How To Make Do With Less: Layoffs, Reductions In Hours And Workforce BY JOEL GREENWALD Considering the rapidly changing economic and social landscape caused by COVID-19, many employers find
potentially pay to employees if notice is not provided. Exceptions may exist for unforeseen business reasons – but not always. • Overtime Exemption Status May Govern Employee Treatment : As a reminder, with regard to pay structure and overtime requirements, both federal law and the laws of states that address it, require that all employees be paid overtime wages (1 ½ times their regular hour- ly rate) for all hours worked over 40 in a workweek, unless that employee falls into an exemption from the rule. If they are not under an exemption, they are called “non-exempt” and must be paid overtime wages (for hours worked over 40 hours in a week). If they are un- der an exemption based on their job’s duties and re- sponsibilities, they are called “exempt” employees and do not get overtime pay. Exempt employees get a set salary every week that cannot be decreased except in limited circumstances. This distinction can be key when decreasing pay. • New Legislation May Affect Company Decisions : At this time, there is legislation being circulated through the federal government that may involve sweeping paid leave protections for employees who are forced to take time off from work for various COVID-19-related reasons (such as: for the employee’s own treatment, preventive care, or quarantine, or to care for a family member who is being treated or a child whose school
themselves wondering what might happen if they are unable to main- tain their current workforce at its cur- rent level. Clients have reached out to ask important and pressing ques- tion such as: Can I reduce employee hours? Can I reduce pay across the board? What can I do to avoid a lay-
Joel Greenwald
off? What if I have to lay off? Can it be temporary? I have heard the term “WARN” notice; what is it? These are all good questions. We will address these, and more, below. First, we’ll discuss some key things you need to know to put these questions in context. And after that, you’ll find answers to some of these timely questions. • Notice to Employees and Government of Termina- tions/Reductions in Force : The federal Worker Ad- justment and Retraining Notification Act (WARN) and state equivalents require certain larger companies to give advance written notice to employees of certain large-scale terminations and reductions in force (such as mass layoffs and plant closings, among others) and,
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March 30, 2020
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