Practical Answers to Employment Law Issues
March 21, 2020 - Coronavirus (COVID-19)

Implications of California’s Coronavirus Stay at Home Order for Employers

Implications of California’s Coronavirus Stay at Home Order for Employers

On March 19, 2020, California Governor Gavin Newsom issued a statewide Stay at Home Order, California Executive Order No. N-33-20 (“Order”), in response to the growing COVID-19 pandemic. The Order is effective immediately and shall stay in place until further notice.

The Order calls for all California residents “to stay at home or at their places of residence except as needed to maintain continuity of operations of the federal critical infrastructure sectors.” The Order clarifies, however, that Californians working in “critical infrastructure sectors” as identified by the federal Cybersecurity & Infrastructure Security Agency (CISA) or the governor “may continue their work.” The Order cautions residents who need to leave their homes to “practice social distancing” at all times.

Critical Infrastructure Sectors

The Order cites to CISA’s March 19, 2020 Memorandum on Identification of Essential Critical Infrastructure Workers During COVID-19 Response (the “CISA Memorandum”) and to CISA’s web page on Critical Infrastructure Sectors for guidance on the types of businesses and industries that are exempt from the order. The CISA Memorandum provides detailed information regarding what classes of workers qualify as critical within the following sectors:

  1. Healthcare/Public Health
  2. Law Enforcement, Public Safety, First Responders
  3. Food and Agriculture
  4. Energy
  5. Water and Wastewater
  6. Transportation and Logistics
  7. Public Works
  8. Communications and Information Technology
  9. Other Community-Based Government Operations and Essential Functions
  10. Critical Manufacturing
  11. Hazardous Materials
  12. Financial Services
  13. Chemical
  14. Defense Industrial Base

Stay Home Except For Essential Services

The press release for the Order posted on the governor’s website also links to a new page at entitled “Stay home except for essential needs,” which provides guidance about the Order. In addition to the critical infrastructure sectors identified by CISA, the guidance states that businesses that provide “critical government services, schools, childcare, and construction, including housing construction” are exempt from the Order. It also states that the following businesses providing essential services will remain open:

  1. Gas stations
  2. Pharmacies
  3. Food: Grocery stores, farmers markets, food banks, convenience stores, take-out and delivery restaurants
  4. Banks
  5. Laundromats/laundry services

The following businesses, however, must close:

  1. Dine-in restaurants
  2. Bars and nightclubs
  3. Entertainment venues
  4. Gyms and fitness studios
  5. Public events and gatherings
  6. Convention centers

Potential Liabilities for Violations of the Order

Employers could face various liabilities if they require employees to report to work in violation of the Order or take adverse action against them for refusing to report. Employers violating the Order can face penalties under California “Government Code section 8665” and various sections of the California Health & Safety Code.[i]  

In addition, California Labor Code § 1102.5(c) prohibits employers from retaliating against “an employee for refusing to participate in an activity that would result in a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation” or who reports potential violations of law to either the employer or government agencies. Noncompliance can result in penalties of up to $10,000 per violation in addition to penalties available under other laws and typical remedies available in wrongful termination cases.[ii] 

Employees discharged for refusing to come to work in violation of the Order may also have claims for termination in violation of public policy, a.k.a. Tameny claims, since that action could arguably contravene the “substantial public policy principle[s]” behind the Order.[iii] Workers compensation laws may also not preempt claims for employees experiencing workplace injuries or illnesses, including emotional distress, stemming from public policy violations.[iv]

What Employers Should Do

Employers should first determine how their business is impacted by the Order. Employers providing essential services are allowed to remain open, while bars, dine-in restaurants, and others are expressly required to close. Many other employers will need to determine if they provide critical infrastructure services exempt from the Order based on the CISA Memorandum, the “Stay Home Except For Essential Needs” webpage, and the most recent available guidance from the California governor’s office.  

Businesses that must close should determine whether their employees can work from home or consider other options. For example, employees affected by this Order may be entitled to paid leave under the recently passed Families First Coronavirus Response Act, which we discuss in more detail here. Furloughed or laid-off employees may also be entitled to unemployment insurance benefits.

California employers should be mindful that the California governor has partially suspended the California WARN Act, which would have required 60 days’ notice for any mass layoffs, terminations, or relocations, but employers are still required to provide as much notice as practicable, as discussed in our post here.  

Several other states and localities have also recently issued similar “stay at home” or “shelter in place” orders. Local orders within California may be enforceable under the same laws criminalizing violation of the statewide Order, and other states may have similar or alternative enforcement mechanisms.

[i] Cal. Health & Safety Code §§ 120125, 120140, 131080, 120130(c), 120135, 120145, 120175, 120150.

[ii] Cal. Labor Code § 1102.5(f).

[iii] Tameny v. Atl. Richfield Co., 27 Cal. 3d 167 (1980).

[iv] Livitsanos v. Superior Court, 2 Cal. 4th 744 (1992) (holding Tameny claims exempt from preemption by state workers’ compensation laws).