What You Need to Know About “Shelter in Place” Orders

More cities and states are issuing “shelter in place” orders (or at least recommendations) to combat the spread of COVID-19. Some states are banning gatherings of various sizes and limiting the number of people who can go to work. This article will address what businesses can do to comply with these orders and protect their workplace, and it will also provide resources relevant to affected jurisdictions.

To begin with, it is important to recognize that different state or local laws may apply depending on your location. If you operate in multiple states, then you need to ensure that your actions comply with all states. Also, state and local governments are still developing plans and issuing orders as the COVID-19 pandemic unfolds. To know whether your jurisdiction is subject to a “shelter in place” order, you can visit your state’s website for the secretary of state or emergency management agency. The table at the end of this Article contains the latest information on “shelter in place” orders of which we are currently aware.

What is a “Shelter in Place” order?

Most “shelter in place” orders mandate that citizens stay in their homes under quarantine unless they have an emergency or unavoidable need to leave their house (e.g., to get food). Most orders restrict or prohibit “non-essential” individuals from going to work. Other orders restrict the number of people that can gather together at any given time (except when working for an essential business).

A business being considered “non-essential” and ordered to close could have huge ramifications. But there may be ways that you can modify procedures to continue operations. Many employers have switched to “telework” or “telecommuting.” Some restaurants that have suspended their dine-in options are offering take-away, curbside, or delivery food services. But business may still have trouble making payroll and paying expenses. Keep in mind that there are various types of loans available during disasters that could help to keep your business afloat until the pandemic subsides.

What do I need to look for in my jurisdiction’s Shelter in Place order?

Every Shelter in Place order is different. It is crucial that you make yourself aware of the nuances to your jurisdictions’ orders and updates. Some things you will want to think about as it relates to orders that apply to you and your business:

• Is the order directed to businesses, individuals, or both? I.e., does it order businesses to close, employees to stay home, or both? Or does it just prohibit gatherings over a certain size, or mandate social distancing?
• Are certain businesses or individuals excluded? Do you or your business qualify as “essential”?
  • Your jurisdiction’s order may be vague, but check for guidance from the government, whether in the form of an infographic, FAQ, or direction to refer to DHS’s designation of “essential critical infrastructure workforce.”
  • To assist you in these determinations, we have provided a discussion below of what “essential” means, and we have included information in the chart below on where to find out how your jurisdiction defines “essential.”
• If you are exempt, or if you have categories of employees that are exempt from a shelter in place order, you may need to provide documentation to show law enforcement, landlords, etc. that you, your business, or your employees are essential.
• Does your jurisdiction provide a process for you to apply for a waiver or an exemption so that your business can continue operating even if it is not technically “essential”? What procedures are in place for obtaining a waiver or exemption?

Bottom line: You need to be aware of what your jurisdiction’s order says. Know what level of restrictions are in play and whether you and your business are subject those restrictions (including whether what you do is “essential”, and then find the best way to continue operations accordingly, or cease operations while complying with applicable laws, and in view of any new orders.

But what does “essential” even mean?

According to the Department of Homeland Security, the nation’s “essential-critical-infrastructure-workforce” includes the following industries: Health Care/Public Health; Law Enforcement, Public Safety, First Responders; Food and Agriculture; Energy; Water and Wastewater; Transportation and Logistics; Public Works; Communications and Information Technology; Other Community-Based Government Operations and Essential Functions; Critical Manufacturing; Hazardous Materials; Financial Services; Chemical; and Defense Industrial Base. For more information on these broad categories, go to: https://www.cisa.gov/publication/guidance-essential-critical-infrastructure-workforce.

Many states have adopted the Department of Homeland Security’s definition of essential, but many other states have not. You will have to check your specific jurisdiction’s accepted definition, which may be found on the table below.

So, what am I supposed to do?

Othering that scouring your applicable government websites for guidance, you may wish to consider consulting with legal counsel for help dealing with specific situations for each jurisdiction. There is no “one-size-fits-all” approach. While abiding by a shelter in place order, employers must comply with new federal legislation for paid Family and Medical Leave and paid sick leave, as well as with the federal OSHA standards for workplace safety related to COVID-19. Compliance with state and local laws may be more difficult to understand, but generally you will be required to abide by the strictest rules that apply in your jurisdiction.  So, for instance, if you are under both a state order and a local order, you must comply with the strictest aspects of both.  So, for instance, if the local order you are under is stricter than the state order you are under, you must apply with the stricter provisions of the local order.  However, if the state order is stricter, you must follow the state order.

Should we begin “telecommuting”?

Businesses that can operate remotely via telework setups should strongly consider doing so—especially if a shelter in place or similar order applies. Businesses that are able to continue normal (or mostly normal) operations without having employees leave their homes should do so, especially if a shelter in place order is looming on the horizon. In that case, businesses would likely benefit from having a transition time where employees move to working from home, but may still go into the office if needed to gather supplies or move equipment necessary for normal operations.

What happens if I refuse to comply?

Presumably, local law enforcement personnel will be tasked with enforcing state and local “shelter at home” orders, but enforcing such orders may prove impossible where “essential” businesses are allowed to stay open. Some authorities, like Los Angeles, have threatened to turn off utility services to business that refuse to comply. Others, like Birmingham, may issue fines for non-compliance. Be sure to know what enforcement procedures are in place for your jurisdiction.

Businesses should also be aware that violations of applicable orders could be grounds for OSHA violations, as if your jurisdiction has issued a shelter in place or a restriction on gatherings due to pandemic conditions, your workplace might be deemed inherently unsafe.  Therefore, businesses should continually assess whether their policies and procedures are in line with OSHA requirements during this tumultuous time.

Other issues to consider:

• Will you be able to provide goods and services to your clients?
• Will you be able to pay rent? What about vendor invoices?
• Will you need loans, including SBA Economic Injury loans? Does your jurisdiction’s government’s website have any resources for community-based loans?
• Will you be eligible for payroll tax credits under the Families First Coronavirus Response Act?
• For employers under collective bargaining agreements, are you likely to experience any NLRA implications?
• What are the other implications on your Commercial Transactions and Real Estate?
  • Butler Snow has some Practical Advice for handling these issues.
• Do you have insurance coverage for the above? Will you have any other insurance implications, including “Business Income”/”Civil Authority” Coverage? When do you need to give your insurer notice that you will be making a claim?
• You should consider how to Develop Policies and Procedures to Combat COVID-19.
• Your status and obligations as an employer and related workforce issues may include:
  • Appropriate monitoring of telework arrangements;
  • Obligations to provide mandatory paid leave under state laws and new FFCRA (as of April 1);
  • Ramifications of layoffs and furlough, including notice requirements to the impacted workforce; and
  • Funding health benefits and retirement plans.
• How does the CARES Act affect your business?
• For other issues you may have, please see Butler Snow’s FAQ for Employers.

Affected Jurisdictions:

As of March 31 at midnight, the following jurisdictions have instituted Shelter in Place or similar orders prohibiting non-essential activities and closing non-essential businesses:

*This list only includes orders as of midnight on March 31. Optional recommendations and requests are not included. This list is not exhaustive. There may be jurisdictions with applicable orders that are not listed.