Labor & Employment
Q. May I require employees to work remotely?
A. Generally, yes if they can work remotely.
Q. Must I continue to pay employees who work remotely?
Q. How do I track overtime for employees who work remotely?
A. Employees must track their work hours and lunch breaks. Employers should require employees to submit weekly electronic time sheets that include total hours worked and a statement affirming the accuracy of the hours of work reported. Overtime policies requiring authorization before working overtime are permitted and apply equally to remote work as to work on site.
Q. What do I do if an employee has special needs and is working from home when he/she previously worked in the office?
A. If an employee requests an accommodation due to his/her disability, or if the employer has reason to believe an employee has special needs, the employer needs to enter into a dialogue with the employee to ascertain if there is a reasonable accommodation that can be provided in his/her home to address those needs. If there is a reasonable accommodation that addresses those needs, the employer needs to provide it. NOTE: if a particular accommodation would result in an undue hardship for the business, the employer does not need to provide it.
Q. We are considering scanning the temperature of all of our employees and customers before they are allowed on site to ensure no one with a fever is on the premises. Is this legal?
A. While there have been no recommendations by any government agencies to implement these scans, the World Health Organization’s (WHO) declaration that COVID-19 is a pandemic may change that, especially if any federal, state, or local government agencies follow suit. Currently, companies should consider the employment and public accommodation aspects to performing such scans until guidance or directives from government health authorities mandate or recommend them. The Americans with Disabilities Act (ADA) provides nondiscrimination protections to individuals with contagious diseases but balances this protection with the requirements designed to protect the health of others. When a member of the public poses a direct threat to the health or safety of others, i.e., that individual poses a significant risk to the health or safety of others that cannot be eliminated by other methods, an exception to the ADA may apply. EEOC guidance provides that during a pandemic, CDC guidance or other directives may indicate that employers may measure employees’ body temperature. The U.S. Department of Justice has not yet opined whether the COVID-19 pandemic permits private entities to conduct temperature testing on customers. Thus, companies should exercise caution before relying on the “direct threat” or other similar ADA defenses as a basis for temperature or other similar screenings. If any screening is performed, companies should not single out any group to screen based on a protected category like national origin.
Q. Can we require our employees to submit to a medical screening (either voluntary or mandatory) before returning from sick leave or a leave of absence?
A. Fitness for duty examinations are permitted under the ADA under certain circumstances. They are also sometimes permitted under California’s Fair Employment and Housing Act (FEHA). These examinations may be permitted under the ADA because they are either not disability-related or, are justified under the ADA standards for disability-related inquiries for employees in light of the declaration that COVID-19 is a pandemic. Under the FEHA, an employer may require an employee to undergo a medical examination to certify fitness for duty upon the employee’s return from a non-FMLA medical leave of absence if there are reasonable safety concerns regarding the employee’s ability to perform the essential job functions. That examination, however, must be job-related and must be a business necessity under the specific circumstances.
Q. One of our clients is inquiring about the travel and health statuses of certain employees with whom they will come into contact. What are we allowed to disclose?
A. Employers always should be cautious about disclosing private information about its employees without their express written consent. However, employers can provide its clients and/or vendors with basic information regarding its workforce. For example, an employer is likely at liberty to disclose whether certain employees have recently traveled overseas and where they traveled. However, employers should be conscious of the confidential status of certain medical information prior to disclosing more specific information without employee consent. Employers should also consider the increased privacy rights in states, such as California, which may further limit the scope of information they would be at liberty to disclose. As a practical matter, a policy that discloses the least amount of information to answer a company’s clients’ and/or vendors’ inquiries is most advisable.
