Employers should check state laws, however, for minimum hours pay requirements. Absent a contract or collective bargaining agreement providing otherwise, hourly workers need be paid only for actual hours worked. Furloughing or reducing the hours of non-exempt workers typically is straightforward. Those considering these options should be cautious about potentially jeopardizing the status of employees who are exempt from the minimum wage and overtime requirements of the Fair Labor Standards Act (FLSA) and applicable state laws by inadvertently violating the salary basis requirement of the exemption. Many employers will consider requiring mandatory use of paid leave and implementing furloughs, temporary shutdowns, or reduced-hours plans as alternatives to layoffs. Whether agencies will have authority this time around to make retroactive adjustments to contracts for impacted employees is unclear. Agencies paid workers retroactively once the doors reopened, but many government contractor employers were not reimbursed for the days their workers were idled on government contract projects. Past government shutdowns have led to a temporary loss of income for federal workers and a permanent one for many government contractors. In addition to the federal WARN Act, employers should consider applicable state mini-WARN laws that often contain requirements that are different and more stringent than the federal law. During the 2013 government shutdown, various agencies issued interpretation and guidance memoranda regarding these notification issues, but none had the force of law. When notices should be issued in the case of a government shutdown, when the period of work disruption may be unknown, requires analysis on a case-by-case basis. Notice must be given as soon as the triggering event is foreseeable. An exception to this requirement has been made for “unforeseeable business circumstances.” This exception allows an employer to order a mass layoff or a plant closing without giving the full 60 days’ notice if the layoff or closing is caused by business circumstances not reasonably foreseeable at the time that notice would have been required. An employer that fails to provide appropriate notice faces steep penalties. A mass layoff is defined in terms of the number of workers at a single site of employment who suffer an employment loss (including a layoff for more than six months or a reduction in hours of more than 50 percent in each month of a six-month period). Under the federal WARN Act, an employer with at least 100 employees ordering a mass layoff or plant closing must provide 60 days’ written notice to affected non-union employees, union representatives, and certain government officials. A plan for timely and effective communications with employees on these matters is equally important for employers. The employment and labor law concerns that a government shutdown raises include compliance issues with the Worker Adjustment and Retraining Notification (WARN) Act and wage and hour law, the impact on employee benefits and immigration status, and labor union and collective bargaining agreement issues. To avert an immediate shutdown, some lawmakers are advocating a four-to-five day funding extension, but key House Republicans have announced they would not pass such a continuing resolution if sent to the House by the Senate. Senate has yet to take a vote on the funding measure and key Democrats have vowed to block the measure unless DACA is addressed. House of Representatives passed a bill on January 18 that would extend funding for one month, giving lawmakers and the White House time to try to resolve contentious issues centered on the Obama-era Deferred Action for Childhood Arrivals (DACA) program, which President Donald Trump announced in September 2017 that he would rescind. While some contractors were able to secure retroactive funding to cover or defray labor costs associated with the 2013 shutdown, such funding varies from agency to agency, and from contract to contract-which can make planning difficult. The 2013 government shutdown lasted two weeks and caused havoc for many government contractors and uncertainty with respect to a host of employment and labor laws implicated when funding suddenly stopped and employees could not report to work. The fact that one political party has control of both the White House and Congress makes this instance historically unique. A government shutdown looms on January 20, when the current government funding expires at midnight on January 19.
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