As the number of reported cases of COVID-19 continues to increase dramatically, several states, including California, Connecticut, Illinois, Massachusetts, Maryland, New York, New Jersey, Ohio, and Louisiana, have issued public health orders requiring over one-fourth of Americans to stay at home. More states are likely to follow. While these orders generally require non-essential businesses, such as bars and restaurants, to close their doors, many other businesses, including those deemed essential and critical infrastructure, are exempt from these public orders. Moreover, companies providing medical and other supplies under a “rated order” to the government may be required to continue operations under the Defense Production Act (DPA). Although telework may be an option for some employers who can remain open, remote work is not possible for workers at many of these companies.
Even when allowed to continue onsite operations under the stay-at-home orders, employers face a number of practical and legal issues when they ask employees to come onsite, especially when those employees refuse to report to work fearing for their safety or due to other obligations at home. In this alert, we provide practical guidance for employers to mitigate potential liabilities when asking employees to report to the worksite in jurisdictions with stay-at-home orders.
Take Proactive Measures to Mitigate COVID-19 Exposure at the Worksite
Employers who are allowed to remain open should adhere to the requirements of the applicable stay-at-home orders as well as the most up-to-date guidance from the Centers for Disease Control (CDC), other federal agencies, and state and local officials for maintaining a safe workplace, including:
- Practicing social distancing;
- Instructing employees not to come to work if they or a family member are exhibiting symptoms or have been diagnosed with COVID-19;
- Taking extra precautions to sanitize the workplace daily;
- Prohibiting visitors or customers from coming to the workplace unless necessary for business;
- Educating their workforce on best practices for minimizing risk of COVID-19 at work; and
- Staggering shifts, where possible, to allow for more effective social distancing.
In addition, while the Occupational Safety and Health Administration (OSHA) has yet to issue specific standards covering COVID-19, employers should follow OSHA’s guidance to reduce risk of employees being exposed to COVID-19 at work, including by developing an infectious disease preparedness plan and instituting policies and procedures for identifying and isolating sick people in the workplace.[1]
Even when following these recommended practices, employers cannot ensure employees that their workplaces are absolutely free of COVID-19. According to current research, the novel Coronavirus can be spread by individuals not exhibiting any symptoms and can remain infectious on hard surfaces for long periods. As a result, it can be difficult for an employer to identify members of its workforce who have been infected or even to disinfect all parts of its workplace each day. Requiring social distancing at the workplace can also prove logistically and practically difficult for a number of worksites. Even asking employees to report to the worksite can place them at greater exposure, particularly for employees who rely on public transport to get to work at peak rush hour commute times. These realities are causing many workers to fear that their presence at the job site could expose them (and possibly their family members or others who live with them) to the virus.
On top of these challenges, many employees are homebound because of their family obligations. Given that schools and childcare providers have closed their doors for the coming weeks (and in some cases months), some employees are unable to report to the worksite because they must care for minor children who are at home due to those closures.
What to Do if an Employee Refuses to Come to Work
Businesses that remain open will need to be prepared for employees who might refuse to come to work out of fear for their safety or are unable to work because of the lack of childcare or caring for ill family members. When an employee raises concerns about coming onsite, employers should first inquire why the employee cannot report to the worksite before taking any adverse action. Employers should consider the following questions to determine if an employee has a lawfully protected reason for not coming to the worksite.
- Does the employee have an underlying health condition that may require a reasonable accommodation? Under the Americans with Disability Act of 1990 (ADA), employers must provide reasonable accommodations to qualified individuals with disabilities unless doing so would cause undue hardship to the employer. The duty to accommodate can be triggered even when the employee does not expressly request an accommodation. Employers who become aware of the need for a reasonable accommodation have a duty to engage in the interactive process with the employee to determine if the employer can reasonably accommodate the employee. Unpaid leave from work can qualify as a reasonable accommodation. Many states have similar laws.
- It has been widely reported that those suffering from asthma and other respiratory conditions or whose immune systems might be compromised based on other underlying conditions (e.g., HIV) are more at risk of death or serious injury if they contract COVID-19. Accordingly, if an employer becomes aware that an employee has an underlying health condition or disability covered by the ADA or similar state laws that puts the employee at greater risk of having serious health consequences from contracting COVID-19, the employer may have a duty to engage in the interactive process to accommodate the employee’s disability. Given the current situation, most employers would likely need to accommodate such employees either by offering the option to work remotely (if that is possible) or providing an unpaid leave absence as an accommodation.
