COVID-19 Shelter in Place Order: What Does it Mean for Business?

A Shelter in Place order is being seriously considered by multiple states in the Midwest in response to the spread of COVID-19. A growing number of states have already enacted this order, and the list is expected to spike significantly this week.

Our partners at Synergy Human Resources have been conferring with a major Los Angeles law firm who has been advising business clients in California who are impacted by the order issued there. The order issued there is fairly comprehensive as well as restrictive. The following is a summary of the California order that is in effect. Here’s a link to the text of the California order >

What does this potentially mean for businesses in the Midwest? In short, many of your employees will have to remain at home. The gathering of residents outside their homes would be limited with these exceptions:

• Essential activities
• Essential travel
• To perform work for essential businesses
• To perform work for governmental activities
• To perform work for essential infrastructure work

Any permitted activities where people may interact would require the necessity to observe all Centers for Disease Control and Prevention (CDC) COVID-19 protocols, including social distancing, not going to work if you are ill, and the washing of hands.

What are Essential Businesses?

• Healthcare operations, including home health workers
• Essential infrastructure, including construction of housing and operation of public transportation and utilities
• Grocery stores, farmers’ markets, food banks, convenience stores
• Businesses that provide necessities of life for economically disadvantaged individuals and shelter facilities
• Pharmacies, health care supply stores, and health care facilities
• Gas stations and auto repair facilities
• Banks
• Garbage collection
• Hardware stores, plumbers, electricians, and other service providers necessary to maintain the safety, sanitation, and essential operation of residences and other essential businesses
• Educational institutions for the purposes of facilitating distance learning
• Laundromats, dry cleaners, and laundry service providers
• Businesses that ship or deliver groceries, food, and goods directly to residences
• Childcare facilities providing services that enable essential employees to go to work
• Roles required for any "essential business" to “maintain basic operations,” which include security, payroll, and similar activities

In addition, the order considers certain professional services to be “essential businesses.” These include legal and accounting services where they are necessary to effect compliance with legally mandated essential services. Also, it is critically important to understand that all businesses may continue “minimum basic operations.” What does this mean?

• To maintain the value of the business's inventory
• Ensure security
• Process payroll and employee benefits
• Related functions

What are Essential Services?

• Essential travel (e.g., travel relating to “essential activities,” “essential businesses,” or “minimum basic operations”)
• Activities that support “essential businesses” (e.g., healthcare operations, first responders, grocery stores, convenience stores, media services, gas stations/auto-repair facilities, banks and related financial institutions, shipping services)
• Activities that support government agencies, restaurants providing delivery or carry-out services, and certain professional services, such as legal or accounting services, when necessary to assist in complying with legally mandated activities
• Activities that support essential infrastructure work, including public works construction, housing construction, airport operations, water, sewer, gas, electrical, oil refining, roads and highways, public transportation, solid waste collection and removal, internet, and telecommunications systems

Please be aware that non-essential businesses are not required to end all of their activities and go out of business. They may continue “minimum basic operations.” Non-essential businesses are also permitted to conduct the activities necessary to help employees to be able to work remotely from home. Law enforcement is charged with the responsibility to ensure compliance.

In order to mitigate your risk, you should determine whether you are an essential business. You should also determine what your “minimum basic operations” are if you are not an essential business. Staff utilization planning is critical.

If you have questions related to this update, please contact your North Risk Partners advisor. Don’t have an advisor? No problem. We’ll help you find one.

This regulatory update was created in partnership with our value-added HR and legal service partners at Synergy Human Resources. This update is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice.