As shutdown orders begin to subside and states across the nation take steps toward reopening, employers should prepare for a potential spike in employment claims arising out of new legislation, the application of existing laws to novel workplace circumstances and a sudden downturn in the economy. Below is a summary of some of the claims that employers can expect to receive in the coming months.
Claims stemming from layoffs, furloughs and recalls to work
Employers may see claims brought by individuals who allege that they were not given proper notice of, and/or were discriminated against, in an employer’s selection of employees to terminate, furlough or recall following the onset of the COVID-19 pandemic.
Federal Worker Adjustment and Retraining Notification (WARN) and parallel state “mini-WARN” acts generally require covered employers to provide advance notice (usually 60 days) of a mass layoff or a significant reduction in hours. As a result of the shutdown orders across the country, many non-essential businesses were abruptly forced to significantly slow or completely halt operations. Consequently, these businesses were forced to furlough or lay off their workforces with little or no notice. Employers that were unable to give requisite WARN notice (or gave no notice at all) may see an influx of claims seeking potential damages for back pay and fringe benefits for each day of violation, as well as for civil penalties. Unfortunately, the U.S. Department of Labor has yet to provide clear guidance as to whether the unforeseeable business circumstances or natural disaster exceptions will apply to businesses impacted by these shut-down orders.
In addition, employers will likely see an increase in discrimination claims related to the selection of individuals to be laid off, furloughed, or recalled to work. Specifically, individuals adversely affected by these decisions may claim that the basis for their termination, furlough or exclusion from a recall to work was because on their membership in a protected class – for example, age, race, gender, disability, etc. – as opposed to a legitimate, non-discriminatory business reason. Alternatively, employees may claim that these actions disparately impacted individuals belonging to one or more protected classes.
Discrimination and retaliation claims under the FFCRA
The second area ripe for litigation is claims under the Families First Coronavirus Response Act (FFCRA). By way of background, in mid-March, the federal government passed a sweeping mandate, requiring employers to give employees paid and/or unpaid time off for COVID-19-related reasons. Briefly, this law requires that employers with fewer than 500 employees provide time off at full or partial pay, depending on the underlying need for the leave. This law was implemented quickly, and the accompanying guidance was slowly rolled out over the following month. As a result, employers were forced to expeditiously grapple with identifying eligible employees, designating the leave appropriately, and administering the respective payments. Employers can expect to see claims for failure to provide appropriate notice of rights under the law, failure to grant leave requests to eligible employees, and retaliation stemming from adverse actions (such as reduction in pay, discipline or termination) against employees who take FFCRA leave.
Failure to accommodate high-risk employees
Employers will likely also see a rise in claims brought by individuals who allege that their employers failed to provide them an accommodation based on a condition that makes them highly susceptible to contracting COVID-19, or at a higher risk of severe illness if infected. This will be especially true given that many employees have been teleworking for the last two months and have demonstrated that they can perform the essential functions of their jobs from the safety of their home. Beyond the interactive dialogue process under the Americans with Disabilities Act, some states and localities have more stringent requirements surrounding requests for an accommodation. Employers should therefore review their accommodations policies and practices, to ensure that they align with applicable law.
Given the novel working conditions created by COVID-19, employers should carefully review their handbooks, manuals, policies and practices to ensure that they are mitigating possible exposure to these claims and others. For additional questions, employers should contact one of the knowledgeable attorneys in Reed Smith’s experienced Labor and Employment Group.