Can an Employer Ask About Your COVID19 Vaccine Status?

With the rise the Delta Variant and breakthrough infections employers have a right to be very concerned over the COVID-19 vaccination status of their employees.  The Occupational Safety and Health Administration (“OSHA”) finally gave guidance that gives employers a very strong incentive to ask about vaccination status and to pursue a 100% vaccination rate over their workforce.  See https://www.osha.gov/coronavirus/safework.  Despite this, employers across New England are running into resistance from their employees.  Many employees, incorrectly cite and rely upon the Health Insurance Portability and Accountability Act (“HIPAA”) as they decline employer requests for vaccination status.  HIPAA was passed in 1996 to create national standard to protect patient health information from being disclosed without a patient’s consent or knowledge.  Anyone in the medical field knows this.  However, there is a significant amount of misinformation and disinformation concerning HIPAA and its applicability to COVID-19 vaccination status.

HIPAA DOES NOT PREVENT EMPLOYERS FROM ASKING ABOUT COVID-19 VACCINATION STATUS.

Nothing in federal law, INCLUDING HIPAA, prevents employers from asking their employees whether they have been vaccinated.  HIPAA only applies to certain industries including healthcare plans, healthcare providers and healthcare clearinghouses.  A statement from the Department of Health and Human Services reads “[i] an employer asks an employee to provide proof that they have been vaccinated, that is not a HIPAA violation.”  This, however, comes with the caveat that there are medial and religious exemptions.  Remember, the employer must also comply with state and local laws – some of those laws may prevent inquiring about vaccination status so these must be examined before implementing any workplace policy.

Despite this, confidentiality of employee information is front and center on this issue.  Employers are still required to keep vaccination status confidential and safeguard that information to avoid running afoul of privacy laws.

But how does this resonate with employees?  According to a survey conducted by the American Staffing Association in June, 66% of employees believe they have a right to know whether or not their coworkers have been vaccinated.  However, 60% also stated that their vaccination status is no one’s business but their own.  See the results of the survey here.  https://americanstaffing.net/asa-workforce-monitor/asa-workforce-masking-anxiety/

Can Employers Mandate Their Employees Get a COVID19 Vaccine?  

If there is no medical or religious exemption present, there is nothing in federal law that prohibits employers from requiring employees to be vaccinated.  Again, state and local laws must be consulted, but there are already companies terminating employees or refusing to hire for the failure to get a COVID19 vaccination in the event an exemption does not apply.

Florida makes telemarketing more difficult and costly for violators

On June 29, 2021, Florida Governor Ron DeSantis signed into law Senate Bill 1120 or the Florida Robocall Bill.  This bill not only expands Florida’s preexisting telemarketing restrictions, but also removes certain exceptions for previously lawful communications and allows parties to seek statutory damages through private litigation.  The law became effective on July 1, 2021.  Penalties for violations range from $500 to $1,500 per call or text in violation of the statute.

Even before the Florida Bill’s enactment, Florida regulated by statute how and when a “telephone solicitor” may engage in “telephonic sales call[s],” including any “telephone call, text message, or voicemail transmission to a consumer for the purpose of soliciting a sale …, or obtaining information that will or may be used for the direct solicitation of a sale.” Fla. Stat. § 501.059(1)(f)–(g).  Pursuant to the statute, it is unlawful to “make or knowingly allow a telephonic sales call to be made if such call involves an automated system for the selection or dialing of telephone numbers or the playing of a recorded message when a connection is completed to a number called.” § 501.059(8)(a).  This restriction is much broader than the definition of an “automatic telephone dialing system” under the federal Telephone Consumer Protection Act (TCPA), recently clarified by the U.S. Supreme Court in Facebook, Inc. v. Duguid, 141 S. Ct. 1163 (2021).

The new law creates a rebuttable presumption that calls made to a Florida area code is made to a Florida resident or to a person in Florida at the time of the call. CS for SB 1120 § 1 (amending Fla. Stat. § 501.059(8)(d)).  Interestingly, the law does not address what happens when the Florida resident is on vacation in another state or staying temporarily in a second here in New England.

This private right of action is not limited to autodialer and recorded messages claims. Instead, it applies to any “violation” under § 501.059, including the statute’s preexisting restrictions on calls to persons who either registered their phone number on the state’s do-not-call list or made a do-not-call request directly to the caller; calls disguising the callers voice; and calls that fail to transmit the caller’s or seller’s originating and redialable telephone number. Fla. Stat. § 501.059(4), (5), (8)(c)–(d).

