Here we are in lockdown due to the novel coronavirus. It affects everyone: employers and employees. One of the questions I am getting continuously is, as an employee, what are my rights, and as an employer, what are my responsibilities?
Since the onset of COVID-19, everything is being done on the fly, and obviously, much of this is unprecedented. Because of the current situation, there are no specific rules in place.
We may shortly be getting more guidance as Congress is currently negotiating the structure of an economic platform that is desperately going to be needed to keep the economy afloat.
The standard of the employer/employee relationship is not about to change. The fundamental relationship which applies to most American workers (absent an employment contract or union collective bargaining agreement) is that most employment is considered at-will, which means that employers may hire, fire or change employment arrangements as needed, provided they meet legal parameters. That is, they cannot discriminate based on race, religion, nationality, sex, age or due to a disability of the employee without providing reasonable accommodations.
So, that is a long way of saying that the employers can pretty much adjust as needed. They don’t need workers for a set number of hours? Even if promised? They can require layoff periods.
Can employers ask for employee givebacks for salary? Yes, they generally can as long as there is not an employment contract requiring a specific salary for a specific time period.
In addition, where an employee has an employment contract, is there a “force majeure” clause? This clause is a provision that commonly arises in insurance claims where people are seeking lost payments and are being denied by their insurance companies. Most insurers will not pay on events that are natural disasters or unforeseen by the policy, which is defined by “force majeure.”
That is not to say that either employers or employees are out of luck. The government realizes these are extraordinary times and, as such, Congress late last week passed a relief bill that designated funds for those hurt by the current sequestration. A second bill is being debated this week, and as of the publishing deadline is still being negotiated in the Senate. Unfortunately, this bill, which will include the details of the government’s plan, is the subject of partisan squabbling.
Ultimately, there will be a deal because everyone knows it needs to happen. As social distancing entered into its second week, the mood noticeably changed among sequestered Americans. While the first week was anxious, the mood was generally cooperative and good-spirited. Now, people are starting to get nervous as a new month approaches; generally a time when bills are due for rent or mortgage, car payment, tuition, insurance or many other assorted responsibilities of the typical family. If citizens don’t have access to funds to pay for their typical needs, the blow to the economy is going to make the financial sector’s reaction so far look like a love tap compared to what’s coming.
Congress knows this, which is why both sides want to create a budget that will result in an infusion of billions of dollars to keep the economy afloat. Although it’s not clear specifically what shape the relief bill will take, it has been contoured and the basic provisions have been established. It will include enhanced unemployment benefits for individuals laid off due to the current sequestration and extended benefits for those seeking employment but are unable to find a job due to the present crisis. The Treasury Department has also announced that the tax deadline for filing will be extended.
At the time this article was written New York State Senator Charles Schumer said that there is a basic consensus between the Democrats and the Republicans. Schumer said that in addition to the huge lending program for industries, the legislation would send $1,200 checks to many individual Americans, set up a $350 billion loan program for small businesses, expand the unemployment insurance program and pump more than $100 billion toward hospitals, among a host of other provisions. In its size, scope and speed, the bill would be unlike any other passed by Congress in modern history.
There are also benefits being debated, although not yet established, that will likely be aimed at the “gig economy.” There are many individuals who are paid for what they produce and receive no benefits. They have no access to health insurance, which is an imperative in a crisis like this.
That is not to say you are without potential remedies. In the most recent plan announced along with the declaration of the State of Emergency, the federal government announced that there will be grants available for affected workers and expanded unemployment benefits for workers who lose work. The government will send stimulus checks to all citizens, it likely will to targeted businesses as well, which will hopefully help blunt the worst effects of lost income. The Republican party, in a concession, agreed to oversight on a government loan program to businesses in order to create accountability and make sure funds are not wasted.
We are all hurting, but we are all in this together. Even Congress. While the shape of the eventual package is still being contoured and, yes, certain factions are pushing their pet projects, in the end Congress will likely take heed of the advice of Mel Brooks’ character Hedley Lamarr in Blazing Saddles: They will pass a package, because their primary interest, like ours, is to save their jobs.
Stephen R. Loeb heads the Law Office of Stephen R. Loeb, a civil practice in New Jersey and New York. He can be reached at [email protected]
