Rehiring in the time of COVID-19: Best Practices for Employers

Some companies are in the midst of rehiring employees laid off due to the pandemic, and for others that’s still in the future. Either way, as you make plans to protect your employees’ health, be sure you know how to protect your business too. In this post we’ll talk about two important ways you must follow the law and best practices as you continue or begin the rehiring process.

Avoid Discrimination Claims

Any time you lay off an employee and later refill the position, the potential exists for a discrimination claim if you offer the job to someone else or end up hiring a different person. It’s critical to understand what may constitute discrimination so you can avoid it.

Of course, your policies should state explicitly that your hiring practices do not discriminate on the basis of race, color, religion, sex (including pregnancy, sexual orientation, or gender identity), national origin, age (40 or older), disability and genetic information (including family medical history), or protected veteran status. But in the age of COVID-19 extra caution is warranted.

According to the Centers for Disease Control and Prevention (CDC), some people are especially vulnerable to severe COVID-19 disease and complications, including people over 60, those with underlying medical conditions, pregnant women, and others. But these do not count as valid reasons to not rehire an employee. Even if you have your employees’ best interests and health in mind, it can still be construed as age or other discrimination. One option may be to discuss plans for a delayed start or work from home if possible; however, the employer should make the final decision whether to accept this kind of arrangement.

You can also avoid claims of discrimination by using the same considerations for making both layoff/furlough and rehiring decisions. For example, If a business laid off employees based on seniority, then seniority could be the main factor considered when deciding who to bring back to the active workforce.

But there are valid reasons to not rehire someone, or to delay a return-to-work temporarily, as long as it is not discriminatory, based on objective criteria, and well-documented. Some examples include, but are not limited to:

• documented past poor performance
• significant changes to the job that make the person no longer qualified
• newly added job duties that the person cannot perform (for non-discriminatory reasons)
• diagnosis of COVID-19 in the employee, a family member, or person the employee is caring for
• current doctor’s orders to self-quarantine
• inability to obtain childcare (or dependent care) due to school or care center closure due to COVID-19

Always make rehiring decisions on a case-by-case basis, taking care that you are able to document the legitimate non-discriminatory reasons for making such decisions.  If you are uncertain, consult with an attorney or employment specialist.

Document Offers to Return to Work

It is always the best practice to make a formal, written offer of employment. This helps document the actions that an employer took. Retain records of any response, or document a lack of response from any employee as well. Because many employers have taken out PPP loans, they may wonder how rehiring impacts loan forgiveness. It is unlikely the SBA will penalize employers in the loan forgiveness calculation if the employer can show that they made a good faith, written offer of rehire, and can document the employee’s rejection of that offer. Letters should include a return-to-work date, an overview of what’s changed and what hasn’t, the status of their benefits, a summary of new health and safety procedures for reassurance, a deadline to accept or decline the offer, and a job offer to return an employee to “suitable work.” Exact definitions vary from state to state, but in general, suitable work means a job that offers wages comparable to recent employment and work duties that correspond to education level and previous work experience.

Just because you offer suitable work, however, does not guarantee it will be accepted. Those collecting unemployment are usually required to certify weekly that they are attempting to find employment (though some states have suspended this requirement due to the unique circumstances of many COVID-19 layoffs). It’s implied that offers of employment must be accepted except if there is “good cause” to reject it, such as a change to the nature of the work, reduced pay or salary, a new duty location, for example. When an employee refuses an offer to return to work and is collecting unemployment compensation benefits, a final determination of whether good cause exists must be made by an administrative law judge. 

Two reasons that do not qualify as “good cause” are fear of contracting COVID-19 (as long as you are following safe practices and taking reasonable precautions for worker and customer safety during the pandemic) or the fact that the person is earning more from unemployment benefits than the offered wages or salary. Depending on your state’s requirements, you may be required to report these types of refusals.

For example, in Ohio, “employees are expected to return to their previous employment if asked to do so and if there is not otherwise good cause for refusing to return to work.” Refusing to return to work without good cause makes an individual ineligible for further unemployment benefits. Employers can notify the agency by filing the "Eligibility Notice/Refusal to Return to Work Form. secure.jfs.ohio.gov/covid-19-return-to-work/.

Most of us are eager to get back to business as usual. We need to follow health and safety precautions to continue opening the economy, but we also need to take steps to protect our businesses when we rehire. Count on Horizon Payroll Solutions to keep you informed on important HR matters as the COVID-19 continues to evolve.

Disclaimer: This article is provided for informational purposes only and is not intended as legal advice. Please consult an attorney or your local or state jobs department with specific questions.

Matt Stokely is a shareholder with the law firm Pickrel, Schaeffer and Ebeling in Dayton, Ohio and is the Chair of the firm’s Labor and Employment Department.