With companies implementing record-setting layoffs and furloughs following the outbreak of COVID-19, outside counsel are turning to analytics technology to help clients better manage their restructurings. Indeed, more employment lawyers are leveraging adverse impact analysis software to limit client liability and meet demand for efficiencies.

"Certainly software is quicker than crunching the numbers manually, and it also provides a clear illustration for the client to be able to see which groups or group may have a higher or lower selection rate than others," said Ogletree, Deakins, Nash, Smoak & Stewart shareholder Danielle Vanderzanden, whose practice includes discrimination and labor and employment litigation.

Lawyers say software speeds up the process for reviewing data and proactively managing risk before a restructuring decision is made.

"If we see that the statistical analysis suggests there may be adversely impacted groups, then we can dig more deeply into the employer that is making those decisions, to make sure the decisions are being made for legitimate, nondiscriminating reasons to ideally prevent claims of discrimination arising from restructuring or changes in employment status. Or in other scenarios, at least have them prepared against those claims," Vanderzanden added.

While useful for clients during important employee decision-making, Crowell & Moring labor and employment group partner and chair Kris Meade argued that using adverse impact analysis software poses no additional risks to companies or employees.

"It's not novel and statistical analysis remains the starting point," he said. "The true art comes after you run the analysis [and] decide what steps you want to take whether you make changes or end up validating the underlying decisions."

While Meade argued the software has long been a common tool in employment lawyers' arsenal, COVID-19 has hastened the development of these solutions for some firms. In May, for instance, Littler Mendelson publicly announced the release of its Restructuring Assessment Solution.

"We've been thinking about making a solution that automates how we do adverse impact analysis for quite a time, but as the pandemic hit and a lot of clients were looking to restructure, we saw a new need," said Littler shareholder Scott Forman.

Under shareholder Allan King, Littler expedited the development of the assessment tool, a hybrid of in-person consultation and proprietary analytics software. After speaking with the client to determine business goals, Littler leverages its software to analyze the suggested laid off or furloughed workers' data points for potential regulatory or litigation risk. Those data points can include age, race, education and years at the company, King said.

"What we do is reflect the legal standard courts have decided if a particular selection of patterns may raise a red flag behind the motivation of those selections," King said. "[Or] if those selections impact a protected class."

Ultimately, the client decides whether they will continue with originally planned restructurings or modify them, King explained. The software doesn't leverage algorithms and doesn't decide who's fired or furloughed, which King noted makes the tool fairly low risk.

"There really isn't an opportunity for the analysis to skew the results inadvertently, perhaps by [an] algorithm," King said.

With little risk, computerized assessment of workforce restructuring likely won't slow down, Vanderzanden said.

"Clients look for those solutions especially in 2020; they're looking for cost efficient ways to advise them and solve their legal problems. When we talk to clients, using technology to maximize efficiency [is something] they're really pleased to do."