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Law360 (September 8, 2020, 4:18 PM EDT) --
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| Jessica Shpall Rosen |
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| Keli Liu |
Below are five categories of employment-related lawsuits that are currently trending, and suggestions about what companies can do now to avoid or mitigate risk.
1. Discrimination Claims
In the barrage of daily challenges triggered by the pandemic, many employers have been faced with sometimes existential questions about their business and need to make tough decisions, and fast. This was true particularly in the early days of the pandemic. Fortunately, some companies are recovering now, but the decision of who to bring back to work or rehire also presents risks.
While discrimination and retaliation claims have always been a lurking risk underlying employment decisions, the COVID-19 era has created a new level of uncertainty.
For example, in Fitzgerald v. The We Company, filed recently in the U.S. District Court for the Southern District of New York, a plaintiff sued her former employer for retaliation and discrimination, alleging that the company used the pandemic-related layoffs as a pretext to fire her in retaliation for complaining about sexual harassment and taking intermittent Family and Medical Leave Act leave.[1] It also seems likely that there will be claims over employers' decisions about who to bring back to work from a furlough or layoff and in what order.
To mitigate risks, employers should carefully examine and document the business reasons for a particular employment decision. Simply citing economic reasons is not enough; employers should be prepared to demonstrate that there is a legitimate business reason to support the decision to terminate the employment of each affected employee.[2] These reasons should be based on objective measures where possible, such as tenure, sales or billable numbers, and job function.
Since performance, which is more subjective, usually plays a role in these decisions too, employers should compile real-time evidence of these concerns, such as a recent performance evaluation or email discussing performance issues with an employee. While this process takes time, in the event of litigation — or threat of litigation — having this evidence in hand, which was collected when the reasons were top of mind, can bolster the company's position. Going through these steps can also show that the employer made a fully informed business decision.
Other preventive measures include offering a separation payment in exchange for a release. And because angry employees are more likely to sue, employers may want to also consider offering nonmonetary benefits, such as extending health care benefits and offering outplacement services, which give employees resources in their job search.
If a company is fortunate enough to be in a position to rehire or reinstate employees, it should similarly document why certain employees were selected at a given time. Having documented the business reasons as discussed above in advance of the original termination or furlough decision, employers can refer to that thought process as a guidepost.
Finally, employers should assess the demographics of those affected by both layoffs/furloughs and rehire decisions, to ensure that legally protected groups are not being disparately impacted.
2. Workplace Safety Claims
The pandemic has obviously brought workplace safety issues to the forefront. Many companies have implemented workplace safety measures such as social distancing, face coverings and health screenings.
But determining how to implement and enforce safety measures, while still meeting productivity and business goals, is far from straightforward, and employers are left to untangle a variety of local, state and federal guidance. To make matters more complex, the safety guidance keeps changing.
Not surprisingly, employees have started bringing safety-related claims, both in court and before government agencies, relating to a host of safety issues, for example: failure to provide employees with adequate personal protective equipment or training in how to use PPE; failure to implement health screening policies — such as temperature checks or symptoms screening; or the generic failure to keep the workplace safe.
These claims have been brought under various theories of liability: traditional negligence claims, claims alleging violations of local, state or federal workplace safety laws or guidance, and public nuisance, among others.
In one recent example, Palmer v. Amazon.com Inc., workers at an Amazon warehouse in New York City filed a lawsuit in the U.S. District Court for the Eastern District of New York in early June, alleging health and safety violations under a theory of public nuisance and a state labor law provision that contains a general duty to protect the health and safety of employees.[3]
Amazon recently filed a motion to dismiss, arguing that the claims are preempted by the Occupational Safety and Health Act and that these issues are within the primary jurisdiction of the Occupational Safety and Health Administration, citing other recent federal cases that dismissed similar claims. Amazon also argued that the claims were speculative and that the public nuisance doctrine could not be applied to a private workplace under the circumstances, in addition to other arguments.
While it's unclear whether these theories of liability will stick, the reputational risks to a business of being called out publicly for having an unsafe workplace are potentially more damaging.
Employers should carefully consult applicable federal, state, and local health and safety guidelines and regulations in their location, regularly monitor developments, and develop a well-rounded workplace safety plan and policies that contain protocols for workplace safety issues that may arise. Employers should consider taking other proactive steps, such as appointing a chief safety officer and safety committee that can monitor developments, establish and update policies, and train employees on safety issues, among others.
3. Retaliation and Whistleblower Claims
Retaliation/whistleblower claims can go hand in hand with COVID-19 workplace safety claims. These government investigations and lawsuits tend to assert that an employee was disciplined or terminated for raising issues about workplace safety or working conditions or for requesting leave for COVID-19-related reasons.
