KERN
BUSINESS JOURNAL
Vol. 9, No. 1
Spring 2020
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Community Business: Tourism update amid pandemic
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Finance: Tax law changes enacted by “CARES Act”
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Legal and Human Resources: People turn to gallows
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humor to help ease anxiety over coronavirus
Health: Adventist Health inspired by community
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Cover story
Historic stimulus bill to help keep small businesses afloat T
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Please see STIMULUS | 7
Kern Business Jouranal
Kern Business Journal 3700 Pegasus Bakersfield, CA 93308
velopment Center at California State University, Bakersfield. The largest stimulus package in U.S. history was passed as the ongoing coronavirus pandemic forced millions of Americans to stay home and required restaurants, bars, entertainment venues and other “nonessential” businesses to close their doors. Unemployment rates have skyrocketed, as businesses have laid off workers. “This is not the fault of the American public,” Mnuchin said, explaining the intent of writing checks to individuals and families as part of the stimulus bill is “to get all those people paid.” Loans and loan forgiveness programs written into the bill will encourage companies to retain their employees during these temporary closures and hire laid-off workers. In a nutshell, the nation’s struggling small businesses will see: • A $350 billion partially forgiv-
Monday, April 20, 2020
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The stimulus bill passed by Congress will aid small businesses from the coronavirus pandemic.
reasury Secretary Steven Mnuchin estimates that the small-business relief included in the massive Coronavirus Aid, Relief and Economic Security Act could keep 50% of Americans at work. A key piece of the $2 trillion stimulus bill passed by Congress and signed Kelly Bearden into law in March by President Donald Trump was more than $349 billion in funding for small businesses. The U.S. Small Business Administration will be overseeing the distribution of those funds through local banks, as well as other assistance programs. To accomplish the goal of helping small businesses keep their staffs employed will be the efforts of the SBA’s partners, including the Small Business De-
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Kern Business Journal
Monday, April 20, 2020
KERN Journal Business
Kern County’s premier business publication Spring 2020 Vol. 9, No. 2 Kern Business Journal is a publication of TBC Media. Copies are available from The Bakersfield Californian, Kern Economic Development Corp., Greater Bakersfield Chamber of Commerce and by subscription. Editor Mark Nessia Specialty Publications Designer Julie Mana-ay Perez To advertise Cliff Chandler cchandler@bakersfield.com 661-395-7521 To subscribe 661-392-5777 Contact us 3700 Pegasus Drive Bakersfield, CA 93308 661-395-7500 kbj@bakersfield.com
Industry spotlight
San Joaquin Valley Air reminds businesses to apply for grant funding amid COVID-19 BY CASSANDRA MELCHING
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hile the COVID-19 situation continues to evolve, it has most definitely impacted life for all of us here in the San Joaquin Valley and the way we conduct business. As an essential public health agency, the San Joaquin Valley Air Pollution Control District’s wants to remind businesses that services are still available despite the closure of our offices to the public. Our mission is to improve the health and quality of life for all valley residents through efficient, effective and entrepreneurial air quality management strategies and we continue to do so while also striving to maintain the health of our employees and the people we serve. During these uncertain times, Kern County businesses are encouraged to take advantage of the robust grant programs offered by the Valley Air District. Staff is available by phone and email and key funding information is available on our website at www.valleyair.org/grants.
Here are a few of the opportunities available to Valley businesses and public agencies:
PUBLIC BENEFIT GRANTS PROGRAM This program was developed and designed to meet the needs and challenges faced by valley public institutions by providing funds toward a wide variety of clean-air, public-benefit projects that will provide a direct benefit to Kern County residents. Currently, the program provides up to $20,000 for the purchase of a new alternative fuel vehicle, including battery electric, plug-in hybrid, natural gas or fuel cell.
CLEAN GREEN YARD MACHINES: COMMERCIAL Commercial lawn businesses can also benefit from this program, which was originally only available to valley residents. It’s a voucher program that offers up to $25,000 annually per applicant to purchase eligible electric landscape maintenance equipment.
TRUCK REPLACEMENT AND TRACTOR REPLACEMENT PROGRAMS Businesses that operate heavy-duty diesel trucks or tractors may be eligible to receive funds for cleaner replacement trucks/tractor or for the expansion of their fleets.
