In response to the impact of Hurricane Helene, SESCO Management Consultants, which advises tire dealerships on human resource matters, sent an FAQ sheet to employers.
The contents of the sheet, listed below, are addressed to business owners.
Q: Can employees refuse to work because of hurricane-related safety concerns?
A: OSHA expressly instructs employees to approach their employer when they first believe that working conditions are unsafe and unhealthy. If there is a condition that clearly presents a risk of serious physical harm, the employee may have the legal right to refuse to work in a situation (in which) they would be exposed.
Q: Should we provide Family and Medical Leave due to leaves caused by the hurricane?
A: Employees requesting time away from work could concievably be protected by the Family Medical Leave Act to the extent they develop a serious health condition or need to care for a family member with such a condition as defined by the Act. Of course, there is nothing to prevent you from voluntarily providing an employee with a leave of absence. These personal leaves can certainly be granted on a case-by-case basis.
Q: A few employees have been called to serve as relief workers. Do laws protect their leave?
A: Probably, yes. USERRA (Uniform Services Employment and Re-employment Rights Act of 1994) is a broad statute, significantly restricting the treatment of employees who perform services protected by the statute.
Q: An employee requested leave as they want to volunteer with the hurricane relief effort. What are our obligations?
A: If the employee does not qualify for federal USERRA protection or state or local military leave, then you are not obligated to provide such protection. However, you certainly can allow this leave with or without pay on a case-by-case basis.
Q: Many of our employees have lost homes, property and/or have significant damage. Is there anything that we, as an employer, can do to provide them (with) assistance?
A: Yes. There are at least four ways in which an employer can help these employees:
Loans and hardship distributions: The IRS has, in the past, announced liberalized procedures for loans and hardship distributions to victims of hurricanes. A detailed description of relief granted by the IRS can be found on their website.
401(k) Plans: Amend 401(k) Plans, pursuant to 2019 IRS regulations. Employers can amend their 401(k) Plans to provide hardship distributions for expenses and losses (including loss of income) incurred by employees on account of a disaster declared by FEMA under the Robert T. Stafford Disaster Relief and Emergency Assistance Act.
Leave-Sharing Programs: Employers can also set up leave-sharing policies to allow employees to donate their accrued, unused paid time off to a pool that can be used by affected employees. Leave programs must be carefully structured to ensure compliance in that those employees donating their leave are not taxed on the leave that they gave voluntarily to other employees.
Charitable Foundation: Employers wanting to create a long-term assistance program for employees impacted by natural disasters and other hardships may consider establishing a 501(c)(3) foundation in which employees, families and other entities can make taxdeductible contributions to assist other employees who suffered losses.
Wage and Hour/Payroll Compliance
Q: Must we continue to pay employees who are not working?
A: Under the Fair Labor Standards Act (FLSA), for the most part the answer is no. FLSA minimum-wage and overtime requirements are attached to actual hours worked in a workweek. This applies to nonexempt employees.
If employees are considered exempt under one of the FLSA’s “white-collar” exemptions then generally speaking, yes. If an exempt employee does any work during the seven (7) day workweek, the salary basis rules require that they be paid.
If the employer is open for business and the exempt employee decides to take a day off for personal reasons and performs no work, then they are not required to be paid for that time.
If the business closed, but the exempt employee is able and ready to come to work, then the exempt employee may be required to be paid.
Q: Can we charge time missed as caused by the hurricane to vacation, PTO or other paid leave balances?
A: The FLSA generally does not regulate the accumulation and use of paid time off. It will be up to the employer’s policy and practice. Further, the salary requirements for exempt “white-collar” employees can implicate time-off allotments under various circumstances.
Q: Can an employee volunteer to perform recovery services for the business without pay?
A: The FLSA does not permit employees to “volunteer” work to their for-profit private sector employer.
Q: Do we have any legal liability if we are forced to suspend operations without prior notice because of the hurricane and its aftermath?