A recent example of this type of claim is Berlingo v. Monroeville Operations LLC, a lawsuit filed in the Pennsylvania Court of Common Pleas in which a nursing home administrator alleged that he was fired for reporting COVID-19-related concerns to the state department of health.[4] Depending on the applicable laws and the specifics of the situation, the remedies available to an employee who brings a claim may vary, but may dwarf the value of the underlying alleged safety violations — and it may not matter whether the safety complaint was valid in the first place.
Before making employment decisions, employers should carefully assess whether an employee has raised a complaint about safety or other reasons protected by law. In the COVID-19 era, the line for what constitutes a complaint can be blurry, so employers should tread carefully here.
It is also essential that front-line managers and supervisors be trained on company reporting procedures, to ensure that upper management and human resources are aware that complaints are being made. This will ensure that complaints are investigated and addressed promptly, and help senior management assess the risks of taking a particular employment action.
4. Employee Leave Claims
A common challenge companies now face is employees' reluctance to return to the workplace. Additionally, employers have to navigate new federal laws, like the Families First Coronavirus Response Act, and/or state COVID-19-related leave laws.
Many businesses find themselves between a rock and a hard place, needing staff and having to address employees' requests for paid and potentially unpaid time off for a variety of unprecedented reasons. These laws are ambiguous in some respects and untested by the courts. In addition, a recent order from the Southern District of New York struck down aspects of the U.S. Department of Labor rules implementing the FFCRA, creating further uncertainty for employers grappling with real-life questions about how to apply these leave laws.[5]
Because the law is in flux and these are unprecedented issues, it is particularly important for employers to engage and communicate with their workforce. For employers looking to reopen their workplace, one way to address these concerns is through developing and conducting an internal employee census in advance of the reopening.
This way, an employer can evaluate each employee's needs directly, to explore whether creative solutions or accommodations can be provided. Because these issues are so complex and novel, employers should use caution and avoid setting hard-line rules.
5. Federal and/or State WARN Act Claims
Out of necessity, many businesses made lightning-quick decisions regarding staffing in the spring and carried out layoffs, furloughs or shutdowns as part of their operations. The federal Worker Adjustment and Retraining Notification, or WARN, Act (and state equivalents) requires employers of a certain size to provide advance written notice to employees and certain government agencies regarding mass layoffs. The stakes are potentially high, as employers who are found to have failed to comply with the very technical WARN requirements could end up responsible for civil penalties and damages.
Although some of the various WARN laws provide an exception to the advance notice requirement for unforeseen businesses circumstances, this defense has not been tested in the courts in the unprecedented context of the COVID-19 pandemic. Plaintiffs attorneys have already started to challenge pandemic-induced layoffs.
For example, a recent putative class action, Benson v. Enterprise Holdings Inc., was brought in the U.S. District Court, Middle District of Florida, alleging that Enterprise Holdings and its affiliates failed to give proper WARN notice to employees who were laid off in April.[6] Time will tell whether the "unforeseen business circumstances" defense will hold up.
Because the cost, uncertainty and distraction of litigation can be crushing to businesses — especially smaller businesses that may be covered under state WARN laws, even if not the federal law — employers should not presume that a court will automatically accept the COVID-19 pandemic as an excuse to avoid giving notice. This will be a fact-specific inquiry.
For these reasons, to the extent possible, employers should endeavor to give some advance notice, because some notice may generally be better than no notice. Since these issues are highly complex and technical, employers should evaluate whether there are any feasible options, even potentially giving notice after the fact, that may mitigate the risk of these types of claims or at least limit potential damages.
Conclusion
Litigation is an unfortunate byproduct of the many shades of workplace challenges brought on by COVID-19. A two-tiered approach is vital: (1) proactively focusing on compliance to sidestep these litigation tripwires and; (2) strategizing and preparing defense in a meticulous and thoughtful manner, should a business be in the unfortunate situation to have to contend with one of these or similar claims.
Jessica Shpall Rosen is a partner and Keli Liu is an associate at Greenwald Doherty LLP.
The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.
[1] See Fitzgerald v. We Company dba WeWork, et al., No. 1:20-cv-05260 (S.D.N.Y. July 9, 2020).
[2] Of course, if it's a large-scale layoff or elimination of an entire department, the approach could differ.
[3] See Palmer et al. v. Amazon.com Inc. et al., No. 1:20-cv-02468 (E.D.N.Y. 2020).
[4] See Berlingo v. Monroeville Operations LLC, case number GD-20-009050 (Court of Common Pleas, Allegheny County, PA).
[5] See State of N.Y. v. U.S. Dept. of Labor
, No. Case 1:20-cv-03020-JPO (S.D.N.Y Aug. 3, 2020).[6] See Benson v. Enterprise Holdings, Inc., et al., No. 6:20-cv-00891-RBD-LRH (M.D. Fla.).
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