Legal and Operational Implications of COVID-19

March 18, 2020

Legal and Operational Implications of COVID-19

With the spread of COVID-19, companies are strategizing on what to do when employees are working remotely and customers are staying away from their businesses. 

The virus creates "not just a health crisis but an economic crisis," said Aaron Goldstein, a partner in the Seattle office of law firm Dorsey. 

Scheduling and Layoff Regulations

For industries that can't tell employees to work from home, such as manufacturing, retail, and hospitality, employers may take steps to have fewer workers in a building at any one time to reduce contagion in the workplace. For employees who can't work remotely, there are scheduling options "that could allow you to keep employee density down or that would allow you to accommodate the same output with a smaller workforce at any one time," Goldstein said. Beware of any local scheduling laws, he noted. 

"The pressure on companies to squeeze costs is building as consumers, governments and others pull back on activity," reported The Wall Street Journal on March 14. "Purges of workers could become unavoidable in some industries such as shipping, air travel, retail and dining as demand slows."

Trina Ricketts, an attorney with Ogletree Deakins in Kansas City, Mo., advised organizations to, "make sure you comply with any employment contracts and collective bargaining agreements."

Also keep in mind the federal Worker Adjustment and Retraining Notification (WARN) Act, which requires qualifying employers to provide 60 days of advance notice of a temporary or permanent plant closing or mass layoff. State specific employee-notice requirements and WARN laws can also be a factor.

Telework Implications

"Senior leaders need to work together with HR, legal and IT teams to ensure there are proper resources to accommodate the implications of working from home,” said Jeff Christianson, chief legal officer at Nintex, a business software firm.

  • Have the infrastructure in place. Beyond the IT and equipment needs of remote workers, Fisher Phillips law firm also notes the importance of having security and privacy protocols.
  • Be flexible. "Make sure your team has some wiggle room to be flexible with their schedules,” the Colorado Small Business Development Center (SBDC) advises. With many school systems and daycares closing, parents will be juggling child care with work responsibilities. 
  • Support wellness. Mary Kay O'Neill, a partner at HR consultancy Mercer, suggests companies not overlook emotional health, "especially if people are quarantined for weeks on end. Epidemics like this can increase anxiety and depression among people, resulting in a greater need for these services." In fact, Starbucks is offering free therapy sessions starting April 6 via video chat and access to self-care apps.

The Cost of Cleaning

The coronavirus that has infected more than 100,000 people around the world can lurk for hours on doorknobs, handrails, keyboards, elevator buttons and other hard surfaces, just waiting to be passed on to someone else. But what is the best way to disinfect a contaminated space? And how clean is clean enough? What is the cost of additional cleaning services? Employers are figuring it out as they go.

While some companies are closing completely for a deep cleaning after an employee tested positive for COVID-19, many businesses cannot shut down after exposure. Heavily used airports and transit systems continue to operate 24/7, with more frequent swabbing of handrails, doorknobs and elevator buttons. 

Fighting Racism

Fear of the coronavirus is manifesting as racism against people who are of Chinese or Asian descent after the virus was first identified in China in December. Individuals around the world are being shunned, shamed, and verbally or physically assaulted as fear over the coronavirus spreads. 

"Being Chinese or Asian American does not increase the chance of getting or spreading COVID-19," the U.S. Centers for Disease Control and Prevention (CDC) says on its website. "Viruses cannot target people from specific populations, ethnicities or racial backgrounds."

Employers need to reiterate and review anti-discrimination, harassment, bullying and retaliation policies and conduct investigations where needed. Educating workers on the nature of the virus is important to ward off potential stigmatization, misunderstanding or overreaction, according to Eckert Seamans Cherin & Mellott, a law firm based in Annapolis, Md.

Privacy Concerns

Employers will need to take steps to keep employees' health information confidential, as required by the Health Insurance Portability and Accountability Act (HIPAA), employment lawyers advise.

"If the employer learns of the employee's medical information, condition, diagnosis, etc., through the health plan, then that information is likely protected under HIPAA," wrote attorney Carrie B. Cherveny, senior vice president for strategic client solutions and compliance at Hub International, a global insurance brokerage, and Mingee Kim, senior vice president and certified leave management specialist at the firm.

Moreover, under the confidentiality provisions of HIPAA and related laws, "only those who 'need to know' may know about the diagnosis," Cherveny and Kim advised. 

Pandemics, however, may alter those practices. Mark J. Neuberger, a litigation lawyer with Foley & Lardner in Miami, said that "when an employee comes to you with a health condition, that's confidential information. But [with the coronavirus], there may be an obligation to tell people" that a colleague has tested positive for the virus.

Work with local public health officials to understand when there is an obligation to tell people that an employee has tested positive for the virus. 

The Authors: 

Deborah Stadtler is Managing Editor at SHRM’s Executive Network, HR People + Strategy.