Prepare for Wide Range of COVID-Related Lawsuits

Allen Smith, J.D. By Allen Smith, J.D. May 27, 2020
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​Employers can expect to face many coronavirus-related lawsuits and claims from infected or laid-off employees and families of deceased workers, employment attorneys said. Workers' compensation claims are likely, as workers' compensation statutes have been amended to cover COVID-19 in more circumstances. Claims for gross negligence, wage and hour oversights, discrimination, and layoff-notice discrepancies are also possible.

Meanwhile, Congress is debating the possibility of some liability protection for businesses from coronavirus-related lawsuits. Some Democratic senators have expressed interest in limited liability protection, although Sen. Democratic Leader Charles Schumer, N.Y., and Speaker Nancy Pelosi, D-Calif., are against it. Sen. Chris Coons, D-Del., wants some form of liability protection, so long as workers are protected. Sen. John Cornyn, R-Texas, said he wants a higher standard of proof for coronavirus-related lawsuits, rather than blanket immunity, The Hill reports. Senate Majority Leader Mitch McConnell, R-Ky., has said that liability reform must be part of the next coronavirus-relief legislation.

"Given the uncertainty about whether workers' compensation will apply to COVID-19-related illnesses, it is important for employers to do all they can to limit potential liability," said Jenifer Bologna, an attorney with Jackson Lewis in White Plains, N.Y. The best way for employers to accomplish this is by following all guidance from the U.S. Centers for Disease Control and Prevention, state and local health departments, and the Occupational Safety and Health Administration, she said.

If an employee has died from coronavirus, employers should be prepared for employee relations and public relations challenges along with legal ones, said Mark Neuberger, an attorney with Foley & Lardner in Miami.

The family of a Philadelphia shop steward who died from COVID-19 sued for wrongful death against JBS USA, a large meat processing company, reported WHYY. The employer allegedly made social distancing "impossible," forcing employees to use crowded work areas, and, according to the complaint, did not provide enough personal protective equipment. "We recognize our responsibility as a food company during this crisis, and we have continuously evolved our operations, based on the latest available guidance from experts, to improve our coronavirus-preventive measures," said Andre Nogueira, JBS USA CEO, in a statement.

In a wrongful-death lawsuit brought against Walmart by the brother of a Chicago-area employee who died after contracting coronavirus, the complaint asserts that Walmart failed to alert workers that employees were showing symptoms of COVID-19, according to NBC News. Another worker at the store also died from COVID-19. A Walmart spokeswoman said that "following the guidance from health authorities, we have taken appropriate actions to keep our associates and our customers safe while we continue to provide an essential service to our communities," she said.

Workers' Compensation

Legal experts predict infected workers and families of deceased workers also will file workers' compensation lawsuits.

"Things are changing quickly in this space," said Steve Shardonofsky, an attorney with Seyfarth in Houston. "Several states have already passed legislation or emergency orders creating a rebuttable presumption for workers' compensation claims that essential workers who test positive for COVID-19 were exposed at work."

California's Gov. Gavin Newsom recently enacted sweeping changes to the state's workers' compensation standards, providing that most California workers who contract COVID-19 are presumed to have a workplace injury covered by the workers' compensation system. 

"Employers should expect a wave of workers' compensation claims from employees who have contracted COVID-19, claiming that they contracted the virus while at work," said Ronald Flowers, an attorney with Burr & Forman, an attorney in Birmingham, Ala.

In some cases, plaintiffs should have an easier time proving that work caused them to get the coronavirus, said Sonya Rosenberg, an attorney with Neal Gerber & Eisenberg in Chicago. Causation should be easier to prove with someone who worked at a facility that continued operating after multiple employees tested positive for COVID-19 than with an individual who worked at a site with one previously confirmed case in a location far from that person, she said.

Some states exclude flu-like illnesses from workers' compensation coverage, Flowers added. In these states, employees might bring negligence claims, or their families allege wrongful death since workers' compensation laws' exclusive remedy provisions wouldn't apply.

 "If workers' comp applies, then the employee and their heirs are generally prevented from suing in tort for such things as wrongful death, pain and suffering, and loss of consortium," Neuberger said. "But most states have an exception to the prohibition of suing the employer when there is gross or willful negligence. In the COVID-19 wrongful-death suits that have been reported in the media, it appears the families are in fact alleging gross or willful negligence."

 [SHRM Resource Spotlight: Coronavirus and COVID-19]

Wage and Hour Lawsuits

For employees working from home, there might be a rise in claims alleging unpaid wages, failure to pay overtime and failure to reimburse business-related expenses in violation of the employer's policy, said Jonathan Kozak, an attorney with Jackson Lewis in White Plains, N.Y.

Employees might seek reimbursements for cellphone and Wi-Fi charges and for office supplies, said David Kurtz, an attorney with Constangy, Brooks, Smith & Prophete in Boston.

Misclassification claims might arise as a result of furloughs, he added. For example, an executive may lose her executive employee exemption if her staff has been furloughed, he said.

Discrimination Claims

Laid-off workers may claim discrimination. Reduction-in-force decisions "often impact older workers disproportionately because they tend to be the most highly compensated," Shardonofsky said.

Companies may also face an Americans with Disabilities Act claim if they deny a COVID-19 related accommodation, he noted. Or there might be Occupational Safety and Health Act retaliation claims from workers who contend that they were let go after refusing to return to an unsafe workplace.

Michelle Phillips, an attorney with Jackson Lewis in White Plains, N.Y., said that race, gender and age discrimination claims already have been filed after job eliminations, as well as retaliation claims. Claims of discrimination against Asian Americans in particular have risen sharply, reported ABC News. Expect Family First Coronavirus Response Act claims too, she added.

Layoff Notice

Robert Horton, an attorney with Bass, Berry & Sims in Nashville, Tenn., noted that a Worker Adjustment and Retraining Notification (WARN) Act claim requires the plaintiff to show that:

  • A facility closed and at least 50 full-time employees lost their jobs;
  • At least 500 full-time employees at a facility lost their jobs; or
  • At least 50 full-time employees lost their jobs and the number of full-time employees at the facility losing their jobs exceeded one third of all employees at the facility.

Although the WARN Act has an unforeseeable business circumstances exception, an employer must provide all required WARN Act notices as soon as possible, said Penny Ann Lieberman, an attorney with Jackson Lewis in White Plains, N.Y.

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