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Behind the Shield: Some States Enact COVID-19 Liability Immunity Laws to Protect Re-Opening Businesses

May 19, 2021

Laura L. Rubenstein

A business may provide Personal Protective Equipment (PPE), limit the number of workers in the office, implement more cleanings, mandate masks and social distancing and be thorough in enacting all CDC recommended guidelines. But, if an employee or customer still contracts COVID-19, is the business liable? Cue liability shield laws. Many states are considering enacting this form of legislation that provides varying degrees of employer immunity from lawsuits involving COVID-19 claims. Some suggest it has become a matter worth addressing in steps towards economic recovery.

The discussion of business immunity began in May 2020, when the U.S. Chamber of Commerce issued a letter urging Congress to “protect businesses against the acute economic threat of lawsuits” through liability relief legislation. As businesses re-opened and more workers and customers were returning, lawmakers and stakeholders worried of the potential influx of lawsuits relating to contracting COVID-19 in the workplace. These kinds of claims could threaten the sustainability of businesses, by consuming resources of time and money. A fear of this could keep small businesses from reopening their doors altogether or welcoming back employees.

Though federal legislation was ultimately not passed, state shield laws designed to protect businesses from COVID-related matters began to appear on states’ legislative agendas during the summer of 2020, with an increase in popularity since the start of 2021. Over 20 states have instituted some form of employer protection. Here’s what you need to know.

1. The shield laws are state dependent. Maryland’s efforts to enact COVID-19 liability protection have fallen off the priority list, as the state has not seen evidence of a spike in lawsuits, nor is there an anticipated spike to come. Some states, like Alabama, have laws that cover all employers, while other states, like Indiana, have applied shield laws only to specified businesses or industries, such as those considered essential or healthcare workers. It’s best to do the research to see what’s available in your state.

2. Liability protection does not mean lawsuits will be non-existent. The employer relief provided by these liability shields extends only to claims involving the transmission of COVID-19. Claims involving matters regarding other COVID-associated topics, such accommodations under the Americans with Disabilities Act, wrongful termination, FFCRA non-compliance, and others do not release the employer of liability. Some states have taken steps to deter unnecessary claims, such as limiting a plaintiff’s maximum recovery amount or requiring certain means of proof. Though this may lessen the number of lawsuits brought forward, it does not stop them altogether.

3. Protection does not apply to businesses that disregard their proper health and safety protocol. Any employer or business that shows intentional or willful misconduct leading to gross negligence is excluded from the liability safeguard.

As workers and customers begin to frequent brick-and-mortar establishments again with comfort provided by vaccinations and warmer weather, employers should be attentive to their COVID policies and safety guidelines. These liability immunity laws do not provide an excuse for relaxed enforcement, but rather provide a measure of comfort in businesses reopening without fear of mounting litigation costs.

If you need assistance in drafting your COVID-19 safety procedures, strategizing about a re-opening plan, or an updated COVID-19 communication plan, contact Laura Rubenstein at lrubenstein@wcslaw.com.

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