Several states, including California and Illinois, are now imposing “stay-at-home” restrictions on residents and the businesses operating within these states. The executive orders are unprecedented and are not uniform in their language or scope. It is likely that additional states will issue such orders in the weeks to come. Many businesses are struggling to understand whether they can continue operations under controlling “stay-at-home” orders. If allowed to keep their operations open, they may have questions regarding what operations they are allowed to continue and what safety and health measures they are required to meet. Two such orders were issued last week in California (Executive Order N-33-20 or the “California Order”) and Illinois (COVID-19 Executive Order No. 8 or the “Illinois Order”). A summary of each is provided below.
Although California and Illinois both issued state-wide orders, a number of counties and individual cities throughout the U.S. have enacted their own public health orders with more specific instructions. Generally speaking, any stricter local emergency health requirements will remain in effect, in addition to the new state-wide orders.
In addition, companies that are subject to any of the local or state “stay-at-home” orders may be compelled to exercise their right to suspend performance under “force majeure” clauses of their contracts with vendors and/or customers. These are decisions that should be made upon consulting with your business attorney and after review of the specific contract and the controlling “force majeure” clause. These types of clauses vary considerable from contract-to-contract.
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