The U.S. Department of Labor (DOL) has issued guidance on the application of the Fair Labor Standards Act (FLSA) and Family and Medical Leave Act (FMLA) to employees who telework from home or from another location away from the employer’s facility.
The Field Assistance Bulletin (FAB) 2023-1, released on February 9, 2023, is directed to agency officials responsible for enforcement and provides employers a glimpse into how the DOL applies existing law and regulations to common remote-work scenarios. FAB 2023-1 addresses FLSA regulations governing “hours worked,” rules related to break time and privacy for nursing employees, and FMLA eligibility factors.
Hours Worked
In the FAB, the DOL reviews the rules governing compensability of work time, explaining that, regardless of work location, short breaks (typically, 20 minutes or less) generally are counted as compensable hours worked, whereas, longer breaks “during which an employee is completely relieved from duty, and which are long enough to enable [the employee] to use the time effectively for [their] own purposes[,] are not hours worked.” Examples of short breaks, whether at home or in the office, include when an employee takes a bathroom or coffee break or gets up to stretch their legs.
Longer rest breaks and periods of time, when employees are completely relieved from duty and able to use the time for their own purposes, are not considered work time. Just as would be the case when an employee is working in the office, if during remote work an employee’s 30-minute lunch break is interrupted by several work-related phone calls, that 30-minute period would be counted as hours worked. Conversely, if an employee working from home takes a three-hour break to pick up their child or to perform household chores, that time does not count as work time under the FLSA. In short, the FAB reiterates the telework guidance set forth by the DOL in a Q&A series published during the height of the COVID-19 pandemic.
The FAB emphasizes that, regardless of whether an employee performs duties at home, at the worksite, or at some other location, if the employer knows or has reason to believe that work is being performed, the time must be counted as hours worked. Importantly, the FAB notes that an employer may satisfy its obligation to exercise reasonable diligence to acquire knowledge regarding employees’ unscheduled hours of work by providing a reasonable reporting procedure for employees to use when they work non-scheduled time and paying employees for all hours worked. This guidance was addressed in greater detail in FAB 2020-5.
Guidelines for Nursing Employees
The FAB further clarifies that, under the FLSA, an employer’s obligation to provide employees “reasonable break time,” as well as an appropriate place to express breast milk, extends to employees who are teleworking or working at an off-site location. Just as an employer has an obligation to provide an “appropriate place” for an employee to express milk while working at a client site, the employer should ensure a teleworking employee has privacy from a “computer camera, security camera, or web conferencing platform” to express milk.
Employers are not required to pay employees for otherwise unpaid breaks simply because the employee is expressing breast milk during the break, but if an employee is working while pumping (or if the pumping occurs during an otherwise paid break), they must be paid for that time. For example, in most cases, if a remote employee attends a call or videoconference off camera while pumping, that employee would be considered on duty and must be paid for that time.
The recently enacted PUMP Act expanded existing employer obligations under the FLSA to cover exempt employees, as well as non-exempt employees. The DOL has published more guidance on breast milk pumping during work.
Eligibility Under FMLA
The DOL also addresses FMLA eligibility requirements for remote employees both in terms of hours worked (employee must work 1,250 hours in the previously 12 months) and the small worksite exception (employee must work at a worksite with at least 50 employees in a 75-mile radius).
As with the FLSA, it is important for employers to have a system to track their remote workers’ hours. With respect to hours worked, the FAB reiterates that the 1,250 hours determination for remote worker is based on compensable hours of work under FLSA principles.
With respect to the worksite size determination, the FMLA regulations explain that an employee’s personal residence is not a worksite. Instead, whether a remote employee is FMLA-eligible is based on the size of the worksite from which “they report to” or “their assignments are made.” If a remote employee reports into or receives assignments from a site with 50 or more employees working at that site (or reporting to or receiving assignments from that site) or within 75 miles, then that employee would meet that eligibility factor.
The DOL provided two examples of this rule:
Employers are reminded to review state and local wage and hour laws, paid and unpaid leave laws, and lactation accommodation laws. If you have any questions about applying the FLSA, the FMLA, or state and local laws to your remote workers or any other questions about remote work considerations, please reach out to any Jackson Lewis attorney.
