Category: Corporate Social Responsibility

Reporters Are Pushing to Reveal CARES Act Beneficiaries. Is Your Firm Prepared for Tough Questions?

As law firms continue to announce restructuring, furloughs and layoffs in response to the economic emergency caused by the coronavirus, CMOs and marketing directors of small to midsize firms are quickly realizing they may have to contend with a corresponding PR crisis: their firms’ financials are under increased media scrutiny.

That’s because reporters across the legal and mainstream media are pushing the Small Business Administration and Treasury Department to make public the names of companies that accepted assistance through the various programs created through the Coronavirus Aid, Relief, and Economic Security (CARES) Act, including the Payroll Protection Program and Economic Injury Disaster Loans.

We all saw the stories back in March of billion-dollar-plus companies whose bailouts depleted the PPP fund within days, only to be forced, sheepishly, to return the money after the public outcry. Obviously, midmarket firms are far smaller than those companies in both staff and revenue, but seeing so many powerful corporations take advantage of government support that was intended to help the little guy has made the public skeptical and even hostile toward any business larger than the corner hardware store who received government help.

Add to this inhospitable climate the lack of clear guidance for borrowers and grant recipients on how the money can be used, and all law firms who participated, even those working in good faith to stay well within the bounds of eligibility requirements, could face damage to their reputations. This is particularly true for law firms that predominantly serve small business clients. How will those clients respond if they learn their lawyers received the funding when they themselves struggled to secure it to protect their own business?

One thing we know for sure: this information eventually will be made public, whether the government releases it or it is leaked to reporters at the Washington Post or ALM. Therefore it is critical for CMOs and marketing directors to create a plan for how they will respond if their firm’s name is likely to show up on the list.

Anytime negative media coverage hits, firms have a few options:

  1. Say nothing. Hope for the best. Maybe your firm will show up so far down the list that no one will notice?
  2. Wait for the information to become public and then issue a statement confirming the barest set of facts.
  3. Confirm the facts and make a spokesperson available for interviews.
  4. Proactively disclose your participation in CARES Act programs, explaining why you did so, focusing on the jobs you’re protecting and describing your firm’s plans for weathering the coming months.

While many firms are banking on option #1 and hoping to benefit from chaotic news cycles and short attention spans, there is a risk that they could be underestimating the blowback they may face. If you remain silent while reporters write stories about your firm, your clients and prospects will tend to fill the information vacuum with their own speculation.

The smarter play is to deploy some combination of the other three options, and what that plan looks like will depend on strategic coordination with firm leadership and your answers to a few key questions, such as:

How will your most important clients react to the news that your firm received CARES Act support? Some clients will be relieved to know their law firm is on solid ground and can continue to provide uninterrupted service. Others might question the firm’s underlying financials or, as mentioned above, react with resentment that a business with revenue in the nine figures is displacing a small business. Predicting key clients’ responses to the news will allow you to create a media strategy that defuses criticism and shapes a more positive narrative about why the firm accepted the government support. Think about all the messages you’ve sent over the years about who you are and what you value as a firm. If leadership’s decision-making here was consistent with those messages and values, you’re in good shape.

Has your firm eliminated jobs, and does it plan to? One of the most important and well publicized terms of the PPP is that, in order for the loans to be forgivable, 75% of the funding must be used to cover payroll. This is intended to protect as many jobs as possible. That doesn’t necessarily mean that moving ahead with job eliminations violates the terms of the loan, which can be repaid, in full or in part, at a 1% interest rate. But taking PPP funds and cutting jobs will raise eyebrows. Timing here is key. Did your firm lay people off and then take the funding? Could that be perceived as funneling the benefits to members of the firm who already receive the highest compensation? These are the kinds of questions reporters will be asking; leaders need to be prepared to answer them.

Has your managing partner and other members of the c-suite agreed to sacrifice some of their own compensation? If your firm decides to take the most proactive course and disclose its status, it’s crucial to use that opportunity to tell the most compelling story of why you did so. Of course, every managing partner has sent out a reassuring email to the firm in the past few weeks that says some version of “We’re all in this together,” but this message is a lot more meaningful when leadership can point to actual sacrifices they’ve made to try to save people’s jobs.

One positive development around the CARES Act programs is that now, some weeks after the disastrous rollout and the better-managed second round of PPP loans, businesses are no longer in competition with each other to get needed support. The sense that this is a zero-sum game has subsided, and that’s good news for midsize law firms that may need to disclose their participation. Still, marketers must think carefully about how to engage with the media on this sensitive and still-evolving issue. Don’t wait until a reporter calls to decide what you’re going to say.

