California Employer Guidelines on COVID-19 Part II: What should business owners do now?
As a California employer, you likely have questions about how best to respond to COVID-19, how to continue to serve your customers, how to keep your employees safe, and what to do about new regulations and orders from local, state, and federal governments. You can deploy these 6 strategies today.
- First and foremost, do not panic. Contrary to what you may have seen in any magazine or newspaper, the best response is to calmly develop and deploy a game plan.
- Secondly, you should message your customers about your response procedures. For many of you this may involve moving to video and telephonic meetings instead of in person meetings, and for others, this may involve continuing business-as-usual but for heighted sanitary precautions. Your messaging should be clear, consistent, and detailed enough to let customers know what they can expect from you at this time.
- Consider remote work options so that your business can continue to serve customers. On March 16, 2020, the following counties issued a Shelter-In-Place Order: Alameda, Contra Costa, Marin, San Francisco, San Mateo, and Santa Clara. All non essential businesses must cease operations at any physical location located in these counties from March 17, 2020 through April 7, 2020 and allow employees to remain at home. Employers are encouraged to continue operations remotely by allowing employees to work from home. If you have questions about whether your services qualify as essential, contact a lawyer. Know this: failure to comply with these orders risk a misdemeanor punishable by fine, imprisonment, or both.
- If you have to shut down one or more locations and think this will remain permanent beyond the Bay Area Counties Shelter-In-Place Order issues March 16, 2020, call your lawyers before taking any action. You must consider how to handle your lease and major customer contracts. Multiple provisions in these contracts could be available to help you save some money and create various options for you. These may include negotiating a buy-out of your lease, using the force majeure clause to argue unforeseen circumstances beyond your reasonable control in any contract, and assignment or subletting of the lease.
- If you are considering reducing your work force, now may be the time. This past weekend, the U.S. House of Representatives passed H.R. 6201 known commonly as the Families First Coronavirus Response Act. This has not been made law just yet as it has to pass the U.S. Senate and be signed by the President. But, if it does, H.R. 6201 would expand the Family and Medical Leave Act (FMLA) so that immediate and short-term paid sick leave is now available for employees. This will have financial implications for your business that will be especially felt if you are seeing a reduction in customers and customer spending.
If you have decided that you need to reduce your workforce due to the current market conditions, doing so now, before the passage of H.R. 6201 could benefit you. Additionally, you must be prepared to comply with multiple employment laws at both the state and federal level. We frequently get calls from knowledgeable human resource managers asking us how to comply with these complex laws. Do not go at this alone.
- Yes, the Federal Reserve has lowered interest rates. See more information here:
While Garcia & Gurney, ALC is not in the business of giving out financial advice, we are in the business of considering all options. When interest rates are this low, possible options include refinancing your business loans, or taking out additional mortgages to take advantage of any equity you have stored up. You also always have option to set aside cash reserves to weather a financial storm. If you are considering any of these options, or want to know about the best course of action for your business, connect with your tax advisors, CPAs, estate planners, and other trusted financial advisors and brokers.
BONUS: This weekend, I went to a local sporting goods store to purchase a basketball for my son. While there, the store was implementing social distancing techniques by having people check in to a line but wait in their vehicles for their turn to enter the store. Gun and ammunition purchasers were among the many people shopping. This comports with the Los Angeles Times recent article showing that in abnormal times like these, gun and ammunition sales, as well as crime increase. Please take care of yourselves, your loved ones, your employees, and your property.
We at Garcia & Gurney, ALC are happy to assess your specific needs and craft appropriate plans for your business. Please call us at 925-468-0400 or contact us online. We are working with you in during the COVID-19 pandemic.
Disclaimer: The contents of this article should not be construed as legal advice. This article is not an exhaustive list of issues that may arise in your business. Businesses should seek the assistance of an attorney who will analyze multiple factors unique to each kind and size of business.