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Bringing select workers back carries litigation risks: Experts

coronavirus workplace

Employers that are inviting select employees to return to work after COVID-19 shutdowns must tread carefully to avoid potential discrimination claims, experts say.

Without analysis beforehand, employers could leave themselves open to charges of violation of federal laws including the Americans with Disabilities Act, the Age Discrimination in Employment Act, and Title VII of the Civil Rights Act of 1964, as well as state and local laws.

There is also the potential for wage and hour litigation, experts say.

They also point out that federal legislation now protects workers who cannot return to work because of child care issues.

Experts warn, too, that given the widespread unemployment created by the pandemic, some litigation may be inevitable, as desperate workers turn to it as a possible income source.

“This is a tough situation for business, because it is a unique thing. No one’s been through this before, and the guidelines are certainly changing, and it’s going to vary from state to state depending where you are in the country and what your local community is doing,” said Talene Carter, New York-based national employment practices liability product leader for FINEX North America at Willis Towers Watson PLC.

Decisions need to be made on an “unbiased, nondiscriminatory basis,” said Kelly Thoerig, Richmond, Virginia-based U.S. employment practices liability product leader for Marsh LLC.

“The potential concern is not having a facially neutral criteria on bringing people back,” said Keith Gutstein, co-chair of the labor and employment practice at Kaufman Dolowich Voluck LLP in Woodbury, New York. “You can’t just pick your favorites and hope for the best.”

In deciding who will not return, employers should not target those who can be deemed susceptible to the coronavirus, such as older employees, pregnant women or individuals with pre-existing conditions, said Jason Habinsky, a partner with Haynes & Boone LLP in New York, who is chair of the firm’s labor and employment practices group. “Employers need to be prepared to accommodate rather than discriminate,” he said.

To avoid discrimination claims, employers should follow the same procedures they would in reductions-in-force by statistically analyzing whom they are asking to return and see if it is disparately impacting protected classes, said Tom Hams, Chicago-based managing director and national employment practices liability insurance practice leader at Aon PLC.

If that is the case, they must see if they “can justify the statistical anomaly. That’s the way to protect yourself,” Mr. Hams said.

Employers should be looking at skill sets, relative performance and evaluations, said Barry Hartstein, a shareholder with Littler Mendelson P.C. in Chicago, who is co-chair of its equal employment opportunity and diversity practice group.

“You may need individuals who are cross-trained and may be far more valuable,” Mr. Hartstein said. So it could be a question of “what are the skill sets we’re going to need in the new economy, because quite honestly we may be living in a new economy,” he said.

If an employer returns a 35-year-old to a job but not a 65-year-old to the same position, based on a concern the older employee is more vulnerable to COVID-19, this could arguably be considered discrimination, said Gus Sandstrom, a partner with Blank Rome LLP in Philadelphia, who defends and advises employers. 

“One thing we’ve been recommending when this comes up is, it’s perfectly appropriate to reach out to employees in high-risk groups and inquire as to accommodations that may be possible,” and whether they may prefer to stay home or return at a later date, Mr. Sandstrom said.

There are also possible situations in which employees who are asked to return to work are too nervous to do so. “Employees are only entitled to refuse to work if they believe they are in imminent danger. This is a high bar to meet” under Occupational Health and Safety Administration regulations, said Melissa Camire, a partner with Fisher & Phillips LLP in New York, who represents employers.

“You should be taking steps to make the workplace a safe environment,” she said.

“That is a very slippery slope,” said Andrew Doherty, Valhalla, New York-based national directors and officers practice leader with USI Insurance Services LLC.

“There’s not a lot of precedent for this situation, and I think there’s going to be a lot of unique situations about what level of fear you have” with respect to the ADA “and what is a disability and what is a reasonable accommodation.”

Employers need to figure out what is a reasonable accommodation and what isn’t, Mr. Doherty said, adding, “Of course, there are situations where employers do have to move and get work done.”

Another possible source of claims is the federal Families First Coronavirus Response Act, which took effect April 1 and is set to expire Dec. 31. It requires employers to give employees paid emergency family and medical leave and emergency paid sick leave. The law covers private employers with fewer than 500 employees and certain public employers.

Experts warn an increase in litigation over the return-to-work issue may be inevitable. Currently, there are not many claims, because employees are collecting unemployment benefits that in some cases are more than what they would have made from their regular salary, Mr. Gutstein said.

But that situation may change, when companies start bringing people back and some workers are excluded, “when the unemployment runs out and there’s no other income,” or when they find their salaries have been cut, he said.

Employment practices liability policies “cover your traditional discrimination type claims,” including for retaliation and wrongful termination, “but EPL policies do have bodily injury exclusions, so it’s really going to depend on the specific wording of your EPL policy, and also how the claim is alleged, Ms. Carter said.

“If it’s straight discrimination and no bodily injury allegations, chances are it will trigger the policy, but with this pandemic it’s really hard to say how some of the claims will be alleged,” she said.

Wage and hour litigation is also possible, experts say. With more people working from home “you have much less control over tracking hours worked” and meal and rest breaks, Ms. Carter said. “I think we’re going to see more claims in terms of failure to pay overtime.” There may also be claims regarding the time it takes to wait in line to have temperatures taken when entering the workplace.

More insurance and risk management news on the coronavirus crisis here.