CHARGE UP! Public agencies, businesses and property owners of multiunit dwellings (i.e., apartment complexes, condominiums, etc.) can receive funding to install electric vehicle (EV) chargers. These chargers will support existing EV owners and encourage the growth of clean technology in Kern County. To obtain more information about any of the mentioned grants or to see the funding amounts for each program, visit www. valleyair.org/grants or call 559-230-5800 to speak to a representative. Cassandra Melching is an outreach and communications representative with the San Joaquin Valley Air Pollution Control District.
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Monday, April 20, 2020
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Community Business
Kern Business Journal
Monday, April 20, 2020
Tourism update amid coronavirus pandemic I
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write this during the first week of April. With what has changed in just the past few weeks, it is anyone’s guess what the situation will be by the time this article is published. Because of a dramatic reduction in traveling, some Bakersfield hotels pivoted from offering their rooms for overnight stays to also offering flexible day rates. This change involved promoting rooms as David Lyman alternative home offices for those who found their normal home office a bit noisier than usual because of school closures. These properties promoted their large (and quiet) work spaces, free high-speed Wi-Fi and business center assets, such as printers and office supplies. One hotel that touted its rooms for alternative office spaces was the new Home 2 Suites by Hilton. Denise Taylor-Connor, the hotel’s director of sales, said an advantage her property had was being an extended-stay hotel. “The kitchen amenities and our full size suites allow comfort while limiting outside interaction with others,” she said. “Another advantage is that we are pet-friendly.” Taylor-Connor said her hotel’s staff at 8227 Brimhall Road had to be creative while thinking of everyone’s safety. “We partnered with Modern Grub down the street from us on Calloway and Brimhall because they offer clean, healthy meal preparation and healthy takeout and delivery for our guests,” she said. While many travelers rely upon hotel rooms, others bring their accommodations with them. At Bakersfield River Run RV
Park, manager Ryan Uhles said that RV’s are self-contained, so they allow easy shelter-in-place accommodations. “We have made some significant changes to our operations,” said Uhles of his park at 3715 Burr St. “We are taking care of business over the phone and are offering curbside delivery or delivering to the site for mail and grocery items. We also installed sinks in each laundry room so that anyone using the laundry room has access to a sink to wash their hands whenever they are doing laundry.” One change at a large Bakersfield hotel was very visible and welcomed by many. Each night, lights in certain rooms at the Bakersfield Marriott at the Convention Center were left on to spell out the word “HOPE.” The south side of the hotel, located at 801 Truxtun Ave., is visible for several blocks. Two blocks east of the Marriott, Visit Bakersfield temporarily closed its downtown visitor center on March 20. Signs on the doors directed travelers who stopped by to leave a telephone message and those messages were promptly returned by the visitor center staff. One traveling couple, visiting in an RV from South Dakota, had visited Bakersfield in the past. They did not have a chance to see the Tehachapi Loop last time but wanted to visit it on this return trip. A Visit Bakersfield staff member was able to provide that information, including suggesting the “Back Roads to the Tehachapi Loop” tour brochure that was available for downloading online. Those visitors sent back an email that “the driving tour was great! We got to see some great rural country and will be back at some point to investigate the area again.” With many local residents following stay-at-home orders, Visit Bakersfield unveiled a weekly
CALIFORNIAN FILE PHOTO
Lights left on in vacant hotel rooms spell the word “HOPE” at the Bakersfield Marriott at the Convention Center.
coloring contest. Each week a new page featuring a popular Bakersfield location was unveiled, with a prize going to the winning entrant. The contest began with the Majestic Fox Theater, with the winner receiving a Two Hour Blaster Expedition Family Fun Pack from Bakersfield’s own River’s End Rafting & Adventure Company, valued at $180. In addition to helping families through some of the boredom of isolation, the contest sought to educate residents of many notable Bakersfield landmarks, promote local businesses and leverage spending once the stayat-home orders were lifted. Several local travel partners also provided educational and entertainment options to those who were homebound. The Kern County Museum posted frequent tours of its notable artifacts led by collections curator Bethany Rice, along with suggestions for at-home projects from the museum’s Lori Brock Children’s Discovery Center. CALM, the California Living Museum, posted a variety of videos of its animals, including weigh-in time with raccoons, porcupine chewing on plants and feeding time for
PHOTO COURTESY OF VISIT BAKERSFIELD
The weigh-in of raccoons was one of the activities shared by the California Living Museum (CALM) through videos posted during school closures.
a burrowing owl. Those videos, and others, also were shared by Visit Bakersfield to help educate residents about local attractions and amenities. After all, when travel resumes it will be those residents who will be asked by friends and family about things to see and do in California’s ninth largest city.