The COVID-19 Outbreak Period was declared effective on March 1, 2020. It had numerous impacts upon employee benefit plans, extending timelines with which plan participants and plan sponsors/employers had to perform certain benefit-related activities. On January 30, 2023, President Biden declared he would end the National Emergency effective May 11, 2023.
To recap, the declaration of the Outbreak Period impacted benefit plans in many ways by instructing ERISA plans and participants to disregard the Outbreak Period for:
However, it is important to note that ERISA contains language limiting timeline extensions to no more than one year. Thus for example, the normal 60-day timeframe for a an eligible Qualified Beneficiary to elect COBRA continuation coverage was extended by the Outbreak Period to one year plus 60 days.
With the declaration of the end of the National Emergency on May 11, 2023, the 60-day clock to end the Outbreak Period will start. This means that effective on July 10, 2023 (60 days after the end of the National Emergency) all of the pre-pandemic rules impacting the above items (and others) will go back to their normal timeframes.
Need medical treatment this year and want to nail down your out-of-pocket costs before you walk into the doctor’s office? There’s a new tool for that, at least for insured patients.
As of Jan. 1, 2023, health insurers and employers that offer health plans must provide online calculators for patients to get detailed estimates of what they will owe — taking into account deductibles and copayments — for a range of services and drugs.
It’s the latest effort in an ongoing movement to make prices and upfront cost comparisons possible in a business known for its opaqueness.
Insurers must make the cost information available for 500 nonemergency services considered “shoppable,” meaning patients generally have time to consider their options. The federal requirement stems from the Transparency in Coverage rule finalized in 2020.
So how will it work?
Patients, knowing they need a specific treatment, drug, or medical service, first log on to the cost estimator on a website offered through their insurer or, for some, their employer. Next, they can search for the care they need by billing code, which many patients may not have; or by a general description, like “repair of knee joint,” or “MRI of abdomen.” They can also enter a hospital’s or physician’s name or the dosage amount of a drug for which they are seeking price information.
Not all drugs or services will be available in the first year of the tools’ rollout, but the required 500-item list covers a wide swath of medical services, from acne surgery to X-rays.
Once the information is entered, the calculators are supposed to produce real-time estimates of a patient’s out-of-pocket cost.
Starting in 2024, the requirement on insurers expands to include all drugs and services.
These estimator-tool requirements come on top of other price information disclosures that became effective during the past two years, which require hospitals and insurers to publicly post their prices, including those negotiated between them, along with the cost for cash-paying or uninsured patients.
Still, some hospitals have not fully complied with this 2021 disclosure directive and the insurer data released in July is so voluminous that even researchers are finding it cumbersome to download and analyze.
The price estimator tools may help fill that gap.
The new estimates are personalized, computing how much of an annual deductible patients still owe and the out-of-pocket limit that applies to their coverage. The amount the insurer would pay if the service were out of network must also be shown. Patients can request to have the information delivered on paper, if they prefer that to online.
Insurers or employers who fail to provide the tool can face penalty fines of at least $100 a day for each person affected, a significant incentive to comply — if enforced.
And there are caveats: Consumers using the tools must be enrolled in the respective health plan, and there’s no guarantee the final cost will be exactly as shown.
That’s because “unforeseen factors during the course of treatment, which may involve additional services or providers, can result in higher actual cost sharing liability,” federal regulators wrote in outlining the rules.
Insurers will not be held liable for incorrect estimates.
Because the cost estimates may well vary from the final price, either because the procedure was more complex than initially expected, or was handled by a different provider at the last minute, one risk is that a consumer might get a bill for $4,000 and they will be upset because the estimator told them $3,000.
Many insurers have offered versions of cost-estimator tools before, but small percentages of enrollees actually use them, studies have shown.
Federal regulators defended the requirement for estimator tools, writing that even though many insurers had provided them, the new rule sets specific parameters, which may be more detailed than earlier versions.