© 2020 Page2 Communications. All rights reserved.

For more on the SBA PPP Loan, see the National Law Review Coronavirus News section.

Secretary Of State Issues 2020 Women On Boards Report

The legislation creating California’s female director board quota requires the Secretary of State to publish on his Internet website a report no later than March 1, 2020 a report of the following:

  1. The number of corporations subject to the law that were in compliance during at least “one point during the preceding calendar year”.

  2. The number of publicly held corporations that moved their United States headquarters to California from another state or out of California into another state during the preceding calendar year.

  3. The number of publicly held corporations that were subject to this section during the preceding year, but are no longer publicly traded.

The Secretary of State published the mandated report a day late and without some of the required information.  Below is the Secretary of State’s summary of the report:

The above table illustrates one confusing aspect of the new law – the female director quota law refers to “publicly held corporations” and foreign corporations that are “publicly held corporations” while the corporate disclosure statement requirement applies to “publicly traded corporations” and “publicly traded foreign corporations”.  See Publicly Held Corporations and Publicly Traded Corporations – Non Bis In Idem?

The report explains that the Secretary of State lacked the data necessary to comply with the requirement to report on publicly held corporation’s movement of headquarters or delisting of shares from a particular market or exchange.

© 2010-2020 Allen Matkins Leck Gamble Mallory & Natsis LLP

Sustainability: Environmental, Social, and Governance (ESG)

Understanding the environmental, social, and governance (ESG) issues of today’s business world are key to understanding the discussion of sustainability and climate change (a sub-topic of each ESG and sustainability).  For example, a sustainable business that demonstrates strong ESG planning, will often include climate change risk management.

Today’s press informs that mounting pressure from the United Nations participants continues to build a focus on reducing greenhouse gas emissions.  The UN’s 25th Session of the Conference of the Parties (COP25) to the UN Framework Convention on Climate Change was held in Madrid from December 2 – 13.  The U.S. filed a notification of withdrawal from the Paris Agreement on November 4, 2019.  The U.S. State Department has announced it will continue to participate in ongoing climate change negotiations and meetings, such as COP25, to ensure a level playing filed that protects U.S. interests.  Also, the UN released its report noting the emissions gap they observe that demonstrates the difference between amounts of carbon dioxide emitted now and lower levels predicted as necessary to stop global warming.  The question being asked is whether there are missed opportunities to achieve GHG reduction goals.

Domestic and international companies are in the process of reviewing their ESG reports to assess last year’s accomplishments and in setting goals and action items for the new year of 2020 and beyond.  Climate change and other sustainability concerns like waste management are clearly on the minds of many.  There is no single formula for a well-developed ESG strategy and report, since each is as unique as the individual company about which the report speaks.  There are common ESG themes, however.  The UN Sustainability Goals provide a convenient list of well-refined issues against which a company (or individual) can assess their opportunities and vulnerabilities.  The goals set forth a number of environmental, social, and governance topics worthy of note to include: poverty, hunger, good health, education, gender equality, clean water, affordable and clean energy, decent work and economic growth, industry/innovation/infrastructure, reduced inequality, sustainable cities/communities, responsible consumption and production, climate action, life below water, peace and justice, and partnership to achieve the goal.  These are the types of issues to consider when exploring ESG and sustainability.  Consultation of the Global Reporting Initiative (GRI) and the Sustainability Accounting Standards Board (SASB) can also assist.  Keep in mind that there is no one gold standard metric against which to measure ESG ratings or accomplishments.  The reason for that is simple, each company has a different complement of skills, talents, and opportunities or stated differently, ESG risks and solutions.

If you were to review a few ESG reports found on corporate websites, it will become apparent the differences and unique qualities of each reporting company.  Geographic locations of operations can define the ESG goals.  If operating in major metropolitan cities as opposed to emerging countries, the corporate responsibilities are quite varied.  If manufacturing consumer products, packaging is an attractive target for reduction in waste.  However, if manufacturing items used in the value chain, perhaps an ESG goal is managed through energy consumption during manufacturing or delivery of products.  If providing medical services, the ESG goals can be energy, water, supply chain, waste, etc.  Just as each of us possess capabilities and assets we can use to invest in our future, the same is true for companies.  We must acknowledge the unique accomplishments and actively invite the benefits gained from a collective effort.

