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Hazard Pay and the COVID-19 Pandemic:

Issues and Options



May 13, 2020
A number of policyrnakers have expressed interest in providing essential workers at risk of exposure to
COVID- 19 with additional compensation, or hazardpay. The Health and Economic Recovery Omnibus
Emergency Solutions (HEROES) Act (H.R. 6800), introduced on May 12, 2020, would create a fund for
pandemic premium pay for essential workers. This Insight highlights some of the policy considerations
should a hazard pay policy be pursued, as well as federal government options for supporting hazard pay.

What is Hazard Pay?
Hazard pay is a type of premium pay for individuals performing work that involves hazardous duty or
physical hardship. Hazard pay may be provided to compensate workers for additional risks and to
incentivize workers to work in jobs with potentially dangerous conditions. The Fair Labor Standards Act
(FLSA), which is the main federal law that establishes wage and hour standards for most private and
public sector employers (e.g., minimum wage and overtime pay), does not regulate the provision of
hazard pay. While hazard pay is available for some federal workers, it is not mandated for private sector
workers.

Financial Support for Essential Workers: Policy Considerations

Federal government support of hazard pay could compensate individuals who have been exposed to
additional risk while providing essential services. However, there are a number of questions that arise
when considering which employees are essential, and the amount and duration of any hazard pay
provided.

Who is an essential worker?
Determining who is an essential worker for purposes of hazard pay depends on multiple factors. A broad
approach would be to include all workers except those operating in an environment with low risk of
COVID-19 exposure (e.g., teleworkers). More targeted approaches include identifying specific groups of
workers and sectors of the economy as essential, including possible consideration of risk to workers in
different parts of the country.

                                                              Congressional Research Service
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