KEY POINTS

  • Unemployment has soared as a result of the pandemic, putting 22 million Americans on the jobless roles in the last month
  • Jobs once considered menial are now considered essential, forcing a rethink of fair compensation
  • The federal mandate for paid sick leave will only be in effect for the duration of the crisis

The coronavirus pandemic continues to have a potent impact on the labor market and has changed perceptions about the value of certain jobs, leading to some positions being deemed "essential" and forcing others to work remotely. Experts foresee that when the economy reopens, there could be a changing of philosophies on everything from unions to the definition of benefits.

The spread of COVID-19 has redefined the role of an essential worker and what constitutes fair compensation for jobs that now take on greater importance. With more than 22 million Americans filing initial unemployment claims in the last month and unemployment projections ranging as high as 20%, employers and employees can expect to forge new ways of interacting and viewing each other’s needs in what could be a deep recession.

While healthcare workers, police officers and postal service workers have always been viewed as essential, lower-paying jobs that require less training have taken on great importance. The coronavirus has spotlighted the necessity of grocery store employees, fast-food workers and truck drivers.

In its bid to stem the spread of the pandemic, which has killed nearly 40,000 Americans as of Sunday morning, the federal government is mandating paid sick leave for the duration of the crisis for many of those who never before were eligible for such benefits. In addition, some companies have started providing protective gear, and some workers who may earn a little more than minimum wage, are demanding hazard pay. Meanwhile, companies have shuttered thousands of offices and directed employees to work from home.

Will any of these changes last beyond the pandemic?

“Never has there been a stronger universal need for a union approach as today,” said David Lewis, founder and CEO of OperationsInc, a human resources outsourcing and consulting firm. “As we start to return to work individuals and groups of employees are going to want to see standards met for safety, testing, hygiene, etc. A union can certainly fill that role. The question is whether or not a white-collar world will embrace this or see it as something more applicable to blue-collar levels.”

Kenneth G. Dau-Schmidt, professor of labor and employment law at Indiana University’s Mauer School of Law, said the performance of the United Food and Commercial Workers will be an influence on whether unions reverse years of decline.

Dau-Schmidt noted the UFCW “negotiated new safety precautions and increased wages and paid leave for their members who are employed by Kroger, and that contract is now the model for the grocery industry. Employees with a union contract have protection against employers unilaterally changing the terms and conditions of employment. I think more workers have seen the usefulness of unions in this crisis.”

Labor unions took a hit in June 2019 when the Supreme Court ruled that government workers who don't join unions may not be required to help pay for collective bargaining.

“There is a subset of the current U.S. workforce deemed as ‘essential’ meaning they continue to report to work during shutdown, shelter-in-place and stay-at-home orders. Amazon is the best example of these groups mobilizing and looking to unionize because they fear unsafe workplace conditions,” said Brooke Iley, an attorney at Blank Rome. 

Leiden University post-doctorate researcher A.M. Nissen said Amazon had to learn the hard way that it needed to communicate better with its employees.

“I am sure that various corporations will draw valuable lessons from Amazon's blunt and slow response to legitimate concerns about the right to health and the right to strike of warehouse workers, who are essentially risking their lives,” Nissen said.

“This is not the first time scandal concerning Amazon’s labor rights practices. Just before the COVID-19 pandemic, there were the Black Friday strikes over pay and working conditions, and claims that workers injury rates are alarmingly high around Christmas. If Amazon would have tackled these issues head-on, then it would have been much better prepared to deal with the COVID-19 pandemic.”

Amazon has struggled to keep up with demand and a fractious workforce that included some warehouse workers not showing up for shifts.

“Amazon and Instacart were highly targeted during the crisis because they did not safeguard the working environments for their employees,” said Denise Broady, chief operating officer of WorkForce Software.

Compensation could also become a growing issue, even after some Democratic presidential candidates in 2019 made a living wage a key platform of their campaigns. Broady sees workers' rights and the narrowing of the wage gap becoming a priority, while Lewis doesn't foresee a boost to low-income wages anytime soon.

“The federal stimulus under [the $2.2 trillion] CARES [Act] brings $15- an-hour to those sitting at home in the form of a $600 a week supplement in unemployment payments, on top of the state wage,” Lewis said. “This means that those going back to work for less than $15 an hour [actually in many cases less than $25 an hour] will be taking a cut. You need to contrast this, though, with a severely crippled economy, and businesses that will be hurting and unable to survive easily, let alone afford raising their hourly pay. I think $15 an hour likely does not gain steam.”

Attorney Carrie Hoffman of Foley & Lardner LLP agrees that that benefit expansion and wage hikes probably won't last.

“Employers are not likely to be increasing benefits in these strained financial times. For employers who do not provide sick leave benefits, it seems unlikely that they will be increasing benefits,” Hoffman said. “The sick leave available under the Families First Coronavirus Response Act are limited in time and eligibility.”

As for bonuses and increased wages to guarantee people would continue to work, Hoffman predicted that would disappear because of the high unemployment level once the economy emerges from the crisis.

“If businesses do not rebound in the anticipated time period, employers will seek more concessions creating a lack of trust among the workforce, which will bolster union drives,” Iley said.