In outlining the final rule, the Centers for Medicare & Medicaid Services pointed out that some previous calculators “on the market only offer wide-range estimates or average estimates of pricing that use historical claims data” and did not always include information about how much the patient had accumulated toward an annual deductible or out-of-pocket limit.
The agency says such price disclosure will help people comparison-shop and may ultimately help slow rising medical costs.
But that isn’t a given.
“CMS has a lot of people who believe this will make a significant impact, but they also have a long time frame,” said David Brueggeman, director of commercial health at the consulting firm Guidehouse.
In the short term, results may be harder to see.
“Most patients are not moving en masse to use these tools,” said Dr. Ateev Mehrotra, a professor of health care policy at Harvard Medical School.
There are many reasons, he said, including little financial incentive if they face the same dollar copayment whether they go to a very expensive facility or a less expensive one. A better way to get patients to switch to lower-cost providers, he said, is to create pricing tiers, rewarding patients who seek the most cost-effective providers with lower copayments.
Mehrotra is skeptical that the cost estimator tools alone will do much to dent rising medical prices. He’s more hopeful that, in time, the requirement that hospitals and insurers post all their negotiated prices will go further to slow costs by showcasing which are the most expensive providers, along with which insurers negotiate the best rates.
Still, the cost-estimator tools could be useful for the increasing number of people with high-deductible health plans who pay directly out-of-pocket for much of their health care before they hit that deductible. During that period, some may save substantially by shopping around.
Those deductibles add “pressure on consumers to shop on price,” said Brueggeman, at Guidehouse. “Whether they are actually doing that is up for debate.”
Employers will have the option to provide pre-deductible coverage of telehealth services for people with high-deductible health plans for another two years.
The $1.7 trillion omnibus spending bill signed into law by President Joe Biden Dec. 29—which contains a number of other important provisions affecting employers, including the Secure 2.0 retirement overhaul and pregnancy accommodations—includes a provision extending the telehealth relief in the 2020 Coronavirus Aid, Relief and Economic Security (CARES) Act.
Significantly for employers, the provision allows health savings account (HSA)-qualifying high-deductible health plans (HDHPs) to cover telehealth and other remote-care services on a pre-deductible basis. Additionally, an otherwise HSA-eligible individual can receive pre-deductible coverage for telehealth and other remote-care services from a stand-alone vendor outside of the HDHP. In both cases, the pre-deductible telehealth coverage won’t hinder an individual’s eligibility to make or receive HSA contributions. Many employer groups and stakeholders have said that the waiver improves health access, notably for some employees who may have avoided telehealth because of out-of-pocket expenses.
SHRM has been advocating for the continuation of pre-deductible telehealth coverage, arguing that improved access to telehealth allows employees to access more health care options—including mental health services—at their convenience.
“Pre-deductible coverage helps employees because it allows insurance providers to cover telehealth services without requiring a co-pay or deductible upfront,” said Emily Dickens, SHRM chief of staff, head of public affairs and corporate secretary. “Employers need the flexibility to design benefit plans that improve employees’ well-being and help retain top talent. I am grateful to our members for engaging with lawmakers from across the nation to secure this extension.”
The CARES Act allowed HSA-eligible health plans to provide pre-deductible coverage for telehealth services, but only through 2021. Normal cost-sharing was still allowed for telehealth visits, such as through co-pays that the plan may require after the deductible is paid. It was then renewed in the 2022 Consolidated Appropriations Act for April 1 through Dec. 31, 2022.
The omnibus bill also extends Medicare telehealth provisions for another two years, including delaying in-person screening requirements for Medicare telehealth mental health services and allowing providers to provide acute hospital-level care at home.
Still, the extensions don’t permanently extend telehealth relief—something many health and policy experts advocate for. Without a further extension, the telehealth relief will expire Dec. 31, 2024, for calendar-year plans. Some groups expect Congress might make these changes permanent, although some lawmakers are concerned with telehealth’s potential for higher costs and increased fraud.
The Departments of Labor, Treasury, and Health and Human Services (the Departments) issued reporting relief for health plans and issuers facing difficulty meeting the December 27th, 2022, deadline of reporting prescription drug and health care spending information.