David Lyman, Ph.D., is manager of Visit Bakersfield. He and his staff help visitors from throughout the world spend their money and find “The Sound of Something Better” in California’s ninth-largest city. They are available toll-free 866-425-7353 or at Info@VisitBakersfield.com.
Community Business
Give Big Kern to support local nonprofits through COVID-19 crisis with Online Giving Day Platform I
PHOTO COURTESY OF LOUIS MEDINA
Billy the Give Big Goat’s social-distancing message.
from all corners of Kern have amounted to much more — in the six figures — than the funds could give out. Why give to nonprofits through our Online Giving Day Platform? Going back to the good times, despite all the challenges California’s nonprofit sector faces, CalNonprofits says its output represents 15% of our gross state product. Charities generate close to $274 billion each year in annual revenue and bring in more than $40 billion from out-of-state sources. One out of every 14 jobs in California is at a nonprofit. Volunteers contribute the equivalent of $16.6 billion in unpaid labor to the state’s economy. And 4 out of 5 Californians deem nonprofits to operate more ethically, efficiently and frugally than for-profit businesses or government. From animal rescue and lowcost spay-and-neuter efforts, to affordable child- and elder-care
options, to veteran services, to environmental justice, to homelessness and hunger prevention, nonprofits are woven into the fabric of the quality of life we enjoy in California. But now we’re in some of the worst times our state, nation and world have ever had to face. If you have been helped by a nonprofit in any capacity or know someone who has, consider making a donation to any of the more than 130 charities fundraising through Give Big Kern, Kern’s official “Online Day of Giving,” at a time when they need funding the most. Just go to www.givebigkern. org, search for a nonprofit by name or cause and give. The website has been accepting donations since April 5, and will stay open till May 6, one day after Give Big Kern Day, which this year falls festively on Cinco de Mayo.
You can pay with a major credit card; through mobile pay options such as Apple Pay, Google Pay or Microsoft Pay; and, if making a gift of $100 or more, through your bank account using automated clearing house. If you don’t have money to give now, use the Volunteering page on the drop-down menu of the website to make a pledge of volunteer hours to one of the participating nonprofits. They are surely going to need a lot of people power to get their operations back up and running when social-distancing restrictions have been lifted. Louis Medina is the Director of Community Impact for Kern Community Foundation, which hosts the Give Big Kern Online Day of Giving each year on the first Tuesday in May. You can reach him at Louis@kernfoundation.org.
Kern Business Jouranal
San Joaquin Valley. Enter COVID-19. These are bad times and nonprofits are struggling even more. A number of community-based organizations have had to cancel much-needed fundraisers in March, April and May due to social-distancing requirements. Shelter-in-place directives have caused many of them to temporarily suspend or scale back fee-for-service programs that cannot be offered remotely. The leaders of all-volunteer-run nonprofits may be facing financial hardships due to lost income from day jobs that are on hold indefinitely. From our experience of quickly mobilizing COVID-19 relief funds at Kern Community Foundation, thanks to the philanthropic generosity of local corporate and individual donors, the grant requests we have received from scores of nonprofits
Monday, April 20, 2020
n good times, California nonprofits are under-resourced. According to the California Association of Nonprofits (www. CalNonprofits.org), 70% of charities are all-volunteer-run, 68% of those that receive government funding (federal, state and local) say it does not cover the full cost of contracted programs and services, and 33% of nonprofit leaders say federal funding has decreased for them in the last 12 months. Survey data from nonprofit and social enterprise lender the Nonprofit Finance Fund’s latest “State of the Sector” report from 2018, reveals that 86% of nonprofits nationally say demand for services keeps rising, yet 66% of them find offering competitive pay for employees a top challenge and, for seven consecutive years, fewer than 25% of nonprofits surveyed Louis Medina have said they had more than six months of cash in reserve. San Joaquin Valley nonprofits, including those in Kern, fare even worse, according to CalNonprofits: • Valley nonprofits serve 11% of the state’s population but only receive 4% of total nonprofit revenue compared to Bay Area nonprofits, which serve 19% of the state’s population but receive 35% of the state’s nonprofit revenue. • Bay Area and Los Angeles foundations together control 89% of all foundation grantmaking dollars, while San Joaquin Valley foundations control only 1%. • Of all California nonprofits receiving government funding, 66% (a whole two-thirds) are in the Bay Area, Los Angeles and San Diego, while only 6% are in the
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Community Business
