Business Invitees and Waivers in Pennsylvania
May 22, 2020
By: Michael P. Leahey and Jason L. Ott
Over the past few months, we have become accustomed to the New Normal of our personal and professional lives in the midst of the novel coronavirus, which causes the COVID-19 disease (collectively, “COVID-19”). As certain governments are starting the process of rolling back shelter-in-place and business shutdown orders though, we all are concerned with best practices for getting back to business and trying to build the economy back up. In particular, all businesses that provide services to customers in person should consider waiver agreements to help shield themselves from potential liability under the circumstance that a customer sustains injuries – or at this point, contracts COVID-19 during his/her visit to their business locations.
Below, we address whether there could be a claim against a business owner in Pennsylvania if a business’s customer contracts COVID-19. Although COVID-19 presents a novel situation medically, well-established Pennsylvania premises liability law provides the initial guidance.
Pennsylvania Premises Liability Law
Under Pennsylvania law, the analysis begins with a classification of the entrant on the land, i.e., trespasser, licensee, business invitee. In the situation of a business or premises owner and customer, the customer would be an invitee and thus entitled to the highest degree of protection from the premises owner, but that standard of care is not absolute. A premises owner is subject to liability for physical harm caused to invitees by a condition on the land, but only if the premises owner knows or by the exercise of reasonable care would discover the condition and realize that it involves an unreasonable risk of harm to the invitees, and should expect that the invitees will not discover or realize the danger or will fail to protect themselves from it and the premises owner fails to exercise reasonable care to protect the invitees against the danger.
We see primarily two questions relative to COVID-19: (i) whether the business owner knew or should know of the hazard; and (ii) whether the business owner should expect that its invitees will recognize the hazard. The difficulty will be in determining whether the business owners could have actual knowledge that COVID-19 is present at its site – given the invisible nature of a virus, the answer is probably “no.” Therefore, every business should treat its facility as if COVID-19 is present. An advantage for the business owner is that there is extensive information about the hazards of COVID-19 and the measures necessary to protect oneself from an unreasonable risk of exposure to the point that the public at large will generally have a substantial understanding of those topics.
For this reason, the most powerful measure a business owner can take is to inform its customers in multiple formats of the potential hazards of COVID-19 and the ways to protect themselves, including the making available of guidance from the Centers for Disease Control (“CDC”), any state and/or local health agencies or other applicable regulatory authorities. Business owners should post applicable CDC guidelines in conspicuous places and follow all federal and state guidance as any rules and regulations promulgated for COVID-19 will set the standard of care to which businesses must adhere.
With respect to drafting a written waiver for customers to sign, one of the most important elements would be to restate the guidelines for whatever industry or space to which the waiver applies (such as hair salon, gym, etc.) and to inform the customer that the business owner cannot guarantee the safety of its customers from COVID-19. A waiver, however, will be enforceable only if the business owner takes reasonable steps to comply with all existing state and federal rules and regulations. The business owner will also be held to best industry practices.
To be valid and enforceable under Pennsylvania law for a person to waive claims of any kind, that waiver must be knowing, intelligent, and voluntary. Additionally, waiver agreements or exculpatory clauses (including covenants not to sue) are valid if they meet the following three conditions :
- the agreement must not contravene public policy [A waiver of liability violates public policy only if it involves “a matter of interest to the public or the state.” Such matters of interest to the public or the state include the employer-employee relationship, public service, public utilities, common carriers, and hospitals.];
- the agreement must be between persons relating entirely to their own private affairs [the waiver relates only to the parties involved and is of no interest to the state]; and
- each party must be a free bargaining agent to the agreement so that the contract is not one of adhesion [The signer is under no compulsion, economic or otherwise, to participate, much less to sign the exculpatory agreement.].
Further, electronically signed waiver agreements are enforceable in Pennsylvania as well, which is particularly helpful and convenient for business owners to implement waivers right now.
Notably though, even the most potent waiver agreement will not relieve a business owner of conduct that falls significantly below the general standard of care – amounting to gross negligence or recklessness. Business owners have some guidance regarding best practices from the standpoint of keeping their business locations clean and sanitary, but continue to wait for updated, revised guidelines from various governmental authorities, including the CDC as mentioned above. In the absence of specific guidance, business owners must continue to put together the best feasible sanitization protocols and document their efforts to show that they are providing safe environments for customers.
In Pennsylvania, Governor Wolf’s phased approach to re-opening Commonwealth businesses certainly will affect the manner in which business owners will be able to welcome customers back to their facilities. With that re-opening scheme in place as a backdrop, businesses may consider putting together waiver agreements or revising prior waiver agreements to add references to injuries potentially arising from contracting communicable diseases in the current climate. Further though, there are practical concerns for business owners to consider as part of the calculus of determining whether they will be requiring liability waivers before allowing customers to enter their locations.
Here at Jackson Kelly, we regularly advise business clients on various operational and financial matters. If you have questions about customer waiver agreements in the context of your business or would like us to help draft a waiver agreement tailored to your business, please feel free to reach out any time and we would be happy to do anything we can to help.