Senate stimulus negotiations at risk of collapsing over whether companies can be sued for outbreaks

With just weeks to reach an agreement before federal emergency relief programs expire, lawmakers have thus far failed to reach a consensus on the GOP’s proposed corporate “liability shield,” which would exempt companies from lawsuits filed by workers and customers seeking redress for personal harm caused by infections.

The impasse could sink much wider efforts to provide hundreds of billions of dollars in aid to jobless Americans, struggling municipalities, and hard-hit small businesses.

A half-dozen Senators met on Monday night in the Mansfield Room in the U.S. Capitol, and multiple lawmakers expressed renewed optimism about the possibility of a deal being in reach after the discussion.

Sen. Mitt Romney (R-Utah), one of the architects of the $908 billion bipartisan stimulus plan that revived talks last week, on Monday proposed that immunity from federal lawsuits only last for 2020, according to a draft of his plan circulating among the bipartisan group. The measure would provide an exemption, allowing suits over gross negligence or willful misconduct. Senate Majority Leader Mitch McConnell (R-Ky.) and other senior Republican lawmakers have proposed that the liability shield cover five years.

Sen. John Cornyn (R-Tex.), the lead author of GOP liability shield plan, left the bipartisan discussions early on Monday night. But he and Sen. Lindsey Graham (R-S.C.), a close ally of the president, have been involved in crafting a liability compromise. They are expected to work on a proposal with opposing senators, including Richard J. Durbin (D-Ill.) and Angus King (I-Me.), on Tuesday. It is unclear whether McConnell will ultimately support whatever compromise language the bipartisan group may develop.

Senate Democrats have also not backed Romney’s plan but cited progress in negotiations on Monday. “Tonight was a very good night,” said Sen. Joe Manchin (D-W.Va.) after leaving the meeting devoted to the liability issue. Manchin added of the meeting: “Very bright individuals who feel very good about it and we’re just moving along.”

Romney also told reporters: “It was a more productive meeting than I expected it would be … There was a good faith discussion, and I think we may be able to get there.”

Republicans and business groups have been pushing the liability shield since this spring. McConnell called the liability shield a red-line in negotiations in May, predicting a flood of lawsuits could amount to a “second pandemic,” and saying the measure was necessary to protect companies from costly litigation.

Democrats have characterized the liability shield as a non-starter, alleging that the Trump administration’s lax stance on worker protections has already tilted the scale towards companies on safety issues. Durbin, who had been involved in the bipartisan group’s work, pulled out of discussions last week and criticized the inclusion of a liability shield in the legislation.

Lawmakers have more information now than they did in the spring about the potential for coronavirus-related lawsuits. And data shows that the “flood” of litigation warned about by Republicans and business groups has not materialized thus far.

An online complaint tracker from the law firm Hunton Andrews Kurth shows that out of an overall pool of about 6,500 lawsuits filed across the country so far, only 116 have been filed by employees over issues like lack of personal protective equipment, exposure or infections at work, and death from the virus. Consumers have filed another 29 personal injury or wrongful death claims for coronavirus exposure.

“That’s like two to four lawsuits per state,” said Hugh Baran, a expert on legal recourse for employees at the worker-focused National Employment Law Project. “That’s a trickle. It’s not a flood … This whole immunity bill that’s been proposed by McConnell and Cornyn is really a solution in search of a problem.”

The legal database Lex Machina counts 234 personal injury and wrongful death cases filed against companies for coronavirus related issues as of the end of November, predominantly negligence suits from clientele of cruise lines and assisted living facilities. Another 527 lawsuits have been filed by employees over coronavirus issues, mostly workers claiming they were retaliated against or terminated for getting sick. Both of those figures represent just a fraction of the non-covid related court cases those practice areas this year: 16,461 personal injury and wrongful death suits and 17,822 employment cases.

“Cases caused by COVID-19 have not hit the federal courts in particularly a large wave at this time,” said Rachel Bailey, a legal analyst at Lex Machina.

By contrast, the businesses themselves appear to be a much larger source of litigation than employees: some 1,300 lawsuits have been filed by companies against insurers over business interruption claims due to the coronavirus, for example. Lawsuits that track with conservative-leaning complaints, like nearly 1,000 lawsuits counted by Ballotpedia against local and state coronavirus restrictions, have also made for a significantly larger bulk of the legal cases during the pandemic.

