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LA, Chicago Impose Virus-Inspired Layoff, Leave Mandates

May 28, 2020, 9:30 AM

Employers in Chicago face new worker leave mandates while some Los Angeles businesses will soon see limits on how they handle layoffs—examples of the employment ordinances cities are pursuing in response to the Covid-19 pandemic.

Those ordinances and others that have passed or been proposed in New York City, Philadelphia, San Francisco, Seattle, and elsewhere aim to protect workers from unexpected job losses, workplace safety concerns, or the pressure to come to work despite personal health risks.

Management-side employment attorneys, however, said the ordinances bring compliance challenges and litigation threats that increase the already-significant risk for businesses reopening during and after the pandemic. The new Chicago and LA ordinances, in particular, give workers the option to sue employers who violate them.

“Employers are going to need as much flexibility as possible to operate efficiently and profitably,” said Robert R. Roginson, an attorney who represents employers at Ogletree Deakins in Los Angeles. “These ordinances are limitations on that,” he said about the pair of new LA ordinances, which are set to take effect June 14.

Businesses with operations in multiple cities and states face a heavy burden in trying to keep track of all the new ordinances, laws, and regulations while also guarding against litigation risk related to Covid-19, said Uma Chandrasekaran, an employment lawyer at Seyfarth Shaw in Chicago.

“It’s a challenge for employers because it’s kind of a patchwork,” she said.

Worker Retention, Paid Leave

Under LA’s new worker retention ordinance, certain businesses that undergo changes of ownership or control must retain the workers for at least a 90-day transition period. The policy applies to businesses that operate at the airport (not including airlines), hotel and event center operators, and commercial property managers.

LA’s City Council also enacted a “right of recall” ordinance, requiring that the same categories of employers must offer laid-off or furloughed workers the first chance to get their jobs back as companies resume operations.

In Chicago, a new ordinance bars employers from firing workers who take time off for reasons related to Covid-19, such as obeying a stay-at-home order from state or local officials or after a health official’s quarantine instructions specific to the employee. The new anti-retaliation restrictions took effect May 20, when the City Council and Mayor Lori Lightfoot (D) enacted them.

As part of the same ordinance, the city also enacted changes to its paid leave law, expanding it to cover outside sales representatives, motor carriers, members of religious organizations, and student workers at Illinois colleges and universities. The language of the ordinance said these categories were omitted due to a “scrivener’s error” when the city previously amended its paid leave law in December. The new paid leave requirements take effect July 1.

The new Chicago ordinances carry a substantial enforcement threat, in the form of both private litigation and enforcement action by the city, Chandrasekaran said.

In a lawsuit, workers could win up to three times the wages lost due to their termination plus actual damages and attorney fees, she said. Through a city enforcement action, businesses also could face fines of $1,000 per day per violation.

Employers are “really getting ready and bracing themselves for seeing employees challenge” the layoff and furlough decisions that companies have made over the last several weeks, Chandrasekaran said.

Chicago’s moves to expand paid and protected leave follow similar action by cities and states around the U.S., including at least four California cities—Los Angeles, Oakland, San Francisco, and San Jose.

Hazard Pay, Gig Worker Proposals

Beyond paid and protected leave requirements, cities also are pursuing employment mandates ranging from hazard pay to gig worker reclassification as part of their Covid-19 responses.

Proposals pending at the New York City Council would require large employers to pay daily bonuses to essential workers during the Covid-19 public emergency and restrict businesses’ ability to lay off or fire workers without “just cause.” Both proposals were heard and held in committee May 5, along with others that would expand the coverage of the city’s paid sick time mandate to include more workers, such as gig workers.

New York City Councilman Brad Lander publicly nudged his colleagues to take action on the proposals in a May 26 tweet. Lander, who also chairs a progressive policy advocacy group of local elected officials called Local Progress, didn’t immediately respond to a request for comment.

“New York City, we can take a meaningful step forward for these drivers, by extending paid sick leave to Uber, Lyft, and other gig-workers right now,” he tweeted.

Seattle city leaders also are considering a proposal to provide hazard pay to gig workers.

A proposed ordinance in Philadelphia would bar employers from firing or retaliating against workers who complain about workplace safety problems or refuse to work in unsafe conditions.

And in San Francisco, on-demand workers would be paid minimum wage and receive health care while the city would secure more data directly from the platforms, under recommendations that a city commission approved May 15. The proposal will be forwarded to the city’s full Board of Supervisors for further consideration.

—With assistance from Joyce Cutler in San Francisco.

To contact the reporter on this story: Chris Marr in Atlanta at cmarr@bloomberglaw.com

To contact the editor responsible for this story: Karl Hardy at khardy@bloomberglaw.com

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