The Nonessential Business Closure Order appears to be fairly liberal in adopting Delaware’s definition of what businesses or industries are considered essential businesses.
On March 22, 2020, Delaware Governor John Carney issued his Fourth and Fifth Modifications of the Declaration of a State of Emergency for the State of Delaware Due to a Public Health Threat, pursuant to which he has ordered the closure of nonessential business and commercial establishments in Delaware (Nonessential Business Closure Order). The order takes effect on Tuesday, March 24, 2020, at 8:00 a.m. and remains in effect “until after May 15, 2020, or the public health threat of COVID-19 has been eliminated… .” Violations of the Nonessential Business Closure Order constitute a criminal offense.
While essential businesses—as defined in the governor’s order and highlighted below—may continue to operate, such businesses must continue to comply with certain health-protecting guidelines and measures promulgated by the Centers for Disease Control and Prevention (CDC) or the Delaware Department of Health and Social Services’ Division of Public Health (DPH). Among the measures essential businesses are required to observe while they remain open for employees and customers are the following: (a) implementing flexible and nonpunitive sick-leave policies; (b) excluding employees who are actively exhibiting signs of illness or have had close contact with persons diagnosed with, or suspected of having COVID-19; and (c) the adoption and encouragement of certain personal hygiene and property sanitizing practices.
The Nonessential Business Closure Order appears to be fairly liberal in adopting Delaware’s definition of what businesses or industries are considered essential businesses. To that end, businesses that employ or utilize workers in the following general areas are considered essential businesses and may remain operational to provide functions critical to the day-to-day needs of Delaware’s citizens:
- Healthcare/Public Health: Not surprisingly, the list of workers related to the healthcare/public health industry is quite broad and not only includes those persons directly responsible for providing healthcare services, but also workers and businesses that are critical to the support of such healthcare functions.
- Law Enforcement, Public Safety, First Responders
- Food and Agriculture: Here, too, the list of essential functions broadly captures a wide swath of the food and agriculture segment to ensure that this critical industry remains functional. Thus, the directive generally declares as essential workers and businesses critical to the production of, distribution of and the sale of food and beverage products not only for human consumption, but also for pets and livestock.
- Energy: This industrial category is broken down into the following subcategories: (a) electricity industry; (b) petroleum industry (including transport, storage, refining, distribution and sales); and (c) natural gas and propane.
- Water and Wastewater
- Transportation and Logistics: This category broadly covers persons and businesses needed to move goods and services, as well as to maintain the assets used in transportation and logistics activities.
- Public Works
- Communications and Information Technology
- Other Community-Based Government Operations and Essential Functions: This category covers workers such as: (a) election personnel; (b) weather forecasters; (c) educators; and (d) hotel workers, among others.
- Manufacturing: This category broadly encompasses “Workers necessary for the manufacturing of materials, goods, products, or similar distribution.”
- Hazardous Materials
- Financial Services and Insurance
- Defense Industrial Base
- Construction: This category includes both the persons engaging in the construction and repair of residential and nonresidential structures and the businesses that supply materials and hardware to those trades.
- Necessary Products Retailers: This category lists a number of necessary products that include: (a) medical and hygiene supplies; (b) dry goods; (c) agricultural supplies; (d) pet and animal food supplies; (e) hardware; (f) products and equipment needed to work from home; (g) alcohol, beer and wine; and (h) “any other household consumer products or other products necessary to maintain the safety, sanitation, and essential operations of residences.”
- Necessary Retail and Service Establishments: This category lists 26 types of necessary retail and service establishments that include: (a) businesses that sell to or supply such businesses; (b) plumbers, electricians, exterminators, etc.; (c) lawn and garden retail facilities; (d) marinas; (e) child care facilities; (f) professional services such a legal and accounting; (g) hotels and taxis; and (h) pet sitters.
- Open Air Recreation Facilities
The Nonessential Business Closure Order also contains a list of types of businesses that are considered nonessential businesses, which includes places such as casinos, racetracks, sporting facilities, theaters and concert halls, among others. This list appears to cover a number of facilities in which large numbers of people might ordinarily gather together.
To determine the specific status of a specific type of business or worker, the state of Delaware has published an industry status list, in which the industries named above are broken down into their four-digit North American Industry Classification System (NAICS) code. The industry classification list states—by code number—which types of businesses may or may not operate (or operate with certain listed restrictions) during the time the order is in force. Moreover, in a set of FAQs published by the state, it is noted that if a business has more than one NAICS code, “[y]ou may follow the instructions for the least restrictive NAICS code your business is classified under.”
Delaware’s Nonessential Business Closure Order appears to broadly define essential businesses in a manner that will allow many aspects of Delaware’s manufacturing, commercial and business landscape to continue to operate, giving Delaware citizens the most normal day-to-day life possible, without unnecessary restrictions, in these challenging circumstances.
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If you have questions regarding how the Nonessential Business Closure Order might affect your business, please contact Sharon L. Caffrey, Richard L. Renck, any of the attorneys in our Wilmington office, any member of the COVID-19 Strategy Team or the attorney in the firm with whom you are in regular contact.
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