Supporting Low-Wage Earners to Keep Them On the Job

We’ve talked to several employers over the past week who are working hard to keep hourly workers on the clock and productive. The essential employees working in grocery stores, pharmacies, the food service industry, warehouses, and delivery services are just the tip of the iceberg – many industries, from healthcare to communications to finance, have low-wage essential workers. Depending on their personal, family and employment situations, some employees who weigh continuing to work against collecting unemployment insurance are choosing the latter as a safer source of income. What can you do to better support vital workers during these difficult times to keep them on your payroll? Here are some ideas: 

Short-term financial support

  • Transportation support (e.g., private transportation, gas stipend, transit reimbursement, parking reimbursement)
  • Stipend/vouchers/reimbursement for short-term cash expenses (e.g., gas, groceries, utility bill for one month)
  • Paycheck accelerating options for hours already worked (hourly employees)
  • Options for paying for household items via payroll deduction 
  • Delivery of essential goods (food, Rx, household supplies) or provide vouchers

Benefit support

  • Vacation pay when economy resumes (with the message, “your hard work now will pay off later”)
  • Extend deadline for vacation carryover usage
  • Voluntary (or employer paid) hospital indemnity plan
  • Waiving member cost sharing for employee and family for COVID-19 treatment
  • Expanded EAP program
  • Child care/ elder care support
  • Support for parents, including home schooling teaching resources

Flexible scheduling

  • Compressed work week
  • 4-day work week
  • Ultra flex or “results-based” schedule

Hazard pay

Our survey of over 600 US employers found that – through April 1 -- most were still paying essential employees their regular pay only. However, it may be time to rethink that policy. From our job evaluation methodology, we know that jobs with “risk to life” are compensated at higher rates than jobs where there is no risk to life. The pandemic has moved jobs that were formerly zero risk into higher risk categories – some all the way to maximum risk. As Mercer, we’re working to establish a rule of thumb that captures this change of risk profile and its impact on compensation levels to provide a fact-based way to inform hazard/risk/premium pay decisions. 

It goes without saying that efforts to protect your employees and keep them safe on the job are critical – and should be clearly communicated to employees to help alleviate fears. But at a time when other people are being told to stay home for their safety, going the extra mile to provide support and show empathy to workers who are being asked to do the opposite could make a big difference in how they feel about staying on the job.

Note: Some of the strategies discussed above raise tax and regulatory issues; we can help you identify and think through how to address those issues prior to implementation. 

Special thanks to Sherry Crowley, Will Ferguson and Marty Roberts for their contributions to this post.

Tracy Watts
by Tracy Watts

Senior Partner, National Leader for U.S. Health Policy

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