COVID-19 AND THE CONSTRUCTION INDUSTRY

Here's How You Can Protect Your Business
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10 Tips for Contractors Dealing with a Government-Imposed Shutdown

Employers around the country must plan, prepare and respond to coronavirus disease (COVID-19). As the global pandemic spreads across the United States, cities are issuing shelter-in-place orders and jobsites are temporarily closing. There will be challenges ahead for all construction businesses as they deal with federal, state, and local government restrictions, health and safety concerns for their workforce, and a disrupted supply chain. 

In this editorial, a Nashville construction dispute lawyer will advise you on ways your construction business can mitigate many of these challenges and stay ahead of the curve during a difficult time in the industry. At Cotney Construction Law, we are here to help construction firms navigate their way through this pandemic so that they can thrive for many more years to come. Our Nashville construction law firm is serious about protecting our industry, as serious as contractors are about protecting their businesses. 

Here are ten tips for your construction business during a government-imposed shutdown:

1) Confirm You’re an Essential Business

If your location is dealing with a shelter-in-place order, you need to be considered an essential business to continue to operate. The U.S. Department of Homeland Security (DHS) states that “essential critical infrastructure workers” can continue their operations; however, the local government in many cities is determining what businesses qualify on a case-by-case basis. Construction businesses need to closely monitor the most up-to-date federal, state, and local guidelines and comply with regulations. Furthermore, closely review your order and consult a Nashville construction law professional to learn more. 

Related: Is Roofing an Essential Service?

2) Prevent Exposure at Your Jobsite

Assuming you qualify as an essential business, workplaces must be prepared for a potential COVID-19 outbreak. Employers need to know the symptoms of infection. They need to study up on Occupational Safety and Health Administration (OSHA) standards related to COVID-19, and they should educate their workforce on ways they can reduce the spread of the virus. Employers should also implement a more flexible sick leave plan, including non-punitive sick leave, to encourage workers to self-isolate if they are experiencing symptoms. We encourage you to visit the Centers for Disease Control and Prevention and OSHA.gov to learn more about health and safety standards related to COVID-19. 

3) Review the Provisions in Your Contract

The majority of disputes stem from a poorly drafted contract. Although COVID-19 may seem like an unprecedented event, there should be provisions within your contract related to the pandemic. For example, every contract should feature a provision that protects the professional from elements outside of their control. Similarly, the contract should feature provisions related to delays and how disputes will be resolved. Now is the time for you and a Chattanooga construction attorney to carefully review your contracts to ensure that there are critical provisions in place to protect your businesses’ best interests, including a force majeure clause, no damages for delay, and price acceleration provisions.

Related: Force Majeure Takes Center Stage

4) Plan the Next Step

Employers will need to proactively mitigate the spread of COVID-19, while also managing their business operations. Some areas that will need to be addressed, include:

  • Adjusting Your Operations: some business operations will need to be paused, some workforces will need to be downsized, and telework can be a reasonable accommodation for non-essential employees during this time. Employers also may want to prohibit some employees from traveling for work at this time.
  • Planning for Absenteeism: with projections forecasting more sick workers in the near future, contractors need to plan for absenteeism and implement a strategy to combat potential labor shortages. This includes cross-training employees to ensure the essential functions of your business operations are intact.
  • Linking the Supply Chain: With limited resources available, construction firms will need to consider alternative supply chains to obtain their essential supplies. Consistently checkup with your most reliable suppliers, network with other businesses in your community, and learn as much as you can about your supply options. 

5) Perform a Risk Assessment

All phases of a construction project require a risk assessment, so it should come as no surprise that, during a global pandemic, employers will need to closely monitor their jobsite and the health and wellness of their workers. Because COVID-19 is a community spread disease, contractors must monitor public health requirements and familiarize themselves with best practices to reduce risk of their jobsite being impacted and take action. Employees with preexisting conditions should be given at least six feet of space, as they have a higher exposure risk than other employees. Similarly, jobsites in compromised communities are at higher risk. For this reason, construction companies should only have employees present that are required to perform essential tasks at the jobsite.    

6) Obtain Outstanding Payment 

As the full economic impact of COVID-19 is felt, delayed payment and bankruptcy will only become more prevalent. Projects of all sizes and in all phases will run into payment disputes. Being a business owner, you must do everything within your power to ensure that payments are received and that projects are completed on time. If you require assistance with lien and bond claims, demand letters, or ensuring that your business runs as smoothly as possible given the circumstances, consult a Knoxville contractor attorney. Although COVID-19 has never been seen before, funding issues are nothing new in the construction industry.

7) Get Ahead of Any Dispute

Regardless of what stage of a project you are at, some disputes are inevitable, especially during a global pandemic when materials become more difficult to obtain and parties engaged in a project run into financing problems. If work has been slowed down significantly or come to a screeching halt, proactively reach out to your business partners and try to resolve any issues now, before they become a serious problem. Alternative dispute resolution (ADR) proceedings, such as mediation, can accelerate the resolution process. If there is any conflict over who’s at fault, ADR may be the most affordable way to find a solution. To learn more about mediation, consult a Nashville construction dispute attorney.

8) Improve Your Future Operations

Whether work has slowed down or stopped entirely, now is the time for employers to assess their business and determine ways they can improve their operations, including:

  • Offer your key employees additional leadership training opportunities
  • Communicate with your workforce and be attentive to their needs
  • Identify the team members that are vital to maintaining the success of your business
  • Engage with your active clients and make sure they’re receiving value
  • Sort through your finances and cover all immediate expenses
  • Develop a strategy to ensure your company is resilient to supply chain breakdowns
  • Get involved with community outreach programs and network with other businesses

With a reeling stock market and a disrupted supply chain, many businesses will need to reinvent themselves to thrive in the future. Some firms will be downsizing. Others will merge with other companies. Some will find a specific niche that separates their business from the competition. Regardless, now is the time for employers to consider their next move and tailor a strategy to meet this goal. 

Related: $2 Trillion Stimulus Plan to Help Roofing Contractors Stay in Business

9) Have an Answer for Employment Law Questions

Employers have to prep their jobsite and their employee handbook during a pandemic. The next few months will require employers to make a lot of difficult decisions. Employers will need to have answers to questions regarding sick leave policies, worker classification, telework, paid and unpaid leave, wage and hour requirements, and the newly passed the Families First Coronavirus Response Act (FFCRA). Moreover, employers need to make certain that their company policies align with current public health guidelines and federal and state laws. Although this is no easy feat, it’s critical that employers protect their business and their workforce during this challenging time by ensuring they have the most accurate and up-to-date information featured in their company policies.

10) Invest in a Protection Kit and Subscription Plan
As COVID-19 remains a threat, contractors and construction firms will require assistance with contract review, employment law, dispute resolution, safety regulation compliance, and more. At Cotney Construction Law, we are a construction industry advocate that can help protect your business during this difficult time. We offer a COVID-19 Protection Kit that includes a jobsite response plan, a toolbox talk with a sign-up sheet, and an employment law guide that covers everything you need to know about newly enacted federal leave laws. 

We also offer affordable, monthly subscription plans to cover your essential legal and business needs. Whether it’s access to our knowledgeable Knoxville contractor lawyers to answer pertinent legal questions or seeking real-world, practical advice from one of our consultants, we will help navigate you through all of your construction business and legal issues during this challenging time.  

To learn more about our subscription plans, protection kit, or the latest news on our COVID-19 resources page, please visit our website. We are staying up-to-date on the latest developments nationwide, and our attorneys are standing by to answer any COVID-19-related questions you may have. 

If you would like to speak with our Chattanooga construction attorneys, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.