Q. If an employee contracts COVID-19 while working, can the employee pursue a claim for workers’ compensation benefits?
A. Maybe. Whether or not these claims are compensable under a particular state’s workers’ compensation laws depends on various factors, and is determined on a case-by-case basis. Generally, workers’ compensation policies and laws cover only injuries or illnesses that are related to the employee’s job. Because COVID-19 is not an injury, it will likely be analyzed under state law to determine whether it is considered an “occupational disease,” which involves consideration of these factors:
1. The illness or disease must be “occupational,” meaning that it arose out of and was in the course and scope of the employment; and
2. The illness or disease must arise out of or be caused by conditions “peculiar” to the work.
Given the vast number of different kinds of occupations and work-settings in our economy, each workers’ compensation claim related to COVID-19 will be fact-specific and individualized.
To be safe, employers should consider providing any such employee with Workers’ Compensation forms and encourage him/her to complete and submit them if they feel they may be covered under the applicable state law.
Q. Can an employer limit an employee’s personal travel plans?
A. Probably not in some jurisdictions such as New York, but employers can advise employees to restrict work-related travel and may also require an employee to self-quarantine following travel that is personal or work related if recommended by the CDC.
Q. What do you tell an employee who is concerned he/she has or has been exposed to COVID-19?
A. An employer should require any employee who believes he/she has COVID-19 or has been exposed to COVID-19 to stay home until he/she has been diagnosed and cleared to return to work by a healthcare provider. Employers should designate an employee as the point person for questions of that sort and encourage employees to seek emergency assistance from a medical provider and contact local/state health departments. Employers should tell employees to obtain documentation in connection with test results regarding COVID-19, as there may be additional relief available for which such documentation is required. The Families First Coronavirus Response Act, which takes effect on April 1, 2020, includes documentation requirements, further discussed here and in the Q&A from the DOL.
Q. What should an employer do about employees who cannot work on premises and cannot work remotely?
A. Employers should apply vacation, sick or PTO time for employees unable to work due to COVID-19 circumstances and comply with ADA and FMLA requirements where applicable. Whether an employer must pay such employees depends upon the employer’s sick or medical leave policy and applicable federal, state and local laws and ordinances. Note that some state laws may provide additional emergency paid or unpaid leave requirements (see our Quickstudies about New York's recently enacted law and New Jersey's proposed legislation). For companies with unions, employers should check collective bargaining agreements and meet with unions to discuss protective measures. Employers may consider expanding paid time off benefits. Further, the Families First Coronavirus Response Act, contains paid time off provisions, which, as of April 1, 2020, most employers with less than 500 employees will need to follow, with a narrow exemption for certain qualifying small businesses. These provisions are further discussed here. The CARES Act also may provide releif to those employees as more fully discussed here.
Q. What laws should we be concerned about?
A. Employers should ensure they are following all applicable federal, state and local laws which include, among other enactments, paid and unpaid leave, statutes and ordinances, and unemployment, discrimination, retaliation, and accommodation laws. In addition, the Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), some of the more likely applicable federal laws to which employers will need now to pay additional attention are: the Americans with Disabilities Act (ADA), Title VII of the Civil Rights Act of 1964 and state and local anti-discrimination laws, the Pregnancy Non-Discrimination Act (PDA), the Genetic Information Nondiscrimination Act (GINA), the National Labor Relations Act (NLRA), the Family and Medical Leave Act (FMLA), the Health Insurance Portability and Accountability Act (HIPAA), the Fair Labor Standards Act (FLSA), Worker Adjustment and Retraining Notification (WARN) Act, and the Occupational Safety and Health Act (OSHA).
Q. Can I disclose the name of an employee who is diagnosed with COVID-19 to other employees, to local, state or federal health organizations, or to the general public?
A. In general, employers are not required to disclose the names of employees who have contracted COVID-19 to other employees or to the general public or to health organizations (except to certain professions). Members of management or others who have a demonstrable “need to know” may be exceptions to this general rule. Employers should balance privacy interests with safety and health concerns and provide the only information necessary for those involved to take the requisite precautions.
Q. Does HIPAA apply to health information my business is receiving related to employees who have been diagnosed with COVID-19?
