United States: Businesses Are Reopening: Are You Safe From Claims?

Highlights

• Many companies are eager to reopen and begin generating revenue as federal, state and local governments start to relax business closure orders. However, they also may be wary of potential liability if a customer, vendor or employee contracts COVID-19 while on the premises.
• In addition to guidance from various levels of government, a number of industries have industry-specific guidelines that businesses should review and incorporate in their reopening plans. Industry standards are often used as a benchmark to determine whether a business has engaged in negligent behavior.
• This Holland & Knight alert provides companies with a number of practices that, if implemented, will make their businesses safer and will also help them to mount a defense to liability claims, demonstrating that they have taken reasonable efforts in line with governmental and industry-specific guidance.

As the federal, state and local governments begin to relax business closure orders around the country, businesses may be eager to reopen and begin generating revenue but may be fearful of potential liability if a customer, vendor or employee contracts COVID-19 while on the premises. While there is no way to guarantee against such claims, companies can implement a number of practices that will make their businesses safer and will also help them to mount a defense to liability claims, demonstrating that they have taken reasonable efforts in line with governmental and industry-specific guidance.

Standard of Care

The standard of care owed to invitees on business property will vary from state to state; however, under most states' premises liability law, there are three basic elements: 1) the premises owner has knowledge of the person's presence on the property (whether as an invitee, worker or known trespasser); 2) the premises owner was negligent in addressing an unsafe condition that it knew about or should have known about (in the current crisis, conditions that would foster, and not deter, the spread of COVID-19), and 3) such negligence caused a person's injury.

Legislation Limiting Liability for COVID-19 Claims

The federal government and some states are considering (and a couple of states have passed) legislation that provides protections for certain businesses for claims arising out of COVID-19. A U.S. Senate Judiciary Committee hearing is scheduled for May 12, 2020, where the topic is expected to be discussed.

The following states are among those that have also passed legislation or issued executive orders limiting liability in some sectors (most commonly in the healthcare industry):

• Utah.¹ On May 4, Utah Gov. Gary Herbert signed into law a bill that provides Utah business owners immunity from civil liability for damages or an injury resulting from exposure of an individual to COVID-19 on the business premises. The law does not protect business owners if they engage in willful misconduct, reckless infliction of harm or intentional infliction of harm.
• Illinois.² On April 1, Illinois Gov. JB Pritzker issued an executive order that provides healthcare providers immunity from civil liability for any injury or death that occurs while they provide healthcare services in response to COVID-19. The order provides an exception when a healthcare provider is found to have acted in a grossly negligent manner or engages in willful misconduct.
• New Jersey.³ On April 1, New Jersey Gov. Phil Murphy issued an executive order that made healthcare providers immune from civil liability for damages sustained as a result of actions taken "in good faith" in connection with the response to COVID-19. The immunity does not cover acts or omissions that amount to a "crime, actual fraud, actual malice, gross negligence or willful misconduct."
• New York.⁴ New York Gov. Andrew Cuomo issued a similar executive order that provides immunity from civil and criminal liability for New York healthcare facilities, healthcare professionals and volunteers related to COVID-19. The order does not provide immunity from acts or omissions that were caused by the willful or intentional criminal misconduct, gross negligence, reckless misconduct or intentional infliction of harm.
• North Carolina.⁵ On May 4, North Carolina Gov. Roy Cooper signed into law the North Carolina COVID-19 Recovery Act. The Act provides immunity for essential businesses (as determined by the North Carolina Department of Revenue) against claims of negligence for injuries arising out of COVID-19 that occur between March 27, 2020, and the expiration of the governor's state of emergency order. It does not provide immunity against claims of gross negligence, reckless misconduct or infliction of intentional harm.
• Pennsylvania.⁶ Gov. Tom Wolf signed an executive order that affords healthcare practitioners protection against liability for good faith actions taken in response to the call to supplement the healthcare provider workforce during the COVID-19 pandemic.

In addition to the legislation highlighted above, states and the federal government are also considering legislation that relates to expanding insurance coverage for certain businesses due to COVID-19.

