Pandemic Presents Host of Legal Issues for Employers

Issues & Policies

From essential companies that have maintained operations throughout the coronavirus pandemic to shuttered companies waiting to reopen, businesses of all sizes and industries face a host of legal issues.

These include fears of endangering the health of customers and employees, and liability concerns of manufacturers, including those that have switched operations to address the critical shortage of medical supplies and equipment.

The legal areas are vast and have business and industry organizations calling on lawmakers to pass measures that protect businesses from virus-related lawsuits.

“A reopening plan that is medically based and relies on social distancing and other best practices for public health may raise significant regulatory and legal liability risks,” Suzanne Clark, president of the U.S. Chamber of Commerce, wrote in the organization’s National Return to Work Plan.

“These are in addition to numerous lawsuits already filed as a result of COVID-19 and litigation risk that will become exacerbated during a reopening.”

Liability Issues

Among the liability issues concerning the chamber are:

  • Health privacy: If employers must verify an employee’s COVID-19 status and if an employee has an underlying health condition
  • Discrimination claims: If a risk-based reopening is based on factors including age and underlying conditions
  • Safe work requirements: If the use of workplace PPE to prevent COVID-19 is mandated, how do OSHA regulations apply

The U.S. Chamber is calling for a safe harbor for temporary employer measures designed to combat COVID-19 transmission.

Employers, already facing lawsuits over pandemic-related workplace practices, are concerned over a number of issues that could lead to more lawsuits.

These include litigation resulting from disruptions to reimbursement areas such as wage and hour, leave, and travel, as well as workplace safety.

“There should be a safe harbor for temporary employer-implemented workplace policy changes designed to combat the spread of the coronavirus,” the U.S. Chamber plan said.

Regulatory Structure

Business groups are calling on lawmakers to install a regulatory and legal structure that acknowledges the extraordinary risks to businesses, including those deemed essential.

Patrick Harden, vice president of litigation for the National Association of Manufacturers, said lawmakers are recognizing the legal issues businesses are confronting.

“The nature and the contour of the problem that we’re facing here is starting to become much more evident to members of both parties,” Harden said.

“There’s a growing understanding that we’re going to have to find a solution.”

NAM’s Patrick Harden

“And I think there’s a growing understanding that we’re going to have to find a solution.”

Evan Greenberg, CEO of insurer Chubb, writing in the Wall Street Journal, called on Congress to grant immunity from coronavirus-related litigation.

“How long the disaster will last—or how much worse it will get—is unclear,” he said.

“But it won’t help Americans or the economy to allow lawsuits to proliferate or to try to pin the damage on insurers like my company.”

Action Plan

NAM’s American Renewal Action Plan also recognizes the legal issues employers face and calls on Congress to:

  • Limit lawsuits claiming damages for workplace exposure to COVID-19 to those based on claims that companies knew the person would be exposed to the virus and acted recklessly or with indifference as to whether the person would catch it
  • Acknowledge that the patchwork of advice, industry practices, and state directives make it hard to identify a clear standard of care
  • Provide employers with a safe harbor for collecting and exchanging crucial information related to employees’ health and adopting reasonable measures to combat workplace transmission
  • Place state public nuisance claims off limits for the spread of a pandemic disease during a declared national emergency 

NAM also called on the U.S. Department of Labor to protect employers from frivolous litigation by announcing what California has already said—that COVID-19 can be considered an “unforeseeable business circumstance” under the WARN Act.

And it asks Congress to protect manufacturers who have stepped up to produce PPE by enacting liability protection from state or federal claims.


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