As the COVID-19 pandemic continues, most U.S. venture capital firms have been subject to federal, state or local directives to “shelter in place” since March. Thanks to the nature of the venture capital business, most firms were likely able to convert the bulk of their employees to a remote working arrangement with few complications.   

As we enter the month of May, federal, state and local governments are signaling that restrictions may be loosened soon, such that certain businesses may be able to resume operations at their workplaces in coming weeks or months. While the details will differ based on how each location eases its restrictions, we recommend that employers start planning ahead now as to what a return to the office might look like. 

On April 17, we published an article highlighting a number of general issues for all employers to consider as they draft their return to office plans. This blog expands on some of the items covered in such article and highlights specific considerations for U.S-based venture capital firms.

1. When we are allowed to return to the office, how do we decide who returns?

This decision will first be impacted by how applicable restrictions are lifted. Firms should review all relevant federal, state and local orders to determine the parameters of who will be allowed to return. Some orders, for example, are only letting businesses reopen at 25 or 50% of their prior capacity. Higher-risk individuals, as identified by the CDC or other sources, may be ordered to continue to shelter in place to protect their health.

Once you have determined who you are legally permitted to allow back into the workplace, make a list of the employees who will be asked to return. Which of the firm’s critical functions cannot be successfully performed from home? Which teams need to come into the office at least occasionally to complete their tasks efficiently? 

Also consider the communication, sequencing and structure of the return. Will you have all employees return at once or allow them to return slowly in phases? Will you require employees to return or ask them to? Should the managing partners and other teams be divided into subgroups that come into the office on differing days or weeks, so that if one individual is infected the potential exposure to the entire team can be contained? 

2. What if an employee voices concern about returning to the office and asks to work from home?

If an employee is hesitant to come in, we suggest allowing them to continue working from home to the extent they can do so productively. The federal government’s guidelines on “Opening Up America Again” suggest that for the first 2 of 3 phases of returning to work, employers encourage and use telework options as much as they can while maintaining productivity. We anticipate any state or local orders will advise similarly.  

We anticipate that firms will be able to accommodate a request to work from home for most investment professionals, back office employees and administrative assistants. Especially if those employees have demonstrated during the shelter in place that they can be trusted to get their work done, we suggest allowing them to continue to work from home until they feel comfortable returning to the office.

However, some tasks must be performed in the office. For example, a firm may insist that a receptionist return to the office to perform his or her duties. For other job positions, management may determine that in-person meetings will be required for certain purposes. Management may determine that productivity is better during in-office  performance, for various reasons, and set minimum expectations for attendance. Firms may set these requirements, and employees generally cannot refuse a reasonable expectation and continue working on their own terms.

However, in responding to an employee’s refusal to come into the office, consider the following laws:

  • Disability Discrimination Laws. Certain qualified disabled employees may request a reasonable accommodation, under the Americans with Disabilities Act (ADA) and, in the case of California based firms the California Fair Employment and Housing Act (FEHA) (consider other similar laws in your state if not California), to permit them to continue performing essential functions of their position remotely, in order to avoid a significant risk of substantial harm to the employee.  Employers have a duty to provide reasonable accommodations, absent undue hardship, and must engage in an interactive process with the employee to determine what accommodations may be possible. Employers may require medical substantiation of the impairment and risk of harm.  Ultimately, after the interactive process, the employer decides what, if any, reasonable accommodation will be attempted.  Refusing a request for an accommodation, or failing to conduct the interactive process, could lead to liability. A firm may begin the interactive process before employees are asked to return to the office. The federal Equal Employment Opportunity Commission (EEOC) has suggested use of an Attendance Survey in advance of returning to work, which may prompt employees to make accommodation requests in advance.  Firms should seek legal advice before using such a survey. Employees cannot be asked to disclose previously unknown impairments.
  • The Occupational Safety and Health Act. Under the federal Occupational Safety and Health Act, and certain state analogs, employees have a right to refuse work assignments if they can show that the firm did not meet its duty to provide a safe and healthy workplace. This issue could arise with any employee returning to the workplace.  Some employees may resist returning to the office simply on the basis of age (per CDC recommendations for those age 65 or more), even without an impairment requiring the duty to accommodate a qualified disabled employee. The employee would have to show all of the following: (i) the employee genuinely believes an imminent danger exists in the workplace; (ii) a reasonable person would agree that there is a real danger of death or serious injury; (iii) the employee asked the firm to eliminate the danger and the employer failed to do so; and (iv) the circumstances are such that the issue cannot be corrected through regular enforcement channels.  Note that if the firm follows CDC and local health guidelines, and enforces the firm’s social distancing protocol when employees are together in the workplace, employees may not be able to show an imminent danger, or that the firm failed to meet its duty to provide a safe and healthy workplace.  Any California employer should update and apply its Injury and Illness Prevention Program, in order to show that obligations for workplace inspections, employee training and communication, and hazard investigation and abatement are being met under current health and safety requirements.  Non-California employers should consider any similar state laws.
  • The National Labor Relations Act. If individual contributor employees refuse to come in, and communicate with other employees about it, or ask for their support, they might have a claim that any adverse action taken against them is retaliation for engaging in protected concerted activity under the federal National Labor Relations Act. In that case the firm should continue dealing with each individual request on its own merits, and treat the employees identically to similarly situated employees.   

