Are Employers Liable for Take-Home COVID-19 Claims?

• Date: 01 October 2023
• Author: Fiona W. Ong and Jamie L. Salazer

Are Employers Liable for Take-Home COVID-19 Claims? By Fiona W. Ong and Jamie L. Salazer GETTY IMAGES/E+/ANDRESR 18 THE BRIEF ❭ Fall 2023 PUBLISHED IN THE BRIEF, VOLUME 53, NUMBER 1, FALL 2023. © 2024 BY THE AMERICAN BAR ASSOCIATION. REPRODUCED WITH PERMISSION. ALL RIGHTS RESERVED. THIS INFORMATION OR ANY PORTION THEREOF MAY NOT BE COPIED OR DISSEMINATED IN ANY FORM OR BY ANY MEANS OR STORED IN AN ELECTRONIC DATABASE OR RETRIEVAL SYSTEM WITHOUT THE EXPRESS WRITTEN CONSENT OF THE AMERICAN BAR ASSOCIATION. Throughout the pandemic, it was all too common for an employee to be infected at work and then spread the infection at home to their family members. This gave rise, of course, to litigation—specifically, the “take-home” COVID-19 claim. While the employee’s own illness is covered by workers’ compensation if it arose out of and in the course of employment, 1 it has been unclear whether their family members can bring their own claims against the employer based on their own illness. Recent cases, building upon a body of case law arising in the context of take-home asbestos claims, have begun to provide some guidance on the viability of take-home COVID-19 claims. In this article, we first discuss the impact of COVID-19 business liability shield laws on such claims. We then turn to the question of whether the derivative injury doctrine under state workers’ compensation laws serves to bar take-home claims. Assuming that such claims are not prohibited under these two mechanisms, we then discuss the possibility that employers may owe a duty of care to employees’ family members. Finally, we explore whether exceptions to any existing duty of care arising out of public policy considerations may apply. COVID-19 Business Liability Shield Laws May Protect Businesses from Take-Home Claims To their great relief, companies in many states may be legally protected against take-home COVID-19 claims. During the pandemic, 30 states rushed to enact laws or issue executive orders to shield businesses from liability for personal injury, death, or other loss due to exposure to COVID-19, whether that of customers, visitors, or others. Depending on the scope of the specific business liability shield, this could include take-home claims. A wide variation in the shields exists, starting with their period of effectiveness. Some have or had an expiration date. For example, Alabama’s business liability shield terminated one year after the end of the state’s COVID-19 public health emergency, which occurred on October 31, 2021—so its shield expired on October 31, 2022. 2 Sixteen other states’ shields have also ended. 3 Yet others have set shield termination dates in the future, most in the next few months or so, 4 although Montana has set this date quite far into the future— January 1, 2031. 5 On the other hand, a number of states’ business liability shields continue on indefinitely. 6 Notably, under most, if not all, of the date-limited business shield laws, immunity will likely continue against claims that accrued during the period in which the shield was in effect, even beyond the termination date. As to the scope of protection, some states, like Alaska, shield companies only against claims by customers, or from claims arising from exposure to COVID-19 on the business premises. These laws will not protect employers against take-home claims. However, other states’ laws are less specific and provide generic protection against claims for injury, death, or loss generally related to COVID-19. This language is almost certainly broad enough to encompass take-home claims. The actions required to trigger the business liability shield also differ widely from state to state. In some states, the company must have reasonably attempted to comply with applicable COVID-19–related laws, regulations, executive orders, or public health guidance. 7 In others, like Arizona, the company needs only to act in good faith to protect the individual in question—without mention of laws or guidance. In several states, the company need not make even a minimal good faith effort to comply with controlling standards or take protective measures for the immunity to apply. 8 This immunity is not absolute; the vast majority of state business liability shield laws provide an express exception to immunity where the business engaged in certain wrongdoing, including grossly negligent, wanton, reckless, willful, or intentional misconduct. This means that the shield laws will not necessarily bar take-home claims where the family member can establish such wrongdoing. Derivative Injury Doctrine Likely Will Not Bar Take-Home Claims In those states where COVID-19 shield laws do not or no longer exist, or where an exception applies, companies may argue that workers’ compensation—and, more specifically, its derivative injury doctrine—serves as a bar to such claims. In every state, an employee’s exclusive remedy for workplace injuries or illnesses—including COVID-19—is through the workers’ compensation system. As the Supreme Court of California explained in its recent take-home COVID-19 case, Kuciemba v. Victory Woodworks, Inc. , a state’s workers’ compensation law establishes a “compensation bargain” under which an employer assumes liability for workplace injuries and illnesses in exchange for limitations on that liability, while an employee receives guaranteed payments in exchange for forgoing additional tort claims. 