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What we can learn from Hurricanes Harvey and Irma

September 18, 2017

By Michael Burns, courtesy of SBAM Approved Partner ASE

With Hurricane Harvey and Irma causing widespread destruction and also severe business disruption, employers everywhere should plan for disasters and disruptions caused by any form of natural disaster.  What laws may come into play that the employer should be aware of?

Some employees who serve may be called up for military duty in the event of a disaster. Do any employees belong to the National Guard, Reserve, or other service that may be engaged for disaster relief?  If so, the Uniformed Services Employment and Re-employment Rights Act of 1994 (USSERA) may apply. Also check state law for additional protections and requirements.

The Family and Medical Leave Act (FMLA) may also come into play.  The National Defense Authorization Act extends leave to the spouse, child, or parent of a uniformed service member called to active duty. Make sure supervisors and managers do not dismiss a request for leave when a natural disaster requires service activation of a worker or worker’s family member.

Unemployment Compensation – if an employee is out of work due to a natural disaster, states may extend unemployment benefits to them. The employer may also supplement unemployment if the payments are not earned, but the employer has no obligation to make payments. In this case the benefits would not be reduced or lost. And if a state’s unemployment system does not provide benefits the federal Disaster Unemployment Assistance program may. This project will cover lost income as a direct result of a declared major disaster.

Safety and Health – OSHA applies to an employer if its employees are engaged in cleaning and recovery after a disaster. This work activity might involve exposure to bloodborne pathogens and bacterial issues. It can involve injuries from falls and heat exposure, just to name a couple of disaster recovery work situations. Employers are responsible for employee safety in these circumstance. OSHA and the Federal Emergency Management Agency provides information and fact sheets for employers on what to do to protect employees during and after a disaster.

Employers are not supposed to expose workers to “imminent danger.” This is defined as a “threat of death or serious physical harm” or if there is “a reasonable expectation that toxic substances or other health hazards are present, and exposure to them will shorten the life or cause substantial reduction in physical or mental efficiency.”   If this threat is present, OSHA applies. In cases that involve this imminent danger, workers could be protected from discipline or discharge if they refuse to do the work and the employer could be liable for an OSHA violation. This also brings in the National Labor Relations Act (NLRB) if the workers are found to be engaging in “concerted protected activity.” Yes, this is out there a bit, but we are talking infrequent events (natural disasters) to begin with.
 
What about pay and benefits? If an employee is working, the normal Fair Labor Standards Act (FLSA) rules for hours worked do apply. There are no emergency exceptions to the FLSA that changes employer obligation to pay and benefits. Employers should review paid time off benefit policies to ensure clear communication of pay and benefits if no work is being performed due to natural disasters. What about benefit accrual during business shut downs? State laws may add additional requirements and protections, so employers need to be aware of laws.  For example, in New Jersey “No employer shall terminate, dismiss or suspend an employee who fails to report for work at his or her place of employment because he or she is serving as a volunteer emergency responder during a state of emergency declared by the President of the United States or the Governor of this state or is actively engaged in responding to an emergency alarm . . .subject to certain notices and verifications.”

These are just a few of the laws pertaining to employers during times of natural disaster. Other laws that employers should be aware of include tax laws. The Internal Revenue Service (IRS) provides employers tax relief if they make “qualified disaster relief payments” to their employees. This includes other direct hardship payments that are normally taxable income. These payments, if done according to IRS requirements, may be excluded under Section 139 of the Code if the employer’s payment to the employee is for reimbursement or payment of expenses incurred in connection with a “qualified disaster.” These types of payments may be for “(i) personal, family, living, or funeral expenses, (ii) expenses incurred for the repair or rehabilitation of a personal residence (rented or owned), and (iii) expenses incurred for the repair or replacement of the contents of a personal residence, but only to the extent any such expense is not otherwise compensated by insurance or otherwise.

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