COVID-19: Legal Implications for the Food Industry

Even if a plaintiff were able to overcome the legal intricacies associated with worker’s compensation statutes, they would still have an uphill battle. This is because the nature of viral spread would make proving causation especially difficult. COVID-19 is different from Salmonella or Listeria, where genetic fingerprinting can establish definitive connections between case-patients. Thus, it would presumably be difficult to prove an employee contracted the virus at work, as opposed to in the grocery store or at the park, for instance.

Nevertheless, defending lawsuits is expensive regardless of merit. The legal issues, like the virus itself, are novel. Because courts have not previously rendered judgment on these questions, it will take a substantial amount of time and effort to adjudicate the issues. That will translate to high costs. To prevent this from happening, commercial lobbying interests are advocating for a legislative solution. They want Congress to enact a COVID-19 liability shield that would preclude companies from being sued in relation to COVID-19. Similarly, the U.S. Chamber of Commerce is seeking a safe harbor from negligence claims for businesses that followed governmental guidance on COVID-19 in the workplace. Whether Congress will enact such a liability shield is unclear, and the topic remains the subject of bitter partisan rancor.

Attorneys tend to be leery of liability shields. One of our society’s abiding legal principles is that for every harm there is a remedy. In simple terms, this means that when a person’s unreasonable conduct causes injury, that person is legally responsible for redressing the injury. With the pandemic, however, a limited liability shield may be appropriate. COVID-19 is an unprecedented event. Food companies in particular have had to navigate the manifest difficulties of implementing new and frequently changing policies that have fundamentally reshaped how we move about the workplace and the world. While many businesses closed, food companies had to remain open. Despite the challenges, the food industry performed remarkably well in the face of extraordinary challenges. Given that fact, it would seem unjust to subject these companies to retrospective liability for reasonable conduct based on the best information available at the time.

Whatever happens with the legislature or the courts, the best way to protect employees and stave off lawsuits is to ensure the company is monitoring and observing governmental guidance and implementing responsible, science-based policies and procedures to safeguard employees.

Contractual Liability

Another area of potential concern relates to contractual liability. For the first time in modern history, the food industry is having to fundamentally reimagine the way it does business. The challenges of implementing change while navigating the ongoing pandemic will continue to result in at least temporary shortfalls in production, increased costs, and prolonged maintenance delays. Consequently, many businesses will not be able to meet their contractual obligations. Breaching a contract can result in a troubling array of business losses. Fortunately, from a legal standpoint, there are defenses available when a contractual breach is caused by an extraordinary event such as COVID-19.

Force majeure is a legal term of art, meaning “superior force.” In simple terms, it is a provision frequently incorporated into contracts that discharges the parties of their performance obligations in the event of an extraordinary event like COVID-19. Force majeure clauses do not protect against foreseeable risks such as market fluctuations or other common business risks. A pandemic, on the other hand, is precisely the type of unforeseeable event force majeure protects against. Thus, where a contract contains a force majeure provision and a party is unable to perform due to COVID-19, it is likely the provision would allow the party to be discharged of its contractual obligations.