Sources for Establishing Reasonable Care

During the COVID-19 crisis, there have been consistent sources of guidance for establishing what steps businesses and individuals should be taking to prevent the spread of COVID-19. Incorporating the directives and guidance provided by the below sources will assist companies in establishing a defense to liability claims arising out of COVID-19. These sources include:

The Centers for Disease Control and Prevention (CDC)

The CDC has issued interim guidance for business and employers to help prevent workplace exposures to COVID-19.⁷ All businesses are encouraged to coordinate with state and local health officials regarding community-level strategies in reopening, particularly if there are instances of a local outbreak. Businesses also are encouraged to implement and update as necessary their COVID-19 response and control plans. Such plans should identify all workplace areas and job tasks with potential exposure to the virus and include control measures to eliminate or reduce such exposures. With the goal being to prevent an outbreak and mitigate the spread of the virus, the guidance focuses on 1) measures to reduce the spread; 2) maintaining healthy business operations; and 3) maintaining a healthy work environment. Examples of some recommended practices in these areas are set forth below:

• Reducing Employee Transmission. Employees who have symptoms or are sick should stay home and abide by home isolation requirements. Where an employee has a sick family member, they should also notify their supervisor and follow CDC-recommended practices. Businesses should consider conducting daily in-person or virtual health checks (e.g., temperature checks) before employees enter the workplace. They should conduct a hazard assessment and use appropriate controls, including engineering and administrative controls and wearing of personal protective equipment (PPE). Even where PPE is not required, businesses should encourage workers to wear cloth face coverings at work. Employers should take appropriate action (e.g., closing off areas, cleaning and disinfecting) when an employee is suspected or confirmed to have the virus. Fellow employees should be informed of possible exposure while maintaining confidentiality. Educating employees about best practices to reduce the spread (e.g., washing hands, cleaning and disinfecting, social distancing) is critical to maintaining a safe work environment.
• Business operations. Businesses should appoint a workplace coordinator to be responsible for COVID-19 issues. They should consider implementing staggered work schedules and flexible worksites, offering employees (especially those with higher risk) the opportunity to telecommute. Businesses should establish policies and practices for social distancing to physically separate employees and customers and vendors, when possible (e.g., physical barriers, tape marks). Businesses also should assess essential functions and prepare to adjust their operations if supply chains and staffing are disrupted. They should deliver services remotely by telephone, video or web, and, where possible, reduce contact with customers (e.g., provide curbside pickup, drive-thru service or delivery of goods).
• Work environment. Maintaining a healthy work environment is vital to mitigating the spread of the disease. Businesses should evaluate and consider ways to improve their ventilation systems if needed (e.g., increase the ventilation rates, ensure operability and acceptable air quality). Soap and water for frequent washing should be readily available. Alcohol-based hand sanitizers should be placed in multiple locations. Posters that encourage hand hygiene should be encouraged while handshaking discouraged. Directing employees to visit the CDC's webpage on coughing, sneezing and clean hands etiquette is recommended. Routine cleaning and disinfecting of frequently touched surfaces should take place. Sharing of equipment should be discouraged and disposable wipes available to clean and disinfect. Businesses should limit employee travel and minimize nonessential meetings and trips.

State, County and Local Government and Department of Health Orders

Although the federal government has issued guidelines on how companies should reopen,⁸ state, county and local governments (including departments of health) orders will determine what precautions and safeguards businesses will be required to institute in order to reopen. For example, all essential businesses and other businesses that have reopened in Pennsylvania require employees to wear masks, and employers must provide those masks and conduct temperature checks of employees before the start of their workday. In jurisdictions such as Texas where restaurants have been reopened, those establishments must put plans in place to adhere to the CDC guidance on social distancing of at least 6 feet between parties and have capacity limitations on their occupancy.

In some jurisdictions, state, county and local departments of health are issuing additional orders and guidance that are incorporated into the reopening orders from the state, county or local officials. Reviewing and ensuring that requirements and guidance from state, county or local officials and departments of health are incorporated into a company's reopening plan may be helpful in limiting liability.

Occupational Safety and Health Administration

The Occupational Safety and Health Administration (OSHA) has been active issuing industry-specific guidance and more general guidance to employers throughout the COVID-19 pandemic.⁹ Although this guidance is not focused on customers, vendors or other third parties who may visit a business, the guidelines are focused on ensuring a safe working environment for employees. OSHA guidance tends to be more technical and detailed in nature than guidance from other sources. Nevertheless, business should consider incorporating applicable OSHA guidance into business reopening or return-to-work policies and protocols. Holland & Knight's Labor and Employment Group will address the specific COVID-19 OSHA requirements in a forthcoming alert as part of its COVID-19 Return to Work Series.

