The Emergent Threat
Researchers and other whistle-blowers first identified the public spread of the coronavirus (COVID-19) in China in December 2019. It has since spread worldwide, including cases in Washington, D.C. and Northern Virginia. While similarities persist between the coronavirus and prior serious outbreaks (such as Severe Acute Respiratory Syndrome and Middle East Respiratory Syndrome), it appears more contagious and more deadly.
While the threat of the coronavirus continues to develop across Virginia and Washington, D.C., business operations are implicating to various degrees. Safety for employees and customers is a priority; but prudent management requires thinking about long-term implications. To help you through these tumultuous decisions, here are a few considerations to keep in mind.
The Occupational Safety and Health Administration (OSHA) regulates health and safety in the workplace pursuant to the Occupational Safety and Health Act. The Agency and the Act impose legal obligations that require all employers to maintain a workplace free of any recognized hazards that may cause death or serious injury to their employees.
OSHA has published this guidance on preparing workplaces for COVID-19.
- The federal district court for the Eastern District of Virginia has ordered that “all civil and criminal (grand and petit) jury empanelments, jury trials, and grand jury proceedings before any district or magistrate judge in any courthouse in the Eastern District of Virginia are continued until further Order of the Court.” The Court recently issued General Order 2020-11, which authorizes some hearings via remote means.
- For cases in the Commonwealth of Virginia courthouses, the Virginia Supreme Court declared a judicial emergency for all Virginia courts. This effectively delays all on-going cases “with the exception of emergency matters, including but not limited to, quarantine or isolation matters, arraignments, bail reviews, protective order cases, emergency child custody or protection cases, and civil commitment hearings.”
- District of Columbia Superior Court scheduling updates can be found here.
- In every jurisdiction, courts are liberally granting continuances as needed.
- The Paycheck Protection Program and Economic Injury Disaster Loan Emergency Advance as two on-going and much-publicized programs. While your bank can help you through this process, be aware of some of the ownership restrictions and limitations on use of the funds.
- The U.S. Small Business Administration has a comprehensive guide to funding options.
- Ensure that your telework policies, business continuity plans, and other data privacy mandates are up-to-date and enforced. Though the emergent threat of the virus is creating a need for quick decisions, privacy and data protection laws still apply to your Virginia business.
- Check out this informative article from the IT professionals at Envescent, LLC regarding best practices for remote work.
- Keep in mind that applicable anti-discrimination proscriptions remain in place. Ensure that your company’s decisions are applied uniformly and in-line with updated federal, state, and local guidelines.
- Although there is pressure to provide updated and real-time information to employees, vendors, and local-government authorities, HIPPA and applicable federal and state regulations related to private health information and other privacy information still applies. Do not run afoul of these stringent rules in the rush of the moment.
- Nonetheless, the government has issued guidance concerning an employer’s ability to ask employees about their health and wellness related to this pandemic. Here is the U.S. Equal Employment Opportunity Commission’s guidance related to application of the Americans with Disabilities Act (ADA) and the Rehabilitation Act.
Current and Future Contracts
- Consumers and vendors (even the Government) are unilaterally cancelling and altering legally binding contracts without regard for the legal implications. Although that may be prudent in light of the risks, there will be legal battles over the financial damages after this threat passes.
- Government contracts are likely to be impacted more than most in the immediate future, since the Government must mobilize the resources to contain and counter this threat. This will create strain and opportunity for government contractors. A close review of the FAR and applicable contract language is appropriate, as many seldom relied-on provisions will come into play.
- Many commercial contracts contain a force majeure, material adverse effect, or other “act of god” clause that may provide for termination of a contractual obligation. But many do not. And a larger pandemic threat may or may not justify the force majeure clause’s application depending on the obligation.
- These issues will not get worked out until after the crisis passes, but it is worth considering how to enforce or break your business’s contractual obligation and the risks that your business may incur.
- While drafting new contracts, it is worth considering whether to draft specific “public health emergency” or quarantine provisions relative to the force majeure or material adverse effect clause.
- While there are legal implications to your Virginia business’s decision, you may decide that the societal and public policy considerations outweigh your legal obligations. Meaning, you may decide to make decisions that are legally risky, but that seem otherwise preferable. This is the very nature of business decisions
- Just make sure that you understand the implications before proceeding.
Like every business decision, consult with experienced professionals who can advise you regarding the legal implications so that you can make a knowledgeable decision. Our office will remain available for Virginia business consultation or representation as needed.