Employees in the Earthquake Aftermath
While the dust was settling last week many questions arose about employees. The two biggest issues were employee safety and employee pay.
A. Employee Safety
Employers are responsible for their employees’ safety in the workplace. If employers remain open during clean up they must make sure their employees are safe. Employers should be mindful of employees handling broken glass and moving large objects. Employers may need to take steps, such as providing gloves, hiring a cleaning or moving crew, or providing an alternative work station so that their employees’ can work safely.
B. Employee Pay
Equally important is employee pay. Some businesses remain closed and employees have not returned to work.
1. Pay Obligations
Employers are not required to pay non-exempt employees if the employer is unable to provide work to the employees due to a natural disaster.
Employers are required to pay exempt employees full salary if the worksite is closed or unable to reopen due to a natural disaster for less than a full workweek. Employers are not obligated to pay exempt employees if the worksite is closed or the employer is unable to reopen for a full week.
2. Unemployment Insurance
If employers anticipate having employees out of work for an extended period of time their employees may be eligible for unemployment benefits. Information concerning unemployment can be obtained from the Employment Development Department (“EDD”) at (http://www.edd.ca.gov/Unemployment/Disaster_Unemployment_Assistance.htm)
- Partial Claim: Employees can qualify for partial unemployment if they are out of work for no more than two consecutive weeks. This allows the employer to keep the employee technically employed. If the layoff is for more than two weeks, the regular unemployment claim process is used.
- Disaster Unemployment Assistance: This is a federal program that provides financial assistance to individuals whose employment has been lost or interrupted as a direct result of a major disaster and who are not eligible for a regular unemployment claim. These benefits are 100 percent funded by the federal government, as opposed to the employer. They are available only for weeks that fall within the Disaster Assistance Period, which is the first day of the week following the date of the disaster and ends 26 weeks after the disaster was declared by the President of the United States. The claims are submitted through the EDD and information can be found here: http://www.edd.ca.gov/pdf_pub_ctr/de8714y.pdf. On September 2, 2014, Governor Brown requested a Presidential Major Disaster Declaration for the state. As of the date of this blog, however, there has not been a declaration.
- Wages Notice: If the employer will have 10 or more employees out of work the employer may fill out a Wages Notice which can simplify the benefit application process. The Wages Notice form is DE 4806 http://www.edd.ca.gov/pdf_pub_ctr/de4806.pdf. The form can be completed online, printed, and mailed or faxed to the EDD.
3. Payroll Taxes
Finally, employers in Napa, Solano and Sonoma Counties directly affected by the earthquake may request up to a 60-day extension of time from the EDD to file their state payroll reports and/or deposit state payroll taxes without penalty or interest. This extension may be granted under Section 1111.5 of the California Unemployment Insurance Code (CUIC). Written request for extension must be received within 60 days from the original delinquent date of the payment or return to file/pay.
Earthquake-Related Info from ABC & TTB
Both the California Department of Alcoholic Beverage Control (“ABC”) and the Department of Treasury’s Alcohol and Tobacco Tax and Trade Bureau (“TTB”) have made information available on their websites for alcohol beverage businesses (including producers, wholesalers, and retailers) seeking earthquake related information. Here are links to those bulletins:
Some of the highlights:
- Under the ABC Act, any producer or wholesaler whose premises have been destroyed by an “act of God” may carry on its business for up to six months at a location within 500 feet of the licensed premises. A representative from the Governor’s office has stated that if a demand is identified, the 500-foot limitation may also be waived.
- There is no fee for transferring a license from one premise to another if the originally licensed premise was destroyed by an“act of God” and the new premise is located in the same county. Cal. Bus. & Prof. Code Sec. 24082.
- Over the next three months, alcohol beverage suppliers (producers and wholesalers, or any officer or agent of such businesses) may give, lend, or sell equipment, fixtures, or supplies other than alcohol beverages to any retailer that has suffered losses or damages as a result of the earthquake. This exception to tied house law is found in Cal. Bus. & Prof. Code Sec. 25511
- Although typically businesses must report any casualty loss immediately to TTB, TTB has relaxed that rule, but is encouraging business to report losses “as soon as they are able to determine the extent of the damage to their inventories.”
- Alcohol Beverage retailers, wholesalers, importers and producers may eligible for a refund of the federal excise taxes paid on lost alcohol beverage products. For more information go to When Disaster Strikes. http://www.ttb.gov/public_info/120068_disaster2005.shtml
- TTB will consider waiving late filing, payment or deposit penalties for those that have been directly affected by the earthquake.