- Does the employee qualify for any form of protected paid or unpaid leave? Employees who do not report to work may qualify for job protected leave under federal or state law. Under federal law, the Family and Medical Leave Act (FMLA) provides for up to 12 weeks of protected leave for qualifying employees to take care of their own or a family member’s serious health condition. An employee who is the primary caregiver for a family member who has contracted COVID-19 would likely qualify for FMLA leave. Moreover, the recently enacted Families First Coronavirus Response Act (“FFCRA”) gives employees of companies with fewer than 500 employees up to 12 weeks of paid leave if they must care for a minor child due to a school or caregiver closure resulting from the COVID-19 pandemic, and further provides employees up to 80 hours of paid sick leave that they may use for self-care or family-care in response to the pandemic. Our alert on the FFCRA provides additional details about who qualifies for leave under the FFCRA.
- Many states, including California and New York, also require employers to provide additional paid and unpaid sick leave to employees for various reasons, including under recently enacted laws specific to COVID-19.[2] Because an employer may not discipline or retaliate against employees for using protected leave available to them under federal and state law, before taking any adverse action against an employee, an employer should attempt to determine whether the employee refusing to come to work is eligible for and is seeking to take protected leave.
- Could taking adverse action lead to a retaliation claim? Employers should also be wary of creating potential retaliation claims for disciplining or terminating employees who refuse to come to work out of fear for their safety. Under OSHA, employees can refuse to work under certain circumstances if they believe they are in “imminent danger.” An imminent danger is defined by OSHA to be a workplace hazard that puts the worker at immediate risk of death or serious physical harm or where there is “a reasonable expectation that toxic substances or other health hazards are present, and exposure to them will shorten life or cause substantial reduction in physical or mental efficiency.” Although the COVID-19 pandemic has been declared an emergency by President Trump and various state and local officials, it is not clear whether COVID-19 will be considered an “imminent danger” under OSHA standards. Requiring employees to work with patients in a medical setting without personal protective equipment may rise to the “imminent danger” threshold, but, at least at the present time, many other work conditions likely would not meet the elements required for an employee to refuse to work under that standard if the employer is taking the measures discussed above to mitigate risk of COVID-19 exposure at the worksite.
- Regardless of whether the situation rises to an “imminent danger,” Section 11(c) of OSHA prohibits employers from retaliating against workers for raising concerns about safety and health conditions at the workplace. A number of state occupational safety and health laws also prohibit employers from terminating employees who refuse, in good faith, to expose themselves to dangerous job conditions and have no reasonable alternative but to avoid the workplace. While the employee’s fear must be objectively reasonable, the increasing number of federal, state, and local announcements about the dangers of the growing COVID-19 crisis would arguably give employees an objectively reasonable basis for fearing exposure to COVID-19 in their workplace. Requiring an employee to report to work when the employee refuses for fear of their own safety in the face of this mounting public health crisis could be considered retaliation under OSHA and similar state laws.
- Violations of OSHA and similar state laws cannot only subject employers to significant civil penalties, but employees also often bring claims for retaliation and wrongful termination in violation of public policy. These claims can be difficult and expensive to defend. Given the scope of this crisis and jurors’ (and even arbitrators’) own fears of contagion, juries and judges would likely be sympathetic to plaintiffs in this situation. Depending on the circumstances, prevailing plaintiffs can recover emotional distress damages, punitive damages, and attorneys’ fees and costs. Employers should consider whether disciplining or terminating an employee for refusing to come to work is worth the risk (even if small) of a jury or arbitrator awarding a large amount of damages to a plaintiff who expressed a fear of contracting COVID-19 in the workplace before their termination.
- What is the risk of an unfair labor practice against the company? Under Section 7 of the National Labor Relations Act (NLRA), employees of most companies (even employers with no unionized workers) are allowed to engage in protected concerted activity with their coworkers to discuss terms and conditions of the workplace, including workplace safety. It is an unfair labor practice for employers to discipline or discharge employees who refuse to work in concert with other employees due to unsafe working conditions.
