March 18, 2020

The Impact and Implications of Northern California's Shelter in Place Orders


In the past two days, pursuant to Governor Gavin Newsom's emergency proclamation regarding COVID-19 and applicable state law, public health officials in 10 California jurisdictions (San Francisco, Santa Clara, San Mateo, Marin, Contra Costa, Alameda, Monterey, San Benito, Sonoma, and Santa Cruz counties) issued identical "shelter in place" orders (the “SIP order”) requiring residents to stay in their homes to the "maximum extent possible" subject to certain exceptions to obtain or perform vital services (as defined). Significantly, all businesses with facilities located in the counties (except certain "Essential Businesses" or those involved with "Essential Government Functions" or with "Essential Infrastructure") are "required to cease all activities" except certain defined "Minimum Basic Operations." The orders are effective as of March 17, 2020, through April 7, 2020, or until extended or rescinded. Gatherings of "any number of people" outside a household are prohibited except for limited defined purposes. Failure to comply constitutes an "imminent threat" to public health and is a criminal misdemeanor subject to fines and imprisonment. For permitted activities, "social distancing" is required.

Other California counties, including Orange and San Bernardino, have issued similar, but somewhat less restrictive, orders. In the days ahead, additional California counties and cities, as well as the state itself, may follow suit. Other states and jurisdictions also are considering similar approaches.

Under the SIP order, persons may leave their residences only for defined "Essential Activities" or to operate "Essential Businesses," "Essential Government Functions," or "Essential Infrastructure." All travel, including by automobile, public transit, bicycle, scooter, foot, or other means, is "prohibited" except for purposes of performing such permitted functions. First responders, emergency management personnel, emergency dispatchers, law enforcement and court personnel are exempt from the orders.

Essential Activities

The Essential Activities for which persons may leave their homes and travel include basic activities essential to health and safety such as going to medical and dental visits and obtaining medication or therapy; obtaining necessary services or supplies, such as groceries and sanitation to maintain households; providing essential products and services at an Essential Business, Essential Government Function, or Essential Infrastructure; or otherwise carrying out defined permitted activities, including Minimum Basic Operations.

Essential Businesses

Essential Businesses are listed in the SIP order and include 21 types of businesses providing basic products and services such as health care, grocers and food markets (including home delivery), banking, gas stations, services such as plumbers and electricians that are necessary to sanitation and basic services, educational institutions for purposes of facilitating distance learning, restaurants for carry-out only, businesses that facilitate work from home, businesses that facilitate or supply other critical businesses, and professional services such as legal and accounting "when necessary" to assist in compliance with legally mandated activities. Other than to the extent they facilitate or supply other essential or critical services, the list of essential businesses does not broadly include, for example, manufacturing facilities and professional services firms (e.g., consulting, legal, accounting).

Minimum Basic Operations

Minimum Basic Operations include "minimum necessary activities" to (i) maintain the value of the business's inventory, ensure security, process payroll and employee benefits, or for related functions or (ii) facilitate employees being able to continue to work remotely from home. Such operations do not include normal daily business operations.

Essential Government Functions

Essential Government Functions are not specified but instead determined by the governmental entity performing those functions. Each governmental entity (a "governmental entity" is not defined) is required to identify and designate its employees and contractors to carry out the designated functions. Given the lack of specification, governments appear to have significant latitude to determine which of their functions are essential and to obtain resources to carry out their business, provided the activities are necessary and the applicable social distancing rules are followed. The orders do not address personnel at federal facilities such as military bases. The orders also do not directly address federal contractors and their subcontractors and suppliers. Clearly, a good argument can be made that military functions involving national security or defense operations should qualify as Essential Government Functions. Nonetheless, private sector entities supporting federal government, including Department of Defense activities, should consider obtaining essential function designations from appropriate federal departments and agencies or from their higher-tier contractors. Such entities also should be prepared to cooperate with the orders to the extent possible.

Essential Infrastructure

Essential Infrastructure includes, but "is not limited to," public works construction, construction of housing, airport operations, water, sewer, gas, electrical, oil refining, roads and highways, public transportation, solid waste collection and removal, Internet, and telecommunications systems (including provision of essential global, national, and local infrastructure for computing services, business infrastructure, communications, and web-based services).

Further Guidance from Public Health Officials

Based on our experience so far, health departments are answering questions to the extent resources permit. They are not generally issuing formal opinions with respect to particular activities or businesses.

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