Things are finally starting to look up. After the whiplash of last year, with the pandemic leaving no corner of the economy untouched, small businesses are starting to feel some relief as they begin to experience a dose of stability.
However, as the storm of 2020 clears, there exist more hidden—but no less dangerous—risks on the horizon.
But there’s no need to fear. Getting in front of problems allows you to find solutions so you can work on your business instead of in your business. That means spending less time putting out fires and more time focusing on growth.
The Pandemic Legal Minefield
COVID-19 presented new challenges for small businesses, forcing employers to be flexible and reenvision what the workplace looks like. The most common challenge for most businesses was the transition to remote working in response to stay-at-home orders and social distancing measures.
But even for businesses unaffected by remote working, the workplace became more complex due to a host of laws and regulations enacted during the pandemic. As small businesses were forced to lay off employees, grant furloughs and cut hours and salaries, these new compliance risks emerged at the worst possible time.
Legal firm Fisher Phillips keeps a running tally of COVID-19-related employment lawsuits and has tracked over 2,000 cases since January 30, 2020. The largest group of lawsuits occurred in California, Florida, New Jersey and Ohio, with healthcare being the most commonly targeted industry. Paid sick leave and issues related to remote working made up the largest type of lawsuit.
New Laws, Old Problems
Among the flurry of lawsuits last year, many concerned violations of long-established laws such as:
Fair Labor Standards Act (FLSA)
Family and Medical Leave Act (FMLA)
Unsurprisingly, these laws became more prominent in the face of a public health emergency. But other lawsuits were a result of newly established legislation.
The most wide-ranging and impactful law was the Families First Coronavirus Response Act (FFCRA), passed in March 2020. FFCRA required businesses with less than 500 employees to provide two types of paid sick leave for various COVID-19-related reasons. The law also included up to 80 hours of emergency sick leave and up to 12 weeks of extended family leave.
While the FFCRA expired in January, the recently passed American Rescue Plan Act (ARPA), signed into law this March, extended the employee paid leave covered by the FFCRA.
It’s also expected that a series of similar state-level laws may be considered throughout the year, making it unclear what the regulatory environment will be like months—or even weeks—from now.
State of Regulation
It isn’t just federal regulations that pose a risk to a well-functioning small business.
In Arizona, a few high-profile statewide legal changes could lead to thorny problems for small businesses, such as the rising minimum wage and the legalization of marijuana. These issues are worth keeping an eye on since they are always liable to change.
At the same time, a number of lower-profile state laws were passed that may impact Arizona small businesses more directly.
One example is HB 2045, which expanded protections for pregnant workers by amending the Arizona Civil Rights Act (ACRA). As a result of the legislation, Arizona joins 27 other states in prohibiting discrimination against pregnant workers by changing the state’s definition of sex-based discrimination.
New legislation such as HB 2045 presents potential challenges for small businesses who may be unaware of how complex the legal environment can get. Employers will need to familiarize themselves with these laws in order to ensure they stay in compliance and out of harm’s way.
Returning to Normal?
As vaccinations ramp up, it’s looking like normal life is just around the corner. But the fact is, normal life may never return to the workplace, at least not in the way we knew it.
While it might appear that the worst of times are in the rear view, the return to the workplace could present unforeseen problems. Employers who don’t properly prepare for a smooth return may encounter a minefield of legal risk that could sink their attempts to recover momentum and grow.
That plan might include moving your team back in shifts or requiring your team to be vaccinated, although you may run into legal issues with such requests. In addition, employers must consider if they need:
- Redesigned office space
- Better ventilation systems and plexiglass shields
- Additional meeting space for video calls
- Mandated temperature checks
- Childcare solutions for employees
- Collaboration plans for remote and in-office employees
Along with having clear protocols for reentry, employers should also establish a “reexit” plan in the unlikely, but possible, case that the pandemic returns. As much as we don’t want to consider such a scenario, it’s best to be prepared for whatever may come. After all, how many of us could have predicted 2020?
So Is It Worth the Risk?
Now that you’ve had the chance to review all the legal perils that await the post-pandemic workplace, we must ask the question: Is it worth the risk of going it alone?
If you think these types of lawsuits would never target a small business like yours, think again. A US Chamber study found that small business liability costs totalled $343 billion in 2018, making up 53% of all businesses. This shows that legal risks impact every business, regardless of size.
In addition to dealing with the expected, there’s also the unexpected. No one knows when the next storm will hit, whether it’s another pandemic, an economic recession or something we haven’t yet considered.
When that time comes, you want a trusted partner by your side who can keep you protected from whatever danger lurks around the corner. As a dedicated team of HR compliance experts, Focus HR can help keep the risk at bay so you can focus on what’s important: Your business.
In addition to compliance support, Focus HR offers a full suite of HR services, such as benefits administration, workers compensation, hiring, recruiting, retirement planning and more. As a Tucson-based business, our dedicated team understands the local employment and legal landscape and provides personalized support to help your business stay protected and growing.
Contact Focus HR today for a free consultation to find out how we can help your business grow.