UI Incentives Matter

So one of my clients after a very long delay finally got his restaurant approved for PPP funds today.

This means his restaurant may just survive this crisis considering its been shut for the past 6 weeks and yet expenses such as rent etc have not ceased.

The problem is, some of his employees are making more on unemployment with the $600/week federal kick-up than they were as employees (including part-timers) and don't want to come back to work until that sweet $600/week UI bonus runs out.

Since it's a restaurant, "back to work" means sitting around at home and getting paid their salaries to do nothing rather than sitting around at home on UI to do nothing since he still can't, by the governor's order, open up his restaurant.

Obviously if you're sitting around at home doing nothing, the incentive is to get paid more for your doing nothing, right?

The downside is this may screw up the forgiveness part of the PPP loan due to employees not being back on payroll even as he's willing and able to put them on payroll thanks to the PPP funds to make up for the fact that he's gone 6 weeks plus now with zero income.