NORTH CAROLINA'S STAY AT HOME ORDER AFFECTS BUSINESSES ACROSS THE STATE
On March 27, 2020, Governor Roy Cooper issued a Stay at Home Order for the entire State of North Carolina (Executive Order No. 121, “State Order” or “E.O.”) The order takes effect in all 100 counties on March 30, 2020 at 5:00 P.M. for thirty (30) days.
It is important to note that cities and counties have enacted ordinances and issue state of emergency Declarations based on the more significant spread of the virus in urban areas. The Order states that it is not intended to limit or prohibit counties and cities in North Carolina from enacting ordinances and issuing state of emergency declarations which impose greater restrictions or prohibitions to the extent authorized under North Carolina law.” E.O. 121, §5. At this point, it is unclear how the varying definitions and text of these local orders will interact with the State Order.
The State Order (and all local proclaimations) require “non-essential business and operations must cease.” E.O. 121, at §2(A). Unless a business is defined as a “COVID-19 Essential Business and Operation” it is required to cease all activities within the State except Minimum Basic Operations. E.O. 121, at §2(A). A non-essential business can undertake Minimum Basic Operations such as “The minimum necessary activities to maintain the value of the business's inventory, preserve the condition of the business's physical plant and equipment, ensure security, process payroll and employee benefits, or related functions.” E.O. 121, at §2(G)(i). Those non-essential businesses “may also continue operations consisting exclusively of employees or contractors performing activities at their own residences.” E.O. 121, at §2(A). Therefore, the order also allows “The minimum necessary activities to facilitate employees of the business being able to continue to work remotely from their residences.” E.O. 121, at §2(G)(ii).
The first thing to understand about the State Order and the local orders is that they are endeavoring to maintain the essential critical infrastructure workforce as defined by CISA (the Cybersecurity & Infrastructure Security Agency within the Department of Homeland Security). This list published on March 19, 2020 (link) which is the basis of devising the definition of Essential Businesses followed by the State Order and local declarations. See E.O. 121, at §2(C)(2). The list of sectors and identified essential critical infrastructure workers by the CISA are:
Communications
Chemical
Critical Manufacturing
Commercial Facility
Dams
Defense Industrial Base
Emergency Services
Energy
Financial
Food & Agriculture
Government Facilities
Healthcare and Public Health
Information Technology
Nuclear Reactors, Materials, and Waste
Transportation Systems
Water
The State Order and local proclaimations are trying to limit amount of personal interaction, while still preserving “the critical infrastructure sectors and the essential workers needed to maintain the services and functions Americans depend on daily and that need to be able to operate resiliently during the COVID-19 pandemic response.” CISA report, at 3
Focusing on the decision of whether a particular business or industry is considered an essential business should first look to the CISA for guidance. This is referenced in the State Order in §2(C)(2). However, even these businesses must maintain Social Distancing Requirements between employees and between employees and customers. These essential businesses are also directed to direct employees to work from home or telework.
The State defines Essential Business and Operation to include:
Healthcare and Public Health Operations
Includes traditional healthcare
Naturopathic healthcare providers
Manufacturers, technicians, logistics, and warehouse operators and distributors of medical equipment, personal protective equipment (PPE), medical gases, pharmaceuticals, blood and blood products, vaccines, testing materials, laboratory supplies, cleaning, sanitizing, disinfecting or sterilization supplies, and tissue and paper towel products
Likely including those operations which have switched to manufacture any of these items above
Veterinary care and all healthcare services provided to animals
Human Services Operations
Care homes and facilities
Childcare centers
Social service agencies
Charities providing assistance
Essential Infrastructure Operations
Food and beverage production and distribution
Storage facilities
Construction (see discussion below)
Building and grounds management and maintenance including landscaping
Utilities
Transportation
Trash collection and recycling
Internet
Video and telecommunications systems
Essential Governmental Functions
Needed to ensure the continuing operation of the government agencies
Support the health, safety and welfare of the public
Does not affect Federal Governmental operations
Stores that sell groceries and medicine
Farmer’s markets and farm stands
Prepared food
Alcoholic and non-alcoholic beverages (should include breweries or distilleries with take-out)
Food, beverage production and agriculture
Manufacturing, production, processing, and cultivation
Farming, livestock
Fishing
Forestry
Baking
Services and other necessities of life for animals
A number of businesses listed in the State Order are specific examples as clarification of the categories described above.
Organizations that provide charitable and social services
Religious entities (Limited to gatherings of 10)
Media
Gas stations and businesses needed for transportation
Financial and insurance institutions
Home improvement, hardware and supply stores
Critical trades (see below)
Mail, post, shipping, logistics, delivery, and pick-up services
Educational institutions
Laundry services
Restaurants for consumption off-premises (with take-out or delivery)
Supplies to work from home
Supplies for COVID-19 Essential Businesses and Operations
Transportation
Home-based care and services
Residential facilities and shelters
Professional services
Manufacture, distribution, and supply chain for critical products and industries
Defense and military contractors
Hotels and motels
Funeral Services
Electronic retailers that sell or service cell phones, computers, tablets, and other communications technology
Lawn and garden equipment retailers
Book stores that sell educational material
Beer, wine, and liquor stores
Retail functions of gas stations and convenience stores
Retail located within healthcare facilities
Pet and feed stores
The Department of Revenue has the authority to include other businesses upon request. (link)
If you have an questions about the State or Local Orders affecting your business, contact Allen Stahl + Kilbourne
By James Kilbourne and Derek Allen
Updated: March 27, 2020
Any statements contained herein do not constitute a formal legal opinion and should not be relied upon as such. These articles are intended for general informational purposes only. Nothing expressed shall be grounds for the creation of an attorney-client relationship. Our attorneys can give legal advice only in the context of an attorney-client relationship after a conflict check, the execution of a representation agreement and a discussion of the specific information and unique issues of your particular circumstances.
The situation surrounding COVID-19/coronavirus is changing constantly; as a result, any discussions that might take place may not necessarily reflect the latest information regarding recently-enacted, or pending or proposed legislation or guidance that could override, alter or otherwise affect existing legal analysis.