The Consolidated Appropriations Act, 2021, (CAA) requires that health plans and issuers report, on an annual basis, certain prescription drug and health care spending information. The first reporting (for 2020 and 2021) was originally due in December 2021 but was delayed to December 27, 2022. The reporting has proved to be a challenge for many plan sponsors and issuers.
As such, the Departments announced two important pieces of relief:
As group health plan sponsors, employers are responsible for ensuring compliance with the prescription drug data collection (RxDC) reporting requirements added to ERISA by the Consolidated Appropriations Act of 2021 (CAA). Under ERISA section 725, enforced by the US Department of Labor (DOL), group health plans (not account-based plans, e.g., health reimbursement arrangements and health savings accounts, or excepted benefit arrangements) must report details regarding the plan’s prescription drug benefit utilization, including the drugs most frequently dispensed, the most expensive drugs, and the drugs with the highest cost increase for a given calendar year. Reporting is to be made annually to the US Department of Health and Human Services’ (HHS) CMS enterprise portal’s Health Insurance Oversight System (HIOS) module, starting with the report due by December 27, 2022, for the 2020 and 2021 calendar years. After that, annual reporting is due by June 1st following the calendar year (so, the 2022 calendar year report is due by June 1, 2023). The DOL must thereafter post aggregated information on its website so that the public can see trends in prescription drug utilization and pricing.
What’s required. Under regulations issued jointly by HHS, DOL, and the US Treasury Department, plans must submit RxDC reports which include –
How to comply. HIOS issued specific reporting instructions which explain the reporting requirements in detail and assure plan sponsors that submission for a plan “is considered complete if CMS receives all required files, regardless of who submits the files.” Many group health plan vendors (insurers, third-party administrators, pharmacy benefit managers, etc.) have proactively contacted plan sponsors to assure them that the vendor will report at least some of the information on the plan’s behalf. However, not all vendors are willing to accept responsibility for the RxDC reporting requirements. Employers need to know which reporting obligations will be fulfilled by the group health insurer or other vendor and which reporting obligations must be satisfied by the plan sponsor. Most plan sponsors are wise to be prepared to upload at least some of the data to the HIOS module themselves, which means first setting up a HIOS account on the CMS portal. HIOS accounts can take a couple of weeks to set up, so it’s important for plan sponsors to act on this now if they’ve not already done so. CMS has provided detailed instructions for setting up the HIOS account.
Compliance issues. The statute and regulations impose the RxDC reporting requirements on group health plans, which, by default, usually means that requirements and liability for noncompliance are imposed on plan sponsors (generally, employers). Thus, each group health plan sponsor should ensure that all of the RxDC reporting requirements are satisfied for each group health plan subject to the reporting requirements. Employers should obtain written agreements from plan vendors identifying what data each vendor will upload. Note that the employer remains liable for noncompliance (and subject to excise tax and potential civil penalties), even if it has an enforceable agreement with its vendor to ensure compliance unless the plan is fully-insured and the agreement is with the insurer. Unfortunately, only the reporting entity can view the files it uploads to HIOS, so there is no way for an employer to confirm on the HIOS module that a vendor uploaded the file(s) it agreed to upload on behalf of the employer’s group health plan. Instead, the employer should obtain written assurance from the plan’s vendor(s) and rely on contractual provisions for recourse if a vendor fails to fulfill its RxDC reporting service as agreed.
The Covid-19 pandemic made us all vulnerable, and many of us are struggling to keep our mental health. In the U.S., the percentage of adults with recent symptoms of an anxiety or depressive disorder increased from 36.4% to 41.5% from 2020 to 2021 — so much so that the U.S. Preventive Services Task Force, an expert panel managed by the Department of Health and Human Services, recommended that doctors screen all adult patients under age 65 for anxiety. The Lancet also estimated that the pandemic caused an additional 53.2 million cases of major depressive disorder globally and an additional 76.2 million cases of anxiety disorders globally.