Industry-Specific Guidance from Trade Organizations

Many industries have industry-specific guidelines that businesses should review and incorporate in their reopening plans. The CDC's website, for example, provides guidance for specific industries, such as healthcare,¹⁰ airline,¹¹ shipping,¹² and meatpacking.¹³ In addition, industry trade groups provide additional sources of information to assist with safe reopening and preventive measures. For example, the National Restaurant Association has issued a Reopening Guidance for the restaurant industry,¹⁴ and the American Hotel & Lodging Association has introduced an industry-wide, enhanced standard of health and safety protocols (called Stay Safe) developed in conjunction with public health experts to advance best practices for protecting against the coronavirus.¹⁵ The International Air Transport Association (IATA) has been coordinating with public health agencies and providing resources for best practices for airline operations, including aircraft cabin safety and cleaning¹⁶ as well as safety measures for crewmembers and passengers.¹⁷

Business owners should become familiar with and incorporate the recommended practices within their trades. Industry standards are often used as a benchmark to determine whether a business has engaged in negligent behavior.

How to Document Reasonable Efforts

Businesses should consider documenting their policies and procedures for reopening to ensure consistency and comprehensiveness in their plans, as well as to use as a reference later if potential claims arise. Below are some areas for which businesses should consider developing written plans.

• Develop a written action plan outlining the precautions being implemented by the business that tracks guidance from the above sources.
• Develop an action plan to be followed in the case of a known exposure at the workplace.
• Provide written instructions to employees explaining the protocols to be followed when interacting with each other, with customers and with vendors, and require employees to acknowledge their receipt, understanding and agreement to follow these instructions.
• Establish and share a reporting mechanism for employees and customers who have concerns about a possible exposure at the business.
• Provide visible cues such as signage, ground markings, plastic screens and access to hand sanitizer and cleaning supplies that further reinforce steps being taken by the business to reduce the spread of COVID-19.
• Review insurance policies for coverage and reporting requirements.

Footnotes

1 COVID-19 Provisions, Utah State Legislature, S.B. 3007

2 Illinois General Assembly, HB 5769

3 New Jersey Executive Order No. 112

4 Summary of Immunity Provisions, New York State Executive Order No. 202.10

5 North Carolina General Assembly, Senate Bill 704

6 Order of the Governor of the Commonwealth of Pennsylvania to Enhance Protections for Health Care Professionals

7 See CDC Interim Guidance for Businesses and Workplaces Responding to Coronavirus Disease 2019 (COVID-19), updated May 6, 2020. This discussion relates to non-healthcare settings. CDC has a more detailed and industry-specific CDC guidance for the healthcare industry. See note 10.

8 See, e.g., Guidelines, Opening Up America Again, The White House.

9 See OSHA, Safety and Health Topics, COVID-19.

10 See Information for Healthcare Professionals about Coronavirus (COVID-19); Health Departments.

11 See Updated Interim Guidance for Airlines and Airline Crew: Coronavirus Disease 2019 (COVID-19). The Federal Aviation Administration (FAA) issues guidance and safety alerts in coordination with CDC on many airline issues, including health guidance for air carriers and crew. See COVID-19: Updated Interim Occupational Health and Safety Guidance for Air Carriers and Crews.

12 See Interim Guidance for Ships on Managing Suspected Coronavirus Disease 2019.

13 See Meat and Poultry Processing Workers and Employers.

14 See COVID-19 Reopening Guidance: A Guide for the Restaurant Industry.

15 See Enhanced Industry-Wide Hotel Cleaning Standards in Response to COVID-19.

16 See IATA Guidance for Cabin Operations During and Post Pandemic, May 7, 2020.

17 IATA coordinates with the World Health Organization (WHO), International Civil Aviation Organization (ICAO), Airports Council International (ACI) and CDC to provide information on recommended practices in the industry. See Air Transport & COVID-19 Coronavirus; Operational considerations for managing COVID-19 cases or outbreak in aviation.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.