On March 19, 2020, California Governor Gavin Newsom ordered all individuals in the state to stay at home in order to slow the spread of coronavirus (COVID-19). The order contains exceptions for essential needs, including work in critical infrastructure sectors.
Governor Newsom’s California order comes on the heels of “shelter-in-place” orders issued by seven Bay Area counties – Alameda, Contra Costa, Marin, Santa Clara, San Francisco, San Mateo, and Santa Cruz – just days earlier.
The
California and Bay Area orders have led to many questions for employers in the
state. The following information summarizes employer obligations in light
of the coronavirus pandemic. Employers and employees should contact an
attorney for further details and to obtain advice on specific legal
matters.
Can California employers have employees
work remotely from home during government mandated shutdowns?
Generally yes, but California employers should make sure to
reimburse employees for all necessary business expenses incurred as a result of
working remotely. If working from home requires the use of equipment
(such as computers or printers) that the employee does not already own, the
employer must provide the equipment or reimburse the employee for the cost of
the equipment. Employers must also reimburse employees for internet and
phone costs incurred for business purposes.
California employers should also continue to ensure compliance
with regular wage and hour requirements. This includes, but is not
limited to, meal periods, rest periods, and overtime requirements for
non-exempt employees.
If government mandated
shutdowns cause financial hardship for an employer, can the employer reduce
employee hours or change other terms of employment?
Employment in California is presumed to be “at-will” unless the
parties agree otherwise or an exception to at-will employment applies.
This means that either the employee or the employer may terminate employment
with or without cause or prior notice.
An employer may also change other terms and conditions of employment,
such as hours worked and compensation rates. Employers must pay at least
the applicable minimum wage for all hours worked.
Employers planning a closure or major layoffs as a result of
coronavirus can obtain help from the California EDD Rapid Response
program. Rapid Response teams may help avert potential layoffs and
provide immediate on-site services to assist employees facing job losses.
An employer reducing hours or shutting down operations due to
coronavirus can encourage employees to file an unemployment insurance
claim. Unemployment insurance provides partial wage replacement to
workers who lose their jobs or have their hours reduced through no fault of
their own.
Do employers have to provide paid leave
to employees during the coronavirus pandemic?
Under the
federal Families First Coronavirus Response Act, employers with up to 499
employees must provide workers with two weeks of paid sick leave during the
coronavirus pandemic. After this two-week period, employees who have been
employed for at least 30 days will be able to take up to 12 weeks of leave
under the Family and Medical Leave Act to care for a child whose school or
place of care has been closed. After the first ten days, employees will
be able to receive two-thirds of their usual pay, up to $200 per day and
$10,000 in the aggregate. The Act is scheduled to take effect on
April 2, 2020.
Employees
may receive paid sick leave under the Families First Coronavirus Response Act
if they are unable to work because 1) the employee is subject to a federal,
state, or local quarantine or isolation due to coronavirus; 2) a health care provider
has advised the employee to self-quarantine due to concerns related to
coronavirus; 3) the employee is experiencing symptoms of coronavirus and
seeking a medical diagnosis; 4) the employee is caring for an individual who is
subject to quarantine or isolation due to coronavirus, or advised to
self-quarantine due to coronavirus; 5) the employee is caring for the
employee’s child whose school has been closed or place of care if unavailable
due to coronavirus precautions, or 6) the employee is experiencing any other
substantially similar condition specified by the Secretary of Health and Human
Services in consultation with the Secretaries of Treasury and Labor.
Under the
Act, employers will be able to seek reimbursement of paid leave amounts through
a refundable tax credit. Employers with fewer than 50 employees may also
seek an exemption from the requirements of the Act.
This is a
brief summary of the Families First Coronavirus Response Act. For full
details of the Act, employers and employees should consult with an
attorney.
Are employers otherwise required to pay employees who
cannot work during government mandated shutdowns?
Generally, there is no
legal obligation to pay employees if the employer’s business is shut down due
to the coronavirus pandemic. However, employers are required to provide
paid leave to some employees in specific instances and should consult an
attorney for specific advice regarding their legal obligations.
Further, exempt employees
must be paid their full weekly salary if they perform any work during the
week.
Employers may also
generally permit non-exempt employees to take accrued vacation or paid time off
during government mandated shutdowns.
What notice are California employers
required to provide if they must shut down as a result of the coronavirus
pandemic?
On March
17, 2020, Governor Newsom signed Executive Order N-31-20, which temporarily
suspends Cal-WARN advance notice requirements for mass layoffs, relocation, or
termination caused by coronavirus related business circumstances that were not
reasonably foreseeable as of the time that notice would have been
required.
The
Cal-WARN Act normally requires employers to provide 60 days advance notice of
mass layoffs, relocation, or termination to all affected employees. Under
the Order, an employer must only give as much notice as is practicable and
provide a brief statement of the basis for reducing the notice
period.
It should
be noted that the federal WARN Act, which sets out similar requirements for a
60-daynotice in the case of a closure or layoff, already contains exceptions
for closures or layoffs resulting from business circumstances that were not
reasonably foreseeable.
Other Questions?
For more
information on employer obligations related to the coronavirus and government
mandated shutdowns, contact us online or call
us at 415-788-9000.
*The contents of this article are for informational
purposes only and does not constitute legal advice. Employers and
employees should contact a licensed California attorney to obtain advice with
respect to any particular legal matter. Information on this website may not
constitute the most up-to-date legal or other information. Use of this
website does not create an attorney-client relationship between the reader and
Minami Tamaki LLP. Any links contained
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