Protecting Against COVID-19 Litigation Risks – Part 2: Potential Disputes between Employers and Employees
March 31, 2020
This is the second post a series looking at some of the litigation risks facing businesses responding to the COVID-19 pandemic, and how to manage that risk. Part 1 of the series addresses Commercial Contract Non-Performance. Part 3 deals with Pandemic Public Disclosure Obligations and Insurance Coverage.
Potential Disputes between Employers and Employees Our earlier blog post and FAQs set out best practices and answer common questions for responding to COVID-19 in the workplace. Employers should keep up to date on COVID-19 information and adhere to public health directives of the day.
Employers considering laying off or dismissing employees: Employers who are considering a reduction to their workforce, should review the relevant employment agreement(s) and seek legal advice before making any decisions.
Where the employee’s contract does not expressly provide for a layoff, it is possible that a court will hold that the employment agreement has been breached and the employee has been constructively dismissed (and, therefore, entitled to termination pay). Where the employment agreement expressly provides for layoffs, the Employment Standards Act allows temporary layoffs for up to 13 weeks (or more if payments or benefits are being paid to the employee), and the Canada Labour Code allows temporary layoffs for up to three months (or more if payments or benefits are being paid to the employee). Employers who fail to recall their employees in time will be deemed to have terminated the employees’ employment on the first day of the lay off.
For employers considering employment terminations, particular care must be given to the termination provisions of the employment agreement. Where the employment agreement does not set out employees’ rights on termination, they will be entitled to common law notice period, or pay in lieu thereof. Employers should also be aware of their obligations with respect to mass terminations of 50 or more employees within the same four-week period including advance notice requirements and, in some cases, an obligation to develop an adjustment program to minimize the impact of the group termination on affected employees.
Businesses that are continuing to operate: Employers have an obligation to protect the health and safety of employees, and should comply with public health recommendations for responding to COVID-19 in the workplace. Failure to do so may leave employers liable in negligence to employees who are able to establish that they contracted COVID-19 in the workplace as a result of their employers’ failure to take appropriate measures to ensure their safety.
As part of that obligation, employers can and should require symptomatic employees to go/stay home. Whether the leave is paid depends on the policies or sick leave entitlement under the employment agreement.
An employer’s duty to accommodate is also engaged in the COVID-19 pandemic, particularly with respect to employees who are immunocompromised or whose health conditions render them otherwise vulnerable to the COVID-19 (including employees with anxiety or other mental health conditions). What is necessary to comply with the duty to accommodate depends on the specific employee: each person’s needs are unique and what works for one person may not work for another. Employers should work with employees to come up with appropriate accommodation for the employee in the circumstances. Failure to accommodate may leave the employer vulnerable to discrimination claims.