How Unemployment Works

“I just don’t understand how unemployment works when I’m able to offer a little part-time work for employees.”

Your HR Survival Tip

We have been exposed to just about every combination of work versus unemployment this year. One of the questions we get most often is how unemployment is affected if you only give the employee a few hours each week rather than full-time work.

When a worker is on unemployment but also works part-time, they are required to report those earnings every two weeks to EDD (California’s Employment Development Department). EDD then does a calculation based on those earnings versus the worker’s unemployment benefits, based on one of two ways:

  • Method 1 — This is used when that paycheck is more than $100. The first 25% doesn’t count but the other 75% is subtracted from what the employee would have received in unemployment benefits that period.
  • Method 2 — This is used when that paycheck is $100 or less. The first $25.00 doesn’t count but the rest of the paycheck is subtracted from what the employee would have received in unemployment benefits that period.

We appear to be at the end of the Federal add-on to unemployment. However, knowing these calculation methods may help you in the future when trying to get employees back to work.

More Become Independent Contractors

If you have or were using independent contractors, you know California has complicated it over the past couple of years. The California Supreme Court established the ABC test, which made it very hard to have contractors doing anything related to customers. Then AB5 clarified certain positions could be classified as contractors. While this opened the door a bit, it’s still been hard for most companies to hire contractors and be confident with that decision.

Governor Newsom just signed AB2257, which now opens that door a bit wider. Workers that may now qualify as independent contractors include:

  • Certain occupations in connection with creating, marketing, promoting, or distributing sound recordings or musical compositions.
  • A musician or musical group for the purpose of a single-engagement live performance event, except in certain conditions.
  • An individual performance artist presenting material that is their original work, creative in character, and the result of which depends primarily on the individual’s invention, imagination, or talent.
  • Still photographer, photojournalist, videographer, or photo editor, as defined, who works under a written contract that specifies certain terms.
  • People who provide services to a digital content aggregator, as defined, by a still photographer, photojournalist, videographer, or photo editor.
  • Fine artist, freelance writer, translator, editor, content contributor, advisor, narrator, cartographer, producer, copy editor, illustrator, or newspaper cartoonist who works under a written contract that specifies certain terms.
  • People who provide underwriting inspections and other services for the insurance industry, a manufactured housing salesperson, subject to certain obligations, people engaged by an international exchange visitor program, consulting services, animal services, and competition judges with specialized skills.
  • Licensed landscape architects, specialized performers teaching master classes, registered professional foresters, real estate appraisers and home inspectors, and feedback aggregators.

AB2257 revises the conditions when business service providers providing contracted services to another business are exempt (from the ABC test). There is also an exemption for business-to-business relationships between 2 or more sole proprietors. The bill states the hiring entity need only satisfy all of the conditions of one of the exemption provisions to qualify for the exemption from the ABC Test.

However, having your profession listed above is not the only criteria. AB2257 provides us with a lot of workers who may qualify as independent contractors but there are a lot of details not listed here. At the very least, these workers must meet the usual qualifications of actually looking and acting like a true business. This means they, ideally, have a business name, business license, liability insurance, marketing collateral, and definitely more than one client. You may still want to avoid working with those people who aren’t taking their work seriously enough to create a real business out of it.

Special Updates

We often see little pieces of information that may affect you. This is just a quick summary of some of those items.

FFCRA Back to School Options

It’s possible the Families First Coronavirus Response Act (FFCRA) has more frequently asked questions (FAQs) and answers than anything we’ve seen in years. As always, the emergency Family Medical Leave (FMLA) component is available to employees who are unable to work or telework because of childcare issues. Now that schools have reopened in one format or another, more explanations were in order. The newest additions are FAQ #98, 99, and 100. Some schools now or in the upcoming months will offer in-person classes. The FFCRA monies will only be available if the school is not offering in-person classes, forcing the employee to stay home with their child due to remote learning. However, keep in mind the original qualification…the employee also cannot be able to work OR telework due to childcare issues.

FFCRA Revisions

Based on a court decision in New York, a few things have changed with how the FFCRA is generally applied by companies.

  • If someone is still officially your employee, they may be eligible for FFCRA monies even if they aren’t currently working (e.g., furloughed, sitting, or on a leave).
  • The employer can no longer deny FFCRA intermittent leave if the employee otherwise qualifies.
  • The employer may not require the receipt of documentation prior to starting to pay out FFCRA monies.
  • “Healthcare provider” now has a narrower definition so it doesn’t include non-healthcare employees, such as office employees.

