Understanding the Background of Hazard Pay

by Katie Sawyer, 3 minutes read
HOME blog understanding the background of hazard pay

You’ve heard people chanting “hazard pay for heroes” as employees leave grocery stores. But what are people asking for?

Hazard pay is a temporary wage increase for workers who perform their jobs in high-risk environments. According to the US Department of Labor, “hazard pay means additional pay for performing hazardous duty or work involving physical hardship. Work duty that causes extreme physical discomfort and distress which is not adequately alleviated by protective devices is deemed to impose a physical hardship.” Traditionally, hazard pay covers construction, truck driving, mining, commercial fishing, and work that is exposed to natural elements.

The Fair Labor Standards Act (FLSA) doesn’t address the subject of hazard pay, except to require that it be included as part of a federal employee's regular rate of pay in computing the employee's overtime pay.

In grocery stores, hospitals, shops, and other businesses that could not shut down, workers faced an invisible danger the world couldn’t combat. The stipulations around a hazardous environment leave room for interpretation.

What states and cities support hazard pay?

Cities such as Los Angeles, Long Beach, San Francisco, and Seattle support hazard pay at the city government level. Their ordinances are among the first to be government-mandated, rather than government-funded or voluntarily decided by the employer. In most of these cases, workers received an additional $2 - $4 an hour.

Some states like Pennsylvania and Vermont leveraged their stimulus packages to fund hazard pay. As funding runs out, their programs will likely expire. There's no law requiring employers to pay hazard pay, and the conditions under which it is paid are determined by the employer. The majority of frontline workers do not receive hazard pay.

Why is hazard pay important?

In the current conversation, hazard pay ordinances typically cover grocery store workers. They don’t account for food service workers, custodians, nurses, and retail associates. Hazard pay is important because it helps workers feel valued and appreciated. It validates the public sentiment of essential workers as heroes in a public crisis.

For minimum wage jobs, additional hazard pay can make the difference to cover medical expenses and provide additional security in a fragile economy. Workers’ unions continue to pressure big-box chains to provide hazard pay. Over the summer of 2020, many ordinances expired.

Opponents of hazard pay argue that it can put smaller businesses at risk and put working-class families at a disadvantage. Smaller grocery stores can’t afford to give their staff a 20% pay increase. If they did, they would have to pass the cost to consumers and raise their prices. Big-box retailers such as Walmart and Albertsons can afford to quadruple their staff salaries and still make a profit. At both sides of the argument, working-class people bear the financial impact.

Essential workers matter

Essential workers have been vital to the survival of communities everywhere. They put themselves at risk and deserve better pay in recognition of their value. Policymakers can look towards overwhelming public support to hopefully expand eligibility for hazard pay. Heroes can be praised — and paid — at the same time.

Download this tipsheet, 7 Tips to Prepare Your Business (and Staff) for Hazard Pay, to learn how to get your business ready.

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