General telemarketing practices are also impacted by this bill.  For example, the amendments reduce permitted telemarketing hours to between 8 a.m. and 8 p.m., instead of between 8 a.m. and 9 p.m., and prohibit a telemarketer from calling a consumer regarding the same subject more than three times in a 24-hour period. CS for SB 1120 § 2 (amending Fla. Stat. § 501.616(6)). The amendments also make it unlawful to use technology that deliberately displays a different caller identification number. Id. (amending Fla. Stat. § 501.616(7)(b)). These restrictions apply even without the use of an autodialer or recorded message.  However, they do allow for the private right of action.

These changes demonstrate Florida’s commitment to limiting unwanted calls to Florida residents and make it harder for businesses to contact their customers.  Florida is indeed providing a roadmap for other states to follow.  Will the New England states follow suit?  Only time will tell, but this law has more teeth and gives more rights than the federal TCPA.

Requirements for Repossession Notices in Massachusetts for Auto Loans

Requirements for Repossession Notices in Massachusetts for Auto Loans

On March 12, 2020, the United States District Court for the District of Massachusetts in Piazza v. Santander Consumer USA Inc., found that the borrowers’ allegations of a violation of the Motor Vehicle Retail Installment Sales Act (“RISA”) against Santander Consumer USA Inc.’s (“Santander”) could withstand a Motion to Dismiss.  What exactly is required under RISA to give notice to consumers whose motor vehicles have been repossessed?

Factual Background

Between July 2017 and July 2018, the borrowers entered into two loan agreements with Santander for the purchase of two motor vehicles.  Between December 2018 and January 2019 Santander repossessed both vehicles due to defaults.  After the repossessions, Santander sent each of the borrower a notice advising them of their intent to resell their vehicles.  These notices stated the following:

We will sell the Vehicle at a private sale sometime after [date] . . . . The money that we get from the sale (after paying our costs) will reduce the amount you owe. If the net proceeds at the sale, after expenses, does not equal your unpaid balance, and if the total unpaid balance exceeds $2,000, you may owe us the difference, subject to applicable law (including Mass. Gen. Laws. ch. 255B § 20B).

Plaintiffs allege in Count I of their complaint that these pre-sale notices violated Article 9 of the Uniform Commercial Code (“UCC”), as adopted by the Massachusetts legislature, by incorrectly describing their potential liability for a deficiency.  Shortly thereafter, Santander filed a motion to dismiss Count I.

The Law

Two Massachusetts statutes are relevant to the sale of a repossessed motor vehicle.  The Uniform Commercial Code (“UCC”) and RISA.  The UCC governs defaults in secured transactions.  Williams v. Am. Honda Fin. Corp., 98 N.E.3d 169, 179 (Mass. 2018).  Pursuant to the UCC, after a repossession but before the sale of a motor vehicle, a lender must provide written notice containing a “description of any liability for a deficiency of the person to which the notification is sent.”  Mass. Gen. Laws ch. 106, § 9-614(1)(B).  The UCC calculates a deficiency using the proceeds of a “commercially reasonable” sale.  Id. at § 9-615.  The UCC also provides lenders with a form notice.  This notice is referred to as a “safe harbor” notice.  The safe harbor notice includes the following language:

The money that we get from the sale (after paying our costs) will reduce the amount you owe.  If we get less money than you owe, you (will or will not, as applicable) still us the difference.  If we get more money than you owe, you will get the extra money, unless must pay it to someone else.

Mass. Gen. Laws ch. 106, § 9-614(3) (emphasis added in bold).

However, the UCC calculates the deficiency using the proceeds of a commercially reasonable sale.  RISA calculates the deficiency using the fair market value of the vehicle.  Please see the relevant language below:

If the unpaid balance of the consumer credit transaction at the time of default was two thousand dollars or more the creditor shall be entitled to recover from the debtor the deficiency, if any, resulting from deducting the fair market value of the collateral from the unpaid balance due and shall also be entitled to any reasonable repossession and storage costs, provided he has complied with all the provisions of the section.

Mass. Gen. Laws ch. 255B, § 20B(e)(1) (emphasis added).  This conflict between the UCC and RISA is resolved by a related subsection in RISA which states that its provisions displace the UCC to the extent that the UCC imposes different obligations related to repossessions of motor vehicles.