So, if one of your employees is struggling with their mental health, how do you talk about it? While you will have to have conversations that feel intimate and discomfiting, it’s also not your job to be the office therapist, and you don’t need to have all the solutions when a team member is struggling. Said Daisy Auger-Dominguez, chief people officer at Vice Media Group: “We are not therapists [but] we have to show evidence of care in our engagement with our teams. We also must ensure employees have access to the things that they need to be able to do their work well.”
The good news is that it’s possible to handle mental health conversations without overstepping your expertise. And while it’s natural to worry you’ll start asking the wrong questions or that your employee might ask questions you can’t answer, you can take steps now to create a culture where vulnerable conversations are OK, where boundaries stay in place and where people can get the help they need.
If having conversations about employee mental health makes you nervous, here are three things to remember:
Be Prepared for Vulnerable Conversations
All managers need to be familiar with the basics of privacy practices in the workplace and to have a set of questions ready for when mental health conversations happen.
Jen Porter, COO of the non-profit workplace mental health consultancy, advises to be curious about the impact of an employee’s mental health challenges, not the cause. She said, “You can ask anything you want about the impact of what’s happening on their work and at work. That’s fair game.” What you shouldn’t ask about, she said, is why the employee is having difficulties. Stay away from “what’s going on at home, the deep causes, the health history…anything that falls into that camp. That’s all therapist camp.”
In the U.S., the Americans with Disabilities Act (ADA) offers a basic rule: You can’t discriminate against someone based on health. This means “you can’t force them to talk about their health,” noted Porter. But you can address impacts on work — and the ADA also states employers should provide “reasonable accommodations” to employees with disabilities, including mental illness.
Porter suggested asking open-ended questions and pairing them with non-judgmental observations. “You can ask something like, ‘Hey, I’ve noticed you’ve been absent in our usual meetings, just wanted to check in and see how you were,’ or ‘You’re such an awesome project manager, but a lot of things seem to have been falling by the wayside. I just wanted to check in on you and see if there’s extra support you need or, or if you need to have a conversation with someone.'” These are very human but still about work.
If your employee opens up, however, what do you do? Porter advised, “Clearly they’ve found you to be a person that they trust — well done.” Your job as a manager is to listen, and then enable your employee to get help — but you “don’t want your employee to feel like you’re dropping them or handing them off. … We always recommend a more collaborative approach.”
Auger-Dominguez agreed. “You can say, ‘I’m feeling a little bit over my head right now. If it’s ok with you, I’ll reach out confidentially to HR to make sure that I’m giving you all the support that you need. And let’s meet again in a week.'” You might even suggest that you and the employee walk down to the HR office or connect to a mental health employee resource group. “Just because they’re getting support from someone somewhere else doesn’t mean that they’re [still] not getting support from you,” Auger-Dominguez noted. “It just means that they’re getting support from multiple places and you can focus on where you can give the right support, which is in a work-related context.”
If there’s low trust in HR within an organization, Porter suggested connecting an employee to a peer-based group which tends to have higher trust among employees. “Often people in those groups will have worked with HR or will have tried out the mental health benefits. And sometimes that storytelling and normalizing can be super helpful.”
Set and Protect Boundaries
Whenever you talk about mental health, personal boundaries come into play — the limits and rules we set for ourselves in our relationships. When we cross our own or others’ boundaries, things can feel uncomfortable, emotionally draining and just not right. Many managers fear becoming their employees’ go-to resource for mental health challenges because instinctively we know that our boundaries will be crossed, which will zap our own energy and mood. This might lead us to avoid having vulnerable conversations with members of our team.
However, there is a way to have these conversations and protect boundaries, said clinical psychologist Dr. Emily Anhalt. When it comes to addressing how people should share in a work setting, Anhalt suggested using “boundaried vulnerability”: sharing enough with others to invite connection, without sharing so much that you or your team has an emotional hangover.
