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What Is COVID-19 Liability Protection (and How Can You Protect Your Business)?

By Monique Danao Reviewed By Mike Lucas
By Monique Danao
By Monique Danao Reviewed By Mike Lucas

I Since the initial phase of the COVID-19 pandemic has passed, businesses have contemplated how to safely reopen. 

How do you keep yourself, your employees, and your customers safe from the virus? 

Centers for Disease Control and Prevention (CDC) has implemented guidelines for workplaces and businesses. However, the possibility of pandemic-related litigation has prevented many from restarting operations. 

Will business owners be legally accountable when customers contract COVID-19 within their establishment? Can businesses avoid COVID-19-related lawsuits by following CDC guidelines?

Several states have enacted protection laws and liability shields to protect local businesses at the federal level. While it won’t completely deter COVID-19 litigation, it could defend businesses from the blow of expensive legal fees in the upcoming months or years. 

Let’s take a look at how businesses can protect themselves during these challenging times. 

Why Is Liability Protection Important?

Vaccine rollouts have begun but the pandemic is far from over. 

Businesses are still suffering from the ongoing recession as well as heightened infections in their communities. Some are wary of getting sued by customers or employees who claim to have contracted the virus within their premises. 

No one can completely detect or eradicate COVID-19 within their establishment. However, businesses can follow safe distancing measures to prevent the ongoing risk to staff and consumers. 

As a result, COVID-19 liability protection seeks to protect businesses, schools and establishments which have meticulously followed CDC guidelines. It also requires complainants to prove a business has ignored CDC and state guidelines before they are held liable. 

How to Protect Your Business From Covid-19 Litigation?

The importance of liability protection lies in that it can protect your business from liability protection because of potential COVID-19 infections in your business. 

Now, here are some tips to take advantage of legal liability protection. 

Get A Covid Liability Waiver 

Luke Ritchie, an attorney of Denver law firm Moye White, encouraged businesses to require customers to sign COVID liability waivers before entering their premises. This seems to be a result of the ever-changing COVID-19 safety measures across states and updates by the CDC. 

“It’s not easy for a business to make sure that they’re following best practices. And so a COVID-19 release or waiver is going to be an additional tool that will help protect you and it’ll help protect the company,” he told Marketplace.com

Laws differ across states so COVID liability waivers may not completely protect businesses from lawsuits — but it’s better to be safe than sorry. Check out this COVID liability waiver by Rocket Lawyer to help your business prevent forms of liability such as gross negligence. 

Implement CDC Guidelines

Follow CDC guidelines and safety measures to avoid pandemic-related litigation. This involves enforcing social distancing, having hand sanitizers in shops and requiring face masks. 

A business that can implement strict rules and guidelines will have higher chances of success when defending itself in court. After all, following safety guidelines will help you avoid being held responsible for the infections of others. 

A giant umbrella deflects the COVID-19 virus that rains down at an angle.

Reopen and Abide by State Guidelines 

Each state has a list of business types that can reopen based on their risk and usefulness. If your business isn’t on the list, flouting state rules could lead to a penalty or arrests from police. Businesses are advised to check local and state guidelines prior to reopening. 

What’s more, states can tighten or loosen restrictions due to the current rate of infections so be updated about the current restrictions in your location. 

Communicate With Employees and Customers 

Share efforts to minimize risk with employees and customers. 

Your COVID-19 safety protocols should be placed on your website, social media and in-store outlets. If you require people to wear a mask, then you can ban violators that enter without it. 

This won’t stop people from filing a lawsuit. Yet, citing your guidelines as the reason for denying entry could turn the odds in your favor in court. 

Likewise, employees also should follow COVID-19 regulations in their workplace — but you can’t make them sign a COVID-19 waiver. States and the Americans with Disabilities Act (ADA) have different provisions for workers’ compensation, which could vary based on the type of work. 

Those that can operate with a remote workforce are highly encouraged to do so. Until the pandemic ends, consider this working arrangement to avoid litigation. 

Understand Your Insurance Policy

Every insurance policy has distinct clauses and businesses may expect them to cover litigation costs. Unfortunately, insurance claims may not completely cover legal fees related to COVID-19. 

Discount clothing chain Century 21 filed for bankruptcy protection in 2020. As with many businesses, the pandemic is to blame, but they believe their insurance company should be held responsible. The business wasn’t able to get paid for its COVID-19 claim because its insurance policy didn’t cover a pandemic. 

