Five Types of Lawsuits That Are on The Rise— and What Employers Can Do About It

August 27, 2020

Topics: Employment Litigation

Employee-initiated litigation is back in full swing after a COVID-19-induced hiatus. As the pandemic continues to upend workplace norms and disrupt employment relations in unprecedented ways, employment litigation has taken on a unique spin. Below are five categories of employment-related lawsuits we expect to become more common, and suggestions on what employers can do now to avoid or mitigate risk.

Discrimination Claims

In the barrage of daily challenges triggered by the pandemic, many employers have been faced with tough decisions about terminations and furloughs, the return to work, and how to address employees who have a medical condition or disability that affects their ability to come into the office. While discrimination claims have always been a risk companies faced, the COVID-19 era has created a new level of uncertainty for all involved.  In one recent case filed in New York federal court, a former employee sued her employer for retaliation and discrimination alleging that the company used pandemic-related layoffs as a pretext to fire her in retaliation for alleged complaints she made about a supervisor who she said sexually harassed her.  Employers should carefully examine and document the business reasons for a particular employment action (whether it be a layoff, furlough, or decision of who to prioritize bringing back to work) and consider, with counsel, strategies to avoid claims in the first place.

Claims Related to Workplace Safety

This pandemic has brought workplace safety issues to the forefront. Although many have adopted workplace safety rules such as social distancing, mask-wearing and health screening, some companies have been less cautious. We have seen a myriad of safety claims: from allegations for failure to provide employees with adequate personal protective equipment (“PPE”) or training in how to use PPE, to  failure to implement health-screening policies (such as temperature checks or symptoms screening), to generic “failure to keep the workplace safe” claims.   These claims have been brought under various theories of liability: traditional negligence claims, claims alleging violations of state or federal workplace safety laws or industry agency safety guidance, workers’ compensation claims, and even wrongful death claims.

Because a business may face not only legal but also reputational concerns, employers should carefully consult applicable federal, state, and local, health and safety guidelines and regulations in their location and regularly monitor developments.  Employers should consider taking other proactive steps, such as appointing a Chief Safety Officer and safety committee to monitor developments, establish policies, and train employees on safety issues, among others.

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.  Depending on the applicable laws and the specific situation, the potential damages in these types of cases may dwarf the underlying safety claims. Therefore, it is particularly important that companies consult employment law counsel before taking action against an employee who has raised safety issues (regardless of whether there is merit to the underlying safety concern).

Employee Leave/Benefit claims

A common challenge companies now face is employees’ reluctance to return to work. Additionally, employers have to navigate new federal (like the Families First Coronavirus Response Act- the FFCRA) and/or state COVID-19 related leave laws. Many businesses find themselves between a rock and a hard place, needing staffing and having to address employees’ requests for paid and potentially unpaid time off for a variety of unprecedented reasons. Because these laws are untested (and a recent federal court case struck down as overbroad aspects of the federal regulations implementing the leave laws), it is particularly important for employers to consult with counsel regarding their potential leave obligations before terminating employees who are unable to work.

Federal and/or State WARN Act Claims

Out of necessity, many businesses made lightning-quick decisions regarding staffing in the spring and carried out lay-offs, furloughs, or a shutdown of part of their operations. The federal Worker Adjustment and Retraining Notification Act (“WARN”) (and their 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 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 this. For example, a recent lawsuit was brought in Florida federal court alleging that a car rental company failed to give proper WARN notice to employees who were laid off during the pandemic. The defendants recently filed a motion to dismiss on the ground of unforeseen business circumstances.

Because the cost, uncertainty, and distraction of these litigations can be crushing to smaller businesses and because some notice may generally be better than no notice, employers should consult with counsel to evaluate whether there are any feasible options, even after the fact, to mitigate risk of these types of claims or limit potential damages.

Litigation is an unfortunate byproduct of the many shades of workplace challenges brought on by COVID-19. A two-tiered approach is vital: proactively focusing on compliance to sidestep these litigation trip-wires; and should a business be in the unfortunate situation to have to contend with one of these or similar claims, preparing defenses and strategic with competent counsel in a meticulous and thoughtful manner.

For more information about these topics, please contact the authors Jessica Shpall Rosen, Zev Singer and Keli Liu, or contact your personal Greenwald Doherty contact.