The idea, Anhalt said, is that “There’s a spectrum from too tight to too leaky. Too tight is when we don’t let ourselves show up as humans at work. When we’re going through a really tough time and someone asks how we’re doing and we say ‘I’m good, everything’s fine. I don’t know what you’re talking about.'” This doesn’t work well because people are perceptive and may feel like we’re shutting off possibilities for authentic connection. Too leaky is when people “evacuate so much of their emotional stuff at work that it puts other people in a position of being their therapist or fixing something they don’t have the responsibility to fix.”
Let’s say a person is going through a messy divorce. They’re really overwhelmed and it’s affecting their work. If they pretend everything is fine, that’s too tight of a boundary and not reality. You and your colleagues actually want to know how the person is doing! But on the other end of the spectrum, saying something like “My spouse is just being absolutely horrible to me, and I don’t know what I’m going do about it. Every day I wake up and I don’t know how I’m going get through the day and I get here and it’s just more of the same. What do you think I should do? How should I handle it?” — that’s too leaky.
What’s the middle ground? Anhalt said the boundaried vulnerability version would be for the person to say something like, “To be honest, I’m actually going through some really tough stuff at home. It’s definitely affecting how I’m showing up at work. I’m getting support with it. But what I’d really love from you, if you’re open to it, is a little bit of extra time on that deadline? Is that doable?”
As managers, we can model boundaried vulnerability. If someone comes to us in a puddle, we can say, “I can tell that you’re going through a lot, and I want to make sure that you get the support you deserve for this.” In this situation, we’re modeling own boundaries while also helping the person move to the most appropriate next steps. Auger-Dominguez said you can also keep boundaries and support an employee by holding structured time open for them. If you learn about a mental health crisis during a one-on-one check-in, you can end that meeting by saying something like: “Our next scheduled meeting is five days from now. Is it okay to wait until then? Or would you like to check in earlier?” Then, honor their preference and show up for them at their desired time.
Further, as you set your own boundaries, it’s important to understand that our own anxieties and challenges may be triggered by leaning in to help our employees, said Arti Kashyap Aynsley, global head of health and wellbeing at Ocado Group. Managers want to “lean into being empathetic and compassionate, but we have tasks and deliverables and things that need to get done,” and there are only so many hours in the day. Managers can provide support and guidance, but other professionals in your organization likely have time and training dedicated to help employee mental health.
However, she noted, because rates of mental ill health are so high, and so many people need additional support, companies also need to give managers the time to accommodate increased needs of their teams. It’s not fair to expect managers to support their teams’ needs while not building in space for these conversations to happen.
Showing Up Is the Most Important Thing
Perhaps the most important thing a manager can do to support employees is to show up and listen, and then figure out what your employee needs.
Auger-Dominguez said if a team member seems “a little wobbly,” she asks a simple question: “Do you need me to witness, help or distract you right now?”
This is important, “because if we get clear on that, I’m also normalizing asking what people need, rather than making an assumption. It also creates clarity on what the expectation is from me as their manager. Sometimes they just want me to witness, so it’s not about me solving for anything. It’s just about them. If they want help, I’m going to help them get the resources they need.” And if the employee needs a distraction, Auger-Dominguez might say, “Hey, let’s go for a walk or coffee.” This strategy also helps develop your employees’ agency; that way, they feel empowered to ask for help, versus you trying to assume what they need.
The conversations you have with your employees are the culture you create. Dr. Thomas Insel, former director of the National Institutes of Mental Health, said that only 10% of mental health outcomes are a result of clinical mental health care. The determinants of mental health are broader and societal, and our workplaces are a huge factor in our mental health. Mentally healthy workplaces want employees to feel valued, heard, impactful — and to have agency over their time, work and decisions.
So, remember: You don’t need to be the office therapist. You just need to be ready to listen.
Small organizations have overcome a range of HR challenges in recent years, from managing through a pandemic and converting employees to remote and hybrid work to talent shortages, widespread resignations, and inflation’s impact on compensation and benefits. For those who work at small companies, these challenges can be even more difficult due to a lack of resources and training.
A recession likely is looming, according to many economists who predict that rising inflation will slow business revenues through much of next year and prompt layoffs, some of which have already been announced at large companies such as Amazon, Meta and Disney.
