Reopening and Rehiring
As businesses start to reopen, we keep hearing how some employers are having an issue getting employees back to work. The reason being either, 1) employees don't quite feel safe yet coming back, or 2) they're actually making more money on unemployment than they would if they came back to work. Unfortunately, there's no great solution to this, but here are a few things you can try:
1) Create a safe work environment
If the reason for an employee not returning to work is primarily a safety concern, then I think the best thing you can do is try to create a safe work environment. The means following the CDC guidelines (and any state guidelines) on cleaning, capacity, protocol for dealing with sick employees, etc., and communicate to your employees that you're doing those things.
Another valuable thing you can do is seek input from your employees on what it would take to make them feel safe back at work again. Make it a collaborative effort. You can send surveys using free survey tools like Survey Monkey or Google Forms to obtain that information. Or you can have a phone or Zoom call to make it more personal. Regardless of the method, at least seek employee feedback on this. And the answer may be “nothing”, but I think at a minimum, it reiterates the point that you care about the health and well-being of your employees, and hopefully that's appreciated.
2) Offer employee incentives
If your employee doesn't want to come back because they're actually making more money on unemployment, you could consider offering a bonus or a raise for coming back to work (maybe even using the PPP funds). Now, whether or not bonuses and raises will be forgiven under the Paycheck Protection Program is still up for debate. I haven't seen clear guidance on that yet, but I think intent will be important. If you're only offering bonuses and raises so you can maximize the amount of the loan that's forgiven, you may have a hard time defending it, but if you are legitimately offering your employees a bonus or a raise as a reward for working during a pandemic, you may have a better case. Of course, that's not a legal or tax opinion, those are just some ideas of those that may work. Even if that amount is not forgiven under the Paycheck Protection Program, it'll simply remain a two-year loan at a 1% interest rate, so still a great business loan.
If you want to explore other options, you could consider increasing other employee benefits—things like employee discounts, retirement benefits, vacation—anything reasonable that might incentivize an employee to come back to work.
3) Discuss unemployment impact
If options 1 or 2 aren’t effective, your only solution may be to have a frank conversation with your employee about unemployment benefits and their refusal to work. If you offer your employee their job back and they're able to work, they are not supposed to receive unemployment benefits anymore. Some states actually have an online portal where you can inform the state that you've made an offer and the employee refused the offer. The state will then reevaluate their unemployment benefits. So that's an option, but whether or not you take that route is up to you. Either way, it's really important to document evidence of your offer and the employee’s refusal, because you may need that for the Paycheck Protection Program loan forgiveness application.
Hopefully it doesn't come to this, but if it does having a frank conversation with your employee about unemployment benefits may be effective.
In Summary
So first, genuinely seek input from your employees on how you can create a safe and comfortable work environment. Second, consider offering additional compensation to reward employees for coming back to work. And if that fails, try having a conversation with your employee about how that may impact unemployment benefits.
We wish you the best on reopening!