Jamie Black-Lewis owns two spas that had to close due to Coronavirus shutdowns. Like many other small business owners, she applied for and received a loan under the Payroll Protection Plan. In order to be forgivable, she needs her employees to come back to work and to use most of that money on payroll.
They don’t want to come back to work.
Why? They make more money with unemployment than they do with their regular paychecks.
But, it’s more complicated than that. Here’s what you should know about why employees don’t want to come back.
Spa services are tipped services and Black-Lewis’s spas are closed. While there’s probably plenty of work to be done, there aren’t any tipping customers.
To keep reading, click here: Why Some Employees Don’t Want You to Reopen
21 thoughts on “Why Some Employees Don’t Want You to Reopen”
Guess I’ve never understood the “ I make more money on unemployment angle” #1 it couldn’t be much more #2 its limited duration – usually 26 weeks. I guess the lazy don’t think beyond the immediate payout.
The Federal legislation added $600/WK on top of what state unemployment pays. That may well pay a lot more than what some employees were making when they were working. In that case, since the business remains closed anyway, the employer should leave them out on unemployment, and not call them back until the business can fully open. The worst case scenario is that the Federal Paycheck Protection money doesn’t convert into a grant, and the employer ends up having to pay it back, as a loan, at 1% interest.
For my wife, it’s more than she was making — the retailer she works for had been trimming employees hours in the weeks previously as store sales slipped. Of course she hasn’t seen a dime of that $600 and unemployment yet, but she’s supposedly eligible according to her unemployment account.
I agree with GrannyBunny. And honestly, it’s not lazy, it’s practical if you have a family to provide for. Let’s say someone is making $9.00 an hour – almost $2 an hour over federal minimum wage. That’s $1440 before taxes and health insurance. The extra $2400 a month, even if for only 12 weeks is $7200. It would take them 5 months of working to make the extra they could be getting in only 3, plus their regular pay. In other words, once you add their UE plus the extra pay – they can make in 3 months what would normally take them 11 months to make. Who WOULDN’T want to sit at home when they could be providing their families a level of income that would be impossible for them to otherwise achieve?
Not everyone is getting the extra $ 600. My position was eliminated last month. I am receiving $ 9.75 per hour for unemployment in my state, minus taxes. AND that is the most any unemployed person can receive in my state. I was in management. A lot of organizations are not hiring right now.
Many people collecting unemployment probably want to work. They also want to maximize their income. Seems reasonable to me. Also seems reasonable to me for people to be paid fairly when they are employed. I know that doesn’t happen based on the income disparity widely reported in this country.
People will go back to work because the federal chump change will end quickly. What then? Unless Don and Mitch and Nancy intend to keep buying votes and mortgaging beyond repair… Americans are easily duped.
Doesn’t anyone see that is also an effort by the government to encourage people to stay unemployed relying on benefits rather than being productive. What kind of world are we producing that encourages laziness unless there’s an ulterior motive? Okay I see the money aspect of getting more when you barely worked 10 hours a week, but why were you only getting 10 hours. A highly motivated employee would not accept 10 hours a week for their full income, they would have been working enough hours to support themselves ( the word is self-suffient) . I don’t know if anyone who can support themselves working 10 hours/week unless they are also getting support to cover real bills. The only unemployed people that should benefit from the extra $600 bonus should be those forced from their full-time job into a furlough using up their own paid personal time benefits with no guarantee of being called back to work. Unemployment benefits is merely an aid between jobs and should never be more than potential employment earnings.
Agree Maria, when the Gov’t is involved in any solution it muddies the situation. In this case it creates incentive for business owners to get forgivable funds for hiring back employees who are disincentivized to work. And some want the govt controlling our health care. SMH.
Hard disagree. I see the states reopening as a ploy to offload the burden of the UI from the state to the small businesses even though all empirical evidence points to Covid spiking again. People will have to work and risk infection or be let go. Businesses that care about their staff will have to open or lose the SPP loans. Then when it spikes again and everything is closed again the people who chose to stay safe at the cost of their jobs will not be on the states payroll anymore.