“The insurance industry charges for a policy based on the risks,” said Loretta Worters, vice president of media relations at the Insurance Information Institute to Marketplace.org. “Now, because it’s a pandemic, it was never taken into the rates when an insurance company provided that kind of coverage. So if you’re not paying for that, imagine the amount of loss the insurance industry would pay.” 

Liability Protections Established Per State 

Several states have created their own COVID-related business liability because of the absence of a federal mandate. Liability protection varies per state, but they share the following qualities:

  • They aim to protect businesses and employees from COVID-19 litigation because of potential infections within their premises. 
  • They don’t cover businesses that did not abide by CDC guidelines and state protocols to prevent the spread of the coronavirus. 
  • They don’t cover compensation claims from workers because of workplace exposure to COVID-19 within their premises. 

Not surprisingly, liability shields and the types of protections they cover vary per state level. 

Here are some distinct liability protections established per state. 

  • Prohibit filing: States such as Tennessee have barred complainants from suing a business. An exception is when they can secure a statement from a physician that asserts that their injuries were caused by the business-defendant. 
  • Protections for health-care providers: Several states have implemented amendments that protect health-care workers from liability. 
  • Posting requirements: States such as North Carolina provide businesses with another layer of protection when they post their safety measures to combat COVID-19. 
  • Assumption of the risk: Businesses are encouraged to post a COVID-19 risk notice at tickets, entrances, or receipts in Georgia. By doing so, they are entitled to a “rebuttable presumption of assumption of the risk” against a complainant seeking a COVID-19 claim. 
  • No protection against willful negligence: As more states implement safety protocols to prevent infections, businesses that fail to comply won’t be covered by COVID-19 liability shield rules. In addition, if businesses fail to follow the guidelines implemented at a local, state or federal level, then they could be at risk of receiving a liability lawsuit or found guilty of gross negligence.
  • Limitation on damages: In cases wherein the shield’s civil immunity does not apply, a complainant can sue for damages for a limited amount. 
  • Heightened proof: Nevada requires an accuser to prove to a judge that the business-defendant did not follow health protocols to undergo a trial. 
  • Retroactive protections: COVID-19 was first detected in the US on Jan. 20, 2020. Because of a lack of testing, the virus could have spread earlier. Hence, states like Iowa have put in place a liability shield dating back from Jan. 1, while Alabama, Louisiana and Kansas have liability protection whose coverage begins from mid-March. 

Overall, COVID-19 liability protection could mean the following:

  1. Businesses can face lawsuits for potential or actual COVID-19 exposure.
  2. Businesses aren’t responsible for claims about ordinary negligence.
  3. A business can protect itself from liability by following health protocols and abiding by statutory posting laws. 

A shield bears an emblem of the COVID-19 virus crossed out.

Legal Liability Protection From the Federal Government 

GOP members have highlighted the importance of liability protection for health care providers, employers and school districts. 

“So before we start sending additional money down to states and localities, I want to make sure that we protect the people we’ve already sent assistance to, who are going to be set up for an avalanche of lawsuits if we don’t act,” said Sen. Mitch McConnell (R-Ky.) to The New York Times

In December, McConnell consistently emphasized the need for legal liability protection and liability relief for businesses. However, lawmakers will continue discussions during the next round of talks after Congress approves the $900 billion pandemic relief package. 

Florida House Speaker Rep. Chris Sprowls told News 4  Jax, “I think we all agree it’s a problem that we need to figure out the best way to solve. Making sure that people who were going about it kind of the right way — trying to do the right thing for their customers and employees — don’t get blindsided by a frivolous lawsuit while making sure that if somebody is doing the wrong thing, that they’re still held accountable.” 

The upcoming legal liability protection could be the standard enforced in future pandemics. Without it, businesses may suffer from lawsuits for gross negligence or shut down due to legal fees. 

How to Protect Your Business From Frivolous Lawsuits

For many business owners, reopening seems like a challenge because of the possibility of frivolous lawsuits. 

The good news is COVID-19 liability protection and following CDC guidelines could protect your business. Once you’ve assessed the rules and regulations in your area, simply follow them and you’ll be in good hands.

Monique Danao Monique Danao
Monique Danao is a contributing writer for Fast Capital 360. She writes about social media, content marketing, search engine optimization and ecommerce.
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