How to Protect Your Business from Risk and Litigation in the Wake of COVID-19

Businesses everywhere are struggling with COVID-19’s impact. Social distancing measures, stay-at-home orders, and general public fear of the virus has crushed many bottom lines. But there’s another aspect that the pandemic has brought for businesses: legal risk.

MP partnered with law firm Verrill last week to run a webinar about how to protect your business from legal action in the wake of COVID-19. We covered four major topics: The Families First Coronavirus Response Act (also referred to as the FFCRA), Paycheck Protection Program Loans, reopening your business, and some important pre-COVID employment laws that may apply right now. Read on to learn more about safeguarding your business.

Families First Coronavirus Response Act (also referred to as FFCRA)

There are two basic sections to the law: posting requirements and paid leave. For posting requirements, you must make sure you share a poster from the Federal Department of Labor about employees’ rights and responsibilities to paid sick leave, as well as expanded family and medical leave time. Ensure that all employees get this information—onsite, remote, and returning employees. One tip from our webinar is to place it in prominent locations for employees to see, but also share the poster via email when they won’t be onsite.

The second requirement is a bit more complicated: paid leave. While there are plenty of very specific details to get into (you can find more on the Department of Labor’s website), these are the broad strokes we discussed. Your first course of action is to determine if you’re a qualifying employer under this statute. Generally, you must be operational through the pandemic and have fewer than 500 employees. There are six reasons why an employee might qualify for leave. Depending on the reason, employees are entitled to different timeframes for leave and different amounts in pay. One bit of good news here in a sea of warnings: if paid leave rules apply to your business, there will be a tax credit that will be equal to the applicable wages paid.

Paycheck Protection Program Loans

While these loans don’t set forth any specific rights for employees, you should be prepared for (and try to avoid) a False Claims lawsuit (and more specifically, whistleblowers). It will be important to be able to account for what you’re using the loan money for in some detail. Employees who believe you’re using the money incorrectly (perhaps not to pay them) might become whistleblowers, suggesting you’ve defrauded the US government of these funds. This can also trigger a governmental investigation or audit.

Reopening Your Business

Again, there are many specifics to delve into on the US Department of Labor’s website, but we discussed some basics you’ll want to consider: a point person, The ADA (especially concerning facemasks), remote work, age discrimination, and temperature-taking (and other similar requirements). To start, you’ll want to charge one particular person with compliance of COVID-19 safety measures and legislation. This way things are less likely to slip through the cracks. This person will need to pay attention to how your mask policy might be perceived to run afoul of the ADA. (You might be exposed to potential lawsuits here.) They’ll want to consider how to avoid discriminating against elderly employees with safety policies and what safety measures you can legally require of employees and customers. A big topic they may need to oversee is how to effectively and legally allow remote work (and to whom).

Don’t Forget FMLA, the WARN Act, and OSHA

Amongst all the new and constant changes for legislation specific to COVID-19, we discuss existing legislation. FMLA requirements should not be forgotten right now, especially since they may apply in certain circumstances, like paid leave. As was true pre-COVID, you’ll risk legal problems if you neglect this part of your HR practices. The WARN Act may apply if you do mass layoffs. We discuss some guidelines about it you’ll want to know. Lastly, OSHA is crucial right now. You may be using new chemicals to disinfect, you may have new safety procedures, and the threat of OSHA whistleblowers could be stronger than ever these days.