Youve really drunk the koolaid if you think a measly 125 extra a week is creating a lazy and entitled workforce. Business owners dont have to be on the front lines risking infection to reap their profits. Our country is rich enough to give a UBI through this to secure the middle class but they’ve instead gave tax breaks to the 1% who are furloughing their staff anyway. Banks are also not giving anyone mortgage breaks so forclosures will spike, cash buyers will swoop in and bulk hold purchase like they did in 2010 and housing will continue to become out of reach for most americans. The rich are the lazy entitled ones not the furloughed/unemployed.
You do realize the government is the biggest payor in America right? Also they set the healthcare regs. Most private insurance follows along with CMS regarding their regulations and payment models too.
I find it so funny how many people are like – keep the government out of American healthcare! The government practically runs American healthcare. Private insurance just injects more complexity by adding in prior auth roadblocks to delivering care and arbritary coding changes. Their discounts also drive up hospital charges. Their denials also increase administrative (eg people like me) costs which get off loaded to patients.
Source: I work in a hospital. Its my job to configure EMRs with insurance plans. I also keep up on the federal registrar CMS regs to insure compliance to things like COPs, HIPPA, CARES etc. I also set prices for post acute services.
I wholeheartedly agree. This is exactly what I think when I hear “I don’t want government running my healthcare!”
The government is already running your healthcare! You just never knew it.
“Medicare [reimburses] hospitals for a significant share of residents’ salaries. The Balanced Budget Act established limits on those reimbursements, effectively fixing the number of funded residents at 1996 levels.”
I see the extra pay as a honey-trap to smoke out workers who don’t have a strong work-ethic. A year from now when the economy is as recovered as it is ever going to get, that blank period on your resume that lasts for months after curfew was lifted is going to stick out like a sore thumb as you try to find work.
I doubt it. A few months gap is not a lot. Plenty of places laid off and didnt furlough.
You guys are acting like jobs are growing on trees. I lost my job before covid (a re-org in Dec). I had several interviews in January and February – and then – covid.
Now, not only are there no interviews, there are no jobs to apply for. You don’t think I would rather have a job with benefits than UI that barely covers my $1,200 a month COBRA charge?
My resume is blank not because I don’t want to work but because there is not work to be had.
Actually, its not SAFE TO REOPEN THIS SOON
Exactly! And if you do open your business, how many customers will you have? Can your business survive on 15% capacity? Do you want to open now and burn through your loan in a month, or wait until people are actually comfortable leaving their houses and filling your business?
Bringing back employees early will only mean that they will be laid off again when the money runs out.
Well, theoretically they would get more on unemployment…Do you know anyone that has received an unemployment check yet?
I am also guessing that they dont have employer paid health insurance, since anyone that does is usually better off coming back to work to cover those costs.
Thank goodness I’m not a massage therapist anymore! I worked at a spa for 6 years and if I was still practicing, I would not come back to work now. First, there are not enough clients to fill my books. Yeah, you get one or two people venturing out, but 90% of my clients have the sense to stay home. Second, I was paid 100% commission. I did not receive a base pay so I only earned money when I had clients. No clients = zero pay. Third, why on earth would I massage people during a pandemic? No amount of hand sanitizer would be enough. I’d have to spend 30 min between clients scrubbing down the clinic, and I still could contract Covid just for being in such close proximity to a client. And if any of my clients became infected, I would get blamed and my reputation and possibly my license would go down the drain. Nope-er-ino! I’ll take life over a $40 a week commission check.
Being stingy about aid so that lazy bums will get off their duffs and get a job doesn’t make sense in a pandemic. Lots of people who normally work hard are out of work now. Being jobless even with generous assistance is punishment enough for the many people who would rather be working. And for everyone’s sake it’s a bad idea to make aid so stingy that it’s an incentive for both the hard working and the lazy to rush out and get a job working directly with other people just now. Maybe such incentives will be appropriate later but now is not the time.
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