COVID-19: Pennsylvania Further Clarifies and Modifies Its Business Closure Order

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On March 19, Pennsylvania Governor Tom Wolf ordered non-“life sustaining” businesses in Pennsylvania to cease physical operations.  The order generated much confusion, and the Commonwealth issued additional guidance on March 20.  (See our previous alerts here and here). 

The Commonwealth has provided additional updates regarding both the list of “life sustaining” businesses and its FAQs for businesses.  Here are the key takeaways from the updated guidance:

• More businesses are explicitly permitted to operate, including sawmills, wood product manufacturers, glass/glass product manufacturers, lime/gypsum product manufacturers, lumber & construction materials wholesalers, firearms dealers (limited operations only), insurance carriers, and pet supplies stores. Pennsylvania businesses should check the updated list to see if they now qualify.  
• The FAQs clarify that the list of “life sustaining” businesses is drawn from NAICS classifications. Businesses with a NAICS code that places them within a “life sustaining” category can continue to operate.  Other businesses must cease physical operations or seek a waiver.
  • In so doing, the FAQs erase ambiguities in the previously-provided guidance. Either a business has a NAICS code that permits it to operate, or it does not.
  • The “life sustaining” and non-“life sustaining” categories appear to align with the first four digits in the NAICS classification system. For example, a company with the NAICS code “541715” falls under the general category of “5417,” or “Scientific Research and Development Services,” which Pennsylvania considers  “life sustaining.”
  • A businesses’ NAICS code is not always apparent from what it does on a day-by-day basis. Companies with Pennsylvania operations should look up their NAICS codes, rather than rely upon their general understanding of what a facility does. 
• The FAQs also clarify that waiver determinations will be made based upon Homeland Security’s Cybersecurity and Infrastructure Security Agency advisory entitled “Identifying Critical Infrastructure During COVID-19.” In other words, waivers will likely only be granted for the “production, operation, and maintenance of supply chains” in critical infrastructure categories (g., medical supplies, energy, food, etc.)
• Waiver forms remain accessible here 
• Additionally, the FAQs explain that waivers, when granted, will apply only to the “activities” of a business that the waiver request “specifically identified” as “essential” to a “life sustaining” activity.
• All businesses, even non-“life sustaining” ones, are permitted to maintain limited “on-site personnel” in order to perform “critical functions.” The FAQs appear to specifically bless using on-site personnel to process payroll and insurance claims, maintain security, fulfill mail order and online orders, maintain good repair, process other unspecified “essential functions,” and maintain compliance with federal, state or local regulatory requirements.  And the updated list permits “Services to Building and Dwellings” that include “janitorial, pest control, and landscaping services.” 

Aside from this guidance, the revised FAQs also suggest that penalties for violators will be mild -- at least to begin with.  While noting that “other criminal penalties” may apply, the FAQs indicate that the “most directly applicable” enforcement provisions are criminal statutes (71 P.S. § 1409 and 35 P.S. § 521.20(a)) which are punishable only as summary offenses, with fines ranging from $10-$300 per day.  Moreover, in line with previous guidance, the updated FAQs state that warnings will usually be given first, followed by “progressive discipline,” with enforcement “prioritized to focus on businesses where people congregate.”  However, Pennsylvania has previously threatened much more severe penalties (including revocation of business licenses, and the denial of disaster aid).  Businesses should keep those threats in mind when considering the consequences of violating Gov. Wolf’s order.

Seyfarth is continuing to monitor the situation, and will provide updates as available.  

Jacob Oslick, a Counsel in the New York office, is admitted in Pennsylvania and practices extensively in the Commonwealth.