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Employer protection from COVID-19: U.S. proposals

Monday, July 06, 2020 @ 1:51 PM | By Jordan Wajs


Jordan Wajs %>
Jordan Wajs
In the U.S. Senate, lawmakers are set to debate a bold proposal. The Republicans have publicly affirmed that they will not support a new COVID-19 relief bill unless it includes liability protection for employers from lawsuits connected to the virus.

The suggested justification for this liability shield is that it is essential to the recovery of the American economy. It would, in theory, permit employers who follow federally mandated health and safety guidelines to reopen their workplaces without the fear of what Senate Majority Leader Mitch McConnell has referred to as a “litigation epidemic.”

How you feel about this policy proposal might depend upon whether you believe in such an “epidemic.” If you are like McConnell, you might believe that a flood of litigation is incoming, much of which will be commenced by employees and consumers against businesses doing their best in challenging circumstances. You might believe that, in McConnell’s own words, “… opportunistic trial lawyers … [will be] lurking on the sidewalk outside every small business … waiting to slap them with a lawsuit the instant they turn the lights back on.” For what it’s worth, although some Canadian legal experts have made similar projections, relatively few of such lawsuits have been commenced to date.

It may also depend on how you feel about incentives. Under the proposed legislation, certain employers would be granted immunity from COVID-19-related lawsuits if they can establish that they adhered to certain prescribed health and safety standards. These employers would be rewarded for meeting a minimum threshold rather than rewarded for proactivity or exceptional precaution. If you have faith in businesses as good corporate citizens, you might believe that these incentives are enough to make reopening workplaces safe. Or, in contrast, you might believe that in practicality these incentives would foster a “race to the bottom” among employers eager to receive liability protection.

Moreover, how you feel about the proposed legislation may also depend upon how you feel about where it comes from. The legislation that the U.S. Senate will ultimately consider will likely be influenced if not drafted outright by the American Legislative Exchange Council (ALEC), an organization funded by the billionaire Koch family that crafts model bills for conservative lawmakers. ALEC has played a core role in a broader conservative movement to reform tort law in the U.S. for nearly 20 years, aiming to — in the opinion of Democrats and tort lawyers — make conditions more favourable for employers.  

If you believe that lobbying should have no place in the development of the law, this might impact your perspective on the proposal. If, however, you believe that lobbying groups can advocate effectively for the perspectives of otherwise marginalized parties, or that certain areas of tort law (medical malpractice, for example) are already too welcoming to meritless claims, you might welcome a shift in the law.

What might be less of a matter of split opinion is whether employers across every sector have been forced to reckon with significant, unprecedented challenges in responding to COVID-19. Moreover, that litigation is often expensive and that the costs of responding to claims — even unsubstantiated ones — can threaten the survival of a business. It might be tempting, in light of this, to support some form of liability protection for Canadian employers from lawsuits brought by individuals claiming that they contracted COVID-19 at their places of business.

The adequate solution, however, may already exist. The standard of care in negligence claims is reasonableness, not perfection. An employer will not be held liable if it is established that it acted as would an “ordinary, reasonable and prudent person in the same circumstances.” In theory, this has much the same effect as does the proposed American legislation. Employers who act reasonably — including in comparison to their peers — are not exposed, while those employers who cut corners in ensuring that employees and consumers are sufficiently protected may be held liable.  

The law of negligence does not, to be fair, bar parties from commencing claims in the manner contemplated in the proposed American legislation. However, prospective plaintiffs already face a number of impediments in bringing claims in tort against employers. For one, claimants must bear the often expensive costs of litigation themselves. If these costs are substantial for a business, they can be practically prohibitive for an individual. Additionally, proving claims regarding the contraction of COVID-19 will carry their own challenges. Consider, for example, the two-week latency period of the virus and the difficulty of establishing that an individual did, in fact, contract the virus at a given location.

Perhaps what is needed most is a legal definition of what it means to act reasonably in relation to COVID-19. Paradoxically, this will require the commencement of the type of claims that some wish to avoid. Once precedent exists, however, and businesses, individuals and counsel alike have a less speculative grasp on the likelihood of success in the future, the debate over the appropriateness of policy change might become (as hopefully the virus itself) a thing of the past.

Jordan Wajs is a Toronto-based litigation lawyer at Owens Wright LLP, with a special focus on corporate commercial and real estate litigation. You can reach him at jwajs@owenswright.com or 416-848-4732.

Photo credit / alano design ISTOCKPHOTO.COM

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