9 This bar on civil actions arising from an employee’s illness or injury has been extended to third-party claims under the derivative injury doctrine. This doctrine provides that workers’ compensation serves as the exclusive remedy for third-party claims that are “collateral to or derivative of ” the employee’s work-related illness or injury. 10 But what is meant by “derivative”? The employer community argues that it means any situation in which there is a causal link between the employee’s injury and that of the third party. In fact, this is the position taken in the amici curiae brief in Kuciemba filed by a number of major employer associations, including the U.S. Chamber of Commerce, the National Federation of Independent Business, and the National Association of Manufacturers. 11 In Kuciemba , which involved the claims of an employee’s wife against the husband’s employer for take-home COVID-19, the U.S. Court of Appeals for the Ninth Circuit asked the Supreme Court of California to answer two questions regarding the scope of an employer’s liability when an employee’s spouse contracts COVID-19: ambar.org/tips ❬ THE BRIEF 19 PUBLISHED IN THE BRIEF, VOLUME 53, NUMBER 1, FALL 2023. © 2024 BY THE AMERICAN BAR ASSOCIATION. REPRODUCED WITH PERMISSION. ALL RIGHTS RESERVED. THIS INFORMATION OR ANY PORTION THEREOF MAY NOT BE COPIED OR DISSEMINATED IN ANY FORM OR BY ANY MEANS OR STORED IN AN ELECTRONIC DATABASE OR RETRIEVAL SYSTEM WITHOUT THE EXPRESS WRITTEN CONSENT OF THE AMERICAN BAR ASSOCIATION. TIP : Courts seem unwilling to impose a duty of care on employers to protect an employee’s family from COVID-19 to avoid opening the floodgates to litigation. (1) If an employee contracts COVID-19 at the workplace and brings the virus home to a spouse, does the California Workers’ Compensation Act . . . bar the spouse’s negligence claim against the employer? (2) Does an employer owe a duty of care under California law to prevent the spread of COVID-19 to employees’ household members 12 As to the first question, the employer organizations argued in their amici curiae brief that “causation is an element of every negligence claim, and the employee’s workplace infection is an essential causal link in every ‘take home’ COVID-19 case.” 13 Because the wife’s injury “necessarily” implicated the employee’s injury or illness, the organizations vigorously asserted that her claims fell “squarely” within the derivative injury doctrine. 14 Some courts might agree. For example, the U.S. District Court for the Eastern District of New York summarily found the state workers’ compensation law to bar the claims of household members in Palmer v. Amazon.com, Inc. 15 In that case, several employees and their household members sued Amazon for breach of the duty to provide a safe workplace, among other things. Without discussing the derivative injury doctrine, but relying on the broad coverage of the workers’ compensation law, the Palmer court dismissed the breach of duty claim by all plaintiffs—including the household members—on the grounds that it was subject to the exclusive remedy of workers’ compensation. Other courts, however, have rejected the argument that workers’ compensation and its derivative injury doctrine bar take-home COVID-19 claims by family members, frankly with a far more comprehensive and detailed analysis of the issue than the Palmer court provided. For example, in See’s Candies, Inc. v. Superior Court , the wife contracted COVID-19, allegedly because of her employer’s inadequate safety measures, and then infected her husband, who subsequently died. 16 The employer argued that the derivative injury doctrine barred the family’s wrongful death action. The California lower appellate court rejected a simple causal link approach, and instead held that the derivative injury doctrine applies only when it is “legally impossible to state a cause of action . . . without alleging a disabling or lethal injury to another person.” 17 The See’s Candies court further clarified that the derivative injury doctrine applies to claims that are “logically” or “legally” dependent on the employee’s injury or illness, which is not the same as “causal” dependence. 18 The court also pointed out that derivative claims typically involve economic or intangible losses to the third party resulting from the employee’s injury or illness. But, according to See’s Candies , the doctrine does not apply where the claims arise from the third party’s “separate physical injuries,” even when the employee’s injury is part of the...