Prouty Matrix: A risk management tool every business needs to model frequency, severity risks
Kern Business Journal
Monday, April 20, 2020
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ountry western artist Kenny Rogers passed away recently and is mourned by many, especially here in “Nashville West,” as Bakersfield is often called. Rogers was an effective risk manager at the poker table. He knew “when to hold ’em, when to fold ’em and when to walk away.” But how does anyone in business acquire this same knowledge regarding risks faced by their organization? His lyrics referred to gambling. Many see insurance as gambling. However, there is John Pryor a major difference. In gambling, no risk is created until a bet is placed. In business, whether we hold ’em or fold ’em, risks are perpetually present and a severe threat to the financial solvency of any business. The challenge is for us to know how to treat each risk — not solely through insurance but also through noninsurance solutions. A risk management tool called the Prouty Matrix, named for its creator, is recommended. It is described in depth in my book, “Quality Risk Management Fieldbook,” available on Amazon and from the publisher, International Risk Management Institute in Dallas. In the limited space here, the following description nevertheless may be helpful. Its purpose is to help business owners decide what risk management alternative actions should work best for them. These are the customary financial alternatives: • Risk assumption: Total funding of any loss from internal financial resources.
• Noninsurance risk transfer: By written agreement, usually in the form of a “hold harmless” or “indemnification” provision. • Insurance risk transfer: Commercial insurance. • Combined risk assumption and commercial insurance in which a high deductible is used ($100,000 or higher) or formal self-insurance with a high, catastrophic “stop loss” ($500,000 or higher) reinsured by an “excess insurance carrier.” • Total avoidance of the risk: By not building in a low-elevation flood zone or not engaging in a high-risk project or venture. Each of these actions is typically coupled with multiple effective levels of risk control. For example: • Fire prevention measures — fire suppression (automatic sprinkler) systems, safety and driver training — to reduce employee injuries and deaths. • Security measures — alarm systems, safes, internal accounting controls and other risk reduction measures — to prevent liability claims of all kinds. Each risk facing your business needs to be applied to the Prouty Matrix in terms of the probability of its frequency of occurrence and its maximum dollar amount of severity. Then you’ll have an indication of what appears to be the best action to take for each risk. Not all risks are commercially insurable. The requisites of a commercially insurable risk are that the risk must be fortuitous (unexpected), measurable in terms of dollar loss, definite in time and place and not catastrophic. This is the reason floods, terrorism, war, pandemics, etc. cannot be commercially insured. In many instances, the federal government (not constrained by these criteria) can do so in the public sector what commercial
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insurers cannot do in the private sector. Only the federal government can “print money” to avoid insolvency. A new opportunity for Congress — although ignored so far — is business interruption reinsurance funded by the federal government. Virtually every business property insurance policy includes business interruption coverage. This coverage provides needed cashflow during any shutdown to enable business owners to meet payroll obligations and pay other expenses that necessarily continue even though all normal revenue-generating operations are shut down. Insurers are well positioned to calculate the dollar amount of a business interruption loss.
They usually can even make advance payments to assure adequate cash flow for the business during its shutdown. With the federal government reimbursing insurers for their payments to businesses, this is a much better method than others proposed by Congress to help businesses survive the current pandemic. One of my favorite stories is about a family owned manufacturer on the East Coast who experienced a total fire loss and, therefore, total shutdown of his operations. The owner was regarded as a hero by the media and especially by his employees because he unbelievably continued their salaries even though there was no work they could do in the wake of the fire. Insurance was not mentioned
as the actual source of these payments — but that’s OK. Virtue is its own reward. As has long been said, “You can’t insure against everything.” Therefore, this matrix tool should be helpful to you in deciding which risks should be insured and which risks can be assumed, transferred to others or totally avoided. Then you should enjoy one of the many benefits of risk management — a quiet night’s sleep. John Pryor, CPCU, ARM, is a risk management and general management consultant for CSU Bakersfield’s Small Business Development Center. For management counsel (without any fee), go to www.csub.edu/sbdc for full information.