A: Probably not, so long as you take steps to issue appropriate notices as soon as practical. The Federal Worker Adjustment and Retraining Notification (WARN) Act imposes a notice obligation on covered employers (those with 100 or more full-time employees) who implement a “plant closing” or “mass layoff” in certain situations, even when they are forced to do so because of a natural disaster.
Employee Benefit Issues
Q: Contributions to our pension plan and 401(k) are due in the next few weeks. Because of the hurricane, we either can’t make the contribution or can’t determine how much is owed. What can we do?
A: Following a presidential declaration of a major disaster for the portions of one or more states, the IRS, USDOL and Pension Benefit Guarantee Corporation (PBGC) routinely issue releases providing for extension of various deadlines for employee pension and welfare benefit plans.
Q: What if we can’t meet our payroll tax deposits or file our Form 5500 on time because of the Hurricane?
A: In the past, the IRS has issued relief extending the deadline for filing the Form 5500 Annual Return/Report for employee benefit plans and granting an extension for certain filing deadlines.
Q: If our employees are no longer working, are they still entitled to health insurance coverage?
A: Not necessarily. Please check your plan document or call your carrier to determine if employees who are not actively working may remain covered by your health plan. Once this period expires, you must terminate insurance coverage and provide a COBRA notice.
Q: What happens to health coverage if employees are not working and unable to pay their share of premiums?
A: In the normal course of events, health coverage will cease when premium amounts are no longer paid. However, several actions might be taken that will allow coverage to continue:
1. The insurer providing the health coverage may voluntarily continue the coverage while the disaster is sorted out.
2. You may arrange with the insurer providing health coverage to pay the employees’ portions of premiums to keep the coverage in place (at least temporarily) until you can reopen the business.
Q: We need to provide COBRA notices to employees, but we don’t know where they are or if their homes have been destroyed. What do we do?
A: All you can do is provide COBRA notices and election forms to the last-known addresses.
Unemployment Compensation
Q: How can we or our employees get information about unemployment benefits due to the inability of working because of the hurricane?
A: Simply Google your state unemployment office to determine eligibility, waiting periods, deductions from benefits and similar issues.
Q: If my employees are not eligible for state unemployment compensation benefits, what other benefits may they be eligible?
A: An individual who does not meet the eligibility requirements for state-provided unemployment compensation may be eligible for federal aid under the Disaster Unemployment Assistance Program.
Established policies
It’s important to establish employee policies before devastating weather events strike, SESCO President Bill Ford told MTD.
“These policies should be in (employee) handbooks anyway and not just in preparation” for natural disasters, he said.
“In the handbooks we prepare” for clients, “we have what we call ‘an inclement weather’ policy and it simply talks about: ‘What if a business closes due to weather? What if an employee cannot come to work due to weather? What options do they have? Are they able to use – or are even required to use – any earned, paid time off in those kinds of situations?’"
Policies, he said, "can be expanded," if necessary.
Ford also addressed ways that employers can help with relief efforts, though he noted that not all will have access to the same level of resources.
“It’s going to depend on where they are, how large the organization is, what kind of resources they have. We see (employees) volunteering paid time off” so they can render assistance.
“An employer might want to suggest a food drive.” Another way to donate supplies “might be provided," he noted.
Efforts to help “kind of go to a workplace’s culture. It goes to what a business is all about. Some owners may or may not be able to afford to do a lot, but certainly can organize some efforts.
"There’s a lot more to an employer than just wages and benefits. (Employees) like to see employers engaged.”
Resources available to employers following natural disasters “will vary based on their location, the size of town or city, what’s available, etc. It could be community groups, chambers of commerce...and other local and state agencies.”
The scope of a weather event’s fall-out also will play a factor, according to Ford, noting that with Hurricane Helene, “we’re talking about complete devastation. This was hopefully a once-in-a-lifetime thing. What we’re seeing now is not normal.”
Click here to read about what two tire dealerships are doing to help victims of Hurricane Helene.
