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COVID-19 lawsuits and claims on the rise: What practice owners need to know

Many employers across the U.S. may be facing legal issues as they cope with reopening and maintaining their businesses during the COVID-19 pandemic.

More than 2,000 lawsuits relating to COVID-19 have been filed in federal and state courts. While most claims pertain to customers and clients who have filed for exposure to COVID-19, employees have also filed more focused claims relating to workplace health and safety, termination and nondiscrimination.

“As of mid-June, more than 230 lawsuits directly related to labor and employment violations have been filed,” according to Littler, a labor and employment litigation law firm. “California leads the nation with 32 employment lawsuits already filed.”

As the circumstances surrounding the pandemic continue to evolve, employers should be aware of new laws that federal and state governments have been put in place. Here are several claims that employers could potentially be exposed to under federal and state labor laws:

Paid leave

The Families First Coronavirus Response Act provides up to two weeks of paid sick leave and an additional 10 weeks of leave for eligible employees for school and child care closures due to COVID-19.

But the new regulations have started to backfire for some employers.

"Already we are witnessing claims from employees alleging that they were denied leave to which they were entitled under these new laws or retaliated against for seeking leave," according to Littler.

Employers should monitor developments in this area closely and make sure their leave programs are coordinated to meet varying federal, state and local requirements.

Discrimination

As employees are beginning to return to work, experts predict a rise in discrimination claims — particularly related to age and pregnancy.

The U.S. Equal Employment Opportunity Commission prohibits employers from preventing older employees or pregnant employees from returning to work if they wish to do so. Employers should be mindful of potential violations, even if they believe they are acting in the employee’s best interests.

The Americans with Disabilities Act is another source of COVID-19 discrimination claims. The act governs what medical information employers can seek from employees and requires employers to provide reasonable accommodations to employees who have disabilities and are at high risk for severe illness from the coronavirus.

In California, the Department of Fair Employment and Housing requires employers of five or more to provide reasonable accommodations when appropriate.

The Equal Employment Opportunity Commission recently issued new guidance that consists of workplace protection rules to help employers accommodate high-risk employees. Providers can find detailed information in Accommodating at-risk workers during COVID-19: EEOC issues new guidance.

Wage and hour lawsuits

As more employers are now allowing employees to work from home, such accommodation could lead to a rise in claims alleging unpaid wages and failure to pay overtime.

During remote arrangements, employers should be vigilant about setting expectations in writing related to managing timekeeping policies and rules to ensure nonexempt employees are properly documenting their work hours and working only when scheduled. Employers should then communicate expectations to employees about obtaining prior approval for any overtime work.

In many states, including California, employers are required to reimburse employees for reasonable and necessary expenses. Employers should be mindful of those regulations to avoid a claim for failure to reimburse business-related expenses including cellphone, Wi-Fi charges and office supplies. Employers may set a reasonable monthly flat stipend in lieu of calculating actual percentage costs of those items.

Layoff notice

As many businesses have been forced to downsize their staff during the pandemic, employers should be aware of the federal Worker Adjustment and Retraining Notification. Under WARN, an employer may be required to provide 60 days’ notice to workers when they are laid off for an extended period or when the employer closes its business.

A 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.

The WARN Act provides certain exceptions to unforeseeable business circumstances, but employers are encouraged to provide all required WARN Act notices as soon as possible.

Workers' compensation

As COVID-19 infection numbers continue to rise, legal experts predict that infected employees and families of employees who have died from the virus will file workers' compensation lawsuits.

"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.

Several states, including California, have passed legislation that would make it easier for workers to file successful claims. In May, Gov. Gavin Newsom 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.

To help minimize the risk of exposure in the workplace, employers should implement updated cleaning and safety policies and ensure staff is properly trained. Additionally, patients should be made aware of any new policies before their next appointment.

While business groups have been lobbying for a liability shield provision to protect employers acting in good faith, no significant legislation that offers protection for labor and employment claims has been introduced as of yet.

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