Legal advocates and worker representatives say that allowing workers to challenge employers through private lawsuits is a crucial check on corporate power at a time when OSHA has taken a largely pro-employer approach to safety issues.

The agency was slow to issue citations early on in the pandemic, declined to set enforceable workplace safety standards for the coronavirus, and watered down its guidelines for companies with words like “if feasible,” and “when possible.” In some particularly high profile cases, the fines that it has issued have been paltry.

As a window into what Republicans want, Cornyn proposed a liability shield bill last summer that would have prohibited lawsuits against businesses, nonprofits and local government branches that are following public health guidelines, except in cases of gross negligence or willful misconduct. The bill also appears to exempt companies from some enforcement activity from the federal Occupational Safety and Health Administration — a significant issue given the likelihood that the Biden administration will steer the agency to more aggressively prioritize worker safety in the new year.

Democrats have overwhelmingly criticized the liability shield, with Sen. Bernie Sanders (I-Vt.) going as far as saying he would vote against the overall package if the liability shield is included. Other Democrats have said they oppose the idea but are willing to try finding common ground with Republicans on it to secure passage of the broader legislation.

“This is the reality — in order to gain Republican support, and remember we have to have 60 votes, some liability protection will be part of the package,” said King, who caucuses with the Democrats and was one of the early backers of the bipartisan liability proposal.

The U.S. government has not done a detailed study of the proportion of coronavirus infections that have spread through workplace contact, but it is believed to have made for a significant portion of the pandemic so far. Some 300,000 nursing home staff alone have fallen ill, for example, and 254,000 health care workers; more than 1,600 of those workers have died.

A Harvard study of data from six Asian countries early on in the pandemic found that possible work-related transmission accounted for 47 percent of initial outbreaks. In Oregon, where the state health authority is tracking workplace outbreaks with five or more cases, there have been at least 11,139 cases from workplaces, about 15 percent of the state’s total. Approximately 7 to 9 percent of deaths in the U.S. are due to workers bringing infections home to their families, according to one estimate.

There are already significant barriers in place to prevent a flood of lawsuits from workers who get sick or injured on the job.

The legal particulars differ state to state, but typically worker injuries and deaths are dealt with through the worker’s comp system, where the burden of proof is much lower than a court-room and damages are capped. The threshold for such lawsuits is high — typically an employee or their family would have to show it was the result of gross negligence or an intentional act on the part of an employer.

“It’s going to be some extraordinary level of fault on behalf of the employer, and that’s going to be tough to prove,” said David L. Barron, an employment lawyer at Cozen O’Connor.

Barron said that employment lawyers had been batting around a few theories about why the wave of cases hadn’t materialized, including that it could still be forthcoming in the future.

According to lawmakers and aides familiar with the negotiations over the bill, the debate has included discussion of whether companies should face different liability standards for their actions early in the pandemic, when government public health guidance was inconsistent and rapidly changing, compared to later on.

Aides also cautioned that how to apportion state and local funding has also proven a difficult sticking point in economic relief negotiations, which also threatens to derail talks.

Lawsuits have served an important purpose — even those that have already been dismissed, worker advocates say, provided a window into some of the more egregious allegations of misconduct by some companies.

“People have rights that need to be addressed in the court system,” said Michael E. Levine, who represents the family of deceased grocery worker Gerardo Gutierrez, who is suing his employer, the Florida grocery chain Publix. “Businesses should be held accountable when they’re not keeping their workforce sick, and when they’re taking away the rights of their employees to keep themselves healthy.”

Gutierrez, who was 70, had asked his employer whether he could wear a face covering at his South Beach store, but he was denied, according to the complaint.

A lawsuit filed against poultry producer Tyson Foods, where at least six workers died after a large outbreak at a facility in Iowa earlier this year, said that a manager had organized a betting pool for supervisors to wager how many workers would get sick. Tyson has declined to comment on the allegation.

“People have rights that need to be addressed in the court system,” Levine said. “If workers are safe – consumers can have confidence in going out. That’s what we need to rebuild the economy.”