Social Security Deferral

In August, President Trump signed an executive order that would allow employees who make less than $2,000 per week postpone paying their social security taxes for a few months. Immediately thereafter, the questions began. Based on the latest information from the Internal Revenue Service (IRS), it doesn’t appear that employers will be required to offer this deferral…and it seems most small employers won’t. Aside from the payroll questions arising on how to defer that social security tax, you may have another problem. If the employee leaves your company before paying back their withheld tax, you may be stuck trying to get the ex-employee to pay you back. Yes, it seems you must pay the IRS and then get reimbursed by employees.

Compensation Increased

The Bureau of Labor Statistics shows total compensation rose an average of 2.7% over a year (2.9% in salaries and 2.2% in benefits). Total compensation is a combination of all monies spent on employees for wages and all benefits.

Too Much Leave

“I have an employee on pregnancy/maternity leave but I need to call her back to work because I’m short on help right now. What are my options?”

Your HR Survival Tip


Different leaves of absence have different rules in California. Many of the differences are related to company size but pregnancy leave has very specific rules.


  • When your employee wants to stop working, she must provide you with a doctor’s note stating the date she must stop working and the expected amount of time off. This is considered the disability period because pregnancy is managed the same as other disability leaves. However, pregnancy disability is protected time off in California (meaning you must give her the same job back once she returns to work). The normal time off is 8 weeks and you cannot require your employee to work during this period or there could be legal issues.

Baby Bonding

  • Baby bonding is not always protected time off. In a company with 19 or fewer employees, the company does not have to offer any time off for baby bonding. In fact, if you do offer it, it is actually just a personal leave of absence and is not protected time off.
  • Protected time off for baby bonding is only available if your company has 20 or more employees and your employee is eligible through New Parent Leave or Family Medical Leave. Eligible employees must have been employed for at least 12 months, worked at least 1250 hours during that 12 months, AND are employed at a worksite with at least 20 or more employees within a 75-mile radius. This type of leave can be used by either parent.

A quick reminder here that Paid Family Leave is NOT a leave of absence. It’s merely a badly named plan that provides employees with supplemental pay from the state if the employee should qualify for, or you approve, another leave.

Your Choices

You have no choice about the disability leave. You have no choice about the New Parent Leave or Family Medical Leave. However, only you can approve or deny a personal leave when you have 19 or fewer employees. If your company is under 20 employees, recognize there are too many things that may change and you may need the employee back to work sooner than planned. Therefore, consider waiting to approve baby bonding time until the date is a bit closer.

Baby bonding time can be used anytime within the first year of birth so the employee doesn’t lose that benefit by accommodating you during your emergency. Admittedly, it’s much harder to cut the time short if the possibility hasn’t been discussed in advance. When approving unprotected time off, we recommend you provide the employee something in writing about their time off and retaining the right to shorten their leave (if legally possible) based on business needs. A good employer won’t abuse this right. A good employee may not be happy about changing their plans but is expected to work with you to find some middle ground.

COVID-Related Changes

“I haven’t been paying furloughed employees the emergency paid sick leave but just heard I might need to do it. Am I in trouble?”

Your HR Survival Tip

We have been subjected to ever-changing opinions and rules about COVID-19 since February…and now we have more. Most of these changes have not been backdated so you shouldn’t get in trouble for following the guidance current at that time. The latest changes include:

FFCRA for Non-Working Employees — Originally, only employees actively working were eligible to receive the FFCRA (Families First/CARES) money for emergency paid sick leave or emergency paid childcare leave. Now, anyone still in your employ may qualify for FFCRA money even if there is no available work for them (e.g., furloughed or sitting employees). Note: We don’t believe this applies to employees on a leave of absence.

FFCRA Documentation — You may not require documentation for a COVID-related leave PRIOR to the employee starting the leave. The employees will still need to provide documentation but they may begin the leave and then provide backup as soon as it’s practicable.

CDC Quarantine — The CDC is now only recommending a quarantine of 10 days after a positive test (rather than the original 14 days), assuming mild to moderate effects. However, the employee must also be symptom-free for at least 24 hours.

Intermittent FFCRA Leave — The original rules allowed you to approve or deny the employee’s request for intermittent leave. Now, you must approve it unless the intermittent leave poses a higher risk of infection to others. This change will usually only affect employees using the emergency childcare leave.

Healthcare Provider Definition — The Department of Labor’s (DOL) definition of healthcare providers included everyone working at a healthcare organization, regardless of position. This definition has been narrowed to those actually providing healthcare…but check with your attorney if this might affect your company.

