June 12th 2020
Daniel is a freelance editor with keen interest to small business and startup.
The coronavirus pandemic is creating unprecedented challenges, both for public health and the economy — and those challenges are causing many businesses to lay off their employees and shutter their doors, at least for the time being.
If your business is having to lay off employees, the process can feel overwhelming and confusing. Let’s take a look at some of the most common questions about how to navigate employee layoffs and terminations in California — and, more importantly, the answers you need to navigate layoffs during the coronavirus:
Q: What information do I need to get my employees to ensure they have what they need to file for unemployment benefits?
A: When your employees file an unemployment insurance (UI) claim with the Employment Development Department, they’ll need the following information:
- Your official company name (as it appears on their pay stub or W2)
- Company contact information, including both mailing and physical addresses, direct supervisor’s name, and company phone number
- Their last physical work day
- Gross earnings in the last week they worked, beginning with Sunday and ending with their last day of work
If you want to make the process easier for your employees, you can provide this information at their termination meeting so they have it readily available when they apply for UI benefits.
Q: How do I confirm my employee’s unemployment status with the Employment Development Department?
Q: Is it even legal for me to lay off all of my employees—especially suddenly and without warning?
Q: When do I give my employees their last check—and what needs to be included?
A: The appropriate time to give your employee their final paycheck is at their termination meeting. Their final paycheck needs to include any outstanding money owed to the terminated employee, including any accrued PTO.
Q: With social distancing in full effect, how do I make sure my employees get their final paycheck in a timely manner?
A: Under normal circumstances, you would terminate your employee and give them their final paycheck in person. But the coronavirus—and accompanying social distancing—is changing the way we interact; in order to protect the safety of yourself and your employees, an in-person meeting might not be possible. You still, however, need to get them their final paychecks in a timely manner.
Q: What about insurance?
Q: What other steps do I need to take when terminating an employee?
A: There are a few other housekeeping issues you’ll want to take care of when laying off employees, including:
Collecting any company property (cell phones, tools, company computers, etc.)
Terminating access to any sensitive company information
Cancelling or removing access to any company accounts or credit cards
Q: Is there any support available to help employers prevent layoffs during the coronavirus pandemic?
Rapid Response Team
Payroll tax extensions
If you’re experiencing financial hardship as a result of COVID-19, the EDD is allowing businesses to request an up to 60-day extension to file state payroll taxes and/or deposit state payroll taxes without interest, penalties, or fines. In order to qualify, businesses need to request an extension in writing within 60 days of the original due date of the payment or return.
A: The state of California’s Unemployment Insurance (UI) Work Sharing Program is an alternative that may be able to help prevent layoffs in your business—while also making sure your employees are eligible for unemployment benefits while their hours are reduced or cut.
Clearly, the coronavirus is the reason behind the vast majority of layoffs at the moment. But regardless of the reason, in order to protect yourself, your business, and your employees, it’s important to make sure you follow California law, federal law, and applicable employment law (state or federal) when ending the employment relationship.
While California is an at-will employment state (which means California employers can end the employment relationship at any time, for any reason), there are certain exceptions. Moving forward with a layoff or a firing for any of the following reasons could result in an accusation of wrongful termination:
- Discrimination, including based on gender identity, age, race, disability, citizenship status, national origin, medical status, sexual orientation, or religion;
- Retaliation (for example, for filing a worker’s compensation claim, taking medical leave, or coming forward with sexual harassment allegations); or
- Violation of Public Policy (for example, refusing to work in an unsafe or illegal work environment or refusing to partake in an illegal activity as part of their job responsibilities)
If you have an employment contract in place with your employees, it’s also important to ensure that you comply with the terms of your contract during the termination process.