A. Not likely. For most employers (those that are not health care providers covered by HIPAA), this type of health information is received in the employer capacity (e.g., when an employee submits a doctor’s note and calls in sick). However, to the extent employers receive health information about their employees through a group health plan, such information is covered by HIPAA and should not be disclosed without consent other than for treatment, payment, or operational purposes. An employer should not review its group health plan records to determine which employees may have been tested for COVID-19.
Whether or not subject to HIPAA, employers should keep all employee health information confidential and secure, and only use the minimum amount of information necessary on a need-to-know basis for legitimate business reasons (as further discussed above); if an employer does not adhere to these limitations, there are various laws other than HIPAA that could be triggered.
Q. What does OSHA require employers to do about COVID-19?
A. OSHA has made its latest guidance available at https://www.osha.gov/Publications/OSHA3990.pdf.
The OSHA guidance (which is not mandatory because it does not constitute a law or regulation) encourages employers to:
- Develop an infectious disease preparedness and response plan (e.g., identifying potential sources of infection in and outside of the workplace, identifying and implementing controls to reduce exposure, such as use of personal protective equipment, preparing for increased absenteeism and supply chain disruptions, and considering downsizing or closing operations);
- Prepare and implement basic infection prevention measures (promoting hand washing, covering coughs and sneezes, and “social distancing,” and encouraging employees to stay home if they are ill);
- Develop procedures for prompt identification and isolation of ill employees/visitors;
- Consider and implement flexible work arrangements, such as working from home, reduced hours, alternating schedules; and
- Follow existing OSHA standards, particularly taking additional measures to maintain a clean and sanitary workplace.
If an employer confirms that an employee tested positive for COVID-19, it should consider whether to record the exposure on the OSHA 300 log. Generally, a COVID-19 case will be a recordable illness if the employee contracted the infection as a result of performing his/her work-related duties. Employers must analyze each exposure on a case-by-case basis in light of each employee’s job duties and the resulting effects of the infection (e.g., medical treatment received, days away from work, and restriction posed by the infection). In many cases, it will not be possible to determine whether an employee contracted COVID-19 at work.
Q. How should employers respond to employee requests to work from home or not work at all due to fear of COVID-19 exposure (without any current exposure or symptoms)?
A. Generally, employees are not entitled to leave or to telecommute to avoid getting ill. However, in light of the latest guidance from state, local, and federal health authorities regarding COVID-19, including the Centers for Disease Control and Prevention (“CDC”), employers should consider allowing employees to invoke accrued, unused vacation time or PTO or other types of leave. Employers also should give thought to occupational safety and health laws prohibiting employers from terminating an employee who refuses, in good faith, to expose him/herself to a dangerous job condition and who has no reasonable alternative but to avoid the workplace. Employers should, therefore, review requests on a case-by-case basis to ensure that they do not subject an employee to an unreasonably high risk of contracting COVID-19. Employers also should consider whether employees are entitled to reasonable accommodations (e.g., telecommuting or otherwise) under the ADA due to a pre-existing health condition. Employers also may refer employees to an employee assistance program and otherwise offer information and support when responding to inquiries of this sort from employees.
Q. How should employers respond to employee requests not to work due to needing to be home to care for family members who are ill?
A. If the employee has had exposure to a family member who has been diagnosed with, or is experiencing symptoms of, COVID-19, the employer should consider requiring the employee to stay home for the time being (as further discussed below). Note that because health care providers may be overwhelmed with patients, it may not be possible for employees to obtain timely medical releases clearing them to return to work. Employers should also be cognizant that employees requesting leave to care for an ill family member may qualify for up to 12 weeks of unpaid leave under the Family and Medical Leave Act (FMLA), to the extent they otherwise meet FMLA-eligibility requirements (i.e., have worked for their employer for at least 1,250 hours over the previous 12 months and at a location where at least 50 employees are employed by the employer within 75 miles). Many state or local laws (including, for example, New York, California, the District of Columbia, and Dallas) require paid and/or unpaid leave for such care; other states, including New Jersey, are considering new legislation in the wake of COVID-19. Further, the FFCRA, effective on April 1, 2020, contains additional leave requirements applicable to most businesses with less than 500 employees. The firm has authored a QuickStudy explaining that legislation in some detail. If the requested leave does not trigger federal, state, or local leave requirements, the employer’s leave policies will provide guidance as to whether an employee is entitled to leave and, if so, whether it is paid leave.