Even if none of the above laws are implicated, if an employee is refusing to come in and has no reasonable or protected basis for doing so, the employer may consider such refusal insubordination.  While under ordinary circumstances, at-will employees may find themselves summarily terminated for flatly refusing a reasonable work assignment, these are not ordinary times. During the initial return to the office phases, employers may consider less drastic measures, simply for employee relations and firm culture purposes.  Instead of termination, the firm may be able to negotiate a part-time work from home arrangement with prorated pay, until the concerns in question subside, or put the employee on an unpaid personal leave. The employee should be ineligible for unemployment if the firm has clearly offered full-time employment but the employee refuses without good cause. In this case “good cause” is determined by the state’s unemployment insurance agency.  Again, if the firm is following all of the CDC and County Health Department directives, and enforces the firm’s social distancing protocol when employees are together in the workplace, the employee may not be able to show good cause for refusing the work.

3. What if an employee cannot work, either in the office or remotely?  When do we have to let the employee take a leave of absence?

Employees may be unable to return to the office or work remotely due to personal circumstances involving themselves or a family member, and having nothing to do with a risk or fear of entering the workplace due to COVID-19.  Such reasons can include the employee’s illness or that of a family member, or caretaking obligations related to dependents. 

Almost every venture firm is already familiar with paid sick leave laws enacted in the last few years, entitling employees to take paid time off for specified illness and safety reasons.  However, because of typically small workforces, many venture firms have been insulated from having to learn and apply the intricacies of the Family and Medical Leave Act (FMLA) and state analogs.  That insulation is gone for the rest of 2020.

Congress has enacted a temporary expansion of FMLA to reach all small and mid-size employers, for paid child care leave purposes related to COVID-19.  A companion expansion requires paid sick and dependent care leave for certain purposes related to COVID-19. The Families First Coronavirus Response Act (FFCRA)  allows employees to take up to an additional 2 weeks of paid sick leave if the employee is unable to work or telework for certain COVID-19 related reasons and up to an additional 10 weeks of paid family care leave if the employee is unable to work or telework because their child’s school or daycare is closed. See our prior alerts on the FFCRA here and here.

Upon an employee’s request to stop work, or reduce working time, the firm should consider why the employee is unable to work or needs to reduce working time, and assess whether that entitles them to take a limited leave of absence, whether paid or unpaid. Make sure to examine all applicable federal, state and local sick leave laws, including the FFCRA, as well as the firm’s own leave policies, to confirm what type of leave or leaves an employee may be entitled to take.

4. As we start work on a return to the office plan do we have to consider privacy laws, particularly if we plan to ask employees or visitors to disclose any medical or travel history?

The Americans with Disabilities Act (ADA) and state privacy laws impose privacy protections that will apply to certain inquiries involving COVID-19. 

The EEOC has some helpful guidance regarding the ADA and COVID-19 here.  We focus on that guidance below, although certain state laws may impose additional restrictions.

Firms may generally ask employees about COVID-19 symptoms. Initially the EEOC listed symptoms such as fever, chills, cough, shortness of breath, or sore throat. Current EEOC guidance advises: “As public health authorities and doctors learn more about COVID-19, they may expand the list of associated symptoms. Employers should rely on the CDC, other public health authorities, and reputable medical sources for guidance on emerging symptoms associated with the disease. These sources may guide employers when choosing questions to ask employees to determine whether they would pose a direct threat to health in the workplace. For example, additional symptoms beyond fever or cough may include new loss of smell or taste as well as gastrointestinal problems, such as nausea, diarrhea, and vomiting.”

The EEOC also states that, given the current pandemic, employers may take employee temperatures and may also administer COVID-19 tests as they become available. However, firms must maintain the confidentiality of any medical information obtained. Such information should be stored separately from the employee’s personnel file, with other confidential medical records such as doctor’s notes, and leave requests. If a firm chooses to administer a COVID-19 test, it should ensure the test is accurate and reliable and should consult FDA and CDC guidance in making that determination.

Employees may be instructed not to return to the office if they have COVID-19 or are under observation pending a diagnosis. Those employees will clearly be entitled to sick leave under the FFCRA and other sick leave laws, and also likely under any firm sick leave policy. Such employees can be asked to provide a fitness for duty release once they are released to return to work.

Screening office visitors is not covered by the EEOC, but must be considered in order to protect employees and provide a safe workplace. As a practical matter, visitors invited to the office could be sent a symptom questionnaire in advance, to avoid having to confront them at the front desk with a personal questionnaire. Providing a temperature check at the front desk may also be considered, and certainly should be conducted if employees are required to undergo temperature checks.

Closing Thoughts

As venture capital firms plan for an eventual return to office, they will need to take a number of issues into consideration. Our discussion above is by no means exhaustive and does not, for example, cover the considerable changes firms will have to make to their physical facilities to implement social distancing. Consult our April 17 article for these and other considerations.  Local county health officers have published guidance on these and related issues.

Most crucially, the extent to which firms can return employees to the office, and the manner by which firms can do so, will be dictated by federal, state and local orders that are issued in the coming weeks and months. These orders may be difficult to interpret or reconcile with each order.  Consider working with counsel to prepare a draft plan now and revise the firm’s plan in compliance with those orders once they are released.

Selin Akkan photo
Selin Akkan
Lois Voelz photo
Lois Voelz

Posted by Selin Akkan / Lois Voelz