One of the provisions in the 1.9 trillion COVID-19 relief bill passed by the United States (US) Congress permits states to authorize bonus pay for essential employees who performed critical work during the pandemic.
According to the rule, “the low pay of many essential workers makes them less able to cope with the financial consequences of the pandemic or their work-related health risks, including working hours lost due to sickness or disruptions to childcare and other daily routines, or the likelihood of COVID-19 spread in their households or communities.”
“Employers’ policies on COVID-19-related hazard pay have varied widely, with many essential workers not yet compensated for the heightened risks they have faced and continue to face,” the rule said.
Moreover, according to a recent study published in the Journal of the American Medical Association found that 25% of essential workers were estimated to have low household income, with 13% in high-risk households.
“The added health risk to essential workers is one prominent way in which the pandemic has amplified pre-existing socioeconomic inequities,” US Department of Treasury said.
The rule for the distribution of the stimulus funds also defines “essential work” as “work involving regular in-person interactions or regular physical handling of items that were also handled by others.”
Treasury says priority should be given to lower income essential workers and lists some examples including nursing home staff and home care workers; workers at farms, food production facilities, grocery stores, and restaurants; truck drivers, transit staff, and warehouse workers; and childcare workers.
“The federal government can adopt guard rails to ensure that states don’t backfill their own spending reductions with federal aid dollars and use the savings to adopt tax cuts, but by imposing restrictions at a department level, the Treasury rule functionally makes almost all spending cut-financed tax reductions off limits,” Jared Walczak, vice president of state projects at the Tax Foundation, told Reuters this week.