Developing a cogent response to the coronavirus outbreak (“COVID-19”) is extremely challenging, given the scale of the crisis and the rate at which it is evolving.  With all its unknowns, the virus is certain to test the resiliency and adaptability of businesses of every size and industry, and construction is no different.  The virus injects uncertainty and risk at every stage of production, across all supply chains and all inputs, most obviously labor.  Identifying and managing the risks that can be mitigated will be crucial to weathering the crisis.

We recently put together an outline of some of the things contractors can do to plan and respond to the virus, first and foremost among them, following the current guidelines promulgated by the CDC and OSHA to protect their workers and minimize spread on worksites.  For most people in the United States, the risk of infection with COVID-19 remains low, but as the outbreak expands, that risk will increase, especially as more instances of community spread are identified.  It is imperative that, in addition to following current CDC and OSHA guidelines, contractors play close attention to local news sources and comply with any guidance and directives issued by state, regional and local authorities, which are likely to better reflect the risks specific to their community.  The incidence of confirmed cases of the coronavirus can be monitored on the CDC website and on the John Hopkins University Center for Systems Science and Engineering webpage.

In addition to keeping the worksite safe, it is important for contractors to review their current contracts and insurance coverage to assess how the increased risks imposed by the coronavirus -such as the increased risk of performance delays, supply chain disruptions and third party liability – are allocated on each construction project, and to update their contracts and expand insurance coverage wherever practicable.

It is likewise important that contractors review and update their employment policies and practices to comply with any changes to federal and state labor laws.  On March 14, 2020, for example, the U.S. House of Representatives passed H.R. 6201: the Families First Coronavirus Response Act, which is expected to pass in the Senate with few revisions.  If enacted in its current form, among other things, the Act would require employers with less than 500 employees to give employees who are impacted by the virus two weeks of paid sick leave, although much of the costs of providing such leave would be defrayed by refundable tax credits.  The Act also significantly expands – on a temporary basis – the number of employers subject to the Family Medical Leave Act (“FMLA”).

We will be monitoring these developments closely and will try to post updates as new developments emerge.

Please feel free to discuss any aspects of this action plan with any of the attorneys at Couch White. This action plan is a source of general information for clients and friends of Couch White, LLP. Its content should not be construed as legal advice, and readers should not act upon the information in this action plan without consulting counsel.