- Could requiring employees to work onsite lower employee morale or result in unwanted media attention? Forcing employees to work onsite may undermine employee morale or attract negative publicity. It is paramount for employees to feel that their employer has the utmost concern for employee safety, particularly during the current public health crisis. Taking a sympathetic and understanding tone, even when asking employees to come to the worksite, can be critical for maintaining employee morale and loyalty both in the near-term when trying to weather the problems caused by the Coronavirus pandemic and in the future once normal business operations resume. On the other hand, an employer seen as unsympathetic to employee concerns with reporting to the worksite, particularly if telework is an option, can face negative publicity that could damage the employer’s image and hurt recruitment and retention for years to come.
Legal Exposure for Employees Who Contract COVID-19 at Work
While certain employees may refuse to work due to concerns over workplace safety, others will agree to work despite the risks. Employers who maintain onsite operations should be aware of the potential liabilities if an employee is exposed to COVID-19 in the workplace.
Employees who contract COVID-19 at work may have a covered workers’ compensation claim. For example, health care workers and first responders who contract COVID-19 while at work likely will have compensable workers’ compensation claims against their employers, subject to variations in state law. For other types of employees, a compensable workers’ compensation claim may be possible if the employee can show that they contracted the virus after an exposure and the exposure was peculiar to the work. Absent state legislation on this issue, the analysis of whether the employee has a compensable workers’ compensation claim will be very fact-specific and based on the nature of the work and the individual employee’s circumstances.[3] Employers should rely on legal counsel to help navigate these claims.
Employees exposed to COVID-19 at work also may try to bring personal injury claims against their employer. In general, workers injured at the workplace may recover benefits only through the workers’ compensation system, and cannot sue their employers for negligence or seek to recover damages for pain and suffering. Limited exceptions to this rule exist, however, including when the worker’s injury is caused by the employer acting intentionally or recklessly.[4] Accordingly, before requiring employees to report to work, employers should ensure that they have followed CDC, OSHA, and other state and local guidance to minimize the possibility of workers contracting COVID-19 at work. Employers who do not take these precautions or allow or require employees known to have COVID-19 exposure to report to work could face potential personal injury claims. Among other things, overly ambitious claims that a company falls within the “essential business” or “critical infrastructure” exceptions to the recent stay-at-home orders could result in civil liability to employees who are required to report to work and contract COVID-19.
The Defense Production Act Does Not Likely Provide Immunity from Employment Claims
President Trump has invoked the Defense Production Act (DPA) to accelerate the production of medical and other supplies needed to fight the Coronavirus outbreak. The DPA provides the president a broad set of authorities, including the power to require companies to accept “rated orders” or contracts for materials and services necessary for national defense, which must be prioritized over the performance of any other contract. As we noted in an earlier post, the DPA does not per se permit contractors to continue operations in violation of state and local stay-at-home orders. However, having “rated orders” is proof that a company is providing essential goods and services requiring the business to remain open.
While the government may allow or, even require, companies producing supplies under the DPA to remain open to service government contracts, the DPA will not immunize such companies from claims that they have violated the employment laws discussed above. Section 707 of the DPA grants persons or companies limited immunity from liability for complying with a DPA-authorized rule, regulation, or order:
No person shall be held liable for damages or penalties for any act or failure to act resulting directly or indirectly from compliance with a rule, regulation, or order issued pursuant to this Act, notwithstanding that any such rule, regulation, or order shall thereafter be declared by judicial or other competent authority to be invalid.
“In executing a contract under the DPA, a contractor is not liable for actions taken to comply with governing rules, regulations, and orders (e.g., prioritization requirements), including any rules, regulations, or orders later declared legally invalid.” Cong. Research Serv., R43767, The Defense Production Act of 1950: History, Authorities, and Considerations for Congress 6 (2020). However, “[i]mmunity under this provision is limited, and does not confer blanket tort immunity to a contractor for liability to injured third parties. Also, carrying out a contract according to its terms does not necessarily entitle a contractor to be indemnified by the government when the resulting product injures third parties, absent an indemnification clause in the contract.” Id. at 6 n.30.
A company performing work pursuant to a “rated order” contract under the DPA is unlikely to be protected from employment claims under section 707.
