COVID-19 Quick Reference Guide

Last updated 05/01/20

We will continue to update these responses and resources as we learn more. Should you have any questions, please contact us and we’d be happy to help you navigate through these unpredictable and unprecedented times.

Please note that the resources we are providing in this and all subsequent posts are not legal advice. All links and information are subject to change from the date of publication.

For How Long are the Stay at Home Executive Orders in Place?

  • Oregon’s Stay Home, Save Lives Executive Order was entered into effect on March 23, 2020, and will remain in effect indefinitely until terminated by Governor Kate Brown. To read the full Executive Order, please click here. However, there are different timelines based on the applicable executive order. For example, Governor Kate Brown’s School Closure Executive Order will remain in effect until June 30, 2020, unless that period is extended or terminated by the Governor. To view all Executive Orders, please click here.
  • Washington’s Stay Home, Stay Healthy Proclamation was entered on March 23, 2020, and will remain in effect until May 4, 2020, unless amended or extended otherwise.

What is an Essential Business?

  • Washington State’s Essential Business list can be found here.
  • Oregon State’s Non-Essential list of businesses and activities can be found here.

What Safety Standards are Recommended or Advised?

The Occupational Safety and Health Administration (OSHA) has developed guidelines and suggested safety standards which can be viewed here. Although there are no specific OSHA standards covering COVID-19, some OSHA requirements may apply to preventing occupational exposure to COVID-19. Among the most relevant are: OSHA’s Personal Protective Equipment (PPE) standards (in general industry,29 CFR 1910 Subpart I), which require using gloves, eye and face protection, and respiratory protection. When respirators are necessary to protect workers, employers must implement a comprehensive respiratory protection program in accordance with the Respiratory Protection standard (29 CFR 1910.134). OSHA has issued temporary guidance related to enforcement of respirator annual fit-testing requirements for healthcare.

Workers Rights and Employer’s Responsibilities under OSHA
Section 11(c)of the Occupational Safety and Health Act of 1970, 29 USC 660(c), prohibits employers from retaliating against workers for raising concerns about safety and health conditions. Additionally, OSHA’s Whistleblower Protection Program enforces the provisions of more than 20 industry specific federal laws protecting employees from retaliation for raising or reporting concerns about hazards or violations of various airline, commercial motor carrier, consumer product, environmental, financial reform, food safety, health insurance reform, motor vehicle safety, nuclear, pipeline, public transportation agency, railroad, maritime, securities, and tax laws. OSHA encourages workers who suffer such retaliation to submit a complaint to OSHA as soon as possible in order to file their complaint within the legal time limits, some of which may be as short as 30 days from the date they learned of or experienced retaliation. An employee can file a complaint with OSHA by visiting or calling his or her local OSHA office; sending a written complaint via fax, mail, or email to the closest OSHA office; or filing a complaint online. No particular form is required and complaints may be submitted in any language.

I’m an Affected Business?

Does COVID-19 qualify as a business interruption under my insurance?
Business interruption insurance is a type of insurance policy that insures against losses of income and certain extra expenses that are a result of an interruption of business due to a covered disaster. Many insurance companies are denying business interruption and similar coverage due to COVID-19 related events, as pandemics are not clearly covered by the “disaster” or similar definition in some policies (and sometimes pandemic coverage may be specifically disclaimed). Your business interruption policy is generally the best resource to understand your rights. You should consult your insurance policy and applicable endorsements and discuss with your advisors the extent of your coverage.

Do I have to pay rent? Do my tenants have to pay rent?
Commercial Rent: For some businesses, rent is a significant expense that may be hard to continue to pay, in light of COVID-19 related economic disruption. And for other businesses, receiving rent and lease payments are crucial to staying afloat. Because of these hardships, states have taken action accordingly. March 22, 2020, Oregon’s Governor passed a Temporary Moratorium on Residential Evictions for non-payment in response to the COVID-19 outbreak. On March 18, 2020, Governor Inslee issued Proclamation 20-19 imposing a 60-day statewide eviction moratorium prohibiting residential landlords from issuing any eviction notice based upon non-payment of rent or termination of a tenancy unless the landlord attaches an affidavit attesting that the action is necessary to ensure the health and safety of the tenant or other individuals.

