WAIVERS FOR COVID-19 LIABILITY: ARE THEY A GOOD IDEA?

As businesses reopen and seek to restore operations to pre-COVID levels, we have received a number of questions concerning the use of liability waivers to reduce legal  risk related to COVID-19. The main concern is whether you should ask or require people coming into contact with your business to acknowledge the risks of COVID-19 and waive claims that your business caused them exposure to the Coronavirus.  Although liability waivers can be an effective tool for protecting businesses and mitigating legal liability in certain situations, waivers specific to COVID-19 have not yet been interpreted by the courts. Thus, it is still unknown whether Minnesota’s courts (or courts in other states) will enforce COVID-19-specific waivers.  In considering whether a COVID-19 liability waiver is appropriate for your business, it is important to distinguish between the use of waivers with: (1) employees and  (2) customers/clients.

Employee Waivers

Generally, under Minnesota law, liability waivers between employers and employees are unenforceable due to public policy considerations.  The same is likely to be true regarding an employer’s request or requirement that employees waive claims involving COVID-19 liability based on exposure to the Coronavirus at work.  Such waivers would conflict with an employer’s duties under OSHA laws and with mandated worker’s compensation coverage for injuries at work.  Waivers in the workplace may also have negative and unintended consequences, such as discouraging workers from returning to work. Moreover, maintaining a workplace that complies with local orders, state regulations, and guidance from government agencies such as the Centers for Disease Control and Prevention will likely provide an employer with more protection than a liability waiver. Accordingly, we do not recommend that employers ask their employees to sign liability waivers.

Customer/Client Waivers

COVID-19 liability waivers are being used across the country in various industries and activities (salons, restaurants, wellness centers, theme parks, youth sports). While the enforceability of liability waivers varies from state to state, certain principles apply in most circumstances. In order to increase the likelihood that a COVID-19 waiver is enforceable, the waiver must: 1) clearly lay out the risks, 2) be entered into voluntarily, and 3) be consistent with public policy. If the product or service offered by a business is essential or a customer/client must participate in the activity but has no opportunity to negotiate the terms of participation, the waiver is likely unenforceable. For example, a grocery store may be unable to enforce a liability waiver because buying groceries is an essential activity; but a restaurant’s liability waiver may be enforceable because going to a restaurant is more of a discretionary activity. Notably, under many states’ laws, liability waivers will only insulate a business from liability for ordinary negligence. Thus, the liability waiver should not purport to waive liability for conduct that constitutes greater than ordinary negligence.

A waiver is not a substitute for careful planning and implementation of safety procedures for your employees and customers/clients.  Because of the numerous considerations involved in determining whether a liability waiver is appropriate for your business and the scope of the waiver, we recommend that businesses consult with legal counsel before instituting waivers.

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