The defining case in Massachusetts on this this issue is, Williams v. American Honda Finance Corp., 98 N.E.3d 169 (Mass. 2018); see also Williams v. American Honda Finance Corp., 907 F.3d 83 (1st Cir. 2018) (analyzing facts in light of the SJC’s responses to certified questions).  Here, the Supreme Judicial Court (“SJC”) concluded that “the notice that is required by the [UCC] is never sufficient where the deficiency is not calculated based on the fair market value of the collateral and the notice fails to accurately describe how the deficiency is calculated.”  Williams, 98 N.E.3d at 179.  While the parties agreed that the words “fair market value” were not required in the pre-sale notice, they disagreed as to the exact requirements.

“In Williams, the SJC set out a clear standard for a sufficient description of the deficiency calculation in pre-sale notices to debtors.  Specifically, the SJC stated that notices ‘must describe the deficiency as the difference between the fair market value of the collateral and the debtor’s outstanding balance because this is what is required by [RISA].’ Williams, 98 N.E.3d at 179. The SJC determined that using the UCC’s safe harbor language, without describing the deficiency with reference to the fair market value of the vehicle, ‘is inconsistent with Massachusetts law.’ …

 

The Court’s Ruling

 

The District Court found that while the pre-sale notice was not required to include the words “fair market value”, it was required to “describe” the method of calculation in a way that “signals to the debtor that the fair market value will be used to determine the deficiency.”  As a result, the District Court found that the borrowers claims could withstand the Motion to Dismiss.  The key takeaway from this case is to follow the language of RISA as promulgated by the SJC in Williams.

Commercial Insurance Policy Does Not Cover Restaurants’ Loss From COVID19 Stay At Home Orders

On December 21, 2020, the Superior Court/Business Litigation Session in Verveine Corp. v. Strathmore Insurance Company decided that a commercial property insurance policy did not cover loss of income incurred by restaurants as a result of COVID19 stay at home orders issued by Governor Charlie Baker.  What exactly transpired in this case?

On March 15, 2020, in connection with the COVID19 pandemic, Governor Charlie Baker issued an order “prohibiting gatherings of more than 25 people and on premises consumption of good or drink”.  Because of the Governor’s Orders, the plaintiffs could not use their restaurants at full capacity, i.e., no indoor dining.

Plaintiffs relied on two sets of provisions in the insurance policies.  The first set of provisions appear in the ‘Business Income (and Extra Expense) Coverage’ section.  The second major provision relevant to coverage is each insurance policy’s Civil Authority Provision.  The coverage dispute between the parties centered on the meaning of the phrase “direct physical loss of or damage to property” as used in the Business Income and Extra Expense provisions, and similarly, the meaning of “damage” that prohibits access to the premises as used in Civil Authority provision.  The Business Income and Extra Expense Provisions of the Strathmore Policies conditioned coverage on proof of “direct physical loss of or damage to property.”

The Defendants took the position that these words unambiguously required that the physical state of the property in question must be altered in order for there to be coverage.  This position was in line with the majority of recent cases across the country that have dealt with this issue involving the COVID19 pandemic.  Plaintiffs alleged that the limitations imposed on the use of their properties because of the Governor’s Orders constituted a “physical loss” within the meaning of these provisions.  The Plaintiffs further alleged that they parties clearly contemplated and understood that the properties would be used and accessed as dine-in restaurants and that because they no longer could that this was the “direct physical loss.”  The Court disagreed.

In ruling on the Motion to Dismiss, the Court stated that the “Complaint here does not alleged that that the COVID19 virus was actually present in plaintiffs’ restaurants, resulting in physical contamination of the premises.  Rather, it alleges that the loss of income for which they seek coverage was the result of the Governor’s Orders that prevented plaintiffs from using the premises as intended.  Plaintiffs’ actual property remains the same as it was pre-pandemic, and patrons and employees were not prohibited from entering the premises as long as the Governor’s Orders were followed.”

But was this case wrongly decided?  The keystone issue in this case was the interpretation of the “direct physical loss or damage”.  The provision was ambiguous at best.  In Massachusetts, when there is ambiguity in an insurance policy it must be resolved in favor in the policyholder.  Unfortunately, this is part of a nationwide trend of Courts rejecting claims for business interruption coverage at the motion to dismiss stage.  This decision does not bode well for small business owners seeking damages related to the COVID19 pandemic.