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April 20, 2020

When Will Policymakers And Businesses Be Ready To Reopen The Economy?

Officials across North America are starting to contemplate when to bring employees back to work. While U.S. governors ultimately have the authority on when to “open” their respective state economies—CNN is tracking those decisions here —federal officials have offered advice.

On April 16, the White House released Guidance on Opening up America Again. The documents includes recommendations on three phases and is designed to help state and local officials make decisions about rolling back social distancing measures. The three phases outlined by the White House are:

  • Phase 1: Essential businesses continue to operate and a limited group of non-essential businesses like restaurants and movie theaters are allowed to reopen. Schools remain closed and vulnerable individuals continue to shelter in place.
  • Phase 2: Schools reopen and non-essential travel is allowed to resume.
  • Phase 3: Vulnerable individuals can resume public interactions while practicing social distancing.

Phases two and three would only proceed if there was no evidence of a rebound in COVID-19 infections during the prior phase. Before any of these three phases can begin, however, the White House advises that a state have reached two milestones:

  • A “downward trajectory” of COVID-19 cases or a downward trajectory of positive tests for at least 14 days; and
  • Have in place a plan for testing and tracing citizens.

The U.S. Chamber of Commerce (USCC) has begun to explore and catalogue some of the major implications of returning to work. The USCC’s initial thoughts fall into three different sections:

  • Essential Services and Resources. Bringing employees back to work and reopening commerce will require that certain essential services and resources are in place. These include general health screenings, COVID-19 testing, personal protective equipment, transportation, and childcare.
  • Resolution of Regulatory and Legal Liability Issues. A reopening plan that is medically based and relies on social distancing and other best practices for public health may raise significant regulatory and legal liability risks. These issues are in addition to numerous lawsuits already filed as a result of COVID-19 and litigation risk that will become exacerbated during a reopening. Issues include: health privacy, discrimination claims, safe workplace requirements, support for independent contractors, employment practices, exposure liability, product liability, medical liability, securities litigation, customer communications, and the False Claims Act.
  • Support for Businesses and Individuals. The federal government took unprecedented steps to support employers and individuals during the current shutdown. These programs will need to be modified and to some extent extended and targeted to assist those businesses and individuals who will remain under distress during a phased or gradual reopening. In particular, policymakers will need to consider the needs of businesses dependent on high-density gatherings or travel and how to handle individuals who are delayed returning to work.

The USCC recommends that individual businesses also consider the following questions:

  • What additional essential services are needed to support a phased reopening?
  • What additional resources are needed to operationalize a phased reopening?
  • What additional guidance, including specific regulatory guidance, from the federal government would be beneficial for a phased reopening?
  • What additional legal liability issues are businesses concerned about during a phased reopening?
  • What additional financial support do businesses need to bridge a phased reopening? If so, what form should that take?
  • How have businesses changed operations as a result of COVID-19 and what changes do they anticipate continuing?
  • What federal support will businesses need going forward? For example, some types of standing support for business interruption in the case of a pandemic?
  • While restoring the economy will be a matter of private sector employers being able to resume activity, what other role should the private sector be playing, and what hindrances could get in the way of these efforts?