On Friday, May 8, 2020, Alabama’s governor issued an emergency proclamation that protects healthcare providers as well as businesses from the risk and expense of lawsuits associated with COVID-19.

As long as entities covered by the executive order do not act recklessly and operate in a manner that is reasonably consistent with applicable public health guidance, they should be able to avoid COVID-19 liability, under the proclamation. “Businesses have been reluctant to reopen or, where partially open, to fully reopen for fear of lawsuits and the risk of the associated expense and liability,” the governor states in the proclamation.

The eighth supplemental emergency proclamation is effective immediately and retroactive. It covers acts or omissions occurring from March 13 until Alabama’s COVID-19 public health emergency ends.

Read Immunity Proclamation
Key provisions include liability protections, limitations on damages,
standard of care and mental anguish, preservation of existing defenses.

The proclamation has no effect on existing benefits, such as workers’ compensation.

• The proclamation provides civil immunity for “covered activities” by “covered entities” operating in Alabama from certain claims and damages relating to COVID-19, including claims that someone contracted or was exposed to COVID-19 on the premises of a business, or due to the operations or services provided by the business, or due to the provision of health care services or treatment provided by doctors, hospitals or nursing homes. Exceptions to this immunity exist only if the covered entity acted with wanton, reckless, willful or intentional misconduct and such misconduct must be proven under a “clear and convincing” evidentiary standard. Cases that do not involve death or “serious physical injury” are limited to recovering actual out-of-pocket economic damages. Punitive damages cannot generally be recovered.
• In the event of a claim accruing prior to issuance of the proclamation, and a determination by a court that the above provisions are inapplicable to the claim, the Proclamation directs that a covered entity shall not be liable for negligence, premises liability or non-wanton conduct. Damages in these cases that do involve serious physical injury will also be limited to economic damages.

Why was this proclamation needed? 

• The reasonable measures provided in this proclamation will protect healthcare providers on the front lines of the crisis, as well as businesses struggling to keep their doors open, from the risk and expense of lawsuits associated with COVID-19.
• Businesses in all industries and areas of the state are facing major financial damages from the sudden, all-consuming effect of coronavirus which could take years to recover from. These businesses, especially those in the small business community, cannot afford to be exposed to additional financial injury incurred through costly lawsuits resulting from an unprecedented pandemic and circumstances outside of their control.

What type entities are covered under the proclamation? Entities covered under this proclamation include businesses, nonprofits, LLCs, health care providers, educational entities, churches, governmental entities and cultural institutions operating in this state, as well as individuals associated with these entities.

Who is included as individuals associated with an entity and covered under this proclamation? Any director, officer, trustee, manager, member, employee, or agent with respect to any act or omission performed while acting on behalf of the covered entity.

How can a business ensure it is covered under the civil immunity provisions in this proclamation? The best way to avoid COVID-19 liability is for covered entities to operate in a manner that is reasonably consistent with applicable public health guidance in order to show that they are not acting recklessly. The proclamation will assist businesses and healthcare providers because perfection in this time is impractical but using reasonable best efforts should shield covered entities from liability.

Is legislation still necessary? Yes, the proclamation will expire when the state of emergency is ended. The governor has extended that emergency until March 8, 2021. The Legislature will need to act before the emergency order expires so that there is not a “gap” in the law leaving businesses and healthcare providers exposed to unchecked liability concerns.

This article is part of the Alabama Retail Report, a communication for Alabama Retail Association members. Not a member? Join us!

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