State Guidance for Employers Contemplating Layoffs

On March 16, 2020, Governor Whitmer issued Executive Order 2020-10, entitled “Temporary expansions in unemployment eligibility and cost-sharing,” which is effective through 11:59 pm on April 14, 2020. This Order suspends certain requirements and expands the availability of unemployment compensation.

Under the Order, employees must be deemed “laid off” – and thus eligible to apply for and receive unemployment benefits – if they self-quarantine or self-isolate for any of the following reasons:

  • being immunocompromised;
  • displaying the symptoms of COVID-19;
  • having contact in the last 14 days with someone with a confirmed diagnosis of COVID-19;
  • needing to care for someone with a confirmed diagnosis of COVID-19; or
  • having a family care responsibility as a result of a government directive.

Significantly, employers will not be charged for unemployment benefits if their employees become unemployed because of an executive order requiring them to close or limit operations (such as the executive order issued yesterday).

In light of the pandemic, a predictable surge in unemployment applications is underway – whether for one of the reasons set forth above, business closures necessitated by yesterday’s “Stay at Home” executive order, or because work is simply not available at present. The Department of Labor and Economic Opportunity recently issued guidance to Michigan employers who are considering putting employees on temporary unpaid leave, which is summarized as follows:

  • Do not terminate the employee. Instead, specify a temporary / indefinite leave with return to work expected within 120 days.
  • Do not create a contractual obligation to bring the employee back to work. Let the employee know that the situation is fluid and subject to change.
  • Provide the employee with a formal Unemployment Compensation Notice. Employers will need to provide their Employer Account Number and Federal Identification Number.
  • Communicate to the employee about their rights. Under Governor Whitmer’s recent Executive Order, workers who are placed on leave, or are unable to work because they are sick, quarantined, immunocompromised, or have an unanticipated family care responsibility, are eligible for unemployment insurance benefits.
  • Ensure employees are provided information on how to obtain unemployment insurance benefits. A fact sheet can be found here.
  • Get each employee’s up-to-date contact information.
  • Let employees know if you will be putting updated information on the entity’s website or intranet, if applicable.
  • Designate a “point person” to field questions from employees and to compile responsive information to share with the work force.
  • Keep a tally of all questions and answers. Periodically share with employees.

Do you need assistance in navigating the challenging and rapidly evolving employment law landscape? Contact us today at info@wrightbeamer.com or (248) 477-6300.