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Navigating Health-Related Legal Issues

Liability Shield Laws Vary by State
From left: Shevon Rockett, Katie Pfeifer and Gabrielle Wirth of law firm Dorsey & Whitney presented a webinar on employer liability. (Rachel Daub/HNN)
From left: Shevon Rockett, Katie Pfeifer and Gabrielle Wirth of law firm Dorsey & Whitney presented a webinar on employer liability. (Rachel Daub/HNN)
Hotel News Now
February 1, 2021 | 2:58 P.M.

Employers are required by law to provide a safe work environment for employees and pay them accordingly for their efforts, but employers generally were not prepared for the health and safety challenges created by the coronavirus pandemic or the resulting legal issues.

In the recent “COVID-19: A Pandemic of Legal Liability for Employers and Businesses” webinar by law firm Dorsey & Whitney, labor attorneys discussed employers’ responsibilities to employees during the pandemic and the related lawsuits that have come up over the past year.

State Liability Shields

A federal employer liability shield was anticipated as part of the latest COVID-19 relief bill in Congress but ultimately wasn’t included, said Shevon Rockett, a partner at Dorsey & Whitney.

However, many states have adopted their own liability shields through executive orders or legislation, some of which include broad protections for all businesses related to COVID-19 regulations, while others focus specifically on health care providers and personal protective equipment manufacturers.

These liability shields generally cover actual exposure, but they don’t protect against willful, reckless or intentional conduct, she said. Other than that, state liability shields vary widely.

One state’s law requires a physician to certify they believe a patient contracted COVID-19 based on their exposure at a particular business, Rockett said. States such as Nevada require the patient to show to a judge the business didn’t follow public health guidance to proceed to trial.

“In other states, a good faith effort to comply with the public health guidance is sufficient to be a bar to liability,” she said.

Over the next several months, Rockett said, she anticipates additional state liability shields and legal nuances regarding both patrons and employees.

Insurance Coverage

Patrons and employees have and will continue to bring lawsuits against businesses, claiming to have contracted COVID-19 from the premises, said Katie Pfeifer, of counsel at the law firm.

Companies facing a lawsuit from someone claiming they contracted COVID-19 on their premises should look to their commercial general liability coverage, she said. CGL policies cover bodily injury and property damage, although the latter won’t apply as much in this instance.

“The question is going to be whether contracting COVID is an occurrence — and generally speaking, I think you have a good argument that it is an occurrence,” she said.

It may be difficult for the patron to actually prove they contracted COVID-19 at a specific business. But based on the allegation, the company’s CGL policy still might provide defense and indemnification, Pfeifer said.

“That defense is going to kick in right away, which is the important part of a CGL policy,” she said.

There are some exclusions that might apply, such as the expected or intended injury exclusion that would come into play if it is alleged the business didn’t take proper precautions, Pfeifer said. For the most part, that would be a difficult argument for the insurer to make, she said.

The employer’s liability exclusion is triggered when a claim comes from an employee, she said. The CGL policy will have employers work through workers’ compensation for employee claims.

Employment practices liability coverage could come into play if an employee claims to have been fired because of something that arose out of COVID-19, such as being subject to a reduction in force or because of discrimination, she said. As of July, there were about 600 claims that involved this type of insurance.

Employee Claims

Employers have always had a common law duty to keep their workplaces safe, and those responsibilities have been enhanced by the Occupational Safety and Health Administration at the state and federal levels, Dorsey & Whitney partner Gabrielle Wirth said. The only remedy for exposure to COVID-19 in the workplace will be workers’ compensation.

However, there are exceptions for that in most states. If an employer fails to tell employees what they need to know to keep themselves safe, such as they are sitting by someone who had COVID-19, the employees could sue outside of workers’ compensation. The employee can pursue an ordinary negligence claim if the employer did not take reasonable steps to keep the workplace safe.

Several states, including California and Minnesota, have extended workers’ compensation coverage to all employees who were infected with COVID-19 if they were required to be in the workplace, she said.

One of the more common types of lawsuits during the pandemic is over failure to provide COVID-19-related leave, Wirth said. Many employers were not prepared for the federal Families First Coronavirus Response Act, which gave employees up to 80 hours of COVID-19-related paid sick leave. Now that the law has entered the voluntary period, it’s become a state-by-state issue, as several have extended the paid leave into 2021.

Wage and hour claims are another source of lawsuits. Because so many people are working remotely, there are issues around work time, Wirth said. Lawsuits have also been filed related to the time before employees can actually sign in for work, such as the time preparing for on-site work by putting on and taking off protective gear or taking temperature checks.

“We’re seeing lawsuits for failure to pay for the security screening that they’re going through now, filling out the form, getting the temperature checks,” she said.