Top 10 employment risks for 2021

Plaintiffs have filed more than 1,400 employment-related lawsuits stemming from COVID-19.

February 17, 2021

On top of the many immediate human resources challenges the coronavirus (COVID-19) pandemic presents—coordinating a safe return to work, managing requests for leave, implementing telework programs, wage reductions, and more—employers are looking to the future to prepare for the next challenges to come.

Since March 2020, plaintiffs have filed more than 1,400 employment-related lawsuits stemming from COVID-19 under various federal, state, and local laws addressing workplace health and safety, nondiscrimination, and employment termination.


  • Expect increased litigation over claims of “off-the-clock work” by teleworking employees.
  • Be prepared to respond when an employee cannot or will not take the vaccine for religious, medical, or personal reasons.
  • Board focus: Employers’ duty to ensure staff’s safety and health is more difficult than ever.

Here are 10 key areas of employment-related risk arising out of the pandemic to consider and monitor in the months ahead.

Wage and hour challenges

1. Off-the-clock work. Employers must pay nonexempt employees for all hours worked, including overtime pay required by both federal and state law. And in many states, employers must ensure employees take mandatory meal and rest breaks.

Accurate timekeeping and break time compliance is more challenging when nonexempt employees are not in the physical workplace and may be working more variable schedules than before the pandemic began.

We expect to see increased litigation over claims of "off-the-clock work" by teleworking employees. This has always been a challenging issue for employers but is compounded by the significant increase in telework.

2. Expense reimbursement. Many employees have incurred costs associated with telework. Depending on the jurisdiction, an employer may have to reimburse the employee for costs associated with telework arrangements.

Closely review applicable reimbursement statutes to ensure compliance. Several class-action lawsuits have been filed for the costs of prorated home internet and cell phone plans, and even for prorata rent for home offices. Employers that previously offered a nominal stipend for home internet access and cell phone use are being surprised with claims the stipend is now disproportionate to the time spent on work functions.

3. Exemption status. There may be potential changes to employees’ exempt status brought about by changes in job duties for exempt workers.

4. Pay rates. Consider the calculation of the regular rate of pay for overtime when disbursing "hazard pay" bonuses.

Downsizing and reductions in force

5. Selective recalls from furlough. As credit unions return to prepandemic operations or return employees from furlough, they should be mindful of Worker Adjustment and Retraining Notification (WARN) Act obligations.

This is especially true where federal funding to maintain jobs (such as under the Paycheck Protection Program) may be running out, and employers are facing the unwelcome prospect of having to let workers go, potentially triggering WARN notice requirements.

Credit unions need to closely examine and understand their WARN exceptions and obligations when returning employees or reinstituting layoffs and furloughs. Several states also have their own mini-WARN laws to consider and analyze.

Leave and accommodation claims

6. Vulnerable demographics. Be mindful of potential pitfalls when returning staff to the workplace, even when you believe you’re acting in an employee’s best interests.

The Equal Employment Opportunity Commission (EEOC) has cautioned against possible infection control strategies and conduct that may conflict with the Age Discrimination in Employment Act, Pregnancy Discrimination Act, Title VII, or state equal employment opportunity laws.

While credit unions may be particularly concerned for more vulnerable employees, the EEOC has made clear that employers may not prevent older staff or pregnant employees from returning to work if they wish to do so, even if the employer believes it is protecting these workers from risk.

7. Vaccination-related requests. While employers hope a COVID-19 vaccine will enable them to return to some semblance of a prepandemic workplace, there will be significant delays until a vaccine is available for the general public.

From an employment perspective, employers need to consider a broad range of issues including but not limited to equal employment opportunity compliance, labor relations, workers’ compensation, employee safety, and other factors such as the anti-vaccine movement.

Once the vaccine is available to employees, be prepared to respond when an employee cannot or will not take the vaccine for religious, medical, or personal reasons. Also, be prepared to weigh competing demands from staff concerned about their own health vulnerabilities if co-workers do not get vaccinated.

Consider all of these factors when developing a plan for dealing with a vaccine.

Leaves of absence

8. Paid-leave protections. Although the paid leave provisions of the Families First Coronavirus Response Act expired Dec. 31, 2020, numerous state and local governments have adopted new laws, ordinances, or regulations providing or extending paid leave to employees during the pandemic.

While the new pandemic-related Tax Relief Act of 2020 does not require employers to provide employees with paid sick or family leave after Dec. 31, 2020, employers who choose to allow employees to take such leave for a pandemic-related reason through March 31, 2021, can claim the payroll tax credit.

Agency interpretations of protected use for these leave programs have changed throughout the pandemic. Monitor developments in this area closely, and make sure you coordinate leave programs to meet varying federal, state, and local requirements.

Safety and health

9. Providing a safe workplace. Employers’ duty to ensure staff’s safety and health is more difficult than ever. Employers are balancing federal guidance and recommendations with evolving local guidance and orders. Moreover, different sectors of the economy may have drastically different requirements and guidelines to follow upon employees’ physical return to work, particularly for public-facing businesses like credit unions.

An employer that does not adequately adopt measures to prevent the spread of COVID-19 could face liability for failure to comply with the Occupational Safety & Health Administration. The Labor Department has been very active since the spring of 2020 in holding employers accountable for alleged safety violations.

10. Retaliation. Employees who have continued to work in essential businesses during the pandemic increasingly are filing complaints regarding personal protective equipment, social distancing, and other health and safety measures. At the same time, many employers face the reality of changing or reducing hours, cutting pay, or eliminating positions due to the decline in economic activity.

The combination of increased health and safety complaints with a simultaneous escalation of employment actions many employers must take due to business necessity has also led to an increase in retaliation claims being filed under state and federal law.

MICHAEL GOTZLER is a shareholder for Littler, a global employment and labor law practice. Contact him at 608-287-3701 or at This article does not constitute legal advice.

This article appeared in the Spring 2021 issue of Credit Union Magazine. Subscribe here.