Community Business
STIMULUS ❚❚As social distancing continues to be a necessary tool to Continued from PAGE 1
prevent the spread of the highly contagious coronavirus, a wide range of services has been developed to counsel business owners and entrepreneurs.
able loan program designed to help companies retain their workers. • The additional incentive of a 50% refundable payroll tax credit on worker wages for companies retaining employees. • Relaxation of net operating loss-reduction rules. • Delay in payment of the employer portion of Social Security payroll taxes. • Expansion of unemployment insurance benefits for sole proprietors and other self-employed workers. • The targeting of a portion of the $425 billion in funds appropriated to the Federal Reserve’s credit programs to help small businesses. Nearly half of America’s private-sector workers get paychecks from companies with less than 500 employees, and a third of those work for businesses with fewer than 100 workers. The SBA and its partners — the nationwide network of Small Business Development Centers, Women’s Business Centers, Veterans Business Outreach Centers and SCORE — have long nurtured this vital sector of the U.S. economy. The record-setting stimulus bill makes the agency’s role even more important. In these particularly trying times, the Small Business Development Center at CSU Bakersfield is helping local companies maintain access to capital by ma-
neuvering through the red tape of loans and incentive programs. As social distancing continues to be a necessary tool to prevent the spread of the highly contagious coronavirus, a wide range of services has been developed to counsel business owners and entrepreneurs. These free services include telephone access to experienced SBDC consultants, online resources and business guides and weekly webinars. Examples of some recent webinars are “Telecommuting Tips and Tools” and “Managing Your Small Business During the Pandemic Crisis.” For information about participating in upcoming webinars, which are conducted every Wednesday from noon to 1 p.m., go to the website at www.csubsbdc.com or consult the SBDC CSU Bakersfield Facebook page. Those unable to participate in a live online event can watch recorded webinars on the CSUB SBDC YouTube channel. This is truly the place to be for current information small businesses need to navigate the crisis. In many cases, businesses directly affected by the crisis will need funding and available resources to survive. Acknowledging that the massive help being provided to the nation’s small businesses in the stimulus plan may seem complicated, Mnuchin has promised application procedures will be simplified as program details are developed. The assistance provided by the SBDC at CSU Bakersfield will be critical for local business to keep up to date, and to identify and access benefits. One of five service centers within the University of California, Central California SBDC Regional Network, the SBDC in Bakersfield assists small business owners in Kern, Inyo and Mono counties by providing free consulting, small business training and research. For more information, go to www.csub.edu/ sbdc. Kelly Bearden is the director of the Small Business Development Center at California State University, Bakersfield.
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Vol. 8, No. 4
Agriculture:
Fall 2019
New law targe
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Community thefts Business: Investor create 4 s nationwide Legal and invention Human Reso the workplace urces: Califo 7 rnia act prote cts whistleblow Health: Local ers in Latina leade
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Apartment deve new ways to get lopers seek deals done
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Bakersfield developer Ron epending on Froehlich said. what indicators you’re ways to make “There’s better looking at, now a might seem with less risk.” better return time to develop like the right new apartme The situation complexes speaks to a in Bakersfield. nt conundrum Demand is at the heart strong and short by virtually supply fornia’s housing crisis. of Calievery measure Despite Vacancies are . Sacramento’s efforts to extreme make ly sure low, rents are on renters have the rise and an affordab Park West place to live, existing develop le at developers ments fetch luxury rental Stockdale River Ranch, say the multiple high offers housing by cost as Fuller of building soon as they’re Highway in complex schedul Apartment anything PHOTO COURTESY southwest Homes listed for sale. except governm ed to begin Bakersfield. construction and Bolthouse Propert OF FULLER APARTMENT HOMES housing is all ent-subsidized in Decemb Some projects er at Heath ies, is a 312-unit but are moving prohibitive forward, to Road and Stockda the private for be sure, and sector. le Sacramento’s recent emphasis on Kern Busine affordab EXPENSIVE le housing is ss Journal PROPO seen as offering some 3700 Pegasu Development-re SITION help. But for s developers lated costs, weighing investmlocal from labor and Presorted Standard Bakersfield, in new multifam CA 93302 ent nicipal impact materials to muU.S. Postage ily residenfees and regulatial properti tory requirem PAID es, construc ents, have shot tion market-rate Bakersfield, in recent years. projects remainsof up CA Permit No. 838 tough sell. a Bakersfield “It’s a strong Dee said his developer Tom total costs have but you scratch rental market, risen at least your head and 30 ask, ‘Does the past three percent during this make any years. A 16-unit sense at all to roll building that the cost $95 per out that kind dice and put square foot to build of investment?’” a few years ago now costs $145 per square foot, Please see APARTMENTS |6
