Worker Safety Net Measures Get Attention As Coronavirus Outbreak Grinds On

State and federal leaders are looking at options to provide more of a safety net for workers and to bolster businesses amid an evolving economic threat from the coronavirus outbreak.

President Trump said on Monday that White House officials would meet tomorrow with congressional Republicans to discuss the possibility of a payroll tax cut or other relief. Those talks, the president said, would also focus on plans to aid hourly wage earners so they “can be in a position where they're not going to ever miss a paycheck.”

Treasury Secretary Steven Mnuchin later added that the administration’s primary focus would be on parts of the economy that stand to bear the brunt of the ongoing public health crisis. “Especially workers that need to be at home,” he said, “who are at home under quarantine, or taking care of their family.”

“We'll be working on a program to address that," Mnuchin added.

The stock market on Monday took a steep dive, which coincided not only with concerns about the coronavirus, but also with turbulence and a price crash in the oil market. But Mnuchin predicted that the economy was not headed into a slump on par with the Great Recession, which began in late 2007. 

“This is not like the financial crisis where we don't know the end in sight," he said. 

House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer on Sunday placed paid sick leave, often not available to hourly workers, at the top of a list of priorities they identified for any forthcoming federal package to respond to the coronavirus.

They said that paid sick leave should be available for workers subject to quarantines, as well as parents caring for kids affected by school closures. Enhanced unemployment insurance and strengthened food assistance programs were among the other policies that the Democratic congressional leaders identified as priorities.

In New York, Gov. Andrew Cuomo said Monday that he would send a bill to the state legislature to provide paid sick leave protections to people staying home from work due to quarantine guidelines meant to help stanch the spread of Covid-19, the illness the coronavirus causes.

These moves come as public health authorities around the country are advising people with symptoms of the respiratory illness, or others who may have been exposed to the disease, to stay home from work and school and to avoid public places for up to two weeks.

“If what is required is that you're quarantined, then we should be providing the appropriate incentives for people to be able to follow what is being recommended,” said Elise Gould, a senior economist with the left-leaning Economic Policy Institute.

“If you need the money, then that's going to change your incentives about what you do,” she added.

The Covid-19 outbreak has now spread to most states, with over 500 cases across the U.S. At least 25 people have now died from the virus, 22 of them in Washington state. At least 19 of the deaths are linked to a nursing home east of Seattle.

New York had documented 142 cases of the virus as of Monday, 98 of them in Westchester County north of New York City.

Cuomo, a Democrat, has stressed that only a handful of people in New York have been hospitalized due to the illness. But, as of late last week, the governor said that about 4,000 people in the state had been asked to follow “precautionary” self-quarantine measures.

Office-based employees who can easily work from home, and who have only mild symptoms, or no symptoms of the illness, may be able to weather a self-quarantine without any major disruption to their lives or their personal finances.

But for other types of workers, like waiters, retail clerks and Uber drivers, working from home is not an option.

"You can't work as a cashier at Walmart from home,” said Judy Conti, government affairs director, with the National Employment Law Project. "Low wage workers in particular are the ones who disproportionately don't have paid leave," she added.

"There are too many people who are forced to go to work when they're sick," Conti said. “A situation like this, it shows us just how acute the problem is.”

Ensuring there is an adequate safety net for people who are not reporting to work in order to adhere to public health guidelines is one concern. Another is that businesses that commonly employ hourly workers, such as restaurants, stores and entertainment venues, are expected to take a hit as the outbreak drags on.

People, companies and universities are already calling off meetings, in-person classes, events and travel plans. And government officials in some places are contemplating whether more stringent restrictions on where and when people can gather in public may be warranted.

Debra Lancaster, executive director of the Rutgers Center for Women and Work, suggested that it could make sense for paid sick leave proposals to include a public subsidy of some sort, so that certain employers dealing with their own financial difficulties are not left footing the full cost of paying employees who are unable to work.

She pointed to catering businesses as just one example of how the coronavirus could ripple through the economy. Businesses may choose to call off meetings and the catering that goes with them—this may have implications for cooks, drivers, servers and food vendors.

“This could create some serious economic instability for the low wage workforce,” Lancaster said.

Lancaster noted that while paid sick leave legislation is a good step towards helping vulnerable workers that, on its own, it “isn't going to fix” the problems that the virus outbreak could pose.

She also said that unlike natural disasters that spur construction projects and other economic activity in their wake, she was having difficulty seeing where the virus outbreak would create comparable economic opportunities going forward for the low-wage workforce.

Trump said Monday that his administration would work to assist companies of all sizes “so that they don't get penalized” due to the coronavirus fallout. He highlighted the airline and cruise ship industries as two special areas of concern.

Cuomo did not provide details on his new paid sick leave proposal during the news conference where he mentioned it on Monday. His office did not respond to multiple requests for additional information. The governor had previously been pushing for a more general mandatory paid sick leave proposal.

The Business Council of New York State, which had been tracking that earlier sick leave plan, declined to comment on Monday on the governor’s proposal related to the coronavirus, with a spokesperson for the group saying that they had not seen specifics about it yet.

State and local paid sick day requirements vary around the U.S. But Lancaster said that upwards of a quarter of the nation's workforce doesn't have access to paid sick days.

Some companies are stepping up with various plans for paid sick leave. Darden Restaurants Inc., which operates the Olive Garden and Longhorn Steakhouse, said Monday that it would offer the benefit to any worker that is currently not covered by it, Bloomberg reported.

App-based ride-booking companies Uber and Lyft said they would offer as many as 14 days of paid sick leave for drivers that contract the coronavirus or are quarantined, even though the companies regularly contend the workers are independent contractors.

"Paid sick days isn't the only thing that could be done," noted EPI's Gould. She pointed to providing unemployment insurance benefits to people who are quarantined as another potential option.

In Washington state, an epicenter for the virus outbreak, progressive and labor groups published an open letter to state and local officials on Sunday warning that the economic fallout from the disease had already led to sizable cuts in hours for service industry workers.

The groups urge state and local leaders to use emergency powers to preserve employee health benefits, halt evictions, prevent utility shut-offs and provide income assistance.

Their letter says that under Washington law, paid sick days can accrue slowly and “almost nobody in any service-sector job has enough sick days banked to ride out a 14-day quarantine.”

“Further, a sick day offers no benefit whatsoever in the event of a reduction in hours,” the letter adds.

Conti said that, similar to natural disasters, what's happening with the coronavirus, "highlights just how fragile we are in terms of our safety net and social insurance programs."

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