While larger companies often are better suited to survive a downturn, small organizations can find it much more challenging, which is why many are taking steps now to prepare. The following are several ways in which small businesses can gear up for a possible recession while keeping employees’ best interests in mind.
Cut Back on Spending
When a recession is on the horizon, smaller organizations should immediately review all spending and look for ways to reduce or eliminate unnecessary costs, said Linda Chavez, founder and CEO at Seniors Life Insurance Finder in New York City. Given uncertain economic indicators, Chavez said, she is keeping compensation flat for her 50 employees and is operating as lean as possible.
“We have been prudent in our spending in recent years and have built up a cash reserve that will help us weather any storm,” she said. “I’m optimistic about the future because I believe that our company is well-positioned to weather a recession. We have a strong product and a loyal customer base.”
Reduce Bonuses
To many small employers, retaining their workforce is of greatest importance. David Aylor, founder and CEO of David Aylor Law Offices in South Carolina, said his priority is to keep his 15 employees on payroll throughout the duration of the recession and not spend on bonuses to make up for lost revenue.
“We have no plans to lay any of our people off,” he said. “Although we may have to cut down on our bonuses, we fully intend to continue to offer salary raises to keep our existing employees happy. This is because the cost of recruiting and training new employees is very high. So even in a recession, it will be cheaper to give existing employees raises than to lose them.”
Lease Out Employees
Commercial and residential real estate has taken a major hit this year due to rising interest rates. At Borgia Consulting Corp., a service title insurance agency with 10 employees in Fort Myers, Fla., real estate closings have dropped 75 percent in recent months. Fearing the situation will get worse during a recession, owner Karina Lacroix is now leasing out her employees to other companies.
“We get to keep the employee on our payroll, but their income is being covered by the company leasing the employee,” she explained. “If our business turns and we need the employee back, the new company is already aware and the employee would return to their daily activities with our company. That will keep us from having to find qualified candidates for those positions in the future and have to train again.”
Employees are able to continue their relationship with Lacroix’s company and keep receiving their pay, while other employers benefit from having skilled workers on their team, at least on a temporary basis.
“I’m really hopeful that all of my staff will be back together again soon,” Lacroix said. “If I were not hopeful, I would not have leased them out and would have laid them off instead.”
Consider Raising Prices
Rather than laying off any employees, some businesses are raising their prices to make up for lost revenue. Tom Monson, owner at Monson Lawn Care and Landscaping in the Minneapolis area, has taken this approach to protect his 12 employees.
“We’ve done our best to keep inflation at bay, but eventually we had to raise our prices to keep up with our spending,” he said. “We’ve tried to cut our costs without laying off employees so that we’d have a little bit of wiggle room in our coffers to absorb some of a recession. And if it turns out this is all overblown, then we can use that money for more advertising or to upgrade some of our equipment.”
Monson added that as a small business, “the only thing I really can do is to plan ahead, make sure our relationships with our customers are solid and not overexpand my business when it looks like things might be rough on the horizon.”
Research Employee Needs
If you aren’t sure how to proceed when attempting to prepare for a recession, consider advice offered by Julia Christenson, U.S. chair of employee experience at global public relations and communications services firm Edelman.
“Understanding your employees, their day-to-day life and what they are facing is crucial,” she said. “Many companies, especially those with front-line workers, are removed from the daily challenges employees face and don’t have a full understanding of how the recession will impact them. This is particularly true for companies with multi-generational workforces who face a range of social issues and different priorities.”
According to the 2022 Edelman Trust Barometer, which measures employee trust in the workplace, 90 percent of people want organizations to protect the well-being and financial security of their employees and suppliers, even if it means suffering financial losses.
“In preparing for the recession, companies should carefully evaluate the commitments made to employees and the potential trade-offs in continuing to manage employee trust and engagement,” Christenson said. “It’s also critical that companies continue to foster real and true transparency around financial rigor, pay equity and financial decision-making.”
Lacroix said she is committed to putting her employees’ needs at the forefront while ensuring that her business is able to survive the downturn.
