Op-Ed: COVID-19 liability protections needed for small businesses

Published 10:55 am Wednesday, June 24, 2020

Getting your Trinity Audio player ready...

Over the past few weeks, a number of judges and mayors throughout the state have issued orders saying that businesses can be held responsible for customers who won’t wear masks during the pandemic.

There’s no question that masks help prevent the spread of the coronavirus, but these orders unfairly put owners in the position of policing their customers while trying to reopen and rebuild their businesses. The orders also underscore the urgent need for state and federal legislation that protects employers from lawsuits that try to exploit the pandemic for financial gain.

Small business owners across Texas were already worried about becoming the target of greedy trial lawyers to get rich quick on a fast settlement. When my association, the National Federation of Independent Business, surveyed our Texas members this spring about the challenges they expect to face as the Texas economy begins to reopen, 71% cited increased liability related to COVID-19.

That’s why NFIB is urging our elected leaders in Austin and Washington, D.C. to take steps to protect small businesses from predatory lawsuits that target them when they’re at their most vulnerable.

We’re asking lawmakers to adopt NFIB’s “Liability Protection Principles.” We believe these principles will allow people to reopen their businesses and put people back to work without fear of costly legal battles that could force them to close their doors for good.

NFIB believes the workers’ compensation system should be the only means employees use to settle claims related to COVID-19. The workers’ comp system is the best way to determine whether someone contracted the coronavirus at work and should be compensated. There’s no reason for lawmakers to create any other mechanism for settling employee claims.

We also believe that businesses should be protected from liability to customer and other third-party claims unless those customers or outside parties can prove the business knowingly failed to develop or put in place a reasonable plan to reduce the risk of exposure to COVID-19 – and that the businesses’ failure is the reason they got sick.

Another key provision is that only people who were hospitalized because of the coronavirus should be allowed to sue. Doctors are still learning about COVID-19, but one thing they do know is that it affects different people in different ways. Some people have tested positive but experience few if any symptoms. We believe the Legislature and Congress should grant businesses immunity from coronavirus-related litigation except in cases of gross negligence that results in hospitalization or death. No claims for emotional injury due to contracting the virus should be permitted.

Finally, we believe that opportunistic trial lawyers should be held accountable for bringing frivolous COVID-19-related lawsuits. We believe sanctions should be brought against attorneys who bring frivolous COVID-19-related claims and that plaintiff’s attorney should be required to pay the defendant’s legal fees.

Even if a frivolous claim is eventually thrown out of court, the legal fees can be enough to put a small business out of business.

Texas’ small businesses were closed for weeks to slow the spread of the coronavirus, and it will be months before business returns to normal. Unless our elected leaders take steps to protect small businesses from unfair and unscrupulous lawsuits, the recovery will take even longer than expected, and small businesses may end up closing for good.

Annie Spilman is the state director of the National Federation of Independent Business.