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How Small and Medium Size Businesses Can Prepare for the Impact of Covid-19 - Part 1

March 12, 2020

The spread of COVID-19 continues to cause uncertainty and it presents unique challenges for small and medium size businesses (SMBs). We have gathered the most pressing questions that are top of mind with our clients and business owners and will address them through our blog series.

We hosted a free webinar on March 17, in collaboration with Fisher & Phillips LLP, a leading labor and employment law firm, to provide critical up-to-date information on employer-related legal and compliance requirements, as well as best practices to help you take care of your business and your team during this pandemic.

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1. Should my business halt all international travel? What about domestic travel?

With respect to international travel, the first question is whether the travel is permitted by law. On Wednesday evening, President Trump announced new European travel restrictions that will impact nonimmigrant visa holders and certain immigrants (as well as visitors) who need to fly into the U.S. and who have been physically present in the Schengen Area in Europe during the 14-day period preceding their entry (or reentry). The Schengen Area covers 26 European countries. Prior presidential proclamations limited entry of foreign nationals who were physically present in China and Iran. A variety of exceptions apply to the restrictions currently in place. However, the State Department on Wednesday issued a travel advisory urging U.S. citizens to reconsider all travel abroad, even to non-restricted zones and regardless of whether exceptions might allow travel.

Domestic U.S. travel generally is not banned in the same sense as some international travel, however, there are regional restrictions across the country on various activities, such as large gatherings, which is likely to severely limit the ability of your people to conduct business on the road. As such, domestic travel may be ineffective from a business perspective, even if permitted.

Domestic business travel generally does not present an immediate or imminent threat for employees, unless there are underlying health conditions causing employees to have greater risk. However, if employees refuse your instruction to travel for business for fear of catching the COVID-19 coronavirus, try to work out an amicable resolution. For example, the employer and the employee can check and discuss the CDC (avoid nonessential travel), State Department (do not travel to China), and DHS Travel Advisories, which provide guidance on travel precautions.

Beyond government restrictions, many businesses will voluntarily restrict travel in order to protect employees, their loved ones and the public in general. Every business owner must evaluate for themselves the extent to which they can implement such restrictions. While restricting travel may be a costly measure, there are many reasons to consider it. Protecting employees may be the primary reason, however, the public also benefits from restrictions on travel because travel restrictions may limit the spread of the virus. From a purely practical standpoint, there also is reputational risk for any business that might be identified as contributing to the spread of the virus as a result of non-essential business travel

2. Is Coronavirus a covered disease for workers’ compensation eligibility?

It depends. If the employee is a health care worker or first responder, the answer is likely yes (subject to variations in state law). For other categories of employees, a compensable workers’ compensation claim is possible, but the analysis would be very fact-specific.

It is important to note that the workers’ compensation system is a no-fault system, meaning that an employee claiming a work-related injury does not need to prove negligence on the part of the employer. Instead, the employee need only prove that the injury occurred at work and was proximately caused by their employment. Additionally, the virus is not an “injury” but is instead analyzed under state law to determine if it is an “occupational disease.” To be an occupational disease (again subject to state law variations), an employee must generally show two things:

  • the illness or disease must be “occupational,” meaning that it arose out of and was in the course of employment; and
  • the illness or disease must arise out of or be caused by conditions peculiar to the work and creates a risk of contracting the disease in a greater degree and in a different manner than in the public generally.


The general test in determining whether an injury “arises out of and in the course of employment” is whether the employee was involved in some activity where they were benefitting the employer and were exposed to the virus.

3. What if one of my employees refuses to work for fear of contracting Coronavirus?

Employees are only entitled to refuse to work if they believe they are in imminent danger. Section 13(a) of the Occupational Safety and Health Act (OSHA) defines “imminent danger” to include “any conditions or practices in any place of employment which are such that a danger exists which can reasonably be expected to cause death or serious physical harm immediately or before the imminence of such danger can be eliminated through the enforcement procedures otherwise provided by this Act.” OSHA discusses imminent danger as where there is “threat of death or serious physical harm,” or “a reasonable expectation that toxic substances or other health hazards are present, and exposure to them will shorten life or cause substantial reduction in physical or mental efficiency.”

The threat must be immediate or imminent, which means that an employee must believe that death or serious physical harm could occur within a short time, for example, before OSHA could investigate the problem. Most work conditions amongst small and medium size businesses in the U.S. do not meet the elements required for an employee to refuse to work.

OSHA has divided workplaces and work operations into four risk zones, according to the likelihood of employees’ occupational exposure during a pandemic. These risk zones are useful in determining whether the threat is immediate or imminent. The majority of the workforce in the U.S. falls into the medium and lower exposure risk zones. Consider these exposure risk zones when an employee refuses to come to work for fear of contracting Coronavirus.

  • Very High Exposure Risk:
    • Healthcare employees performing aerosol-generating procedures on known or suspected pandemic patients.
  • Healthcare or laboratory personnel collecting or handling specimens from known or suspected pandemic patients.
  • High Exposure Risk:
    • Healthcare delivery and support staff exposed to known or suspected pandemic patients.
  • Medical transport of known or suspected pandemic patients in enclosed vehicles.
  • Performing autopsies on known or suspected pandemic patients.
  • Medium Exposure Risk:
    • Employees with high-frequency contact with the general population (such as schools, high population density work environments, and some high-volume retail).
  • Lower Exposure Risk (Caution):
    • Employees who have minimal occupational contact with the general public and other coworkers (such as office employees).


Both the CDC and OSHA have issued guidance on how to “reduce the impact of COVID-19 outbreak conditions on businesses, workers, customers and the public.” The EEOC has issued guidance on employee protections under the ADA in the event of a pandemic and the guidance from the federal agencies puts the burden on employers to identify health hazards specific to their workplaces and determine lawful actions based on those hazards. On Wednesday, March 11, the World Health Organization (WHO) declared COVID-10 a pandemic.

Once again, this guidance is general, and employers must determine when this unusual state exists in their workplace before determining whether it is permissible for employees to refuse to work.

As the situation is continuously changing, we recommend that you review the comprehensive FAQs on COVID-19 by Fisher & Phillips LLP: https://www.fisherphillips.com/resources-alerts-comprehensive-faqs-for-employers-on-the-covid

This communication is for informational purposes only; it is not legal, tax or accounting advice; and is not an offer to sell, buy or procure insurance.

This post may contain hyperlinks to websites operated by parties other than TriNet. Such hyperlinks are provided for reference only. TriNet does not control such websites and is not responsible for their content. Inclusion of such hyperlinks on TriNet.com does not necessarily imply any endorsement of the material on such websites or association with their operators.

    By Samantha Wellington

    Senior Vice President, Chief Legal Officer and Secretary, TriNet

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