July 5, 2020

Volume X, Number 187

July 03, 2020

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July 02, 2020

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General Liability Considerations and Potential Exposure in Reopening from COVID-19 Shutdown

After weeks of business closures and stay-at-home orders, many states are slowly beginning to allow businesses to reopen their doors—usually with significant modifications from “business as usual,” but with more freedom to operate than during the shutdown. With this next phase of the COVID-19 pandemic come important legal and business issues to consider about reopening.

On May 1, Womble Bond Dickinson litigation attorneys Mark Henriques (who is leading the firm’s COVID-19 Task Force), Greg Horton and Sara Tucker presented a webinar on general liability issues in a return to work scenario.

“A lot of people are thinking about next steps. How do we reopen?” Henriques said.

While the federal government has issued guidelines on how companies should reopen, those ultimate decisions are being left to state and even local officials. (Womble Bond Dickinson has prepared a 50-state interactive map on business closures and reopening orders at stateclosures.com.) These reopening regulations vary greatly from state to state, even within the same geographic region.

For example, North Carolina is taking a conservative approach to reopening. Some retail operations may reopen on May 8, but gatherings still will be limited to 10 or fewer people. Restaurants and bars aren’t expected to reopen until late May. Neighboring South Carolina already has allowed many retail establishments to open. The state’s Department of Commerce is working rapidly to counsel businesses on whether or not they are eligible to reopen. And Georgia has the most aggressive stance on reopening in the country, allowing gyms, hair salons, restaurants and other in-person businesses to reopen in late April.

Making the Decision to Reopen

Many businesses have suffered severe economic losses during the shutdown and more than 30 million Americans have filed for unemployment benefits in the past six weeks. So the incentive to reopen and get employees back to work is strong. Company leaders want to reopen—not just for their own bottom lines, but for their employees’ as well. 

But there are risks as well. Obviously, the biggest risk—and a business owner’s greatest fear—is that an employee, customer or client gets sick at work or on the premises. This could lead to a range of claims against a business, ranging from employment claims and worker’s compensation filings to personal injury or even wrongful death lawsuits. 

“The biggest question I’ve heard from my clients is, ‘If we reopen and one of my employees gets sick, are we in jeopardy?” Horton said.

Again, that question can depend greatly from state-to-state, and also upon the circumstances of the workplace. Horton noted that South Carolina has a strong worker’s compensation preemption provision, which diverts most on-the-job injury claims from the courts to the state’s worker’s comp system. But many states do not have a similar provision.

“An employee easily could allege some type of negligence, such as failure to provide a clean work environment, failure to provide PPE, etc. How it’s going to shake out in the courts remains to be determined,” Tucker said.

Henriques said the risks are magnified for restaurants, retailers and other businesses that have a customer-facing presence, as they could face litigation from customers as well as employees.

“Some litigation already has been filed—it is not a theoretical risk,” he said. Tucker said the “liability risk (from COVID-19) isn’t astronomical, but it’s still there.”

Some federal lawmakers want to introduce liability protections for businesses that reopen, but to date, such measures have not been enacted on a national scale.

Beyond the legal liability concerns, business leaders also have to be careful about the risks to their brand and reputation. Such tolerance for risk may vary greatly from community to community, and that should factor into the calculus on when and how to reopen.

“You want to make sure you are taking the temperature of your community,” Tucker said.

Best Practices for Limiting Liability When You Reopen

Once the decision to reopen is made, how can businesses best protect themselves, their employees and their customers?

The first step – and one that should be taken before reopening—is to familiarize yourself with applicable guidelines from the CDC, OSHA, World Health Organization (WHO) and state and local authorities. If a business operates in multiple jurisdictions, make sure to examine all of the applicable laws and guidelines. Companies should consider appointing a COVID-19 point person or task force to stay abreast of the rapidly changing developments and advise company leaders as needed.