To the extent an employee is ineligible for paid leave under the FFCRA or state law, but is unable to work or telework due to the need to care for a sick child, he or she may be eligible for unemployment benefits under the CARES Act, discussed in more detail here.
Q. How should employers respond to employee requests not to work due to needing to be home with children not in school due to local school closures?
A. Some state laws, including New York and California, require unpaid and/or paid leave for parents and guardians caring for a child during an unexpected school closure and/or a closure ordered by public officials (which is currently the case in several areas). Other states, including New Jersey, are considering similar legislation in the wake of COVID-19. Further, the FFCRA, which becomes effectiveon April 1, 2020, provides paid leave for eligible parents caring for their children due to ongoing school closures. The firm has authored a QuickStudy explaining those provisions. Covered employers must provide leave as required by the Act and as required by applicable state and/or local laws. To the extent and employee is ineligible for paid leave under the FFCRA or state law, but is unable to work or telework due to the need to care for a child, they may be eligible for unemployment benefits under the new federal CARES Act, discussed in more detail here.
Q. What kind of documentation should employers require of employees (1) who request or take leave due to COVID-19 related reasons, and (2) before returning to work following such leave?
A. At the outset, an employer should retain appropriate documentation for employees who take leave under the FFCRA or otherwise, particularly if an employer wants to take advantage of the tax credits offered by the FFCRA. Per the DOL, a qualifying employee who wishes to take advantage of the paid sick leave or extended family and medical leave offered under the FFCRA must provide his/her employer with documentation to support such leave. An employer may also require an employee to provide documentation to support initial or extended family and medical leave taken to care for a child whose school or place of care is closed or otherwise unavailable for COVID-19 related reasons.
Regarding documentation before returning to work, according to the EEOC, employees who are required to self-quarantine and/or work from home due to COVID-19 may be required to confirm by a doctor’s note that they are not infected with COVID-19 and are, therefore, fit to return to work. As a practical matter, employers may choose to waive this requirement if the employee has been in quarantine and symptom-free for 14 days. It is worth noting that the CDC and EEOC advise against requiring employees with illnesses other than COVID-19 to validate their illness or ability to return to work in light of the overwhelming demands on medical providers (as well as the employee’s potential exposure to COVID-19 when visiting a medical provider’s office).
All notes or other certifying documents or medical information provided by an employee to an employer should be maintained as confidential and segregated from the employee's personnel record.
Q. What notices or pay requirements apply if an employer needs to temporarily or permanently shut down some or all of its operations?
A. The federal Worker Adjustment and Retraining Notification (“WARN”) Act generally requires employers with 100 or more employees to provide 60 days’ notice of a mass layoff or plant closing. Notices are to be provided to employees, employees’ collective bargaining representative (as applicable), and to certain state and local officials.
- A mass layoff is a reduction in force at a single site of employment in which 50 or more employees comprising at least 33% of active employees or at least 500 employees are laid off for more than six months or have their hours reduced more than 50% during each month of the six-month period.
- A plant closing is the permanent or temporary shutdown of a single site of employment or facilities or operating units within a single site of employment that results in 50 or more employees being laid off for more than six months or having their hours reduced more than 50% during each month of the six-month period.
Exceptions to the 60-day notice requirement may exist for faltering companies (but only to plant closings) or for employers who experience unforeseeable business circumstances or natural disasters. If an employer believes any of these three exceptions may apply, the employer must provide as much notice as possible under the circumstances. Failure to provide any notice to affected employees will negate the exceptions.
Failure to provide 60 days’ notice, or as much notice as possible when relying on an exception, may result in back pay and benefit awards to employees and civil penalties.
Employers must also take into account state and local notice requirements (commonly known as “mini-WARN Acts”), some of which have notice requirements in addition to, or different from, the federal WARN Act.
Employers considering temporary or permanent layoffs must also consider any state-specific requirements related to payment of final wages, bonuses, commissions, and accrued but unused vacation time. The timing of these payments and what must be included in them or excluded from them varies from one state to another. For example, employers in California and Massachusetts must generally pay final wages to a terminated employee immediately upon termination, whereas an employer in Texas must generally pay final wages to a terminated employee no later than the sixth day after the date of termination.
Finally, employers with unionized workforces must also consult applicable collective bargaining agreements, which may require bargaining with unions over layoffs and their impact on bargaining unit employees. Collective bargaining agreements also may address potential layoff decisions, including the order in which the employer must lay off employees and whether employees may replace or “bump” their co-workers based on seniority.
Q. What should employers consider when reducing hours or salaries for employees?
A. To avoid drastic options like mass layoffs or plant closings, many employers may first want to consider other cost-saving measures, like reduced work hours, wage/salary reductions and furloughs. While these alternatives may help reduce labor costs significantly, they are not risk-free propositions.
For example, reducing employee’s work hours by more than 50% over the course of several months can trigger the notice requirements under the Worker Adjustment and Retraining Notification Act (see FAQ 19, above). The selection of employees for reduced schedules or other cost-saving measures also can create potential disparate treatment and/or disparate impact claims. Employers should use business-related selection criteria to reduce these risks.
Likewise, if not done appropriately, a furlough or reduced work schedule may jeopardize the exempt status of salaried exempt employees under the Fair Labor Standards Act (“FLSA”), which could then trigger minimum wage and overtime pay requirements. Employers should consider the following measures to reduce risk of non-compliance with the FLSA:
- Full-week shutdowns (of one or more weeks): This strategy avoids improper salary deductions and complies with the FLSA because employers must only pay exempt employees their salary for weeks during which they perform work. If an exempt employee performs no work during an entire workweek, the employee is not entitled to his or her salary for that week. Employers who implement this option must prohibit exempt employees from performing work and should consider eliminating an employee’s ability to work remotely (e.g., by eliminating email access or remote connectivity). If an employee nevertheless performs work, the employer must pay the corresponding salary but may discipline the employee for violating the no-work directive.
- Reduced workweek and reduced salary: A prospective reduced workweek coupled with a reduction in salary may avoid violations of the salary basis test under the FLSA, provided the salary reduction is a bona fide change reflecting long-term business needs. Before implementing any changes, employers should, at least one week in advance, if possible, notify affected employees in writing of the reduced workweek and salary plan. Care must be taken to avoid salary reductions that are modified from time to time, as those may be misconstrued as being inconsistent with exempt status. The reduced salary cannot dip below the federal threshold for salaried employees ($684 per week or $35,568 per year) or below state standards that exceed the federal threshold. Otherwise, an exempt employee may become non-exempt. Employers should also keep in mind potential notice requirements under state or local law, including so-called Wage Theft Prevention Act (WTPA) notices, as well as potential issues regarding eligibility for health care coverage for employers utilizing an Affordable Care Act lookback measurement period method. A reduced workweek also may impact health care eligibility and other benefits coverage (see below).
- Reduced salary without a reduced workweek: Unless prevented by an agreement or state or local law, an employer is typically free to set salary/wage rates at any level (subject to minimum wage and salary requirements). A prospective reduction in employee salaries generally does not violate the FLSA if it is a bona fide change reflecting long-term business needs. In addition, the guidance above for reduced salary and reduced workweek also applies in this situation.