The final item listed by the UN Sustainability goals is partnership, meaning the efforts and benefits should be shared.  We all must work together to achieve the change we need.  All contributions must be welcomed to build the sense of common good.

© Steptoe & Johnson PLLC. All Rights Reserved.

For more on global sustainability efforts, see the National Law Review Environmental, Energy & Resources Law section.

California Board Gender Quota Law Challenged In Federal Court

Cydney Posner at Cooley LLP wrote last week about a new challenge to California’s Board Gender Quota law.  The lawsuit, Creighton Meland v. Alex Padilla, Secretary of State of California, was reportedly filed in federal district court in California by a shareholder of OSI Systems, Inc.  According to OSI’s most recently filed Form 10-Q, the company is incorporated in Delaware, its principal executive offices are in California, and its shares are traded on The Nasdaq Global Select Market.  The lawsuit alleges violation of the equal protection clause of the Fourteenth Amendment and seeks declaratory and injunctive relief.

As this case progresses, one question might be whether the plaintiff’s claim is direct or derivative.  OSI is not named as a party to the lawsuit and the plaintiff alleges that the law injures his “right to vote for the candidate of his choice, free from the threat that the corporation will be fined if he votes without regard to sex”.  The Delaware Supreme Court’s test for whether a stockholder’s action for breach of fiduciary duty is derivative or direct asks two questions:

“Who suffered the alleged harm–the corporation or the suing stockholder individually–and who would receive the benefit of the recovery or other remedy?”

Tooley v. Donaldson, Lufkin & Jenrette, Inc., 845 A.2d 1031 (Del. 2004).  Although the corporation will be fined and the fine suffered by all of the stockholders, the plaintiff is alleging that he is being injured by being denied the freedom to vote without regard to sex.  Presumably, that injury would be removed if the law is enjoined.

Interestingly, OSI does not appear in the California Secretary of State’s listing of SB 826 corporations published earlier this year.  According to the proxy statement filed by OSI last month, all of the current directors are men, but a female has been nominated for election at the upcoming meeting.

© 2010-2019 Allen Matkins Leck Gamble Mallory & Natsis LLP

More on Corporate Board diversity rules on the Corporate & Business Organizations law page of the National Law Review

How to Write Gender-Neutral Contracts

“Men” is not synonymous to “person”, nor does “he” mean “she.”  It is important for contractual language to be not only precise but also accurate.  Many agreements govern multiple individuals, some of whose gender is unclear or variable.  This article will give you advice and guidance on how to adjust contract language to be gender-neutral.  As society moves towards treating all genders equally, legal contracts should too.

What is gender?

Gender is the socially constructed characteristics of “male” and “female” and includes norms, roles, and relationships of and between groups of men and women.

What is gender-neutral?

Merriam-Webster defines gender-neutral as “not referring to either sex but only to people in general.”

Why it matters:

Conversations around gender and gender-neutrality are becoming more and more mainstream.  Thomson Reuters reported that in the past year (2018), there has been an increase in the number of clients requesting gender-neutral documents.  Startups are at the forefront of change and industry disruption, so it is logical that they stay ahead of the trend.

As you operate business, there are a number of form contracts that you will use regularly.  These form contracts are agreements your attorney drafts with brackets and spaces for you to update depending on each use.  For example, common form contracts include (1) Employee Offer Letters, (2) Confidentiality, Nondisclosure, and Assignment of Inventions Agreements, (3) Equity Incentive Plan, (4) Stock Option Grants, and (5) Restricted Stock Purchase Agreement.

Traditionally, these form contracts used masculine pronouns.  It used to be that progressive contracts simply did not use “he” but rather “she” or “he or she.”  As Thomson Reuters reported:

“In the old days it was almost certain that your senior employees would be men; a contract would be drafted accordingly, and then the ladies would be given a metaphorical pat on the head by including in the boilerplate the reassurance that references to the male gender should be interpreted to include the female.”

Now, the shift towards non-gendered pronouns and away from binary choices of “he” or “she” means attorneys need to adopt new drafting techniques.  As entrepreneurs and leaders of your own business, you can encourage this shift.

What to do:

Replace the masculine pronoun with an article, for example using “the position” in place of “his position”

  1.  Use a neutral word or phrase such as “person” or “individual”

  2. Define the term and repeat that noun

  3. Rewrite the sentence in order to eliminate the pronoun completely

What to be wary of (for now):

  1. Using the singular “they” and its other grammatical forms to refer to indefinite pronouns and singular nouns, for example using “they” in place of “she” and “them,” “themselves,” and “their” in place of “her,” “herself,” and “hers.”

