COVID-19 BUSINESS IMPACT UPDATES:
In these unparalleled times, the business environment is changing faster than ever before, leaving some business crippled or dead, and others wondering what the next steps are in order to survive and thrive in the months and years ahead.
At Ramos Law, we are dedicated to giving you the latest updates on issues involving the business community as it relates to COVID-19. Each day, our Employment Division researches the most recent developments in funding and funding sources, the latest acts and laws instituted by national, state and local governments, issues with business insurance, unemployment caused by COVID-19, and more. We’re a privately owned business, just like you. We are committed to finding ways to help you navigate these incredibly uncharted waters not only now, but all along the way.
NEW LEGAL DEVELOPMENTS
Business Interruption Insurance: Not Necessarily Available, But Should It Be?
The Coronavirus Pandemic (COVID-19) has affected all of us and is having a historically negative impact on businesses all over the world, including in the states we practice, namely Colorado and Arizona. Each business needs to read and get a solid understanding of the specific language written as to the coverage allowed under the Business Interruption Insurance policy. That said, understanding much of the policy language regarding Business Interruption as it relates to the closing or reduction of business due to COVID-19 is difficult.
There are currently governmental debates raging in various states where legislators are proposing laws that would require insurance companies to provide at least some coverage for losses incurred by small businesses due to COVID-19. As one might expect, the insurance companies are raising serious challenges to these potential changes in legislation, arguing that if they had to cover these claims, it could “lead them to insolvency”. Because this is a debate that could go on for the foreseeable future, it’s critical that businesses don’t wait for things to be decided in the legislature, but instead get out their policies and find out what the language states in their particular case.
That said, there are many different nuances and variations within Business Interruption policies that need to be understood by the business owner so he or she can decide if they believe they may have a COVID-19 claim. It’s often a good idea to have your policy interpreted by a lawyer who has a deep understanding of contract law.
Usually, a Business Interruption policy provides coverage when there has been direct physical loss to the insured property by a covered peril. How does COVID-19 cause physical damage? In the view of some, it could be argued that the COVID-19 virus contaminated all surfaces within the business, causing a dangerous premise where employees or other individuals would have to work, and thus become exposed and/or infected.
There is another line of thinking both businesses and legislators have regarding the responsibility insurance companies have with respect to providing coverage for COVID-19 closings. When a civil authority/local government orders a business to close and there is no specific exclusion in the policy about the closure being “caused by a virus”, some argue that there should be Business Interruption coverage available. The basis for this argument is that if the insurer wished to exclude the closing of a business due to a virus, they could have excluded pandemic/virus related closures.
Insurance policies are contracts and so, if there is a disagreement between the parties as to what the policy does or doesn’t cover, it would be interpreted as a contract by the legal entity that was making the determination.
Stay tuned for the latest developments in the legislative battles going on right now…we’ll keep you updated. In the meantime, if you need someone to review your business insurance policy to see exactly what you have, call us today at 303-733-6353. At Ramos Law, we’re here to help!
Families First Coronavirus Response Act: Employee Paid Leave Rights
Businesses and employees need guidance in understanding how to keep themselves, co-workers and families safe from COVID-19. New laws have been enacted to help provide leave to employees sick or needing to care for sick family members. The Families First Coronavirus Response Act: Employee Paid Rights (FFCRA) requires certain employers to provide employees with paid sick leave or expanded family and medical leave for reasons directly related to COVID-19. The Department of Labor’s (Department) Wage and Hour Division (WHD) administers and enforces the new law’s paid leave requirements. These provisions will apply from the effective date through December 31, 2020. Here are some basics you need to know regarding your responsibility as an employer or your rights as an employee:
- Covered employees are those who work for private employers with fewer than 500 employees. It should be noted that most federal employees are not covered by this act unless they are covered by Title II of the Family and Medical Leave Act, in which case they would be covered by the FFCRA provision.
- Small businesses with fewer than 50 employees may qualify for an exemption to provide paid leave due to the unavailability of childcare or due to school closings if it can be shown that the leave would put the viability of the business in jeopardy.
- Covered employees can receive up to 80 hours (two weeks) paid sick leave if:
- The employee is unable to work because they are quarantined per governmental order, or they have COVID-19 symptoms and are seeking a medical diagnosis. They receive their regular rate of pay for this condition.
- The employee needs to care for an individual subject to quarantine or for a child under 18 years of age whose school or childcare facility is closed for reasons related to COVID-19. This allows the employee to receive 2/3 of their regular rate of pay.
- If the employee has been employed for at least 30 days and needs to provide care for a child who’s childcare or school is closed due to COVID-19, they are entitled to an additional 10 weeks of coverage at 2/3 of their regular rate of pay.
While the above is a general guideline of the FFCRA guidelines, there are many factors included that employees and employers need to understand in order to correctly interpret the act. If you have questions about any of these COVID-19 related legal issues, please seek out legal help. In these stressful times, seeking the help you need is more important than ever. At Ramos Law, we’re here to help. Call us today at 303-667-9475 and we’ll answer all your questions.