Coronavirus. COVID-19. These two words have been increasingly on our minds and in conversations daily. At this point, most of the world has been affected by the current coronavirus strain, COVID-19. As it’s been a long time since the world has had to deal with such a severe pandemic, many are wondering what organizations are supposed to do from a compensation standpoint.
Depending on where your organization is located and where your employees live, some restrictions ranging from social distancing, to curfews, to full on quarantines may have been enacted. For some, this may mean a complete temporary shutdown of operations. For others, options such as alternative work scheduling or full remote work is possible. Here are examples of what some businesses have been doing to handle COVID-19 thus far:
According to a March 10, 2020 NY Post, “Walmart is enacting an emergency leave policy for its 1.4 million hourly US workers that allows them to take time off without penalty if they fear the spread of a new virus.” Adam Stavisky, Walmart’s senior vice president of US benefits, remarked to the Associated Press, that a “revised policy [is] required during these ‘unprecedented and uncharted times’.” He also noted that Walmart looks to “provide some additional support so they can better weather these times.”
A March 11, 2020 CNBC article mentioned that Starbucks is offering “catastrophe pay” to employees that become exposed to the COVID-19 virus. Employees will receive up to 14 days of pay if they have been diagnosed with, exposed to, or in close contact with someone with the current coronavirus strain. Workers who are considered high risk due to underlying health conditions also are eligible for catastrophe pay with a doctor’s note.
Twitter and Apple:
Social media juggernaut Twitter requested that employees telework, according to a March 2, 2020 Los Angeles Times article. Twitter also suspended all non-critical business travel and events. Apple also is encouraging employees to work from home if possible.
On the surface these measures sound wonderful. But not every organization can afford to take these actions or is in an industry that allows such flexibility. In fact, Politico’s Tim Noah explains in one recent SHRM article, “Many white-collar professions can adapt with relative ease to telecommuting from home for a temporary period, but workers in the bricks-and-mortar retail, restaurant and hotel sectors cannot.” Regardless of this, each organization has to be prepared with a plan and to communicate this plan to its employees.
What are the compensation details that you have to keep in mind when making decisions on how your organization will handle the impact of COVID-19? Let’s explore.
Are all employees aware of the organizational, federal, state, and local benefits they can use during this pandemic? For instance, if an employee has to be quarantined, they could possibly use FMLA coverage. As mentioned above, some organizations have become more lenient with sick leave in order to accommodate employees who are sick with the virus or have compromising health conditions. As mentioned above, remote work also is a benefit many organizations are encouraging employees to use. Keep in mind, OSHA laws also cover the employee when working offsite. This means employers should be communicating with employees to make sure they can work safely whether at home or onsite. Workers also need to report if mishaps occur while working offsite.
Non-exempt remote workers will need to have a means to accurately report time worked. This could be a challenge for some organizations. How can we ensure that employees are effectively working remotely, and accurately reporting time worked? Astron’s National Director, Michael Maciekowich, mentions that “one client (that has never had remote workers before) is going to have its employees check in every two hours with their supervisor by phone or email to review what they have been working on. The client also has required supervisors to remind all non-exempt employees that they must take their normal breaks, including lunch, and to shut down from work at the normally scheduled time. The organization is holding its supervisors accountable for maintaining the records during this period.” These steps are a solid foundation to ensuring compliance with the Fair Labor Standards Act (FLSA), as well as applicable state laws.
Besides ensuring that remote workers are reporting time and effectively working, what other compensation factors will organizations have to keep in mind? Variable pay. Now is the time to review how programs such as sales incentives may (or already may) be impacted by lack of business due to the COVID-19 spread. Says Michael, “to keep the sales force motivated, I recommend suspending quota-based plans and temporarily moving to a straight commission-based plan focused on the revenue generated during the period. I also would consider making a strategic decision on which short-term incentive outcome(s) can be realistically worked on during this time, and focus rewards on those until further notice. Again, keeping employees motivated in areas that actually can be worked on is key.”
While everyone is hoping that the disruptions to the workplace are short-lived, that may not be the case. Some employers, particularly those without an on-line presence or a remote workforce, may be forced to lay off employees if the pandemic stretches for multiple weeks or months. In that situation, it is important to ensure compliance with the WARN Act and / or your state’s ‘baby’ WARN Act, as well as state laws regarding payment of final wages. Unsure of what those are? Check with your state’s Department of Labor or your organization’s legal counsel.
What steps has your organization taken to weather the challenges of COVID-19? Are there special compensation concerns you’ve had to consider? Share your thoughts in our comment box below!