- Converting salaried employees to hourly and curtailing hours: Conversion to hourly status is helpful when the reduced salary of an exempt worker would fall below the federal or a state threshold for salaried exempt status or if an employer anticipates making repeated changes to compensation depending on business needs. This latter option, though, is mainly useful if the hours of the salaried exempt worker can be the subject of a rather stable weekly schedule and the employee records his/her hours on a daily basis and reports them weekly. One caveat: the employee must be instructed not to look at work emails outside of his or her hourly schedule; to avoid having additional "on call" at hours other than during the agreed upon schedule. And, of course, the considerations noted above, such as health care coverage and providing any WTPA notices, should be kept in mind.
Remember to check state and local laws, which are changing daily. Employers also must consider whether any state wage and hour laws limit their ability to impose a desired cost-saving measure.
The CARES Act also may provide financial assistance to eligible employers making efforts to keep their businesses running and their workers employed. In the alternative, employees who are furloughed, or whose worksites are temporarily or permanently shut down due to COVID-19 related reasons, may be eligible for unemployment benefits under the new federal CARES Act, discussed in more detail here.
Q. What do I need to know about employee benefits when reducing hours?
A. Impacts on employee benefits is an often overlooked consideration. Employers should not forget to consider how changes in compensation and hours worked will impact employee benefit issues such as health care coverage and 401(k) plans.
Employers also need to consider the impact cost-saving measures may have on benefit eligibility, including whether they call for COBRA notices and whether they may be able, or need, to amend any benefit plans to address eligibility issues.
In that regard, employers should review the terms of governing plan documents to determine whether health coverage, for example, continues during a furlough period. In this regard, these key issues should be considered:
- Employers with insured plans need to review the terms of their underlying insurance contracts to determine whether a reduction in hours will result in a loss of health insurance coverage and at what point in time An employer may elect to change the manner it determines eligibility to participate in a group health plan, which could include providing coverage based on a lesser level of hours worked. To avoid penalties, an employer should consider the impact of any change of this type for purposes of the Affordable Care Act’s coverage mandates, such as the lookback measurement method for periods after the employer returns to business as usual.
- If a furlough or other reduced hours results in a loss of coverage, then it will be treated as a COBRA qualifying event. If so, the employer must provide the required COBRA notices and inform the impacted participants of their rights to continued coverage under the employer’s group health plan.
- COBRA coverage generally requires an employee to pay up to 102% of the full cost of coverage without any employer subsidy. An employer may, however, elect to subsidize some or all of the cost of continuation coverage during a furlough period. However, any such subsidy should be provided non-discriminatively so as to be provided on a tax-free basis to employees.
- For qualified plans like a 401(k) plan, employers also should consider whether layoffs or furloughs trigger vesting requirements and distributions to employees.
Q. If an employee is placed on unpaid leave or laid off due to a temporary or permanent worksite closure, is the employee eligible for unemployment compensation?
A. Eligibility for benefits related to loss of work based on any COVID-19 related issue will depend on each state’s eligibility criteria, but an employer may encourage its employees to apply for benefits and let state authorities make a determination. Additional information is available on various state agency’s websites (for example, that of the Texas Workforce Commission: https://twc.texas.gov/news/covid-19-resources-employers).
The federal government released new guidance due to COVID-19 that gives states flexibility to amend their laws to provide unemployment benefits in multiple scenarios related to COVID-19. For example, federal law now allows states to pay benefits where:
- An employer temporarily ceases operations due to COVID-19, thus preventing employees from coming to work.
- An individual is quarantined with the expectation of returning to work after the quarantine is over.
- An individual leaves employment due to a risk of exposure or infection or to care for a family member.
In addition, federal law does not require an employee to quit so that he/she can receive benefits due to the impact of COVID-19. The CARES Act also expanded the scope of unemployment benefits available to eligible employees. For more information regarding these additional benefits, see our QuickStudy on the CARES Act.
Some states have also waived waiting periods and work search requirements for unemployment benefits sought in connection with COVID-19.
