Businesses Need a Safe Harbor From Covid-19 Lawsuits

(Bloomberg Opinion) -- A lot has changed over the last month. The country’s attention has turned to race relations and police brutality; unemployment has come down; more businesses are resuming normal operations; and polls have moved toward the Democrats. But on the key issue before policymakers in Washington — the next phase of coronavirus relief — nothing has changed.

In early May, Republicans declared that any new legislation would have to protect companies from lawsuits arising from their handling of the pandemic. Democrats said no way. Let's hope the Democrats have just been staking out a bargaining position.

While Congress was able in early June to enact changes to earlier relief bills, Americans are likely to need more congressional action to reduce the economic damage from the pandemic and the response to it. And that action ought to include some limits on liability. Thankfully, though, those limits don’t have to be an all-or-nothing issue.

What companies need is not immunity from all litigation related to Covid-19, but a safe harbor. They need to know, that is, what they have to do to avoid lawsuits. To see why a safe harbor is needed, consider the argument that it isn’t. John Culhane, a fellow at Delaware Law School, writes in Slate that “current liability law is not going to pose burdensome difficulties on businesses that take reasonable action to keep their customers safe.” Reassuring. But just a paragraph later, we learn that “the issue of what’s reasonable quickly gets sticky.”

Well, yes. That’s why companies would prefer to have some clarity on what they will be held responsible for. Would a reasonable company take customers’ temperature? Or what if a company reopens, but other companies don’t, and then cases of Covid-19 in the area surge? Would the speedier companies be deemed unreasonable after the fact?

Legislation could settle these questions, for example, by saying that a company will not be held liable if it follows the guidelines of the Centers for Disease Control. That way companies wouldn’t have to guess how a hypothetical jury would see things.

This kind of congressional guidance could also block lawsuits coming from the other direction: employees or customers who maintain that company safety policies such as temperature checks are too invasive. “A.C.L.U. Warns Against Fever-Screening Tools for Coronavirus,” the New York Times reported in May. No wonder, then, that a recent survey found 68% of small-business owners were concerned about legal liabilities related to Covid-19.

A legal safe harbor would not eliminate all legal uncertainty. Presumably it would leave businesses liable for intentional misconduct or gross negligence, as Senate majority leader Mitch McConnell promises, and what counts will be subjective. But well-crafted legislation could significantly reduce the uncertainty and thus facilitate commerce.

States can take some of the needed action on their own. But federal laws will intersect with the current needs of businesses in ways that nobody contemplated when they were written. Those against discrimination on the basis of age and disability may, for example, inhibit companies from taking precautions to avoid the spread of Covid-19 to vulnerable populations.

Federal action to protect businesses from state laws and state courts may also be warranted. The Constitution put Congress in charge of regulating commerce among the states in order to prevent them from limiting the development of national markets. Conservative lawyers Michael Carvin and Yaakov Roth have argued that federal limits on Covid-19 liability would be a legitimate exercise of this power — one that would satisfy even Clarence Thomas, the Supreme Court justice with the narrowest conception of it.

While Democratic leaders have not budged from their public opposition to liability limits, some of their followers are sounding open to the idea. Senator Chris Coons of Delaware has said companies should be free from lawsuits if they follow national safety standards. He wants the Occupational Safety and Health Administration to issue them.

Republicans and Democrats managed to work together quickly to pass large pieces of legislation responding to the coronavirus pandemic in the early stages of the crisis. We’re about to find out if this bipartisan moment has passed before the crisis that occasioned it has.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Ramesh Ponnuru is a Bloomberg Opinion columnist. He is a senior editor at National Review, visiting fellow at the American Enterprise Institute and contributor to CBS News.

©2020 Bloomberg L.P.

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