Commonground
Senior Moderator
I haven't even got to the "People Factor" which starts on page 35 of a 43 page document. Some excerpts from the The Microbiological Threat to the National Power Grid.
Advanced Pandemic Planning for Utilities Executives
The General Duty Clause
The Occupational Safety and Health (OSH) Act25 is the primary federal law regulating safety and healthconditions in the workplace, and it applies to virtually all private sector employers in the United States.26
In addition to complying with all duly promulgated safety and health standards, employers must comply with the OSH Act?s general duty clause, which provides that each employer ?shall furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.?27 Violations do not give rise to aprivate right of action, however.
-snip-
Several of these factors could weigh in favor of compensability in the context of influenza vaccinations or other prophylaxis or treatment. In other states, injuries suffered as a result of an adverse reaction to a
voluntary inoculation or vaccination have been determined to be compensable workers? compensation injuries.37
Thus, depending on the state, it is possible that an adverse reaction to a fl u vaccine or medication could be a compensable injury whether the vaccination is voluntary or involuntary, if the factors discussed above
are met. This possibility does not mean, of course, that providing access to vaccines and/or to antivirals is unwise. It merely means that, in weighing risks and benefits, companies should factor in the cost of the risk that, among that faction of those treated who can show they were thereby harmed, some may become entitled to compensation.
26 See generally, Mark A. Rothstein, Occupational Safety and Health Law ? 12, St. Paul: West Group (4th ed. 1998).
27 29 U.S.C. ? 654(a)(1), ? 5(a)(1) of the OSH Act. Employers can be cited for violating the General Duty Clause if there is a recognized
hazard and they do not take reasonable steps to prevent or abate the hazard. U.S. Department of Labor, Occupational Safety & Health
Administration, Guidance on Preparing Workplaces for an Influenza Pandemic, OSHA 3327-02N (undated, but issued in May 2007), at
http://www.osha.gov/Publications/influenza_pandemic.html. An employer can be found to be in violation of the general duty clause if it
can be shown that: 1. A hazard existed. 2. The hazard was likely to cause death or serious physical harm. 3. It had knowledge of the hazard or should have had knowledge because the hazard had been recognized by the employer, its industry, or common sense. 4. The
hazard was foreseeable. 5. Workers were exposed to the hazard. See, U.S. Chamber of Commerce Small Business Center?s Website:
http://www.uschamber.com/sb/business/P04/P04_8421.asp (last visited Aug. 6, 2007).
Quarantine
Individuals quarantined but who never develop disease probably have no compensable illness or injury.38
Nor do they enjoy any special protection from adverse employment decisions. Energy companies may wish to think carefully, however, about the effect in the court of public opinion of adverse job actions against such workers.
Health Insurance
Whether employees insured under the company?s policies will have adequate health care coverage will, of course, vary with the company. If influenza behaves as it has historically, however, the great majority of patients will probably either die or recover quickly ? within a week or two. In dollar terms, then, healthcare costs may be relatively modest.
Contracts
Every energy company is both a buyer and a seller. Most commercial contracts contain force majeureclauses.43 As a buyer, a company should consider whether, in a pandemic environment, its suppliers would be excused for nonperformance under the force majeure clauses of its existing contracts. As a seller, the company should determine whether its nonperformance will be so excused. Force majeure clauses vary, but they tend to be narrowly construed and seldom mention pandemic expressly. Omission of this specific ?force? from the list may preclude effective application of the clause.44 Sometimes force majeure law in a given jurisdiction will excuse nonperformance for natural phenomena beyond the control of the parties. In other jurisdictions, however, nonperformance is excused only if the natural phenomena were not only beyond human control, but unforeseeable.45 It would be difficult to characterize a pandemic as unforeseeable.
Even where a viable force majeure defense exists, it may fail in some jurisdictions if some other factor, not a force majeure or ?act of God,? played a role in the outcome.46 In some jurisdictions, where harm is caused concurrently by a force majeure and human acts, the defendant is liable for only that portion of the damagescaused by the latter.47
The party invoking force majeure has the burden of proof.48 Whether a force majeure arose is a question of fact for the jury.49
Energy companies should examine their contracts to see what provisions help and hurt them and may wish to renegotiate those agreements in pursuit of better terms, although renegotiation might well require payment of additional consideration.50
In addition, energy companies should be making inquiries of their suppliers, particularly those that supply
critical items (e.g., coal or nuclear fuel products and services) to determine what those companies are doing to prepare for a potential pandemic and to determine what those companies are doing to determine the adequacy of preparations farther down the supply chain. You might also consider asking them to allow you to see and evaluate the plans they have developed. And as discussed elsewhere, energy companies may wish to assess their policies regarding stockpiling critical supplies in light of a pandemic?s expected duration.
43 Force majeure (French: a ?superior force?) means an event or effect that cannot be anticipated or controlled; it includes both acts
of nature (e.g. fl oods or hurricanes) and acts of people (e.g. riots, strikes, or wars). BLACK?S LAW DICTIONARY 263 (Pocket Edition
1996). See, Glossary.
44 See, Seitz v. Mark-O-Lite Contractors, Inc., 210 N.J. Super. 646, 510 A.2d 319 (1986) (if a law refers to autos, trucks, tractors,
motorcycles, and other motor-powered vehicles, ?vehicles? would not include airplanes).
