What Do State and Local Stay-At-Home/Shelter-In-Place Orders Mean For Employers?

By Conn Maciel Carey’s COVID-19 Task Force

COVIDGovernors across the nation have signed various “stay-at-home” or “shelter-in-place” orders in an increased effort to slow the spread of COVID-19.  Many cities and counties have also signed such orders as well, including in states with no statewide order in place.  These orders vary in their scope in the restricted activities and affected industries but they typically address: (1) the continued operations of critical businesses; (2) restrictions on non-essential businesses; (3) the activities individuals may continue to perform; and (4) other limitations on gatherings.

Spotlight: California

On March 19, 2020, California Governor Gavin Newsom signed an emergency order requiring all individuals living in California “stay home or at their places of residence except as needed to maintain continuity of operations of the federal critical infrastructure sectors.”  Californians may continue working for such critical infrastructure sectors and any other industries the governor designates as critical.  The emergency order cites to federal guidance on the federal critical infrastructure sectors, which identifies the 16 critical infrastructure sectors including critical manufacturing, food and agriculture, transportation, energy, healthcare and emergency services.

The emergency order references a March 19, 2020 Memorandum on Identification of Essential Critical Infrastructure Workers During COVID-19 Response issued by the U.S. Department of Homeland Security, which includes more detailed descriptions of categories of workers falling under each of the identified critical infrastructure sectors.  Some of the other state orders also rely on this federal guidance on “essential critical infrastructure workers” in defining the critical business that may continue to operate under the orders.

Californians may leave their homes to perform critical jobs and perform authorized necessary activities, but must still practice social distancing at all times.  Essential services will remain open such as gas stations, pharmacies, grocery stores, convenience stores, take-out and delivery restaurants, banks, and laundromats/laundry services.  See here for more information.

Spotlight: Maryland, Virginia, and Washington D.C.

On Monday, March 23, 2020, Maryland Governor Larry Hogan issued an Order for nonessential business to close on Monday evening at 5:00 p.m. in a more aggressive attempt to quash the coronavirus pandemic. The new executive order closes all those businesses that are not covered by the federal guidelines defining “critical infrastructure sectors,” which include, health care, food and agriculture, energy, public works, community-based government operations, chemical, hazardous materials, and defense industrial base sectors, law enforcement and public safety, transportation, critical manufacturing, financial services, and water and wastewater, among others.

On Monday, March 23, 2020, Virginia Governor Ralph Northam also issued a statewide order closing certain non-essential businesses, banning all gatherings of more than 10 people, and closing all K-12 schools for the remainder of the academic year.  The Order goes into effect at 11:59pm on Tuesday, March 24, 2020 and will remain in place until Thursday, April 23, 2020.

Today, Washington D.C. Mayor Muriel Bowser announced she will be closing all non-essential businesses in the District.  Some of the non-essential businesses will include salons, barbershops, tattoo parlors, and tanning salons.  More details are expected to be released later today.

Spotlight: New York

On Friday, March 20, 2020, New York Governor Andrew M. Cuomo signed the “New York State on PAUSE” Executive Order, which includes a new directive that all non-essential businesses statewide close in-office personnel functions effective at 8:00 p.m., Sunday, March 22.  Guidance on essential businesses under the Executive Order can be found here.

What Can Businesses Do?

For employers, these stay-at-home/shelter-in-place orders raise many questions, including how the orders apply to their operations and what steps might be taken to offer some relief to the businesses and workers impacted by the restrictive orders.  Businesses should review the orders that apply to them, as well as any guidance explaining the orders.  Some states encourage businesses to contact them with their questions and in some states businesses can apply for a waiver from the order.  For example, in New York businesses can request a designation as an essential business by submitting a request online.

At the federal level, Present Trump signed into law the Families First Coronavirus Response Act to provide some relief, including expanded Family and Medical Leave Act benefits, paid sick leave and a tax credit for employers.  See our blog article discussing the new law here.

We also expect to see action taken at the state and local level to support businesses and workers.

For example, Maryland Governor Hogan announced more than $175 million in grants and loans available to small businesses and Maryland workers.  The funds will be used to pay employees, rent, and critical operating costs, with the primary goal of keeping as many businesses afloat as possible and avoid layoffs. Grants will be for up to $10,000.   Low-interest loans — at 0 percent for the first 12 months — will be available for up to $50,000.  Employers can apply for such loans here.

In California even before signing the shelter-in-place order, Governor Newsom signed Executive Order N-31-20 providing some relief from the 60-day notice requirement under California’s Worker Adjustment and Retraining Notification (WARN) Act for mass layoffs, relocations, or terminations.  Specifically, for the period that began March 4, 2020 through the end of the emergency, the requirements of California Labor Code sections 1401(a). 1402, and 1403 are suspended for an employer that orders a mass layoff, relocation, or termination at a covered establishment, provided the employer does the following:

  1. Provides the mandated notice to affected employees and local agencies;
  2. Gives as much notice “as is practicable” providing a brief statement of the basis for reducing the notification period;
  3. Orders such a mass layoff, relocation or termination that is caused by COVID-19-related business circumstances that were not reasonably foreseeable as of the time that notice would have been required; and
  4. The notice must contain the following statement: “If you have lost your job or been laid off temporarily, you may be eligible for Unemployment Insurance (UI).  More information on UI and other resources available for workers is available at labor.ca/gov/coronavirus2019.”

The California Employment Development Department is also updating its coronavirus webpage with various benefits available to employers, including its Work Share Program, the ability to request up to a 60-day extension of time from the EDD to file their state payroll reports and/or deposit state payroll taxes without penalty or interest, and other available resources.  For more details, see here.  Many other states have similar resources.

As this situation continues to evolve, our firm’s task force of labor, employment and OSHA attorneys can advise how your business may be affected by these “stay-at-home” or “shelter-in-place” orders, steps businesses may be able to take in response, and additional resources that may be available during this difficult time.

Conn Maciel Carey LLP
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