    1. Part of drafting a contract is using precise language.  While there is rising social acceptance of the use of singular “they,” a court has not ruled on its interpretation in contracts.  Likely, it will take legal precedent in Delaware interpreting such use to accept the use of the singular “they.”

    2. This same logic applies to the use of the singular “ze.”

  2. Using the plural “they.”

    1. Similarly, the use of the plural can be misleading.  For an employment offer letter, for instance, the offer is not to a number of people but rather to one individual.

  3. A catch-all clause like “Unless the context otherwise requires, a reference to one gender shall include reference to the other genders”

    1. It was offensive when the use of male pronouns were supposed to encompass women and men. Such use effectively reinforced gender stereotypes.  It is equally offensive when it is used to refer to all genders.

Gender neutrality facilitates accurate, precise contracts.  It is important that an individual who is subject to a contract feel as though the contract applies to that individual.  In addition, that individual should also feel respected.

©1994-2019 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.

ARTICLE BY Kati I. Pajak of Mintz.

Inclusion Does Not Stop Workplace Bias, Deloitte Survey Shows

In Deloitte’s 2019 State of Inclusion Survey, 86% of respondents said they felt comfortable being themselves all or most of the time at work, including 85% of women, 87% of Hispanic respondents, 86% of African American respondents, 87% of Asian respondents, 80% of respondents with a disability and 87% of LGBT respondents. But other questions in the company’s survey show a more troubling, less inclusive and productive office environment, and may indicate that simply implementing inclusion initiatives is not enough to prevent workplace bias.

While more than three-fourths of those surveyed also said that they believed their company “fostered an inclusive workplace,” many reported experiencing or witnessing bias (defined as “an unfair prejudice or judgment in favor or against a person or group based on preconceived notions”) in the workplace. In fact, 64% said that they “had experienced bias in their workplaces during the last year” and “also felt they had witnessed bias at work” in the same time frame. A sizable number of respondents—including 56% of LGBT respondents, 54% of respondents with disabilities and 53% of those with military status—also said they had experienced bias at least once a month.

Listening to those who say they have witnessed or experienced bias is especially important. When asked to more specifically categorize the bias they experienced and/or witnessed in the past year, 83% said that the bias in those incidents was indirect and subtle (also called “microaggression”), and therefore less easily identified and addressed. Also, the study found that those employees who belonged to certain communities were more likely to report witnessing bias against those communities than those outside them. For example, 48% of Hispanic respondents, 60% of Asian respondents, and 63% of African American respondents reported witnessing bias based on race or ethnicity, as opposed to only 34% of White, non-Hispanic respondents. Additionally, 40% of LGBT respondents reported witnessing bias based on sexuality, compared to only 23% of straight respondents.

While inclusion initiatives have not eliminated bias, Deloitte stresses that these programs are important and should remain. As Risk Management previously reported in the article “The Benefits of Diversity & Inclusion Initiatives,” not only can fostering diversity and inclusion be beneficial for workers of all backgrounds, it can also encourage employees to share ideas for innovations that can help the company, keep employees from leaving, and insulate the company from accusations of discrimination and reputational damage.

But building a more diverse workforce is only the first step, and does not guarantee that diverse voices are heard or that bias will not occur. Clearly, encouraging inclusion is not enough and more can be done to curtail workplace bias. And employees seeing or experiencing bias at work has serious ramifications for businesses. According to the survey, bias may impact productivity—68% of respondents experiencing or witnessing bias stated that bias negatively affected their productivity, and 70% say bias “has negatively impacted how engaged they feel at work.”

Deloitte says that modeling inclusion and anti-bias behavior in the workplace is essential, stressing the concept of “allyship,” which includes, “supporting others even if your personal identity is not impacted by a specific challenge or is not called upon in a specific situation.” This would include employees or managers listening to their colleagues when they express concerns about bias and addressing incidents of bias when they occur, even if that bias is not apparent to them or directly affecting them or their identity specifically.

According to the survey, 73% of respondents reported feeling comfortable talking about workplace bias, but “when faced with bias, nearly one in three said they ignored bias that they witnessed or experienced.” If businesses foster workplaces where people feel comfortable listening to and engaging honestly with colleagues of different backgrounds, create opportunities for diversity on teams and projects, and most importantly, address bias whenever it occurs, they can move towards a healthier, more productive work environment.

