The spread of COVID-19 in Colorado and – arguably, even more significantly – the policies of Gov. Jared Polis and his Department of Public Health and Environment, are devastating small businesses in this state. As they take real-world revenue hits, face rising expenses and try to meet ongoing fixed costs, small businesses sadly are forced to cut payroll, wages or hours.  And Colorado is a microcosm of national trends.

Unfortunately, legal risk – or merely the perception of legal risk – is holding back more businesses from making investment decisions.  Owners fear they might face potential lawsuits tied to COVID-19, even as small businesses take steps to follow the rules and abide virus-based regulations.  If government is going to continue tying their hands tightly, small businesses ought to have a COVID-19 liability shield.

Enter outgoing State Sen. Jack Tate, R-Centennial, and his bill regarding “civil immunity for small businesses that comply with applicable guidelines related to COVID-19.”  After concerned business groups approached him earlier in the year, Tate drafted legislation in June.  It failed to get consideration then, but given his background in private sector business, Tate rightly tried to bring it up again during last month’s special session.

Tate’s legislation provides that small businesses are “immune from civil liability for any act or omission that results in exposure, loss, damage, injury, or death arising out of COVID-19 if the small business attempts in good faith to comply with applicable guidelines unless the exposure, loss, damage, injury, or death was caused by gross negligence or a willful and wanton act or omission of the small business” (emphasis added).

This bill is eminently reasonable.  Tate and his cosponsors weren’t offering a complete liability shield, but one for (a) small businesses that (b) make every effort to comply with the stringent regulations already squeezing their businesses.  It still allows plaintiffs to file a legal claim, while limiting the likelihood that such liability claims will succeed.  Despite this, Democrats wouldn’t even let the bill get out of committee. 

Their refusal is genuinely stunning given widespread support for liability protection.  The U.S. Chamber Institute for Legal Reform released a November survey demonstrating nearly eight in 10 Americans of all stripes agree that “employers who follow the latest government health guidelines should be protected from COVID-related lawsuits. The survey shows that 79 percent of Americans agree that aside from cases of gross negligence, employers who follow such guidelines should be protected from lawsuits.”

Seventy-nine percent support!  How often do you find that on anything?  This is a no-brainer – yet it wasn’t even taken up in a special session intended to provide coronavirus relief to individuals and businesses?

When I asked Tate why, he noted that many Democrats “typically look at solving discrete past problems with government intervention, not understanding that business investment and job creation are a matter of the environment, the climate for business, the appetite for risk and the perception for risk.  Considering how terrible it is for a restaurant or anyone else, letting them know they’re not going to get sued when it’s all said and done if they are following the rules is probably a good thing.”

What he said next struck me as wise: “Even if there’s not a real risk, even if it’s just a perception of risk.”

That’s the key!  Business owners make investment decisions based upon their perception of risk.

Countless small businesses are already struggling, and whether a lawsuit of this type has come about or ever comes about is generally irrelevant.  That’s because even the possibility that small-business owners could find themselves vulnerable to lawsuits – despite making every effort to follow burdensome restrictions – could hold back investment. 

In developing his legislation, Tate surveyed other states.  Tennessee literally called a special session solely for this kind of bill; Georgia and several other states have passed business liability protections similar to Tate’s bill.  It just makes sense.

Congress is considering similar liability protection as part of the coronavirus relief package.  Colorado’s delegation should without question advocate such legislation to shield businesses of all sizes against similar lawsuits in federal courts.

Jack Tate won’t be in the state Senate come January, but someone else must take up his critical bill.  Then, the General Assembly should swiftly approve liability protection for small businesses that are simply doing their best to play by the rules and survive.

Legislators owe them that much.