We understand how hard it is to know what the current guidance might be because it has changed so many times. Tracking all the changes related to COVID is even harder than keeping up with California laws. Please contact us if you have a specific question.


We all know the independent contractor scene has been dramatically altered in the past two years. First, the California Supreme Court instituted the ABC test in March 2018, then AB5 was passed in October 2019. Now the Labor Commissioner’s Office is acting on those changes by filing lawsuits against companies.

Mobile Wash, Inc. — This Bellflower company was recently sued by the Labor Commissioner’s Office (LC Office) for misclassifying workers as independent contractors rather than employees. The claim is at least 100 workers were misclassified because those workers did not pass the ABC test. In addition, the company is charged with paying those workers less than minimum wage because the workers were not reimbursed for expenses incurred.

As the company name implies, workers went to customer locations to provide services. The workers were required to use their own vehicle (plus buy gas and insurance), pay for their Mobile Wash uniforms, and pay for cleaning equipment and supplies. In addition, the company charged the worker a $2 transaction fee for every tip left on a credit card. The LC Office also found unpaid overtime, rest and meal break violations, and failure to provide paid sick leave.

Uber and Lyft — These two companies have also been sued by the LC Office for misclassifying their drivers as independent contractors and this suit has been extended to cover nearly 5,000 drivers. As above, this case is about monies owed the drivers for minimum wage, overtime, and meal and rest breaks. The LC Office is asking the court to order these companies to stop classifying their drivers as independent contractors.

Using “gig workers” for your business became a big risk in 2018 and continues. The goal of the Labor Commissioner’s Office is to ensure employees are paid every dime owed them and part of that means ensuring workers are properly classified. If you are using anyone you are calling an independent contractor, it’s past time to confirm they will pass any test thrown your way.

Tool Time

“I’ve always provided the tools my field employees need. Then an employee told me a previous employer made employees use their own tools. How can I implement that?”

Your HR Survival Tip

As you may have noticed, there seem to be laws or lawsuits for nearly everything employment-related in California. There are three things to consider when you have employees who use or need tools in the field:

  1. Employer-provided tools — You provide all the tools, including maintaining and replacing them. You are not able to charge employees for the replacement of lost tools so consider a check-out/check-in system to track your tools.
  2. Employee’s tools — In California, you are only able to require employees to use their own tools on the job if you are paying those employees at least twice the state minimum wage (currently $24 or $26 per hour, depending on company size). If you have employees earning less than that, you are responsible for the tools.
  3. Paid commute — If you have employees carrying your company tools in their personal vehicle every day, there is the possibility you may be responsible for their commute time and costs. Current lawsuits haven’t yet been settled but it appears a paid commute may depend on the amount of space the tools take up in the employee’s vehicle, whether you require the employee to keep the tools in their vehicle at all times, and whether carrying those tools impinges upon the employee’s ability to use that commute time as they wish.

Our wage and hour laws have long dictated the rule about paying the employee sufficiently if they are expected to buy and maintain their own tools. The new question about how the unpaid commute might be changed when hauling around the company’s tools is still unanswered. However, the fact is there are now lawsuits about this topic so it would be wise to explore your policies and practices to ensure you don’t end up on the wrong side of that decision.

Documenting COVID

“What do I need to track for COVID and what do I do with the information?”

Your HR Survival Tip

Running a business has become increasingly difficult as COVID rules and responsibilities keep changing. The one thing we all know is to send an employee home (or tell them not to come to work) when they have symptoms and/or test positive for COVID. But what then?

1) You follow your protocol, which should include finding and notifying those potentially exposed, cleaning the work area of the person who tested positive, etc. When warning about the exposure, you only say “someone you work with has tested positive.” While the employees may figure out who it is, the name can’t come from you due to privacy laws.

2) The next step is to notify your local health department to inform them of a positive case.

3) The last step is determining if this positive test must be reported on your Cal/OSHA Log 300 (that is posted February 1 to April 30 each year). You must list this incident if the employee misses work, is diagnosed by a doctor, has medical treatment beyond first aid, etc. These are the primary things that happen when someone tests positive so it will be surprising if you do NOT have to list the incident.

4) Only if the positive employee is hospitalized (or worse) must you report this directly to Cal/OSHA within 8 hours of learning about it.

The CA Department of Public Health (CDPH) has provided detailed information for employers that can help you with a positive result and even with your protocol. In addition, Cal/OSHA has provided useful FAQs (frequently asked questions) that can also help you know what recordkeeping is expected of you by California.

