As the COVID-19 pandemic shows signs of lessening and states begin to permit businesses to re-open, employers may face a new wave of coronavirus-related litigation. This Client Alert details some of the types of litigation employers may see as business-as-usual begins to resume.
Wage and Hour Claims
The drastic business changes and transition to telework may result in employers being sued for wage and hour violations pursuant to the Fair Labor Standards Act (“FLSA”) and the New York Labor Law (“NYLL”).
The FLSA and the NYLL require employers to pay all employees for all hours worked and require employers to pay non-exempt employees at a premium overtime rate for any hours worked over 40 hours per week. See 29 U.S.C. §§ 206-207; N.Y. Lab. Law §§ 652.
As businesses were shut down by New York State Governor Cuomo’s executive orders, and employees were forced to transition to working remotely, many employers have been confronted with challenges regarding tracking employees’ hours worked and ensuring that employees do not work through their meal and/or rest breaks. These timekeeping challenges may result in lawsuits by employees claiming that they were not paid for all hours worked.
Another wage-and-hour issue resulting from the COVID-19 pandemic is whether employees are entitled to compensation for time spent on health-protective measures, such as (1) waiting for and receiving temperature checks, (2) waiting to receive or cleaning personal protective equipment, or (3) sanitization and hygiene training. As these activities may constitute compensable time, employers may face claims that employees were not properly paid during these times.
Sick and Disability Leave
As a result of the ongoing pandemic, federal and state legislation has been enacted to provide employees who are unable to work due to circumstances relating to COVID-19 with emergency paid leave. The federal government enacted the Family First Coronavirus Response Act (“FFCRA”), effective April 1, 2020, which requires covered employers to provide paid sick leave and expanded family and medical leave to eligible employees between April 1, 2020 and December 31, 2020. Additionally, New York State enacted Emergency Paid Sick Leave (“N.Y. EPSL”), which guarantees job-protected paid sick leave to certain employees subject to an order of quarantine, and Emergency Paid Family Leave (“N.Y. EPFL”), which requires all employers to provide employees subject to a mandatory or precautionary order of quarantine or isolation or providing care for a minor dependent child subject to a mandatory or precautionary order of quarantine or isolation with paid leave. During the COVID-19 pandemic, employees may also request (and may be entitled to use) leave pursuant to the Family Medical Leave Act (“FMLA”), New York’s Paid Family Leave Law (“N.Y. PFL”), and other local paid leave laws for pandemic and non-pandemic related reasons.
Employers need to ensure that they review employees’ requests for leave pursuant to these laws, properly determine employees’ eligibility for paid or unpaid leave, and appropriately compensate employees when required. Employers may face legal action from employees if they fail to properly implement the emergency paid leave and other leave of absence laws by wrongfully denying time off, miscalculating pay, or retaliating against employees who request or use leave.
Employers may also face litigation regarding disability discrimination pursuant to, inter alia, the Americans with Disability Act (“ADA”) and New York State Human Rights Law (“NYSHRL”) as a result of the COVID-19 pandemic and the transition to and from teleworking.
The ADA and NYSHRL give qualified workers the right to request and receive a reasonable accommodation that assists them in performing the essential duties of their position. As in-office functions were shut down and businesses were forced to transfer their operations to teleworking, employers may face disability discrimination claims from employees who requested and did not receive reasonable accommodations to allow them to perform their job duties remotely. Additionally, employers may be required to continue any reasonable accommodations they were providing prior to the pandemic to employees during the remote-work period.
Employers may also face disability discrimination claims as businesses re-open and employees return to work. Employees who are particularly vulnerable to COVID-19 may request accommodations, including teleworking, to allow them to safely perform their job duties. While many employers may have previously been able to argue that an employee’s physical presence at work was an essential function of the job or teleworking was an unreasonable accommodation, these arguments may be undermined if employers have continued their operations remotely during the pandemic without significant interruption.
Liability from Layoffs
WARN Acts Litigation
Rapid layoffs, furloughs, and the reduction of employees’ hours due to coronavirus-related business shutdowns may result in liability for employers who failed to comply with the federal Worker Adjustment and Retraining Notification Act (“federal WARN Act”), 29 U.S.C. § 2101 et seq., and the New York State equivalent, N.Y. Lab. Law § 860-a et seq. (“N.Y. WARN Act”) (collectively, the “WARN Acts”). The notice requirements pursuant to the WARN Acts have not been suspended during the COVID-19 pandemic.
The WARN Acts require covered employers to provide employees with advance notice of an employment loss due to a mass layoff or plant closing. An employment loss under both WARN Acts includes any of the following: (1) a layoff exceeding six months; (2) a termination of employment for reasons other than discharge for cause, voluntary departure, or retirement; and (3) a greater than 50% reduction in work hours during each month of any 6-month period. 29 U.S.C. § 2101(a)(6); 20 C.F.R. § 639.3(f); N.Y. Lab. Law § 860-a(2); 12 N.Y.C.R.R. § 921-1.1(f). Thus, employers who executed layoffs or implemented furloughs or hours reductions which ultimately last greater than six months may face lawsuits from employees for WARN violations.
Employers may argue that the exceptions to the WARN Acts for unforeseeable business circumstances and natural disasters excuse any failure to comply with the notice requirements. See 20 C.F.R. § 639.9; 12 N.Y.C.R.R. §921-6.1 et seq. However, it is unclear whether these exceptions apply to emergencies resulting from the COVID-19 pandemic
Discrimination and Retaliation Claims
Employers may also face discrimination and/or retaliation suits from laid off employees. Former employees may claim that an employer’s selection of workers for layoff was based on a protected status or resulted in a disparate impact on workers of a protected class in violation of, inter alia, Title VII and NYSHRL.
Moreover, laid off employees may bring actions against their former employers claiming that they were retaliated against for requesting or taking leave pursuant to the FFRCA, N.Y. EPSL, N.Y. EPFL, or other leave of absence laws. For example, a former employee has filed an action in federal court claiming that the airline she worked for retaliated against her by laying her off after she requested leave pursuant to the FFRCA. Jones v. Eastern Airlines, LLC, No. 20-cv-01927 (E.D. Pa. Apr. 16, 2020).
Employee Safety Actions
The Occupational Safety and Health Administration (“OSHA”) has issued guidance advising employers to follow the Center for Disease Control and Prevention’s coronavirus safety recommendations. However, OSHA has not implemented specific requirements regarding safety measures to address coronavirus in the workplace.
As employees, particularly essential workers, become sick with coronavirus from workplace exposure, employers may face claims regarding unsafe working conditions. Although the Occupational Safety and Health Act does not permit employees to directly sue regarding safety disputes, other than claims of retaliation, employers may face an increased number of worker’s compensation claims and state law actions regarding workplace illness. Additionally, OSHA may bring enforcement actions against employers who have failed to ensure that the workplace is free of hazards that may cause death or serious physical harm, including coronavirus. See 29 U.S.C. 654(a)(1).
Takeaway for Employers
Employers should continue to track and record employees’ hours worked, ensure paid and unpaid leave is provided to employees in accordance with the emergency paid leave and other leave of absence laws, and document non-discriminatory reasons for adverse employment decisions. Employers should also contact their counsel prior to implementing health-and-safety practices, executing layoffs or furloughs, or reducing employees’ pay or hours.
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If you have any questions regarding this alert, please do not hesitate to contact us.