Risk Management Magazine and Risk Management Monitor. Copyright 2019 Risk and Insurance Management Society, Inc. All rights reserved.
For more on workplace discrimination issues, please see the National Law Review Labor & Employment law page.

California Secretary Of State Issues First Board Gender Quota Report But Is Something Missing?

Yesterday was the first of several deadlines under California’s unprecedented legislation, SB 826, imposing gender quota requirements on all publicly-held domestic or foreign corporations whose principal executive offices are located in California.  This legislation also required the Secretary of State’s office to publish a report on its website no later than July 1, 2019 documenting those corporations subject to the law “who [sic] have at least one female director”.

The Secretary of State did, in fact, publish a report yesterday listing 538 corporations, their jurisdiction of incorporation, street address, phone number and stock exchange.  Oddly missing from the list was any indication of the number of female directors (if any) even though the law clearly requires that information.  It is also unclear why the Secretary of State chose to publish address and telephone information when that information was not required to be in the report.

The Secretary of State’s office did publish an explanation of its methodology that basically consisted of searches of Securities and Exchange Commission and other public filings.  The explanation includes this warning as well:

“Note that federal filing deadlines for filing the annual SEC Form 10-K (60, 75 or 90 days after the end of the fiscal year) differ from the California deadline for filing the Publicly Traded Disclosure Statement (150 days from the end of the fiscal year) so there may be gaps in available data.”

The Secretary of State has modified its corporate disclosure statement to require publicly traded companies to disclose if they have one or more female directors on their current Boards of Directors.  Given the definition of “female” in the statute (an individual who self-identifies her gender as a woman, without regard to the individual’s designated sex at birth), I wouldn’t be surprised to see a question concerning gender identification appearing on Directors and Officer questionnaires.

 

© 2010-2019 Allen Matkins Leck Gamble Mallory & Natsis LLP
For more on corporate compliance, please see the National Law Review Corporate & Business Organizations page.

US Attorney General Jefferson Sessions Issues New Guidance On Transgender Employees

Yesterday, U.S. Attorney General Jefferson Sessions issued new guidance reversing the federal government’s former position that gender identity is protected under Title VII.

In a memo sent to the heads of all federal agencies and the U.S. attorneys, the attorney general stated that as a matter of law, “Title VII does not prohibit discrimination based on gender identity per se.” The memorandum further stated the DOJ will take the position in all pending and future matters that Title VII does not protect against discrimination on the basis of gender identity or transgender status.

Sessions’ memo explains Title VII expressly prohibits discrimination on the basis of sex but makes no reference to gender, and that courts have interpreted “sex” to mean biologically male or female. Sessions concluded employers may differentiate on the basis of sex in employment practices, so long as the practices do not expose members of one sex to disadvantageous terms or conditions of employment to which the other sex is not exposed. The memo highlighted sex-specific bathrooms as such an example. Sessions explained while Title VII prohibits “sex-stereotypes,” insofar as that sort of sex-based consideration causes disparate treatment between men and women, Title VII is not properly construed to proscribe employment practices that take into account the sex of employees, but do not impose different burdens on similarly situated members of each sex.

This guidance reverses and withdraws previous guidance by Attorney General Eric Holder in a December 15, 2014 memorandum in which Holder stated Title VII prohibits employers from using “sex-based considerations,” such as gender identity, in employment decisions. Sessions’ memo also runs contrary to the current position of the U.S. Equal Employment Opportunity Commission, which treats discrimination against an employee on the basis of gender identity, including transgender status and sexual orientation, as violations of Title VII.

Currently, there is a split of authority in the courts on whether sex discrimination under Title VII includes discrimination on the basis of gender identity and sex stereotyping, and thus prohibits discrimination against transgender individuals. The U.S. Supreme Court will likely have to resolve the issue in the future, but may issue some relevant guidance this term in the Gloucester County School Board v. G.G. case (involving issues of a school district’s obligations to a transgender student).

While it is now the position of the Department of Justice that Title VII protections do not extend to transgender individuals, employers should still be careful to avoid discrimination on the basis of gender identity, as the law is still unsettled. As Attorney General Sessions’ memorandum notes, there are still federal statutes that prohibit discrimination against transgender persons, and states and localities may have additional protections. Moreover, the EEOC could still bring suit against employers who engage in transgender discrimination.