- Section 707 immunity seems to be limited to contract damages caused by a company giving priority to government “rated orders” under the DPA. Section 707 generally bars only suits by third parties whose contracts with and shipments from the contractor were adversely affected by the priority given to defense contracts.[5] Presumably, the immunity provided by section 707 should correspond to the risk imposed (the possible need for a company to break or delay work on other contracts in order to prioritize rated orders necessary for the national defense). However, it is unclear whether this immunity can extend to tort suits.[6] Furthermore, in order to establish a defense under DPA, a contractor must identify a “‘rule, regulation, or order issued pursuant to [the] Act’ compliance with which has exposed them to liability.” Weis v. DSM Copolymer Inc., 160 F. Supp. 3d 954, 972 (M.D. La. 2015). Because the DPA rules relate to accepting “rated orders” without imposing any specific requirements in terms of the workforce, it is unlikely that an employer could show that compliance with the DPA required it to violate specific federal or state employment laws.
- Even assuming the DPA provided immunity from liability for employment claims, employers would still have to cover the costs and fees they expend defending such claims. The U.S. Supreme Court interpreted section 707 to provide immunity, not indemnity. In Hercules v. United States, 516 U.S. 417 (1996), the petitioners manufactured and sold Agent Orange to the government pursuant to the DPA. The petitioners sought reimbursement from the government for costs of defending and settling third-party tort claims brought by Vietnam veterans and their families for health problems allegedly caused by exposure to Agent Orange. One manufacturer argued that section 707 of the DPA indemnified contractors for liabilities flowing from compliance with a rated order issued under the DPA. The Supreme Court held that the government was not required to indemnify the contractors. The Court stated that section 707 “plainly provides immunity, not indemnity. By expressly providing a defense to liability, Congress does not implicitly agree that, if liability is imposed notwithstanding that defense, the Government will reimburse the unlucky defendant.” Id. at 429-30.
Practical Takeaways
Both businesses and their workers are facing challenges that they hardly could imagine even a few weeks ago. While the COVID-19 pandemic and associated economic downturn have created unprecedented challenges for businesses throughout the country, employers maintaining an onsite workforce should adopt a flexible approach to the management of their workforces. Companies with workers in jurisdictions subject to stay-at-home orders should review the applicable stay-at-home orders closely to determine if their business can remain open as an “essential business” or under another exemption. Employers who are overly ambitious about qualifying for an exemption from those orders could face criminal and civil liabilities if they require employees to work onsite.
Even when allowed to remain open under stay-at-home orders, employers must tread cautiously when asking employees to come onsite. Taking an individualized approach to each employee’s accommodation request or expression of fear for their safety in the workplace is recommended. In addition, following CDC, OSHA, and other federal and state government guidelines for instituting appropriate safety measures in the workplace is a necessity. Legal counsel should be relied on to help navigate the various labor and employment issues in the workplace and help balance the immediate needs of the business with the future legal and public relations ramifications of certain employment decisions.
Morrison & Foerster associate Victoria Dalcourt Angle contributed to the writing of this post.
[1] Additional information from OSHA specific to COVID-19 can be found here, and further guidance regarding the steps employers should consider taking to protect the health and safety of their workforce in response to COVID-19 can be found in our recent employment law commentary.
[2] See, e.g., COVID-19 Paid Sick Leave handout.
[3] The California Labor & Workforce Development Agency’s website states: “If you are unable to do your usual job because you were exposed to and contracted COVID-19 during the regular course of your work, you may be eligible for workers’ compensation benefits.” California Labor & Workforce Development Agency, Coronavirus 2019 (COVID-19) Resources for Employers and Workers.
[4] In addition, if an employee is injured through the negligence of an entity or individual other the employer or one of its employees, such as a product manufacturer, the employee may be able to bring a third party claim for negligence against that individual or entity.
[5] Eastern Air Lines, Inc. v. McDonnell Douglas Corp., 532 F.2d 957, 997 (5th Cir. 1976) (interpreting section 707 as an “exoneration of breaches resulting from compliance with priority orders”).
[6] See Am. K-9 Detection Servs. LLC. V. Freeman, 556 S.W.3d 246, 273 (Tex. 2018) (stating “the Act provides immunity to contractors who give their ‘rated order’ contracts priority over other contracts or orders when their actions (or inactions) in doing so might otherwise subject them to liability” without deciding whether the immunity could extend to tort suits); In re "Agent Orange" Prod. Liab. Litig., 597 F. Supp. 740, 845 (EDNY 1984) (“If section 707 is to be applied to tort claims at all, it should only be read to bar claims for strict liability, not negligence.”’).