In response to increasing concerns regarding COVID-19, Governor Newsom seeks to minimize hardships and uncertainties for employers and their employees
March 17, 2020
Downey Brand COVID-19 News and Updates
On March 4, 2020, California Governor Gavin Newsom proclaimed a State of Emergency in California as a result of the COVID-19 pandemic. Since then, the virus has spread and continues to threaten the health and safety of citizens everywhere, leading to business closures, cancellation of events, and county-wide shutdowns.
In response to COVID-19 and to protect the public health, Governor Newsom issued Executive Order N-25-20 (“Executive Order”) on March 12, 2020. The Executive Order addressed eleven different actions. With respect to employers and employees, the Executive Order noted that due to COVID-19, individuals may be “temporarily unable to report to work due to illness caused by COVID-19 or quarantines related to COVID-19.” Additionally, individuals directly affected by COVID-19 “may experience potential loss of income, health care and medical coverage.” The Executive Order sought to alleviate some of these hardships and uncertainties surrounding the effects of COVID-19.
The Executive Order provided the Employment Development Department (“EDD”) the discretion to waive the one-week waiting period set forth in Unemployment Insurance Code sections 2627(b)(1) and 1253(d). Section 2627(b)(1) requires an individual to be unemployed and disabled for a period of seven consecutive days before being eligible to receive disability benefits and section 1253(d) requires an unemployed individual to show he or she has been unemployed for a period of one week prior to being eligible to receive unemployment compensation benefits. The Executive Order gives the EDD discretion to waive both of these waiting periods for individuals who are unemployed as a result of COVID-19 and who are otherwise eligible for unemployment insurance benefits. This discretion will give individuals easier access to unemployment and disability benefits and will continue from January 24, 2020 through the duration of this emergency.
The Executive Order also addresses individuals and businesses impacted by “complying with a state or local public health official’s imposition or recommendation of social distancing measures related to COVID-19.” For those affected individuals and businesses, the Executive Order directs the Franchise Tax Board, the Board of Equalization, the Department of Tax and Free Administration, and the Office of Tax Appeals to use their administrative powers to provide extensions for filing, payment, audits, billing, notices, assessments, claims for refund, and relief from subsequent penalties and interest.
Finally, the Executive Order directly addresses the need for adequate state staffing during this emergency. Consistent with applicable federal law, the Executive Order suspends reinstatement and work hour limitations for retired annuitants, permanent and intermittent personnel, and state management and senior supervisors. Currently, there are limitations on certain individuals’, including retired public employees, ability to work for a public employer without forfeiting retirement benefits or having to reimburse for any contributions the individual has received. By temporarily suspending these limitations, public employers may increase staffing to ensure they have enough workers during this emergency without incurring penalties or fines. This also means that individuals who are presently unable to return to work due to the current restrictions, may do so without risking their retirement benefits.
COVID-19 is unprecedented and we are working hard to keep everyone up to speed with the latest developments. Please reach out to a Downey Brand attorney if you have further questions or concerns.