CASCADE OF OPTIONS FOR
We are in unprecedented times and employers in California are facing some of the toughest challenges of the last century. We believe that the vast majority of businesses are trying to make the right decisions for their employees and the survival of their organizations. Many of these businesses have been faced or will be faced with very difficult choices as we pass through this pandemic. These choices involve a complex overlay of financial considerations, operational challenges, legal and tax implications, and cultural, moral, and ethical concerns.
As we have counseled our clients through the beginning stages of the COVID-19 crisis, we have developed a menu of tools that can be used by businesses to get through an economic downturn. Not all of these tools are “legal” tools so to speak, but each of them has legal implications, and it is from this perspective that these tools are presented. You should of course consult your financial, tax, and business advisors as well as your own judgment and common sense on many of these options, as needed.
These tools are not mutually exclusive and most can be used in combination, but in general we have tried to organize them as a cascade of options that move from the mildest to the most momentous. We hope that most employers try to use a combination of less severe measures to preserve jobs, morale, and the common good, before jumping immediately to layoffs. While we understand that some businesses will have no choice but to do layoffs, we’ve seen companies that initially thought they needed to perform layoffs be able to work around layoffs using some of these options and relying on relief from the recent stimulus legislation, which incentivizes employee retention.
As with anything else, there are layers of complexity with any business/legal decision. Below is an overview of the options at a glance with links to additional resources, where applicable. There are three principles to keep in mind when evaluating these options:
 All materials have been prepared for general information purposes to permit you to learn more about issues related to the impact of the COVID-19 pandemic. The information presented is not legal advice, is not to be acted on as such, may not be current and is subject to change without notice. We are providing this information to help keep you informed, and before you take action you should consult your financial, tax, legal, and businesses advisors, as well as your own judgment and common sense, on many of these options.