Employers get major protections in GOP COVID-19 liability shield bill

The Senate Republicans’ sweeping bill to shield businesses from coronavirus-related liability includes significant proposals that would protect employers from a range of workplace laws while also attempting to enact what some call “radical” tort reform, according to Bloomberg Law.

The bill’s safe harbor provision would immunize employers from lawsuits or enforcement actions connected to the virus under seven federal employment laws, including those that prohibit job bias, govern wages, and mandate minimum safety standards.

Companies could invoke the safe harbor if they make good faith efforts to follow government standards and guidance to stop the spread of Covid-19, and attempt to meet the legal requirement at issue. The provision is so broad that employers could use it to defend against claims involving changes to working conditions prompted by pandemic-related laws and executive orders.

The GOP proposal also features a separate plan to help businesses defend against legal claims for allegedly exposing workers and consumers to the coronavirus, by funneling those suits through federal courts and altering procedural rules to favor corporations.

For most employees, the tort reform portion of the bill is “much ado about nothing” because nearly all cases of on-the-job injury and illness go through state workers’ compensation systems, rather than as tort claims litigated in court, said Martin Malin, a law professor and co-director of the Institute for Law and the Workplace at Chicago-Kent College of Law.

The bill, introduced by Sen. John Cornyn (R-Texas), argued that the threat of lawsuits could prevent businesses and other institutions “from reopening for fear of expensive litigation that might prove to be meritless.”

Limiting corporate liability has been a top priority for Senate Majority Leader Mitch McConnell (R-Ky.) since the start of virus relief talks. The liability shield bill, dubbed the SAFE TO WORK Act, is one part of the Republicans’ $1 trillion package of pandemic measures.

Democrats maintain that liability provisions are a “non-starter.”

Although McConnell has said a liability shield must be included for the next virus bill to pass, the White House has indicated a willingness to leave it out.

Most worker injury claims are required to go through state workers’ compensation systems, so they would be unaffected by the proposal’s exposure action procedures, lawyers and law professors said. Workers’ compensation is the exclusive route for workers to seek payment for occupational injuries and illnesses.

Every state except Texas requires employers to pay compensation to workers hurt or sickened on the job. The systems give workers benefits regardless of fault and employers receive protection from lawsuits unless they’re accused of committing serious misconduct.

The stringent requirements for proving diseases are occupational will make it difficult for workers to obtain benefits for Covid-19, legal scholars said. A handful of states, however, have drastically lowered the bar by creating presumptions that certain workers with the disease contracted it at work.

But there’s a massive gap in workers’ compensation systems: They don’t cover gig economy workers, freelancers, and other independent contractors. That means those workers would have to file coronavirus exposure actions if they get Covid-19 on the job.

Covid-19 lawsuits brought under the public nuisance doctrine—such as those pending against McDonald’s restaurants and Amazon.com Inc.—also would be swept into the exposure action process, legal observers said.

The safe harbor provision applies to the Occupational Safety and Health Act, Fair Labor Standards Act, Title VII of the 1964 Civil Rights Act, Americans with Disabilities Act, Age Discrimination in Employment Act, Worker Adjustment and Retraining Notification Act, and Genetic Information Nondiscrimination Act.

The bill would give companies immunity if they were “relying on and generally following applicable government standards and guidance.” That potentially includes a wide range of government directives designed to prevent or mitigate the virus, from voluntary guidelines to mandatory protocols at the local, state, and federal level.

The safe harbor provision also calls on employers to have known about and attempted to satisfy their duties under the relevant law.

The language in the safe harbor provision is so broad that employers could use it to try to block claims that aren’t directly connected to the coronavirus, said Cara Greene, an attorney at the plaintiffs’ firm Outten & Golden. For example, an employer could argue it applies to a claim that an employee who’s working from home due to the pandemic wasn’t paid for all hours worked, she said.

Moreover, the provision “handcuffs” the Occupational Safety and Health Administration from enforcing workplace safety standards, said Hugh Baran, an attorney at the National Employment Law Project, a worker advocacy group.