On April 16, 2020, Governor Inslee expanded the pre-existing eviction moratorium through June 4th and created additional protections for residential and some commercial tenants. Read the moratorium here.

We will be posting a separate blog post to dive deeper into lease considerations in light of the COVID-19 pandemic.

Can I get COVID-19 grants or loans?
Many businesses will face substantial financial uncertainty in weathering the COVID-19 pandemic. In response, state and federal government agencies and private institutions are making available emergency loans, grants, and other financial assistance to help businesses impacted by

Are There Loan Payment Deferral Options?
The Small Business Association has granted automatic deferral for all loan payments due in 2020 that are payments due on existing disaster relief loans (from previous disasters). The SBA has also notified SBA business lenders to remind those lenders of each lender’s unilateral authority to defer payments due on “traditional” SBA loans. How long the lender is allowed to defer the loan depends on the type of loan, but SBA lenders are entitled to defer payments for 90 days and may be entitled to defer payments for up to six months.

How Does E-FMLA Affect FMLA, and Who is Eligible?
The FFCRA provides for an extension to the current FMLA to grant emergency FMLA (E-FMLA) leave for individuals to care for a minor child when the need is related to a public health emergency (PHE). In order to qualify for E-FMLA, the individual’s need to care for the minor child must be because of a declared PHE related to COVID-19 that has caused the child’s school, place of care, or normal childcare provider is closed or unavailable. The initial 10 days of leave are unpaid. After the initial 10 days, E-FMLA becomes paid up to 12 weeks with a maximum of $12,000 or $200/day. E-FMLA is limited to 12 weeks. The FFCRA is currently set to expire on December 31, 2020. Keep in mind that the normal FMLA requirements and guidelines are still in place for other scenarios and individuals.

An employee who has been employed for at least 30 calendar days is eligible for E-FMLA. However, workers who are furloughed or laid off prior to April 1st, or where such furlough or layoff occurs on or after April 1st but unrelated to any symptoms or conditions of that individual, would not be eligible to E-FMLA protection. If an eligible employee is on leave during an adverse employment action, the employer would need to follow an ordinary analysis of whether they can restore the employee to a comparable position.

Under E-FMLA, like FMLA, an employee taking qualifying leave is eligible to be restored to their position (or a comparable position) upon their return from leave. For employers with fewer than 25 employees, elimination of a position due to the present COVID-19 related conditions, including economic conditions, would excuse the employer from placing the employee in a comparable position if none exists upon return from leave. You can read more about the specific provisions here.

Do Small Businesses Have to Comply with E-FMLA?
The Department of Labor (DOL) may exempt small businesses with fewer than 50 employees from the E-FMLA requirements when the imposition of such requirements would jeopardize the viability of the business. You can read more about the specific provisions here.

What About Emergency Sick Leave?
An employer with 500 or more employees may offer emergency sick leave. However, employers may be obligated to do so based on their state and local regulations. Employers should post a notice of eligibility in the workplace.

Paid sick leave eligibility begins April 1, 2020, and is not retroactive.

An employee who has a qualifying leave shall be paid sick leave for up to 10 days (80 hours) leave. Part time employees will be entitled to leave that is equivalent to their average 2-week work schedule. This paid sick leave is in addition to existing leave that an employee is entitled to (whether PTO, vacation, or paid sick leave).

There are maximums amounts that an employer is obligated to pay during an emergency sick leave ranging from $200/day to $510/day, depending on the reason for leave.

  • Leave for the following reasons will be the greater of either the States’ minimum wage or the employee’s ordinary wage, but no more than $510/day ($5,100 total)
    • The employee is unable to work due to Federal, state or local quarantine or isolation order;
    • The employee has been advised by a health care provider to self-quarantine; or
    • The employee is experiencing symptoms and seeking a diagnosis.
  • Leave for the following reasons will be the greater of 2/3rd of the State’s minimum wage or 2/3rd of the employee’s ordinary wage, but no more than $200/day ($2,000 total)
    • The employee is caring for a person ordered to quarantine, or self-quarantining, as described above;
    • The employee is experiencing any condition other than the symptoms described above which the Deptartment of Health and Human Services specifies for leave.
  • An employer is eligible to take a tax credit on their 2020 taxes for the amounts paid in sick leave under these provisions and after the Act was enacted.