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Monday, April 20, 2020
Written by business leaders
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Finance
A look at tax law changes enacted by ‘CARES Act’
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Kern Business Journal
Monday, April 20, 2020
n March 27, the Coronavirus Aid, Relief and Economic Security Act (or “CARES Act”) was signed into law. In addition to providing much-needed funding to small, medium and large businesses though the Paycheck Protection Program, Employee Retention Credit and delay of payment of employer payroll taxes, the following tax law changes enacted by the CARES Act should provide some desperately needed relief to individuals and businesses: Payments will be distributed to eligible taxpayers in the amount of $1,200 per individual taxpayer, plus $500 per qualifying child. The rebate will start to be phased out based upon the 2020 adjusted gross income beginning at $150,000 for a joint tax return filing status, $112,500 for a head of household tax return filing status, and $75,000 for single or married filing separately tax return filing status. As adjusted gross income increases, the payment amounts will be completely phased out ($198,000 joint tax return filing status, $146,500 head of household tax return filing status, and $98,000 single or married filing separately tax return Joel Bock filing status). Net operating losses arising in tax years ending after Dec. 31, 2017, and before Jan. 1, 2021, are allowed a five-year carryback and the 80% of taxable income limitation is removed as well. Any forgiveness of indebtedness of Paycheck Protection Program loans will not be treated as taxable income. Effective for tax years beginning after Dec. 31, 2017, and before Jan. 1, 2021, the limitation on excess business losses for taxpayers other than corporations is removed.
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For the 2020 tax year, the 60% of adjusted gross income limit for cash charitable contributions has been suspended and taxpayers claiming the standard deduction are eligible for a $300 “above the line” qualified charitable contribution. For tax years 2019 and 2020, the business interest expense limitation is increased to 50% of adjusted taxable income instead of 30% of adjusted taxable income (plus business interest income and floorplan financing interest expense). Reimbursements for certain over-the-counter medical products qualify as medical expenses for health savings accounts, Archer medical savings accounts, flexible spending arrangement, and health reimbursement accounts (effective after Dec. 31, 2019). Coronavirus-related distributions from eligible retirement plans are not subject to the 10% excise tax (Jan. 1, 2020—Dec. 31, 2020) and taxpayers may elect to spread the income over a three-year period beginning with tax year 2020. The limit for loans from qualified employer retirement plans is increased from $50,000 to $100,000 (effective March 27, 2020—Sept. 23, 2020). The required minimum distribution rules are waived for 2020 for certain IRAs and certain defined contribution plans. Effective retroactively to Jan. 1, 2018, the depreciable life of qualified improvement property is reduced from 39 years to 15 years, making the property eligible for bonus depreciation. Please consult your tax adviser to determine how these laws impact your specific situation. Joel A. Bock, CPA, MST is a partner in Daniells Phillips Vaughan & Bock, a Bakersfield accounting firm.
Legal & Human Resources
Some turn to gallows humor to cope with pandemic I t didn’t take long after Gov. Gavin Newsom’s shelter-inplace order for the shelter-in-place memes and videos to start hitting the internet. I’m grateful for that because I, like most people, need a laugh right now. My favorite meme so far is “Everyone please be careful tonight, there is a DUI checkpoint on the corner of hallway and kitchen … be safe,” and my favorite video is the one of the guy singing the Adele song “Hello” with his face pressed against his living room window. However, scrolling through Facebook, it’s evident that some people are offended by these attempts at humor or think they reveal that people are not taking COVID-19 Robin Paggi seriously. While it’s obvious that some people don’t understand the severity of the situation, I think making fun of the coronavirus is just the latest example of gallows humor (humor that treats serious, frightening or painful subject matter in a light, satirical way, according to Dictionary.com). In her article “Humor as Weapon, Shield and Psychological Salve,” Nichole Force says that gallows humor was coined by the Germans (galgenhumor) in the mid-1800s and was considered to be “an expression of resilience and hope.”