Q. What else should I keep in mind?
A. There are a host of other issues employers should take into account. Some of them are:
- Requiring use of vacation time: The FLSA does not address the use of vacation or paid time off, so employers generally are free to require use of paid time off in accordance with their policies or practices. However, some state laws impose restrictions on mandatory use of vacation or paid time off, so employers should consider such requirements before requiring use of vacation or paid time off as a cost-saving measure. Moreover, practically speaking, this option likely does not lead to immediate cost savings; employees are simply substituting paid time off for actual work.
- Sponsored foreign workers: Employers who sponsor foreign workers should also consider whether they must report furloughs or reductions in hours or compensation to the United States Citizenship and Immigration Services (“USCIS”) or Department of Labor (“DOL”). In some instances, employers cannot change the essential terms and conditions of a foreign worker’s employment without first notifying USCIS and/or the DOL.
- Unionized workforces: Employers with unionized workforces must also consider whether their collective bargaining agreements limit their ability to implement cost-saving measures and/or whether they must bargain with their union(s) over decisions to implement such measures or the impacts those actions have on unionized employees.
For more information on the matters discussed in this publication, please contact the authors.
Lani Durio | 713-226-1533 | email@example.com
Jordon R. Ferguson | 213-687-6778 | firstname.lastname@example.org
Rufino Gaytán III | 713-226-1379 | email@example.com
Richard D. Glovsky | 617-239-0214 | firstname.lastname@example.org
David Gregory | 713-226-1344 | email@example.com
Nina Huerta | 213-687-6707 | firstname.lastname@example.org
Ricardo Lopez | 213-687-6767 | email@example.com
Jennifer McCoy | 214-740-8362 | firstname.lastname@example.org
Paul G. Nason | 214-740-8562 | email@example.com
Hanna Norvell | 713-226-1423 | firstname.lastname@example.org
Richard Reibstein | 212-912-2797 | email@example.com
J. Michael Rose | 713-226-1684 | firstname.lastname@example.org
Jonevin Sabado | 213-687-6729 | email@example.com
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Privacy & Cybersecurity
Q. We want to enable our personnel to work from home during this health crisis. What do we need to worry about from a privacy and cybersecurity perspective?
A. Start with what you’ve got in place already.
- Do you have current facilities, policies and protocols for remote access?
- Are your current remote access technology, policies and protocols, which may have been designed to permit access by certain, but not all personnel, appropriate for a larger set of your personnel?
- If current technology, policies and protocols are nonexistent, inadequate or inappropriate in the current environment, consider the following:
- Who needs access to your systems in order to function remotely?There may be some personnel who do not need access, or who may need only limited access to perform their job functions remotely.Other personnel who never needed remote access before may now need remote access to work from home.
- Are your remote access policies and protocols, and your technical safeguards, appropriate, or do adjustments need to be made to address the new environment?For example, more personnel may be working remotely, with a need to access more data, than would have been anticipated when your remote access policies and protocols were developed.Your current system may be built on a people connecting through company issued equipment, but other personnel may need access through home computers and other devices, including those accessible by other household members.This raises privacy and cybersecurity concerns that need to be addressed up front.
- Don’t forget about portable media, including paper!With personnel potentially planning for more extended periods of working remotely than the usual business trip or holiday, and expecting that there may not be support in the office, they may be more inclined to take more data along as they think about fulfilling their job functions remotely.Consider refreshing your policies about removing data from the secure office environment.
Training! There’s no time like the present to revisit training on your company’s privacy and cybersecurity policies, expectations and requirements, including the proper use of your technology using remote access. If your personnel will be working remotely, potentially for extended periods, raise awareness about risk avoidance and good privacy and cybersecurity hygiene before they leave the office. This is even more important where you may have personnel working remotely for the first time.
Q. Does HIPAA apply to health information my business is receiving related to employees who have been diagnosed with COVID-19?
A. Not likely. For most employers (those that are not health care providers covered by HIPAA), this type of health information is going to be received in the employer capacity (e.g., when an employee submits a doctor’s note and calls out sick). However, to the extent your business receives health information about its employees through its group health plan, then such information is covered by HIPAA and should not be disclosed without consent other than for treatment, payment, or operations purposes. An employer should not review its group health plan records to determine which employees may have been tested for COVID-19.
