The COVID-19 pandemic will generate more workplace class-action litigation this year, particularly for wage and hour issues, experts warn.
There has been a significant rise in how big aggregate class-action settlement recoveries, particularly last year, and also the trend is expected to carry on.
Based on top 10 largest case resolutions in a variety of workplace class-action categories, settlements totaled $1.58 billion in 2022 and $3.62 billion in 2022, in contrast to $1.34 billion in 2022, according to Seyfarth Shaw LLP's Annual Workplace Class action lawsuit Litigation Report: 2022 Edition.
“The big issue is, you've got the Biden administration that is very, very pro-worker, pro-regulation, and thus you're going to have government enforcement actions which are greatly aligned using the plaintiffs class-action bar,” that will result in an uptick in filings, said Gerald Maatman, someone with Seyfarth Shaw in Chicago.
COVID-19 will bring about the expected increase this season, experts say.
Employers' efforts to adhere to various COVID-19-related obligations “presents uncharted territory, as far as potential class-action claims,” said Gregory P. Abrams, someone with Faegre Drinker Biddle & Reath LLP in Chicago, who represents employers.
“COVID has opened up all-new vistas for that plaintiffs bar,” said Lisa A. Schreter, a shareholder with Littler Mendelson P.C. in Atlanta.
For example, a California appeals court ruled in See's Candies Inc. v. Ek, that South San Francisco-based See's Candies must face a lawsuit filed by an employee who alleged she caught COVID-19 at work and gave it to her husband, leading to his death.
“It seems to allow what we should call 'take home' COVID cases, a minimum of at the pleading stage,” and “is certainly not good news for employers if that reflects a bigger trend that people see in California of more of those claims,” Ms. Schreter said.
Among traditional litigation issues being put on the pandemic is religious discrimination, which can be asserted by workers who face consequences when they refuse to be vaccinated, Tao Leung, someone with Hogan Lovells US LLP in Los Angeles.
The recent U.S. Top court decision blocking a COVID-19 vaccine-or-test mandate for big employers could cause charges that employers don't have enough safety measures in place, because it could open companies as much as contact with charges of spreading the virus, said Adam Kemper, Fort Lauderdale, Florida-based partner with Kelley Kronenberg PA.
“As long as COVID's around and employers continue to keep employees in close connection with each other to where they're interacting” there's “always likely to be a degree” of this risk, he said.
Meanwhile, wage and hour litigation remains “the hot, driving fringe of class actions,” said Paul E. Starkman, a member of law practice Clark Hill PLC in Chicago.
Situations like a traveling salesperson who is now working at a company facility or job duties being shifted due to workers calling in sick could result in employees being newly eligible for overtime pay under the Fair Labor Standards Act and create exposure for employers if salaries are not appropriately adjusted, Mr. Kemper said.
“The manner in which people are paid remains the No. 1 pressure point,” Mr. Maatman said. People working at home will raise questions as to once the workday starts and ends, he said.
However, plaintiff attorney David Sanford, of Sanford Heisler Sharp LLP, in Washington, said fines for wage and hour violations are insufficient to deter some employers because even if they're eventually caught, an excellent will still cost less than would obeying the statute.
Experts also point to the “'great resignation” – in which many employees have voluntarily left their jobs during the pandemic, creating labor shortages – like a factor that will contribute to more lawsuits being filed. Workers are more willing to participate in class actions, and plaintiffs attorneys are “harvesting the low-hanging fruit when employers don't follow wage and hour rules,” Mr. Starkman said.
There has been a transfer of the balance of power between workers and their companies, said Ian Carleton Schaefer, chair, Ny employment and labor, at Loeb & Loeb LLP in New York.
“When someone sees something from order or out of compliance,” other product fear “of acting individually or collectively simply because they know there are many jobs available,” he explained. “It's a lower-risk proposition.”
Another issue is nonuniform laws. Plaintiffs attorneys will take advantage of the “complicated patchwork” of employment-related laws, said Jason E. Reisman, a partner with Blank Rome LLP in Philadelphia.
He pointed to a July 2022 ruling through the Pennsylvania Supreme Court in Re: Amazon.com, Inc. that held, in part, there is no “de minimis” exception under Pennsylvania's wage laws, which means employers must pay workers for even minimal intervals, such as minutes spent dealing with screening. This isn't the situation under the FLSA.
Another concern is privacy-related litigation, including litigation surrounding the Illinois Biometric Information Privacy Act. Illinois remains the only state that permits visitors to pursue litigation under a private right of action, although New York City has enacted such legislation.
Experts express it has already led to considerable litigation in Illinois and will result in more lawsuits if other states adopt it.
