States Move to Pass Liability Protection Laws Critical to Recovery

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Posted by Josie Kavanagh on Tuesday, June 30th, 2020, 10:35 AM PERMALINK

In the past few weeks, a rising number of state legislatures have been passing or seeking to pass bills to provide legal liability protection for businesses for lawsuits related to the spread of Covid-19. Such liability protection is needed to shield already struggling businesses, including healthcare facilities, from frivolous lawsuits as they seek to safely open back up.

Many believe it will be impossible to achieve the “V-shaped recovery” so many are hoping for if businesses have Covid-19 lawsuits on their hands from those who contracted it, or those who will try to claim safety guidelines were not being followed in a time when the CDC rules seem to change every week. State lawmakers are taking actions into their own hands and not waiting on the federal government to provide Covid-19 legal liability protection.

These liability protection laws will be crucial for local and state economies to truly get back on their feet. Recognizing such liability protection will encourage businesses to reopen and bring people back to work without the fear of getting sued, Covid-19 legal liability protection legislation has been enacted recently in Utah, Oklahoma, North Carolina, Georgia, and Wyoming. Other states, such as Mississippi, South Carolina, Connecticut, and Montana, are still debating the topic or currently working on getting such legislation passed.

Back in May, Utah Governor Gary Herbert signed SB 3007 into law, a reform that protects businesses from being sued by those who contracted coronavirus on their property. Businesses are immune from civil liability unless they display intentional infliction of harm. North Carolina lawmakers passed similar legislation, though only applying the protections to essential businesses that needed to stay open. As for Oklahoma, Governor Stitt signed into law the COVID-19 Product Protection Act on May 21st. This establishes liability relief for companies and individuals who manufacture, distribute or donate materials needed to fight the coronavirus pandemic.

Just last week, the Mississippi Senate Judiciary Committee passed the Back to Business Liability Assurance Act (SB 3049), which will provide protections to essential businesses that had to stay open even when they weren't sure of what guidelines to follow. This bill prohibits COVID-19 lawsuits unless malicious intent or willful misconduct can be proved and increases the burden of proof in those lawsuits to need “clear and convincing evidence”. If this bill is signed into law, it would also cap non-economic damages in the lawsuits to $250,000.

A group of seven states (Arizona, Connecticut, Illinois, Massachusetts, Michigan, New Jersey, New York) have passed legislation and/or executive orders specifically aimed to protect healthcare facilities and hospitals from coronavirus-related lawsuits. These states have given their healthcare facilities (nursing homes, assisted living residences, etc.) immunity from civil liability as long as they acted in good faith and without malice or gross negligence. Massachusetts in particular also extended protections to healthcare providers and personnel in its legislation.

Employers and businesses owners around the country are calling on legislators and Governors to follow suit and pass legal liability protection laws. Tennessee lawmakers may return for a special legislative session just to tend to this matter.

“The pandemic is negatively impacting our local and state governments, which certainly will experience declines in revenue, affecting many Tennesseans for the foreseeable future,” Bradley Jackson, president and CEO of Tennessee Chamber of Commerce & Industry & Jim Brown, Tennessee director of National Federation of Independent Business, wrote in a May 27 op-ed. “A relatively quick and safe economic recovery will provide jobs and revenue for the state to continue providing core services; however, a rise in frivolous lawsuits will jeopardize our recovery from these devastating events.”

Hopefully lawmakers in Tennessee and other states can reach an agreement to provide pandemic liability protection for employers. It is now more important than ever for businesses to be reassured enough to open back up and continue to employ their workers. Liability protection for businesses in every state will give the workforce the confidence it needs, which benefits us all.

Photo Credit: dmbosstone

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