Used primarily by the oppressed, gallows humor helped people cope with circumstances beyond their control. An example is this Soviet-era joke regarding whether Joseph Stalin or Herbert Hoover was the better leader: Hoover taught Americans not to drink. Yes, but Stalin taught Russians not to eat. Because this form of humor was also seen as a “secret, subversive weapon” used by the masses, it was sometimes considered to be dangerous by those in control, said Force. Not surprisingly, anti-Nazi humor was outlawed in Germany during World War II and those who engaged in telling such jokes were punished, including being sent to concentration camps or death. Despite this threat, gallows humor persisted even in concentration camps. Elie Wiesel’s memoir “Night,” recounting his imprisonment in the Auschwitz and Buchenwald concentration camps, provides an example: “In Treblinka, where a day’s food was some stale bread and a cup of rotting soup, one prisoner cautions a fellow inmate against gluttony. ‘Hey Moshe, don’t overeat. Think of us who will have to carry you.’” Such macabre humor “demonstrates the vital role it plays in resilience and survival,” according to Force. COVID-19 is a serious, frightening, painful subject that has resulted in circumstances beyond our control. Joking about it helps us from being too depressed about it. Force theorizes, “In much the same way that the release of white blood cells is the body’s natural means of combating an
intruding infection, gallows humor and humor in general could be the natural psychological means of combating an intruding depression.” However, joking about self-isolation is different than making racist jokes about the source of the virus or that the death of older people from it might be a good thing, which have also popped up on the internet. According to www.militarytimes.com, an Army social media manager was fired in March because of something he posted on the Army’s official social media account that his superiors thought was derogatory toward Chinese people. I haven’t seen any news releases about someone being fired for calling the virus a “Boomer Remover” yet, but just give it time. Employers, managers and supervisors should respond to these jokes just as they would to any jokes that disparage people because of their race, age or any other protected characteristic. This response should include the appropriate corrective action (verbal warning, written warning, suspension or termination) based on the severity of the situation. To the creative people who have helped us laugh about hand sanitizing, social isolating and toilet paper hoarding, I salute you. Laughing about it helps to ease the anxiety until we can go back to our lives. Robin Paggi is a training and development specialist with Worklogic HR.
California’s new ‘gig law’ snagging Kern employers on whether the employer had control over the means and manner of the work performed. Also considered was if the contractor used his or her own work tools, had established a business and was able to work for other clients. The 2018 Dynamex ruling replaced that with an ABC test, which asks if contractors: A) Are free from control or direction in work performed; B) Perform specialized services that differ from a client’s usual business; and C) Maintain an independently established business offering services to clients. Within that test, Gonzalez crafted a far-reaching bill that exempts some industries and restricts the work in others. Basically, AB 5 limits employers’ ability to label workers as “independent contractors” and requires benefits, such as sick pay and overtime pay, to be provided to contractors who work beyond the limits. Among the occupations exempted
from the new law were doctors, lawyers, architects, engineers, marketing specialists, human resources administrators, travel agents, graphic designers, building contractors, hair stylists and barbers, licensed estheticians and manicurists. But so many others have been ensnared that a backlash has prompted a scramble to amend AB 5. A much-cited example of how AB 5 impacts independent contractors is the limit it sets on freelance writers and photographers. AB 5 places a cap of 35 annual submissions a year on the work writers and photographers can make to a publication or media outlet before the “independent contractor” is considered an employee, who must be provided benefits. A freelancer who writes only one Please see AB 5 | 10
Kern Business Jouranal
contact their elected representatives and explain how AB 5 affects business and hiring practices, as well as the livelihoods of independent contractors. Authored last year by San Diego Democratic Assemblywoman Lorena Gonzalez, a former labor organizer, AB 5 was introduced in the wake of the California Supreme Court’s Dynamex ruling. The case redefined the classifications of “contract worker” and “employee,” who is entitled to receive benefits and protections. Dynamex is a nationwide, on-demand, same-day, pickup and delivery service. Prior to 2004, the company classified its California drivers as employees. In a cost cutting move starting in 2004, Dynamex reclassified the drivers as “independent contractors.” For 30 years prior to the court’s landmark 2018 ruling, the 11-factor Borello test was applied to classify “independent contractors.” The test basically focused
Monday, April 20, 2020
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he passage last year of Assembly Bill 5, which became law on Jan. 1, has sent shock waves and confusion through California’s labor market. More than 30 bills have been introduced in the Legislature to change, delay or overturn the “gig economy” bill. Numerous lawsuits have been filed by both employers and indeKaren Bonanno pendent contractors, and affected industries are turning to the November ballot to qualify an initiative asking voters to exempt some contract workers, such as Lyft and Uber drivers. In this chaos, employers who depend on independent contractors must obey the new law, while they monitor ongoing endeavors to reform it. They also should