This post was written by Allison L. Goico & Hayley Geiler of Dinsmore & Shohl LLP. All rights reserved., © 2017
For more Labor & Employment legal analysis, go to The National Law Review

Uber’s Decision To “Deactivate” Driver Over Retweet of Article Goes Viral in Minutes

Allen Matkins Law Firm

It all started with a retweet. A recent story regarding the “deactivation” and subsequent reinstatement of an Uber driver in Albuquerque is a useful reminder for employers that, given the widespread use by employees of social media, employment decisions should not only be well thought out, but also should take into account potential negative publicity.

During a period while he was on hiatus from driving for Uber, Christopher Ortiz merely retweeted an article referenced as “Driving for Uber, not much safer than driving a taxi,” without commenting on the article. When he sought to resume driving for Uber a couple of months later, Ortiz received an email from Uber stating that his driver account had been “permanently deactivated due to hateful statements regarding Uber through social media.” The e-mail referenced the title of the article that Ortiz had retweeted. Ortiz immediately tweeted a screenshot of Uber’s email, and the story was picked up by websites such as Forbes and BuzzFeed.

Twitter Feed for Christopher J. Ortiz

Within hours, Uber reversed its decision and reactivated Ortiz’s driver account. Ortiz then tweeted a screenshot of Uber’s message reinstating him, which subsequently was retweeted numerous times.

In this situation, each of Uber’s communications with Ortiz was made public and broadcast within seconds of its transmission to Ortiz. It took only minutes for Uber’s termination decision to get attention from national media outlets. The fact that information regarding employers’ hiring and firing decisions can become subject to public scrutiny at such a rapid pace should serve as a reminder to employers to carefully assess how they approach these decisions and how they react to the decisions’ aftermath. For example, retracting an employment decision, particularly if it is publicized, could embolden other employees to publicize negative employment decisions affecting them in the hope those decisions too will be retracted.

As noted at the outset, employers should contemplate, as part of their decision-making process, that any employment decisions they make, and particularly those they may e-mail to their employees, potentially could be broadcast publicly and be subject to the court of public opinion through various forms of social media. As demonstrated by this incident, once a story gains traction on social media, it is very difficult, if not impossible, to control the ramifications.

ARTICLE BY

Alexander Nestor
Nisha Verma
OF
Allen Matkins Leck Gamble Mallory & Natsis LLP

Apocalypse Averted Again: Preliminary Thoughts on Welcoming Workers Back From the Government Shutdown

MintzLogo2010_Black

As discussed a few weeks ago, the government shutdown had a broad impact on a number of workers in the public and private sectors. Now that the federal government has reopened, employers welcoming back furloughed employees should stand ready to answer worker questions and assuage employee concerns. Below we offer some preliminary thoughts for private employers managing this delicate process.

  • Back Pay and Unemployment. Employers should be prepared to answer employee questions about their eligibility for back pay and unemployment benefits for their time out of work. If employers provide back pay and employees have already received unemployment benefits, employers should notify employees that they may be required to pay back any unemployment benefits received.  Generally, employees can either collect unemployment from the respective state unemployment agencies for the time missed or they can accept the backpay if offered by the employer, but they cannot double collect.  At least three state unemployment agencies (PA, VA, MD) have explicitly stated that they will expect reimbursement if employers provide back pay.
  • Guard Against Liability. Efforts by employers to return workplaces to pre-shut down normalcy, including by providing back pay and other benefits to workers for the furloughed time, should be implemented in an even-handed, non-discriminatory manner to guard against liability. For example, if employers decide to bring employees back from a furlough on a rolling basis, they must be sure to have neutral business-justified criteria for who is brought back to the workplace and when they are brought back to the workplace.
  • Manage the Message. Hundreds of thousands of workers have been temporarily out of work for up to three weeks because of the government shutdown. Employers should emphasize that these temporary furloughs were the outgrowth of the Congressional stalemate. Accordingly the message to employees should be clear: extraordinary circumstances and not poor job performance, forced employers’ hands and required them to temporarily furlough employees.
  • Ease Their Pain. Employers need to be sensitive to the plight of their returning workers, many of whom have been suffering severe economic hardship during this time period. Economic esprit-de corps measures like jeans days or pizza lunches represent cost-effective ways to remind returning employees that they are highly-valued and welcomed back into the corporate fold.

When in doubt about prospective measures in the wake of the government shutdown, employers should contact employment counsel.

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