One often-overlooked aspect of managing a reduction in force is maintaining compliance with state and federal employee privacy laws. The layoff process is taxing from a human and emotional perspective. Often, this stress can cause employers to overlook key aspects of the administration of the process. Doing so, however, would be a grave mistake. 

 

In normal times, employers must go to great lengths to ensure the privacy and ongoing security of their employee’s personally identifiable information and health-related information in particular. This means ensuring that any records, either physical or electronic, are safely handled and stored when employees are laid off.

 

Since the Novel Coronavirus (COVID-19) took hold on American soil, companies from all corners of the economy have been shedding jobs with abandon. Many of these companies have self-funded or self-administered health benefits they offer to their employees and are thus governed by HIPAA regulations. 

 

According to the industry journal JDSUPRA, “Federal privacy laws, such as HIPAA, can create complexities for many plan sponsors as they attempt to weigh the privacy rights of an employee or dependent who has contracted COVID-19 against preserving public safety, including that of the employee’s or dependent’s co-workers, family, and friends.”

 

JDSUPRA further explains that “Information about a COVID-19 patient can be disclosed to certain friends, family members, and other individuals involved in the care of that person. While this exception would generally only apply with respect to a healthcare provider, this exception makes it clear that an employer, regardless of whether it is a covered entity under HIPAA, can share information about an employee’s or dependent’s location, general condition, or death, as necessary, to identify, locate, and notify family members, guardians, and others persons responsible for that person’s care.” 

 

Employees

It’s also important to note that in the current pandemic environment, there may be a temptation on behalf of employees with access to private health information to share that information with the media. Employers should take special care to remind employees with access to such sensitive information of their responsibility to adhere to the strict privacy laws that govern their actions.