Employers unsure about benefits for furloughed workers

Many struggling but optimistic employers have continued to offer medical, dental, and other benefits to employees on furlough during the COVID-19 pandemic. But with no immediate end in sight, they’re wondering what to do next.

Employment relationship hasn’t been severed yet

Most businesses in the United States (and the world, for that matter) remain hobbled because of the coronavirus crisis. (Amazon is an exception. Another notable exception is Peloton, the exercise bike maker, which is glowing in its 172% surge in total revenue, with gains in subscribers and demand for its fitness products.) But employees in several industries, including travel, hospitality, and entertainment, remain uncertain about their futures.

Before the pandemic, “furlough” was a concept more familiar in European countries where it’s mandated by law. We’ve now settled on the concept that the employer hasn’t severed the employment relationship of a furloughed employee, who is still active in the HR system. Instead, the individual isn’t actively working or being paid except for the value of the benefits the employer continues to provide.

Employer options