Anyone with employees in California is familiar with the ever-changing employment laws but COVID has pushed employers to the limit in many ways. In addition to running a business, you are now constantly watching for changes that reflect new information and require expanded safety protocols. Let us know if you need any help or resources.

Revamping Descriptions

“I’ve been reorganizing duties as I’ve begun bringing employees back to work. How do I let my employees know what’s now expected of them?”

Your HR Survival Tip

It seems any major financial crisis, such as a recession or pandemic, results in companies finding new and better ways to be more efficient and more profitable with fewer employees. The changes initially made are based on immediate necessity but then you realize what you’ve done can actually work well going forward. Major changes require a different approach but the following works well for tweaking workloads.

You’ll start with an initial conversation with the employee to inform them you have made changes based on business needs changing, reorganizing the workflow, reorganizing the work to better match skills…whichever reason fits your scenario. Then provide the employee with those changes via memo or updated job description.

We prefer a revised job description because it has many purposes and, in this situation, provides a better overall description of what the job now entails rather than just listing the changes. Ideally, you provide a job description to candidates when hiring, use it to keep employees focused on their responsibilities, and have it play a key role during performance reviews.

Create your job description by starting with a list of 6-8 primary responsibilities for that role. You’ll know you’ve listed the correct items if you would be satisfied with the employee if they accomplished little else. Use 1-2 sentences for each of your 8 items so you’ve encompassed the whole responsibility.

As an example, the first responsibility for a Customer Support Rep might be: Field customer calls, record complaints, assist customers with answers to their technical questions and help them resolve their product problems/inquiries following tactics outlined in standard operating procedures. Evaluate customer problems and determine the point of escalation.

You probably wanted to create at least 5 bullets for that example. However, once they answer the phone, the rest of that statement just includes the possible outcomes of that call. Therefore, it’s all one thing and it’s easy for the employee to understand this is what you’re expecting from them because it’s presented in a more cohesive manner than bullets.

There are a few more things you ultimately want to add to each job description but this is a fantastic start. Every job description needs input from the employee and management to ensure its usefulness and accuracy. Job duties change periodically and so should job descriptions. Let us know if you’d like help!

Careful v. Practical

“I don’t know how to handle all the possible exposures I’m hearing about from employees. Nothing seems to work for both the employee and my company.”

Your HR Survival Tip

Not surprisingly, companies are receiving more and more reports of employees who may have been exposed. We don’t know of any single solution that will work for everyone but we can tell you what some companies are doing.

It’s important to remember that without COVID symptoms, there is no financial help for the employee from the government. The employee must have symptoms AND be talking with a doctor or getting tested to qualify for the Families First money (emergency paid sick leave for 2 weeks).

There are three primary exposure solutions we’re hearing about but each has a negative:

  • Super Safe — You have an employee who was “possibly exposed” go into self-quarantine for 2 weeks. Give some thought about how many of your employees may be potentially exposed at any one time and that those employees won’t be paid during the quarantine period since they don’t have symptoms. The negative is the employee is unpaid for two weeks and you’re low on headcount that could affect your ability to keep things going. However, this can be a very workable solution if employees can successfully work remotely during the quarantine.
  • Careful But Practical — You have employees who were “possibly exposed” stop working until they can be tested and get the results. Some companies are paying for the testing but not for the time off while waiting for test results. The negative is the waiting time…particularly since we have heard some testing sites are not even allowing an asymptomatic employee to be tested for two weeks. Again, remote work can fill the waiting gap but, if that’s not an option, this is the fastest solution for getting employees back to work while also confirming they aren’t contaminating the other employees or worksite.
  • Practical — Unless an employee is showing symptoms, they keep working. Given the number of “possible exposures” we now have and the multitude of ways we might be exposed going forward, this may not be all bad. Overall, it seems to be the symptomatic people spreading the virus, not the asymptomatic people. The negative is dealing with the fear factor from your other employees who have been or are working around the exposed employee.

Before long, employees may realize there is no advantage in informing employers of possible exposure because they don’t want to go unpaid for even a few days. With only exposure but no symptoms, employees won’t qualify for unemployment (because they can’t work) or state disability (because they aren’t sick). Ironically, if you have and enforce good safety protocols, your employees may be safer at work than at home where they take safety more casually.

There is no perfect answer in the current environment. You need to look at how your business operates and what system would work best for both you and your employees. You may even develop a plan that combines some or all of these solutions. Once you decide what you want to do, write up a protocol so everyone understands that system and follows it. It can help employees believe you care about them if you explain your reasoning for choosing that system.