5 Steps to Take Before You Reopen Your Business

Even as a surge in coronavirus cases in some U.S. states triggers another round of lockdowns, business owners are planning for the moment when they can finally reopen their businesses. Before they can, however, they have to have a plan, says Jenn Barnes, CEO of Optima Office, an outsource accounting and HR firm. Her team has recently been fielding calls from clients wondering what financial, legal and safety issues they need to consider, and whether a delayed or limited reopen of their businesses make sense.

Many of the calls are about their use of the CARES Act, and how to be sure they use their Paycheck Protection Program (PPP) loans in a way that result in forgivable repayments, Barnes says. “The rules keep changing, making it difficult for business owners to know what to do.”

The changing rules and stipulations from government agencies, banks and local leaders has created a lot of confusion, adds Phil Urso, chief sales officer for VensureHR, an outsource HR and technology firm in Atlanta. “Every small business just has to be nimble,” he says. “You need to think about how to open safely, and how to protect your business during this transformation.”

With so much uncertainty, experts offered advice on what steps business owners should take before they reopen their doors.

1. Revise cash-flow and revenue projections.

[CC2] Chances are COVID-19 wreaked havoc on your cash-flow projections. Before reopening, she encourages clients to rerun all of their numbers.

Start by considering how much revenue you can reasonably expect in the next 30-60 days and through the end of the year, and what costs you will incur in the meantime. Then consider whether you have access to loans, business assets or personal resources to cover the difference. 

2. Figure out who to bring back.

Depending on your industry and workforce, you may not be able to bring every employee back at once, says Emily Burkhardt Vicente, attorney with Hunton Andrews Kurth in Los Angeles. Social distancing rules, limits on the number of customers you can serve and employees’ concerns about safety risks will all impact your reopening strategy. “Even if you can bring everyone back, businesses need to be conservative to ensure continuity,” she says.

She advises ranking furloughed employees into ‘need to have’ and ‘nice to have’ categories, then selecting which ones to bring aboard first based on that ordering.

3. Be mindful of discrimination.

When deciding who to hire back first, be sure you aren’t under-representing protected classes. “It is easy to make unintentional mistakes,” Burkhardt Vicente says. For example, if you rehire by seniority, or if you make assumptions about who ‘needs to stay home with the kids,’ you might accidentally end up with a predominantly male workforce, which could lead to litigation. “Be sure every choice you make is justifiable to the business.”

Every small business just has to be nimble. [...] You need to think about how to open safely, and how to protect your business during this transformation.

—Phil Urso, chief sales officer, VensureHR

4. Think through their unemployment status.

In some states, employees are making more on unemployment than if they return to work. If you offer an employee their job back and they decline, you can report it to the unemployment office, causing them to lose that benefit.

However, this is a delicate issue to navigate, says John McFarland, SVP of client development for VensureHR. “If you ask an employee to come back and they refuse, don’t immediately reporting them,” he advises. Instead, ask them why. If they don’t want to come back because they are vulnerable or caring for an at-risk family member, do what you can to accommodate them, he says. However, if they are just playing the system, you shouldn’t have to be penalized.

If you do plan to alert the unemployment office, he suggests letting employees know that their benefits will be cancelled if they decline your offer.

5. Create a plan to keep people safe.

Before you bring people back, rethink your office, workplace and operations with safety and social distancing in mind, then look for creative ways to address these needs, says Barnes. That may mean eliminating some workspaces, offering staggered schedules, moving desks into empty spaces or running alternating shifts. Companies should also have a plan for sanitizing shared spaces, ensuring masks are worn where needed, and tracking the temperature of employees. Business owners can refer to OSHA, the CDC and local public health authorities for guidance on how to create a safe environment.

“If employees get the virus because they came back to work, you could be on the hook for workers compensation claims,” Barnes warns. The best way to mitigate this risk is by being able to prove that you did everything you were supposed to do to keep people safe.

Photo: Getty Images