Operating companies & Covid-19: Beware of tomorrow’s litigation!

 

The news of Covid-19 lawsuits being filed is spreading around the world.  In France, the latest news is that some employees of Amazon have filed a criminal complaint for manslaughter, stating that they are not sufficiently protected against the risk of developing Covid-19.  In the United States, Walmart is the target of the first Covid-19 wrongful death lawsuit.  Many trade unions are also threatening to file lawsuits on the ground of gross negligence against companies which keep on operating.

The issue is, however, that in most countries, governments have asked people to stay home but companies, especially the ones which provide for essential goods and services for the population, keep on operating.  One could have thought that governments, in light of these special circumstances, would have provided guarantees to these companies against future litigation through, for instance, the creation of a special State-financed fund or by signing specific insurance policies for these risks on behalf of companies or through special procedural laws or presumptions in favour of companies.  This is not the case.  Governments have decided to help companies face the current lockdown, like measures linked to unemployment and the decrease in the activity level, but have not, however, made any statements concerning the future.

When it comes to the health and safety of workers of companies that are still operating, governments have simply provided for rules relating to how the work should be organised (wearing masks, having only one employee per square meter, providing hydrogel, etc.).  In France, the government imposes on companies measures such as:

  • assess the risks taken at the workplace that cannot be avoided according to the nature of the work to be carried out;
  • determine, based on this assessment, the most relevant preventive measures;
  • carry out this task by involving the staff representatives;
  • contact, when possible, the occupational medicine service, whose mission is to advise employers, workers and their representatives and, in this respect, recommend any useful information on the efficient protective measures, the implementation of the “barrier gestures”;
  • comply with and enforce the barrier gestures recommended by the health authorities” (https://travail-emploi.gouv.fr/IMG/pdf/coronavirus_sante_et_securite_des_travailleurs_obligations_legales_de_lemployeur.pdf)

However, when it comes to addressing liability, the French government specifies that “the employer’s liability for its non-compliance with this specific obligation to prevent occupational risks can be sought” and that “regardless of the situation, complying with this specific obligation or, on the contrary, not complying with it, are not presumed (except in very rare cases) and must be proven, in the event of a dispute“.  The government goes further by stating expressly that employees could file gross negligence claims should they develop Covid-19.

This has not been unnoticed by trade unions which, as mentioned above, have threatened numerous companies that their employees will file such claims.

The question is, therefore, not: will there be Covid-19 litigation against operating companies? The answer is yes.  The relevant question is: how will courts address such claims?

When seeking liability on the ground of gross negligence, two criteria must be proven: the awareness of the danger by the employer and the absence of protective measures required to guarantee the safety of the employee.  The criterion relating to the awareness of the danger will most likely not give rise to any debate.  The classification as crisis, and even health war, is sufficient.  The confinement and concept of social distancing will also be used to demonstrate that bringing employees together may expose them to a risk.  With respect to the implemented protective measures, the employers have to prove that they did not breach any regulation even if the employee develops a disease.

When seeking liability on the grounds of manslaughter, one must demonstrate that the company breached a safety measure that caused a risk to the life of its employees.  The types of protective measures implemented by the employer will therefore be scrutinised.

One can also fear cases relating to the anxiety of developing Covid-19, in a similar way as the litigation that arose relating to the exposure to asbestos.  Pursuant to decisions dated 5 April 2019 (no. 18-17.442) and 11 September 2019 (no. 17-24.879 to 17-25.623), the Plenary Assembly of the French Supreme Court extended case law that was initially limited to workers potentially exposed to asbestos, to any worker exposed to a harmful product or substance.  Here, all employees who did not develop Covid-19 but fear to do so could sue. Here again, the employer must demonstrate that it complied with its safety obligations and provided protective measures as set out by the law.

A lot of questions will arise when courts face such cases, such as:

  • Will courts really carry out a case by case analysis?
  • Will courts take into account the economic benefit of having companies who kept on working during this pandemic?
  • What role will the State’s request to have companies providing essential products and services keep on working play? Will that affect the causal link to the benefit of companies?
  • How will courts interpret the efficiency of the measures taken in a context where scientific and medical data evolve on a nearly daily basis?
  • How will courts interpret the efficiency of the measures taken in a context where there is an established shortage of protective equipment?
  • Will an employer providing “home-made” masks or overalls be sentenced on the ground of the breach of the regulation in a time of national shortage?

Companies are trying to protect themselves.  Some are granting premiums to employees coming to work to encourage them, but also in the hope that they will remember that they were paid for the risk taken and not sue afterwards.  However, will such premiums, which are actually encouraged by the French government, be interpreted as the employers’ recognition of their awareness of the risk?

Some companies are asking their employees to sign a document whereby they withdraw their right to file any Covid-19-related claim in the future.  Many trade unions are criticising this step which will undoubtedly be at the origin of case law to determine whether or not this withdrawal is valid.

What is advisable is to document all the measures that are implemented, to discuss (and have written minutes about it) with the employees’ representatives and trade unions, to document the shortage of protective equipment at the national level, to think about not only providing “physical” protective measures but to also establish a hotline whereby employees can speak about their fears and anxiety.  The companies should also appoint a specific group in charge of monitoring scientific and medical advices in order to try to implement the most up to date protective measures.

Conclusion

While the solidarity of businesses and of their employees ought to be hailed, it is essential that these businesses truly understand the consequences of their decision to remain operational during this unprecedented period.  This unprecedented nature must not be overestimated because the courts have already sentenced many companies who had used legal products, with the authorisation of the State, and sometimes even encouraged to do so by it.

Sylvie Gallage-Alwis, Partner, Signature Litigation

Signature Litigation is a London law firm founded in 2012 by senior lawyers with many years’ experience in leading practices, specialising in high value commercial litigation and arbitration.

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