“I believe that as business owners, we have the responsibility of protecting and keeping our employees happy,” she said. “[I thought] of how we can protect our staff but also help our bottom line during the recession. It’s up to us to come up with ideas that may be considered out-of-the-box to be able to bend with shifting markets and benefit our work family.”
She continued, “I’m sure that if other business owners consider their staff as family, they also will come up with a variety of ways to help their staff and their company during those market changes.”
Article courtesy of The Society of Human Resource & Management (SHRM)
Each year, millions of people in the U.S. experience seasonal affective disorder (SAD), also called seasonal depression or the “winter blues.”
The disorder is characterized by short periods of sadness or people not feeling like their usual selves, according to the National Institute of Mental Health. People may start to feel “down” when the days get shorter in the fall and winter but then feel better in the spring.
“Seasonal affective disorder is a form of depression tied to a seasonal pattern,” said Hanne Hoffmann, assistant professor in the College of Agriculture and Natural Resources at Michigan State University (MSU). “It usually begins in the fall, but some people do experience it in the summer.”
Employers have become increasingly cognizant of mental health problems in the workplace, evidenced by more companies offering “mental health days” and enhanced counseling benefits. Hoffman said that organizations can support workers with SAD in more nuanced ways.
Who Is Vulnerable to Developing SAD?
Sabine Schmidt, director for psychology education with the University of Minnesota, said that the symptoms of SAD often mirror those of major depression. These signs and symptoms can include:
A 2020 article by Forbes indicated that SAD can negatively affect motivation and diminish workplace communication and productivity. Workers with the disorder are also more prone to injuries, accidents and absenteeism, which costs businesses $51 billion annually.
“These symptoms may not be immediately visible [in the workplace] but could go with behaviors such as decreased work productivity, difficulty being on time, slowness, irritability or social withdrawal,” Schmidt explained.
Hoffman said that women experience SAD four times more frequently than men do. She noted that it is unclear why women are more at risk for seasonal depression than men.
Studies have indicated that as much 20 percent of the population in northern states, including Alaska, experience some degree of seasonal depression in the winter because daylight hours are shorter. In southern states like Florida and Texas, seasonal depression is rare.
Why Workers Need Sunlight
Hoffman, who holds a doctorate in biochemistry and neurobiology, runs a lab at MSU that studies how light regulates our physiology, affects our overall well-being and mood, and induces changes in brain function.
“Sunlight boosts your mood and energy,” she said. “What really happens [with SAD] is that our mood follows light quality and light intensity.”
Many employees who work in an office arrive to work when it is still dark outside. When they leave the office, dusk approaches. Hoffman said that this lack of sunlight can increase their risk of developing seasonal depression.
She also noted that natural light promotes an increased sense of well-being. In the fall, many workers do not get enough natural light to maintain the brain signals for feeling happy, so they start to feel sad.
“It’s important that the workers see bright light in the morning,” she explained.
Tips for Employers to Prevent Seasonal Depression
Most workplaces have indoor lighting that is relatively dim. Hoffman suggested that employers improve their indoor lighting, especially in the late fall, to prevent or reduce the effects of seasonal depression among their employees.
She recommended that employees dealing with SAD purchase a light therapy lamp, which emits a brighter light than traditional bulbs, to keep at their desk. She also implored companies to consider allowing more flexible work hours during the winter months.
“The workplace can allow people to start a little later so they see the morning light,” Hoffman said. “Giving them the flexibility to see this morning light will help them prevent seasonal depression.”
Schmidt said that companies should educate themselves as well as their employees about the winter blues.
“For instance, many people wrongly believe that SAD is a minor form of depression or caused by a bad attitude,” Schmidt said. “However, people don’t cause SAD and cannot simply shake it off.”
She also recommended that companies:
Schmidt implored workers to address any signs of winter blues before they become full-blown SAD or major depressive disorder. Once SAD reaches the levels of major depressive disorder, it can cause serious mood changes that affect thoughts and actions.
“It can be quite debilitating and lead to other serious problems such inability to work, substance abuse, physical health deterioration and even suicide,” she said. “Those with known SAD should consult a mental health professional about when to start treatment to help minimize symptoms.”