Whether or not subject to HIPAA, we recommend you keep all employee health information confidential and secure, and only use the minimum amount of information necessary to accomplish the purpose on a need-to-know basis for legitimate business reasons, as there are various laws outside of HIPAA that could potentially be implicated.
For more information on the matters discussed in this publication, please contact the authors.
Theodore P. Augustinos | 860 541-7710 | firstname.lastname@example.org
Laura L. Ferguson | 713-226-1590 | email@example.com
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Q. Our SEC filing will be delayed because of consequences of the novel coronavirus, it that ok?
A. The SEC announced conditional relief for late filings due between March 1 and April 30 where the company or other person filing is unable to file because of the consequences of COVID-19. One of the conditions is that a company file a current report on Form 8-K or Form 6-K explaining the delay. See our Locke Lord Capital Markets Blog, linked here, for further details on SEC Staff guidance on filing relief.
Q. We are making an SEC filing, do we need new Risk Factors?
A. Many companies are adding and updating Risk Factors to reflect the effects of the novel coronavirus. The SEC has given repeated guidance, described in our blog posts referenced above, to the effect that companies should provide investors insight about management’s assessment of and plans for addressing material risks to the company resulting from the coronavirus and inform them of material developments.
Q. Our annual meeting is not until May. Should we warn stockholders that we might reschedule or require remote participation?
A. Many companies are alerting stockholders in their proxy statements that they may reschedule or conduct their meeting with remote-only participation by stockholders. A number of companies have used hybrid or virtual annual meetings in the past, so those changes, if necessary, are not expected to be materially disruptive.
For more information on the matters discussed in this publication, please contact the authors.
Rob Evans | 212 912 2728 | firstname.lastname@example.org
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Q. Disclosure matters – what disclosure obligations arise with respect to COVID-19 matters for primary offering disclosures and continuing disclosure?
A. Disclosure about the COVID-19 outbreak and matters arising from that should be addressed in disclosure documents, unless determined not to be material. Initial disclosures that have been made tended to be more focused on the matter as a “risk factor” with unknown impacts and disclaimers about potential material adverse effects in the future. Now, as impacts are becoming more obvious, it is likely that more detailed disclosures will be made, though with still uncertain or unknown impacts. Any disclosure analysis must be based on the particular facts and circumstances pertaining to a particular issuer and actual disclosures will vary from issuer to issuer. The rapidly changing nature of the entire situation also may require updates or supplements. Annual or periodic filings for continuing disclosure purposes will need to address this matter, if material. Virus related matters are not necessarily required to be disclosed as a material event or significant event, unless one of the listed events is actually triggered as a consequences of the current circumstances. However, voluntary disclosures are permitted and should be considered in order to keep investors informed. In addition, governments at all levels are actively providing information to the public on this matter that will reach investors. Consideration should be given to whether any additional disclosures should be made to provide proper context or add material information to what is otherwise being provided.
Q. How does the COVID-19 situation affect obligations under bond purchase agreements?
A. Termination events in bond purchase agreements – parties should review carefully termination events in bond purchase agreements to ensure the provisions reflect the appropriate and desired allocation of risk between issuer and underwriter. “Standard” provisions from prior transactions, if repeated, may not adequately cover the current circumstances or be ambiguous. Most bond purchase agreements allow for some flexibility on timing of delivery of the bonds, if mutually acceptable to the parties. Current market volatility may limit the willingness or ability of the underwriter to change the delivery date. Current circumstances may also create unforeseen obstacles to having all necessary documents finalized and signed as planned. Closing logistics, while normally straightforward, could be disrupted and should be taken into account as transactions move forward.
For more information on the matters discussed in this publication, please contact the author.
Walter St. Onge III | 617 239 0389 | email@example.com
Visit our COVID-19 Resource Center often for up-to-date information to help you stay informed of the legal issues related to COVID-19.
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