Hybrid and remote work have created an entirely new class of employment practices liability (EPL) claims, and artificial intelligence is making it easier for employees to pursue them, according to Nicholas Boutilier (pictured), commercial account executive at Mitch Insurance’s Kingston branch in Ontario.
“The exposures always change when business practices go through cultural shifts, and we’ve definitely seen that a lot in the past decade or so,” Boutilier told Insurance Business.
He pointed to three: the shift to hybrid and remote work, the emergence of AI, and the rise of the gig economy and job-hopping culture.
The pandemic caught even well-prepared employers off guard, Boutilier said, and few anticipated that remote work policies might later need to be rolled back.
“Even employers who had a strong HR presence at the onset of the COVID-19 pandemic, they were left scrambling trying to accommodate the needs of their employees,” he said.
Read more: Employers are adopting AI faster than they can govern it, and EPL claims will follow, broker says
The first claim type to spike was reprisal, which covers any retaliatory management or employment practice against an employee.
“Hybrid or work-from-home models, they created an entirely new class of reprisal claims,” Boutilier said. “Employees now have one additional employment factor that they can point to and say that their employers may have adjusted these policies to retaliate against them personally.”
The risk is greatest for small and mid-sized employers without written policies on where staff work, he said.
“If there’s a framework for when, how, or how often employees can work from home that’s decided upon and applied equally, that really limits the risk of EPLI claims when there’s a hybrid work model at play,” Boutilier said.
The second issue is accommodation disputes, including cases in which employees and employers disagree over whether a requested accommodation is necessary or whether an employer can justify refusing it on the grounds of undue hardship.
“What’s an employer left to do when a veteran employee has moved outside of commuting distance and now all of a sudden they’re trying to get their employees back in the office?” he said. “It puts employers in a position where employees are now able to point to factors such as gas prices, commute times, and other expenses or inconveniences as a way to point to an undue hardship that could potentially constitute unfair employment practice.”
Another concern is inappropriate conduct in virtual workplaces. Boutilier said remote settings can cause employees and managers to let their guard down, potentially leading to unprofessional behaviour during video calls. He cited examples ranging from inappropriate attire to employees taking meetings from leisure settings, although the employment implications depend on the circumstances.
“It’s something we’ve maybe chuckled or even gasped upon, but the fact of the matter is it’s happening, and it’s a serious exposure for sure,” he said.
He also expects tools employers use to monitor remote staff to become an issue.
“There’s definitely potential for our industry to have a conversation about productivity trackers,” Boutilier said. “I can definitely see an opportunity there for a conversation about privacy, acceptable work practice, or even misuse or abuse of these functions.”
Boutilier called AI “a significantly aggravating factor” for EPL exposure. Before AI, remote work and the gig economy, he said, employees considering a claim faced real obstacles.
“If an employee was experiencing unfair work practices, there was a huge obstacle in their way, which was time, effort, access to information, and stability,” he said. “AI is able to address a lot of those. It gives a lot more power to the individual.”
Read more: EPL claims aren't new, they're just messier now, broker says
The technology also creates exposure on the employer side. Boutilier said he has worked with staffing agencies that are moving to AI models to help clients hire.
“This is certainly an exposure if you’re an employer who’s decided to either personally use or outsource to any sort of AI staffing algorithms,” he said. “Internal biases and errors and any unchecked biases can definitely result in employment liability exposure for sure.”
The third shift, Boutilier said, is the gig economy and job-hopping culture, which has weakened the relationship between employers and staff and made employees more willing to take legal action.
“When we see the hollowing out of the middle class from the ’90s up until the 2020s, there’s just a huge impact on loyalty, community, and culture,” he said.
“The workforce today has less loyalty, but has more access to information, and definitely individuals have more power than ever before,” Boutilier said.
