An employee at work in the meat department of a Florida supermarket. Such workers are considered essential and are taking risks during the pandemic but are not highly paid. Joe Raedle/Getty Images

Who should pay for hazard pay?

Kristin Schwab Jul 24, 2020
An employee at work in the meat department of a Florida supermarket. Such workers are considered essential and are taking risks during the pandemic but are not highly paid. Joe Raedle/Getty Images

Sixteen dollars an hour — that’s how much Rashad Lloyd was making at Total Wine & More in Virginia in March. Now, he’s making $14 because his hazard pay expired in April. And he feels pretty stuck. It’s not like there are a lot of other jobs out there.

“There’s absolutely no alternative right now, and a lot of these companies understand that there’s no alternative,” he said.

Back in March, when stay-at-home orders began, a bunch of businesses were giving essential workers hazard pay, typically a $2-an-hour boost. Now, even though the pandemic is surging in much of the country, hazard pay has mostly disappeared.

That’s partly because at the beginning of the pandemic, companies were worried employees wouldn’t show up to work.

“The power dynamics have changed,” said Erin Hatton, a professor of labor sociology at the State University of New York, Buffalo. “Employers are more easily finding workers, so they’re decreasing incentives to bring workers into the workplace.”

Companies also feel like they don’t have to pay extra because stay-at-home orders have lifted. And aside from big companies like Amazon and Kroger, a lot of businesses can’t afford to give hazard pay forever.

“Business owners need to be supported by governments. I mean, this cannot be an employer enterprise,” Hatton said.

Now, states are stepping in. This week, Pennsylvania established a grant program for businesses to offer bonuses for workers in healthcare, transit, food manufacturing and food retailing.

That’s one way governments could support essential workers. They could also offer companies incentives, like tax breaks. Or mandate that companies pay up, though that means businesses that are already struggling would continue to foot the bill.

A government mandate would also do something else: create rules and guidelines around hazard pay.

Before the pandemic, most people would never have called a grocery store worker’s job dangerous. And now that we’ve reopened much of the economy, with the virus still a threat, many would argue hairstylists and restaurant servers are doing dangerous work, too, said Nicole Hallett, a professor of labor law at the University of Chicago. 

“The definition of what we considered to be hazardous work, what is hazardous work, has changed.”

COVID-19 Economy FAQs

With a slow vaccine rollout so far, how has the government changed its approach?

On Tuesday, Jan. 12, Health and Human Services Secretary Alex Azar announced changes to how the federal government is distributing vaccine doses. The CDC has expanded coronavirus vaccine eligibility to everyone 65 and older, along with people with conditions that might raise their risks of complications from COVID-19. The new approach also looks to reward those states that are the most efficient by giving them more doses, but critics say that won’t address underlying problems some states are having with vaccine rollout.

What kind of help can small businesses get right now?

A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.

What does the hiring situation in the U.S. look like as we enter the new year?

New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.

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