Employees filed thousands of related personal and class action lawsuits against their employers since the COVID-19 pandemic began in 2020. Learn about the legal responsibilities, potential outcomes, and repercussions regarding COVID-19 litigation and the workforce. 

Employer and Employee Litigation Regarding COVID-19

Since March of 2020, there have been over 2,500 claims and/or lawsuits regarding COVID-19 filed against employers.  Most of these COVID-19 claims were filed against employers in the healthcare, manufacturing and production, retail, public administration, and hospitality industries.  COVID-19 has resulted in significant labor and employment legal issues resulting in new and evolving regulations, standards, and public orders in the United States on both the state and national level.  Due to a constantly changing and evolving body of law and regulations, it can be difficult for employers and businesses to stay on top of these matters.  It is absolutely vital for both employers and employees to understand their legal rights and responsibilities regarding the current coronavirus legal climate.

COVID-19 Legal Timeline

The pandemic impacted many sectors, especially the global economy.  With millions of jobs lost, this event created a sizable economic fallout comparable to the Great Recession in 2008. To combat this, governmental entities passed new laws and regulations to provide support to industries impacted by COVID-19.  This support included funding, as well as additions and amendments to national and local standards. 

American Rescue Plan of 2020

This plan provided $350 billion of emergency funding to communities with plummeting revenues related to the pandemic. Employers received support through small business loans, employee retention, and paid leave credit programs. Eligible citizens could receive economic impact payments and child tax credits. Homeowner and renter assistance funds encouraged homeowners and renters to apply for monetary aid. 

This support should help cover loss of revenue related to pandemic restrictions and efforts towards protecting employee and customer health. The American Rescue Plan also provided financial support to state and local entities. 

Families First Coronavirus Response Act

On April 1, 2020, the Department of Labor’s Wage and Hour Division (WHD) passed the Families First Coronavirus Response Act (FFCRA) as an extension of the American Rescue Plan. Revisions were made in September 2020 to further clarify mandates and employer responsibilities. It required employers to provide 80 hours of emergency paid sick leave (EPSL) to employees, as well as 12 weeks of expanded family and medical leave (EFMLA) related to COVID-19. 

This EFMLA only covered employees who had children that could not attend school or daycare as a direct result of COVID-19 closures.  The first 2 weeks of leave under the 2020 EFMLA are unpaid.  In order to compensate small businesses for loss of revenue, the FFCRA will reimburse them with tax credits. Only small businesses of less than 500 employees fell under these mandates. 

The primary goal of this law was to give employees a way to take care of their health without financial repercussions to the employers for lost productivity.  While the act expired on December 31, 2020, the stimulus package allowed employees to use the remainder of their aid until March 31, 2021.  However, this allowance was voluntary, and the employer could deny the request.

Current COVID-19 Legal Climate

2021 brought with it extensions to The America Rescue Plan and subsequent acts attached.

America Rescue Plan of 2021 (ARPA)

When the president extended The America Rescue plan another year, it came with amendments to specific bill regulations. Also known as the ARPA, specific revisions extend the EPSL and EFMLA of the FFCRA to allow employers with less than 500 employees to provide additional leave from April 2021 through September 30, 2021. Additionally, the allotment of 80 hours for EPSL and 12 weeks for EFMLA resets April 2021, so that eligible employers can still receive tax credits to cover related costs. 

While this act is not mandatory and employers can choose to deny time off requests, they must do so universally.  Under the ARPA non-discrimination mandate, an employer must grant or deny time off requests equally throughout their entire work force.  Failure to treat all employee’s equally will result in a loss of eligibility for tax credits.  This non-discrimination clause does apply separately to both EPSL and EFMLA compensation. 

Another modification to the FFCRA allows employee payout for the first 2 of the allowed 12 weeks’ time for emergency family and medical leave. Additionally, the EFMLA had extended permissions to approve employee leave for other reasons related to COVID-19 besides school closures. The ARPA also increased the FFCRA tax credit allowance from $10,000 per employee to $12,000.

COBRA

The Consolidated Omnibus Budget Reconciliation Act, (COBRA) protects workers and their families who lost health benefits because of unplanned events. COBRA provides for a ‘continuation of coverage’.  Specifically, employers who pay for group health plans for over 20 employees must extend that coverage (temporarily). The plan highlights how employees and their family members may attain continuation of coverage.

When the government extended the ARPA in 2021, there were also modifications to COBRA. From April 2021 through September 2021, employers must cover 100% of COBRA premiums. This requires employers to pay the COBRA premiums for all employees with group health plans who need financial aid as a result of employment termination or loss of hours, regardless of whether the termination or reduction of hours is related to COVID-19.  However, family members of the employee are not eligible for free COBRA for any reason.  Furthermore, employees who are eligible for other group health plans or were terminated for gross misconduct may not receive COBRA. Additionally, employees and qualifying family members on COBRA as of April 1st have a “second chance” to re-enroll for coverage. This applies even if they were involuntarily terminated for reasons besides misconduct.

The federal government will reimburse employers for covering the cost of COBRA for their employees through a dollar-for-dollar tax credit. This credit will be applied to quarterly payroll taxes and applied against the employer’s allotment of Medicare hospital insurance tax. If this does not cover the employers’ expenses towards COBRA, the employer can apply for another tax credit which will pay for the additional amount. Employers are also must alert employees of this benefit and provide instruction on how to access coverage, especially secondary enrollment. This legal requirement expires May 30, 2021. Notice should be provided no more than 45 days and no less than 15 days before COBRA expires. 

Employees have the responsibility of notifying their health care plan when they are eligible for COBRA. This benefit is subject to tax penalties.

Paycheck Protection Program

Restaurants, bars, and nonprofits were also added to the list of eligible employers to apply for assistance grants and loans. Loans can be attained through the Paycheck Protection Program offered by the US Small Business Administration. Also known as PPP, the goal is to incentivize small businesses to keep their employees on payroll. PPP loan forgiveness is also available to eligible borrowers. The Paycheck Protection Program expires on May 31, 2021. 

Illinois State Regulations On COVID-19

When HB 2455 expired in 2020, the Governor eventually enacted HB 4276 for occupational disease claims in Illinois. Signed into law on February 26, 2021, HB 4276 extends the presumption legislation for front line workers. 

After the COVID-19 vaccination rollout began, the Illinois Department of Labor (along with other states) added requirements for employers. They consisted of guidelines regarding employee leave, time, and flexibility for vaccinations. After March 2021, if employers require coronavirus vaccinations for employees, they should also provide paid leave or compensation. This is to compensate employees for the time they must take off to get both doses of the vaccine. 

The Employee Sick Leave Act also highlights employer requirements. Employers must grant the same permissions and benefits for time off for COVID-19 related medical appointments involving their immediate family. This includes children, stepchildren, spouse, domestic partners, siblings, parents, mother, and father-in-law, grandchildren, grandparents, or stepparents.