Republicans Draw "Red Line" Over Liability Protections in Phase 4 Relief Bill

May 01, 2020

With the Senate returning to Washington Monday, liability protection for businesses has emerged as a flashpoint in “phase 4” of COVID-19 relief legislation.

Liability debate heads to Congress:  Sen. Majority Leader Mitch McConnell (R-KY) and House Minority Leader Kevin McCarthy (R-CA) have made it clear that liability protection is a “red line” for Republicans in the next round of federal relief.  According to McConnell: “It won’t pass the Senate without it.”  McConnell further cited the “urgent need” to avoid “years of endless lawsuits” and “the biggest trial lawyer bonanza in history.”  

Meanwhile, Democratic leadership has voiced opposition to including any such liability immunity for businesses in a phase 4 bill.  Speaker Nancy Pelosi (D-CA) stated: “At the time of the coronavirus challenge, especially now, we have every reason to protect our workers and our patients in all of this…So we would not be inclined to be supporting any immunity from liability.”  Pelosi and her leadership team decided the House will not return to Washington next week.

DACA protections as a bargaining chip:  Senate Democrats have sought extensions for protections for recipients of the Deferred Action for Childhood Arrivals (DACA) program in previous phases of COVID-19 relief legislation, and are once again pushing for their inclusion in a phase 4 bill.  Their inclusion could be critical to a legislative compromise, as a trade-off for the Senate Republicans’ top priority—liability protections for businesses.  Meanwhile, Democrats also continue to seek further relief for state and local governments, which Republicans have been reluctant to grant.

Business groups lobby for safe harbors:  The National Association of Manufacturers and the U.S. Chamber of Commerce are two of several lobbying groups to submit proposals to Congress, asking for protection for businesses reopening in the coming months.  The groups argue that businesses across all industries will be faced with untenable liability exposure upon reopening due to the COVID-19 pandemic, causing businesses to either be forced to shut down soon after reopening or fail to reopen at all.

Proposals include:

  • Higher burden of proof for holding a business at fault in claims that a customer or employee contracted the virus on site;

  • Limited liability in privacy in the event an employer shares an employee’s contraction of COVID-19 with the rest of its workforce to ensure their safety;

  • Safe harbors for employers who follow OSHA safety guidance regarding masks, gloves, and social distancing; and

  • Removing private rights of action against businesses for negligence in pandemic precautions.

"As long as we are not overreaching in what we’re asking for, and we’re being thoughtful and measured, there’s a real chance we can get these protections,” said Linda Kelly, General Counsel, National Association of Manufacturers.