What Qualifies for Emergency Leave?
Leave for both sick leave and E-FMLA includes the following categories:

  • The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19.
  • The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
  • The employee is experiencing symptoms of COVID-19 and is seeking a medical diagnosis.
  • The employee is caring for an individual who is subject to an order as described in subparagraph (1) or has been advised as described in paragraph (2).
  • The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the childcare provider of such son or daughter is unavailable, due to COVID-19 precautions.
  • The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.

The Department of Labor appears to be taking the position that a business or location which is shut due to governor’s order would not qualify under the above (is not a Federal, State or local quarantine or isolation order).

Are My Contracts Still Valid and Enforceable?
Each contract is unique, so the contract itself will need to be fully considered. But the following are general legal concepts that may apply to your contract and may give you some guidance on how to deal with your contracts given the disruptions caused by COVID-19.

Force Majeure Clause: A force majeure clause is a typical clause found in many contracts; the clause provides an available defense where a party’s performance becomes impossible due to unforeseeable events outside of their control, such as “acts of God,” wars, riots, fire, or other “superior force.” The COVID-19 pandemic is a force that is certainly beyond any party’s control and has already prevented many parties from being able to perform their obligations under a contracted agreement. As such, your force majeure clause may provide some relief for contract obligations you are unable to perform as a result of the pandemic. But note that some force majeure clauses may be narrowly drafted and so not include a pandemic like COVID-19. Perhaps more importantly, many force majeure clauses specifically exclude the payment of a monetary obligation as an obligation relieved by the force majeure clause. That is, a force majeure clause may provide a defense for your inability to complete a service that you are unable to complete due to, for instance, a shelter in place order. But that same force majeure clause may not, and often will not, excuse your obligation to make a payment that is due under the contract. Consider your contracts’ force majeure clauses specifically to understand your available rights and responsibilities in light of the COVID-19 pandemic.

Performance Impossibility: General contract law in most instances provides that a contract that has become impossible to perform will not be enforced. However, the standard for an “impossible” to perform contract is high: you or the other party must literally be unable to perform your obligations as a result of an unforeseen event. So if it is very hard to perform, or if it is not what you thought it would be to perform (but you are still able to perform), you will not likely have an impossibility defense to your contract obligations.In those instances where the contract is not literally impossible to perform but where the circumstances have drastically changed due to unforeseen events, such as COVID-19, you may also have a defense to your obligations based on the contract law doctrine of “frustration of purpose.” Frustration of purpose allows a party to avoid an obligation to perform if circumstances arose that were not contemplated at the time of contracting, and those circumstances have caused the purpose of the contract to be rendered moot. While frustration of purpose may be a defense, it is unlikely to apply in most COVID-19 related circumstances, as it is only available if the goal of the contract is frustrated, as opposed to an underlying obligation related to the goal.

Frustration of the Contract’s Purpose: In those instances where the contract is not literally impossible to perform but where the circumstances have drastically changed due to unforeseen events, such as COVID-19, you may also have a defense to your obligations based on the contract law doctrine of “frustration of purpose.” Frustration of purpose allows a party to avoid an obligation to perform if circumstances arose that were not contemplated at the time of contracting, and those circumstances have caused the purpose of the contract to be rendered moot. While frustration of purpose may be a defense, it is unlikely to apply in most COVID-19 related circumstances, as it is only available if the goal of the contract is frustrated, as opposed to an underlying obligation related to the goal.

What About Unemployment Insurance and Layoffs?
You may be eligible to receive funding and offset unemployment insurance and other related liabilities, and you may have additional options with respect to letting go of any employees during the COVID-19 pandemic, including “standby” status and resources at the state and federal level designed to incentivize businesses to keep employees employed. See below for a list of WA and OR resources that may be of help[1]

Resources

Author: Somya Kaushik
Email: somya.kaushik@immixlaw.com| Direct: (503) 802-5351

As a former litigator who represented clients in both large and small commercial trials and settlements, Somya now uses those experiences to help shape her guidance on business transactions and intellectual property for businesses.

By |2020-05-01T23:55:34+00:00March 31st, 2020|Business, COVID19|Comments Off on COVID-19 Quick Reference Guide
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