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Health/ Legal & Human Resources Adventist Health inspired by community efforts O ver the last few weeks, our communities have been struggling through perhaps the worst public health crisis of this generation. Schools and businesses have been shuttered. People are being asked to stay away from work, their elderly family members and friends. Those we love are getting sick. Families are frightened. Our way of life has drastically changed. But what we are Sharlet Briggs encouraged by, despite the challenges we face, is the overwhelming sense of hope and goodwill we see from our friends and neighbors in the communities we serve in the Golden Empire, from the mountainJeff Lingerfelt tops of Tehachapi to the valleys in Ba-
kersfield and Delano. At Adventist Health, we are guided by our heartfelt mission: “Living God’s love by inspiring health, wholeness and hope.” Today, we are inspired by the hope we’ve seen from our community. Some say that times of crisis bring out either the worst in people or the best. In Kern County, it’s abundantly David Butler clear: This crisis has brought out the best our community has to offer. We’re inspired by the goodwill, friendship and love we’ve seen from those who call Kern County home, and we’re blessed to call this place home, too. We’re inspired by the caregivers across Kern County — and not just those at Adventist Health. The heroes of this pandemic are not only the nurses, physicians, respiratory therapists and others who work in and out of our hospitals and medical of-
AB 5
far-reaching restrictions on the use of independent contractors now are state laws that employers must follow or face penalties, including hefty fines. Prudent employers should audit current company practices and classifications. To be safe, consult an attorney and human resources specialist. If independent contractors are misclassified, change the working arrangement or move the freelancer to employee status. Update organizational charts. Review and, if necessary, revise independent contractor agreements. Replace casual freelance arrangements with carefully written contracts. Contact elected representatives and explain how AB 5 affects hiring practices and the use of independent contractors.
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Continued from PAGE 9
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column a week, for example, will hit the annual limit by August. Freelance writers and photographers report having their contracts canceled and incomes cut as a result of the new law. The long list of other similarly impacted freelancers includes screenwriters, musicians, newspaper carriers, physical therapists, translators, horse trainers, youth sports umpires, loggers, pharmacists, etc. Gonzalez said she is considering removing the cap on the number of submissions freelance writers and photographers can contribute to a publication. But she would require those freelancers to be covered by contracts that specify such things as payment rates and the ownership of “intellectual property.” Earlier this year, a federal judge issued a preliminary injunction to ensure the law would not apply to some truckers. But the proposed law changes, ballot initiative and court challenges do not change the fact that AB 5 and its
Karen Bonanno is president of the Bakersfield-based human resources consulting firm P.A.S. Associates and P.A.S. Investigations. She can be contacted through her website www.PASassociates.com and through the P.A.S. Facebook page.
fices or the scientists working around the globe to develop new vaccines and medications. The heroes of this pandemic are also the grocery store clerks who are at the check stands despite concerns for their own health, the agricultural workers who continue to toil in the vastness of our valley’s fields to pick the food our world depends upon, the restaurant employees and delivery drivers who continue to go to work and the housekeepers in every hospital who clean to keep infection from spreading. The heroes are the folks who give strangers a smile and a wave when you see them from a distance on the street because they know we could all use that kind of friendliness these days. They’re the moms and dads who have overnight become homeschool teachers juggling jobs and teaching duties. They’re the school cafeteria workers who ensure our community’s children receive a hot meal each day, even when they’re not in class. They’re the firefighters, paramedics, police and other first responders who continue to put on their uniforms each
day, hit the streets and protect, us even though they’re scared, too. You are all appreciated and loved, and yes, you are all caregivers, too. You are a testament that together, we can overcome anything — even when it feels like we are more distant than ever before. And you all represent something that no pandemic or virus can ever strip away from us: hope. Even in the darkest of times, there’s always something for which we can be grateful. For us, it’s all of you. During these times, we want to urge our communities to continue to lead with love, to be kind to one another, to offer each other grace and to continue inspiring hope in others the way you’ve inspired it in us. Sharlet Briggs is the president of Adventist Health Bakersfield, David Butler is the president of Adventist Health Delano and Jeff Lingerfelt is the president of Adventist Health Tehachapi Valley. Together, the three hospitals, affiliated clinics and outpatient centers serve hundreds of thousands of people across Kern County.
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