To date, the US government has passed three pieces of legislation to address various problems the coronavirus pandemic has caused. The first was a small funding bill (only in Washington is $8 billion small) that was designed to meet immediate needs in terms of testing and lowering treatment costs. The Families First Coronavirus Response Act (FFCRA), the second piece of legislation, makes provision for paid sick or family leave for reasons related to the COVID-19 outbreak. Last is the $2 trillion economic package that should preserve much of the economy while we all shelter in place. These create new issues for employee benefits management and employee communications in general.
Those involved in employee benefits can largely ignore the first law. Its focus is narrow, and the money affects only a few sectors of the medical and insurance business. The other two, however, will impact HR and employees during and beyond the end of the current crisis.
New Expanded Leave Policies, Familiar Loopholes and Limits
The FFCRA carries the potential to transform the American sick-leave situation. Basically, it states that you get two weeks of paid sick leave if you are ill or quarantined or if you’re caring for a sick family member, and all at full pay. If caring for kids whose schools are closed, you get 12 weeks paid leave at 80% of normal pay. Many private sector workers qualify for this, as do federal employees, but not everyone will get this time.
According to the New York Times, “Those at companies with more than 500 people — 48 percent of American workers — are excluded. Workers at places with fewer than 50 employees — 27 percent of workers — are included, but the Labor Department could exempt small businesses if providing leave would put them out of business. Employers can also decline to give leave to workers on the front lines of the crisis: healthcare providers and emergency responders.”
This is definitely an expansion of what most American workers get as far as sick and family leave. My suspicion is that businesses will adapt readily enough. The current pressures businesses face have forced a re-engineering of many work functions. Working from home and outside traditional nine-to-five hours are necessary. They allow for the kind of flexibility that makes leave easier.
For those in HR, you must learn what this means for your workers and employee communications. There are likely to be questions and it’ll be reassuring if you communicate what it means to employees before they have to ask. Video and short message campaigns (like digital postcards) are well suited for telling people about the new regulations. This is particularly useful because everything I’ve read about the legislation is complicated and, if you don’t read Federalese, it’s confusing.
No Take Backs: Potential Leave Policies After COVID-19
I spent a good part of my career in politics (mostly in failed attempts to win office for candidates) and, in that time, I learned a few lessons. One of them is that once you give the voters a benefit, it’s almost impossible to take it away again. Or as I heard it once, “Nobody remembers who gave them something but, by God, they remember who took it away.”
Because businesses will adapt to these new rules successfully, it’s reasonable to expect these leave rules may become the new baseline. Moreover, the limits are completely arbitrary. Why just two weeks or 12? Why not three and 16? And why exclude places with fewer than 50 employees rather than 25? I expect an expansion of both sick and family leave in business culture as a long-term result of the outbreak. Perhaps the hit many are taking now will help reinforce the need for the kind of leave policies that help prevent contagious illnesses from getting out of hand in the first place.
Stimulating Unemployment Benefits
The stimulus package is also important but what I was impressed by is the size of the stimulus package – $2 trillion. For those who recall the 2008 bailout bill, the Federal Reserve walked away from the $1 trillion price tag. Then, it was deemed politically impossible. Then, the country made do with $750 billion. So, to see them pass a $2 trillion stimulus now is significant.
The immediate injection of funds to individuals is $1,200 per person plus $500 for each child in a household. That will help a great deal, but the real value is in the expansion of unemployment insurance. If your company has had to lay people off, it’s important to know the details. For instance, extension of payments from the usual 26 weeks to 39 weeks will affect many. Also, if your firm uses independent contractors, the new legislation allows them to claim unemployment payments in certain circumstances. Each state has its own rules, and it’s best to refer to the Department of Labor for whichever state you’re working in to get the right information before working it into your employee communications.
There’s help for small businesses, too. If you work for one, it couldn’t hurt to familiarize yourselves with the Small Business Administration grants and loans. I’ve run across two, so far, that may cover a wide range of businesses: the SBA disaster loans and the Small Business Continuity Loans programs. Under the right circumstances, these are interest free, or even convert into grants.
More on the Horizon
Finally, there’s talk on Capitol Hill of a fourth bill. So far, that is all it is – talk. But while the immediate needs of the economy have been seen to, this pandemic is going to linger. That means the full economic impact remains uncertain. There will be a need for more at some stage. In my opinion, it will be sooner rather than later as the shortcomings of the current legislation become apparent. With each new act passed, you’ll need to evaluate how it impacts your workers and plan employee communications accordingly.
Now, stay home, wash your hands, stop touching your face and try not to worry.