And the time to plan is now, even in areas where reopening still may be several weeks away. Considerations include:

  • Creating or revisiting workplace health safety protocols;

  • Establishing social distancing procedures for workers and customers. These can include limiting the number of people in a store (many states have mandatory guidelines for this), implementing one-way aisles, and spacing out employees at least six feet apart;

  • Reviewing shipping and receiving operations to make them as contact-free and safe as possible;

  • Closing breakrooms and other common areas;

  • Requiring PPE appropriate to the workplace;

  • Offering more shifts with fewer workers or other staffing changes to limit interpersonal contact; 

  • Regularly sanitizing the workplace, including frequent cleaning of commonly touched areas; 

  • Discussing responsibilities for common areas with the landlord—this should be clear and in writing; and 

  • Making hand sanitizer readily available to employees and customers.

Such protocols will vary from industry to industry, so Horton said businesses should pay close attention to what other companies are doing. “What I want my clients to do is meet the industry standards of care,” he said. “Do not fall behind—constantly stay updated and informed.” Even if these standards do not prove completely effective, the panelists said, it is much less risky to have a flawed plan than no plan at all.

There will be changes, so it is vital to communicate these changes with employees. When in doubt, over-communicate—and make sure someone is available to answer their questions.

Reopening is an exciting and stressful time for companies. While no amount of planning can completely eliminate the risk of legal liability, companies that carefully plan their reopening, with a focus on safety, have the best chance of a successful reopening.

“The bigger the company, the bigger the risk,” Tucker said. “Try and limit issues on the front end to prevent them from becoming bigger problems on the back end.”

Copyright © 2020 Womble Bond Dickinson (US) LLP All Rights Reserved.National Law Review, Volume X, Number 122

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About this Author

Mark P. Henriques, Womble Carlyle Law Firm, Jury Trial Attorney, Non-Compete Agreements Lawyer
Partner

Mark has successfully litigated cases involving fraud, unfair trade practices, class actions, non-compete and non-disclosure agreements, and breach of contract. He has experience in state and federal court in both North and South Carolina. Mark has prevailed in numerous trials, arbitrations and mediations. Mark has served as first chair in more than eight jury trials, five of which lasted a week or more. He has successfully argued cases before the Fourth Circuit Court of Appeals and the North Carolina Supreme Court.

704-331-4912
Partner

Greg has been involved in litigation (including class actions and mass actions) involving a wide variety of products including electronic component parts, food products, jet skis, automobile tires, escalators, elevators, water heaters, construction products, boats and toxic substances. Many of these cases have involved death or severe injury, including deaths and severe injuries to children.

Greg has defended product manufacturers, general contractors and subcontractors in a wide variety of complex litigation, including class actions and mass actions. He has significant experience in claims involving water intrusion, mold (including personal injury claims) and structural failure and has defended product manufacturers of a variety of construction products including exterior cladding systems, roofing systems, windows, doors, structural steel and lumber.

Greg advises and defends a wide variety of clients, including some of the areas’ largest employers, in matters relating to employment discrimination, harassment, wrongful termination, governmental investigations, trade secrets, restrictive covenants and wage and hour violations. He also litigated one of our state’s most complex and significant trade secrets cases where an alleged theft of trade secrets by an employee allegedly affected competitors in a multi-billion dollar industry. Greg is the former Chair of the Labor and Employment Law section of the South Carolina Bar.

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Sara Tucker Complex Products Liability Litigation Attorney Womble Bond Dickinson Atlanta, GA
Partner

Sara Tucker concentrates her practice on complex products liability litigation with a focus on pharmaceutical and medical device litigation.  A veteran trial lawyer, Sara has experience defending clients in high-stakes mass tort and multi-district cases in federal and state courts.  She also has experience in consolidated state court litigation, consumer class actions and medical malpractice.

The American Bar Association’s Young Lawyers Division selected Sara for its “On the Rise – Top 40 Young Lawyers” award in 2019, and Georgia Super Lawyers magazine has recognized Sara as a...

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