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How can employers learn from the hospital industry and defend themselves from Covid-19 lawsuits?

Updated: Aug 11, 2021

As many sources have started to notice, lawsuits have been increasing against companies whose workers have developed signs and symptoms of Covid-19. Examining these lawsuits gives a sense of the types of risk companies have in the Covid-19 era and how they can prevent some of this litigation.

The initial wave of lawsuits unsurprisingly revealed companies that kept stores open such as Walmart and Safeway were the target of lawsuits from families of deceased workers who contracted Covid-19.  However, the main target of the bulk of lawsuits occurred in manufacturing companies as these industries had extremely large numbers of Covid-19 cases.

One company that received an early lawsuit was Smithfield Foods whose parent company is WH Group in China.  Smithfield's South Dakota plant had reportedly over 850 workers test positive for the virus with at least 2 deaths. From a lawsuit filed by workers there, the first worker at the plant tested positive for the virus on March 24, but the plant was not closed until April 14.  This problem was not localized to its South Dakota plant as at least 5 total Smithfield plants had closed temporarily during the pandemic.  In total over 2000 workers from Smithfield and JBS have tested positive since the pandemic began.

Despite these thousands of infected workers, worker protections have been ignored by federal regulators.  The main organization for workplace safety, OSHA has been largely silent during much of this pandemic.  OSHA’s statements during this disastrous period have consistently mentioned that their standards do not specifically cover infectious-disease protection or airborne illness.  This organization has avoided giving fines, inspections, or excess scrutiny on companies with infections.  OSHA has also deferred providing specific guidance for new, stricter regulations in the Covid-19 era.  

Companies with outbreaks have definitely benefited from being able to self-police in this business-friendly climate and avoided mammoth fines, plant closures, and other censure that would give ammunition to plaintiff lawyers.  Besides the light touch from OSHA, companies have had lawsuit protections in multiple states due to state laws.  

However, these circumstances could change drastically and leave the climate ripe for more lawsuits.   Businesses will face much more pressure from litigation and regulations if there is a new administration in the White House after November’s election (as polls are universally predicting).  Federal lawsuit protections will also fail to be in this instance as industrial companies or others with Covid-19 cases could expect to see potentially enormous fines, tighter regulations and inspection, and minimal protections from lawsuits.

As all companies start repopulating their workplaces, they will be at risk for Covid-19 infections just by statistical probability of some random occurrence.  To try and minimize these untoward events, many companies have already created return-to-work Covid-19 teams which will focus on the major relevant issues in this initiative.  While these teams have largely focused on proper cleaning, spacing, testing, and scheduling in compliance with regulatory guidelines, their legal teams have studied future litigation risk.    The risks are further magnified when distancing is impossible when workers must work in close proximity.  The challenges become more difficult in areas where manual labor and perspiration become more commonplace (and people wipe their faces), where direct constant supervision is absent, and where each individual has no defined unique personal space.   

Manufacturing companies and others who want to minimize tort risk in the Covid-19 era should follow the playbook of the health care industry whose leaders created a movement to prevent lawsuits before they occur. 

The hospital industry created essentially a two-part strategy for minimizing litigation payouts.  In the first part of the strategy, the hospitals would internally look at the factors that created lawsuits and try to improve best practices in these areas.   For manufacturing companies, this parallel implies they should monitor and perform effective contact tracing to isolate high-risk and ill workers.  They should also implement distancing wherever possible and optimize safety standards, deep cleaning protocols and other sensible interventions. These companies could also enhance their corporate communications to give the best available health information for messaging their employees.  

But as the hospital industry has learned, these efforts alone are not enough.

The key is documentation.

Companies need to realize the best protection against lawsuits is to document all their employee information in an easily retrievable space.  Their aggressive surveillance for Covid-19 symptoms and risk factors among their workers is meaningless if they cannot demonstrate this effort to plaintiff lawyers.  As hospitals have learned, stringent documentation of these practices can end many cases in discovery periods.  Plaintiff lawyers have a much more difficult time proving an employee contracted Covid-19 in the workplace when that person’s coworkers have all been symptom-free and all symptomatic employees were immediately detected and quarantined AND the paperwork clearly showed that.  Placing the burden of proof on the plaintiff lawyers after showing them extensive reports of healthy and extensively queried employees will limit liability and even deter further suits against the organization. 

In another page from the hospital industry, large industrial organization with thousands of employees can even show that their statistical likelihood of Covid-19 cases is below national benchmarks so even isolated cases will not be liable.   If a worker does become ill, documentation will reflect company efforts to help the individual such as testing, treatment referrals, and quarantining instructions for other possible contacts.  In this way, companies can work within privacy guidelines for the safety of all employees.  

The Covid-19 has been here for six months and now the lawsuit era is here.  Companies need to prepare now or suffer through fairly predictable consequences.

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