk of U.S. employers who primarily have hourly workforces, the decision is not as easy due to the financial ramifications.
According to Jeff Levin-Scherz, a medical doctor and North American co-leader in the Health Management Practice at Willis Towers Watson, employers concerned with the costs of paying workers who are not at work should factor in the potential alternatives. For instance, the lack of paid leave might encourage people to work when they are sick–posing a risk to fellow employees, vendors and customers.
“In some states, workers compensation will provide coverage–although this is a rapidly evolving area,” Levin-Scherz says. “Employers with self-insured disability insurance also could instruct carriers to pay claims for those out of work due to COVID-19.”
Levin-Scherz says WTW found in a survey that most employers in China and Asia paid their furloughed employees, hourly and salaried, as the coronavirus outbreak unfolded. As noted, he also mentions that there is ongoing bipartisan discussion to offer federal paid leave to address the hourly pay concern, but it likely won’t be in place for some time, if at all.
“In the end, employers will make this decision based on their finances, business and talent needs,” he says.
Melissa Silver, an attorney and legal editor at XpertHR, says that in the absence of a law, employee policy or procedure that provides for paid leave for workers (particularly hourly workers and low-wage workers), employers have can create such measures or update existing policies (e.g., attendance, sick benefits) during a global health crisis to pay employees who cannot work–in order to help prevent or reduce the spread of infection within a business.
“This would help promote a safe, healthy workplace,” she says.
Silver adds that paying employees who are sick, quarantined or forced to be home if the worksite is closed also can maintain or boost morale and retention.
“Whatever it chooses to do, an employer must be mindful that if it implements a new policy during an outbreak, it must ensure that it is applying the policy uniformly; otherwise, it could be exposed to claims of discrimination,” she says.