With the pandemic dragging into its 17th month, insurers, lawyers and businesses said they’ve grown anxious about the looming prospect of litigation. The fear is of a surge of suits by customers or employees against businesses, alleging that they caught COVID-19 at a particular establishment, whose owners failed to take the necessary precautions to prevent illness.
“I know the carriers, nationwide, are really starting to brace for that, including in higher premiums, building up and being prepared for increased costs,” said Gary La Spisa, vice president of the Insurance Council of New Jersey. The trade group’s membership includes such companies as Geico, AAA, Progressive, State Farm, NJM Insurance Group, Liberty Mutual Insurance and USAA.
“These cases don’t have to be filed for almost another year in some cases,” La Spisa added. “We may not start seeing the cases, but we’re certainly seeing preparation for cases, and steps being taken.”
Since the start of the pandemic in March 2020, parties have filed 370 COVID-related employment lawsuits in New Jersey, out of 2,956 nationwide, according to the law firm Fisher Philips. In New Jersey, 102 of the cases were filed in the health care industry, or 27.6%. Following that, 43 of the cases were filed in retail settings and 34 cases were filed in manufacturing.
Sources of litigation range from remote-work disputes, to allegedly unsafe working conditions, discrimination, negligence and wrongful death.
Now, with the delta variant likely to prolong the pandemic, employers and insurance companies “will be watching carefully” to see how those suits are resolved, according to Christopher Pizzo, partner and chair of the insurance practice group at the law firm Fox Rothschild. “Certainly the longer that COVID remains part of our day-to-day life, the potential for developments which leads to greater losses, and therefore litigation, is always a possibility,” he said.
“Insurers have feared the increase in claims and I think they still do have a certain amount of concern particularly as employers are headed back to the workplace,” he continued.
Under a bill Gov. Phil Murphy approved last September, an essential worker who contracted COVID-19 is presumed to have gotten it at their place of work, making them eligible for worker’s compensation. The new law includes workers such as first responders and health care, transit, grocery, retail and gas station workers, and is retroactive to when Murphy declared the public health emergency in March 2020. Any absences from work because of the illness are be counted as “on-duty time” and cannot be used against a worker’s paid sick leave balance.
“The men and women who are on the front lines protecting our health and safety and providing the vital services we all need during this crisis must be assured that they have basic worker protections and that they can get workers’ compensation if they fall ill to the coronavirus,” Senate President Stephen Sweeney, D-3rd District, said in a September statement. Sweeney was one of the bill’s sponsors.
The bill was praised by worker’s rights groups as a means to ensure businesses and high-risk places of employment – like health care settings – adhere to the strictest standards of health and safety. But business groups foresee problems. “How do you begin to decipher where they contracted it, unless you spend some meticulous time backtracking their steps, where they were publicly, did they wear a mask, were they vaccinated or not vaccinated,” said Mike Egenton, who heads government affairs for the New Jersey Chamber of Commerce.
The fear, he said, is for someone to contract the virus while “shopping or in a bar or at the beach,” and claim it was from their place of work.
But Dena Mottola Jaborska, associate director at the progressive advocacy group New Jersey Citizen Action, said the new law is not meant to go after businesses that follow public health guidance and rules.
“If they’re being sued, it’s because they really ignored the guidelines,” she said. “I would say those lawsuits are warranted.”
“Anybody who’s operating right now as a business or an employer needs to take precautions,” like following what’s laid out by the federal Centers for Disease Control and Prevention.
To help soften the blow for employers, a pair of bills were introduced last year that would create legal immunity for businesses and employers from COVID-19 claims, so long as they’ve taken measures to prevent or mitigate the spread of the virus within their establishment.
“The liability protections sought by the business, nonprofit, and higher education communities create the right balance by shielding only those businesses and institutions that comply with applicable guidelines, while providing no liability protections for “bad actors” who flout standards or fail to provide a safe environment,” reads a September 2020 letter by the New Jersey Business Coalition.
But neither measure, Senate Bills 2634 and 2628 , have moved in the state Legislature. Lawmakers do not anticipate reconvening in Trenton until after the November election.
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