March 20, 2020

Pennsylvania Businesses Ordered to Shut Down Their Physical Operations If Not “Life Sustaining”

Update:

  • 3/20/2020: The Wolf administration has updated the list of what it deems a “life sustaining” business. The updated list is here. Business now identified as life sustaining that were not previously included include: forestry, logging and support activities; mining (including coal and metal ore mining) and support activities; specialty food stores; insurance carriers and related activities (except in-person sales brokerage); insurance and employee benefit funds; accounting, tax preparation, bookkeeping and payroll; traveler accommodation; and dry cleaning and laundry services. Businesses that were previously designated as “life sustaining” but no longer carry that designation (and therefore must close in-person facilities) include beer, wine, and liquor stores (except beer distributors) and civic and social organizations.  The governor’s press release announcing the updates is here. The administration has made clear that this is “an evolving situation and decisions will continue to be made and revisited as needed.”
  • 3/20/2020: Businesses seeking an exemption to the closure Order may do so via this website. Businesses are required to provide a justification as to why the operation is “life-sustaining,” and must state the number of employees required to be on-site to perform the “critical work.” Businesses must also describe plans to comply with CDC guidelines and mitigation efforts.
  • 3/21/2020: Governor Wolf amended the enforcement deadline from his original shutdown Order.  Enforcement on non-compliant businesses will begin Monday, March 23 at 8:00 a.m., and not on Saturday, March 21, as previously ordered.
  • 3/21/2020: The Department of Community and Economic Development has issued a set of Frequently Asked Questions and responses to provide additional guidance regarding Governor Wolf’s shutdown Order.  The FAQ responses indicate that authorities should make compliance determinations based on the operations of a particular facility, rather than the business as a whole.  For example, construction businesses (which are identified as non-“life sustaining”) may continue working on road repair and similar emergency efforts, but must suspend other activities that are not “clearly authorized” as life sustaining.  Further, in response to a question about whether businesses may “maintain limited in-person essential personnel for security, processing of essential functions, or to maintain compliance with federal, state or local regulatory requirements,” the DCED states that businesses suspending physical operations pursuant to the Order “must limit on-site personnel to maintain critical functions,” while following social distancing and other mitigation guidelines.  The FAQ responses also indicate that enforcement “should be prioritized to focus on businesses where people congregate,” and that although enforcement measures are within the discretion of the state or local agency, the administration expects that enforcement will be progressive, and will start first “with a warning to any suspected violator.”  The FAQ responses also clarify that hotels and motels, as well as local governments and municipalities, are not required to cease physical operations. 

On Thursday, March 19, 2020, Pennsylvania Governor Tom Wolf ordered all Pennsylvania businesses that are not “life sustaining” to shut down physical operations by Saturday, March 21 at 12:01 a.m. A copy of the Order is here. Such business may continue to operate on a virtual or telework basis, “so long as social distancing and other mitigation measures are followed.”

The Order specifically exempts “life sustaining businesses,” which may remain open subject to those businesses undertaking the same social distancing and mitigation measures. Similarly, the Order allows “businesses that offer carry-out, delivery, and drive-through food and beverage service” to continue operations, subject to the same social distancing and mitigation measures. The Order incorporates a list of life and non-life-sustaining businesses, which can be found here.

The press release accompanying the Order indicates that, “[i]n extenuating circumstances, special exemptions will be granted to businesses that are supplying or servicing health care providers.” Businesses seeking an exemption should email RA-dcexemption@pa.gov. Businesses seeking clarification regarding whether they need to close should email ra-dcedcs@pa.gov.

Employers that do not comply are subject to enforcement actions by the Commonwealth. Governor Wolf has directed the Liquor Control Board, Departments of Health and Agriculture, State Police, and local officials to take appropriate enforcement measures. According to the press release from the Governor’s office, noncompliant entities “will forfeit their ability to receive any applicable disaster relief and/or may be subject to other appropriate administrative action,” which may include license suspension or revocation and termination of state loan or grant funding. The Governor’s office also stated that, “in addition to any other criminal charges that might be applicable, the Department of Health is authorized to prosecute noncompliant entities for the failure to comply with health laws.”

The Order took effect immediately, with non-life-sustaining businesses expected to close by 8 p.m. on Thursday, March 19, 2020. In terms of the timing of enforcement, Governor Wolf announced that:

  • The Pennsylvania Liquor Control Board began enforcing the Order against its license holders on Wednesday, March 18.
  • Enforcement for all other food establishments began at 8 p.m. on Thursday, March 19.
  • Enforcement measures for all other business will begin at 12:01 a.m. on Saturday, March 21.

The Order is to remain in effect until further notice.

The Pennsylvania Department of Community and Economic Development is providing resources to businesses, including working capital loans and low-interest loans for small businesses and eligible nonprofits. Businesses seeking guidance from DCED should contact ra-dcedcs@pa.gov or 1-877-PA-HEALTH (and selecting option 1).

The Order follows on the heels of Governor Wolf’s press conference on Monday, March 17, in which he strongly urged nonessential businesses across the Commonwealth to close for at least 14 days in order to mitigate the spread of the coronavirus. Shortly after the press conference, the Governor’s office issued guidance explaining which businesses it considered essential and nonessential. That announcement is now superseded by the March 19 Order.

Philadelphia Mayor Jim Kenney had also previously announced guidelines for businesses in the City of Philadelphia. Those guidelines similarly addressed “non-essential businesses,” requiring that they close starting on March 16 at 5 p.m. until at least March 27. This announcement too is effectively superseded by Governor Wolf’s March 19 Order.

As the number of cases around the world grows, Faegre Drinker’s Coronavirus Resource Center is available to help you understand and assess the legal, regulatory and commercial implications of COVID-19.

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