Ask Mary Moorkamp what’s next for her company’s in-house team and her peers as they weather the COVID-19 pandemic, and she responds with an expansive list of questions in return.
For example: Do employers have the duty to report COVID-19 cases to their local health department? If an employee tests positive for the disease and his or her family members are exposed, can an employer be held responsible?
During the past few months, Moorkamp has faced those questions and more as chief legal and external affairs officer for Schnuck Markets in St. Louis. She and outside counsel who advise in-house attorneys both weighed in on points they believe will be critical for in-house counsel going forward during the pandemic.
Moorkamp said she and her colleagues have seen a number of issues arise as they have worked in a critical infrastructure role in the grocery industry. Working in the midst of the crisis has been transformative for her colleagues, she said.
“Our teams have just shined in a way that never in a million years you would have thought,” she said. “We’re just traditional and slow to change. We are becoming the most agile organization and decisive.”
As an essential company, Schnucks has moved to stagger shifts for employees in order to meet limits on permissible numbers of people inside its stores and created an app to ensure a store did not exceed its limit at any given time, Moorkamp said. The company also responded to a number of challenges, including supply-chain issues, she said.
From a big-picture perspective, it’s critical for in-house legal teams to consider a wide range of issues, from reviewing contracts for force majeure provisions, to labor and employment issues surrounding employees who get sick, to ensuring employees who are working from home are productive and held accountable for completing projects, she said.
“I’m passionate about this because we’re living through it, and it’s incumbent and it’s imperative that we all start to consider, what does the future look like?” Moorkamp said. “Because it will never be the same.”
Her company already has begun reviewing its response to the pandemic to date as well as considering how to replicate it if infections surge again in the fall, as predicted by health experts, she said.
“We’re fond of saying, ‘We’re not going to return to the way things were,’” she said. “How can we take some of these lessons learned in this situation and apply them going forward?”
Managing risk and investigations
With many states looking to reopen businesses, companies should make case-by-case decisions on reopening their facilities, said attorney Carly Duvall of Spencer Fane’s Kansas City office. Duvall, who defends large corporate businesses and advises on risk management and long-term strategic planning, serves as outside general counsel to startup and emerging growth companies.
Where to start? By finding applicable government orders and guidance, Duvall said. Companies then should develop deliberate and complete plans before opening, taking into account employment risks — including providing a safe environment for employees — as well as risk to customers and the public.
She also recommends that companies develop communications plans within their reopening strategies to guide how they communicate internally and externally about the steps they are taking to adhere to regulations and social distancing guidelines.
“Ultimately I remind my clients that, just because they can reopen doesn’t necessarily mean that they should — and it definitely means that reopening now probably won’t look like it did before,” she said. “As Missouri’s reopening guidelines suggest, even after stay-at-home orders are lifted, businesses will still have to operate with sufficient distance between employees and customers, which may require businesses to alter workplace setup and employee hours.”
Another consideration for in-house counsel is the prospect of future investigations stemming from their companies’ use of federal relief funds obtained through the CARES Act.
Patrick McInerney, also of Spencer Fane in Kansas City, said he is advising clients to anticipate possible federal investigations that review their handling of federal funds obtained from such programs as the Paycheck Protection Program.
A former assistant U.S. attorney, McInerney now is a partner in the firm’s white collar and government investigations practice. He noted that federal prosecutions stemming from the 2008 Troubled Asset Relief Program, also known as TARP, continued into 2019.
“What we’re telling a lot of our clients is we anticipate the inspector general for these funds . . . is going to be looking at what you do today in four, six or eight years,” he said. “They’re looking at it in hindsight how you did this.”
One key point of advice both he and Duvall offer to their clients: Preserve, especially in email form, the advice and thought processes that led them to make certain decisions in seeking federal funds. That applies whether they’re getting advice from outside counsel or the Small Business Administration or other agencies, McInerney said.
“There could be a different interpretation in four or six years,” he said.
Protecting confidential information
With the rise of employees working from home as well as uncertainty in the broader labor market, employers also should examine their practices for protecting confidential information and ensure their non-compete and non-solicitation agreements are up to date, according to Kate O’Hara Gasper of Lathrop GPM in Kansas City.
Gasper said she’s advising her in-house clients to work closely with their companies’ human resources professionals and IT professionals to review agreements they have in place for their employees. She also advises them to ensure they are communicating with employees regarding their expectations for protecting and maintaining confidential business information.
She said in-house counsel are uniquely positioned to bring together different departments of their companies to protect against theft of confidential information, which she anticipates will be on the rise as a result of the pandemic.
For companies navigating layoffs, she recommends that in-house counsel partner with HR to send hard copies of non-compete and non-solicitation agreements to outgoing employees along with termination letters to remind the employees of the agreements in place.
“Their agreement might be something only in paper form in their desk, which they haven’t touched in three months,” she said. “They might not have access to that, so we need to get that in their hands.”