45 See, e.g., URI Cogeneration Partners, Inc. v. Board of Governors for Higher Education, 915 F. Supp. 1267, 1287 (D.R.I. 1996) (holding
that the court will extend a force majeure provision to only those situations that were unforeseeable at the time of the contract); Watson
Labs., Inc. v. Rhone-Poulenc Rorer, Inc., 178 F. Supp. 2d 1099 (holding that the shutdown of the plant was foreseeable and therefore
defendants would not rely on the force majeure clause). See also, Lane v. G&M Statuary, Inc., 156 S.W.3d 498 (Mo. Ct. App. 2005);
Bradford v. Stanley, 355 So.2d 328, 330 (Ala. 1978) (fl ood). For cases of possible historical interest, see Charing Cross Co. v. London
Hydraulic Co., 3 K.B. 442, 449 (1913); Pandorf v. Hamilton, 17 Q.B.D. 670, 675 (1886).
46 Cooper v. Horn, 248 Va. 417 (1994) (defendants allowed trees to grow in earthen dam, so even though dam failed during a three-day
storm, clearly a force majeure, human agency contributed to the fl ood damage and the defense failed). See also, Central Ga. Elec.
Membership Corp. v. Heath, 4 S.E.2d 700 (Ga. Ct. App. 1939) (lightening strike was an act of God, but failure to ground line was not
?free of human agency,? so liability lay).
47 Webb v. Platte Valley Pub. Power & Irrigation Dist., 18 N.W. Ind. 563 (Neb. 1945) (burst dam); Anderson v. Highland Lake Co., 258
S.W. 218 (Tex. Civ. App. 1924) (same).
Challenging Quarantine
Influenza is an equal opportunity threat. Your janitorial staff and your C-suite are more-or-less equally at risk.
There is a real possibility that members of your top leadership could be subjected to isolation or quarantine, and if that happens, their ability to lead and to make decisions could be threatened.
In proper circumstances, quarantine diminishes contagion and so saves lives. Quarantine is also a massive violation of civil liberties, however. The law does provide protections from abuse of power by the civil
authorities,54 and it may be possible to challenge imposition of quarantine orders if procedural requirements are not met or constitutional rights are violated. While a full discussion of this topic is beyond the scope of this document, you may wish to consider whether and under what circumstances you might challenge a quarantine order imposed on, for example, your CEO or Board Chairman.
Communications
We have already considered internal communications above, in connection with litigation that might be brought against the company by shareholders or others. Let us now consider briefly the vulnerability of external communications to exploitation by other adversaries.
To an extent greater than is perhaps the case in any other sector of the economy except public health, energy companies will be called upon in a pandemic to communicate clearly, early, and often. The audience will include customers, employees, suppliers, lenders, shareholders, regulators, legislators, and the media.
Co-author Regina Phelps discusses how companies can address these audiences in a previous chapter, Mobilizing the Enterprise ? Ready, Set, Go! One approach may be to identify topics likely to be important and
what the company wishes to say about them, so that templates are available for use when needed.
In a pandemic, all of the company?s audiences will want information quickly and frequently. Unfortunately, at the time they are called upon to speak, those responsible for such communications may have far less information and far less reliable information than they would ideally like to have, even if they have prepared templates or outlines in advance. They will be under tremendous pressure and will likely have significant difficulty in meeting the information demands of their various constituencies. The possibility of inaccuracy is high. To the extent that members of your audience detrimentally rely on your statements, you could be subject to claims.55 It may be prudent to confer with counsel about any templates you prepare in advance, to spot and, where possible, diminish legal pitfalls.
55 See, e.g., Hoeppner v. Jess Howard Elec. Co., 780 N.E.2d 290 (Ohio Ct. App. 2002) (to invoke the doctrine of equitable estoppel,
plaintiff must show detrimental reliance on misrepresentation).
Conclusion
A pandemic is first and foremost a threat to public health. All other issues pale in comparison. As discussed at the outset, however, the ability of energy companies to operate in a pandemic environment will have a direct impact on the extent a pandemic poses a threat to public health. Also, for any business organization, but especially for energy companies and other segments of the ?critical infrastructure,? a pandemic implicates an array of legal issues as well. In developing their plans, energy companies must factor in these issues to be in the best position to survive the disease and its aftermath.
http://www.ems-solutionsinc.com/pdfs/EnergyRoundtableWhitePaper.pdf
Advanced Pandemic Planning for Utilities Executives
The General Duty Clause
The Occupational Safety and Health (OSH) Act25 is the primary federal law regulating safety and healthconditions in the workplace, and it applies to virtually all private sector employers in the United States.26
In addition to complying with all duly promulgated safety and health standards, employers must comply with the OSH Act?s general duty clause, which provides that each employer ?shall furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.?27 Violations do not give rise to aprivate right of action, however.
-snip-
Several of these factors could weigh in favor of compensability in the context of influenza vaccinations or other prophylaxis or treatment. In other states, injuries suffered as a result of an adverse reaction to a
voluntary inoculation or vaccination have been determined to be compensable workers? compensation injuries.37
Thus, depending on the state, it is possible that an adverse reaction to a fl u vaccine or medication could be a compensable injury whether the vaccination is voluntary or involuntary, if the factors discussed above
are met. This possibility does not mean, of course, that providing access to vaccines and/or to antivirals is unwise. It merely means that, in weighing risks and benefits, companies should factor in the cost of the risk that, among that faction of those treated who can show they were thereby harmed, some may become entitled to compensation.
26 See generally, Mark A. Rothstein, Occupational Safety and Health Law ? 12, St. Paul: West Group (4th ed. 1998).
27 29 U.S.C. ? 654(a)(1), ? 5(a)(1) of the OSH Act. Employers can be cited for violating the General Duty Clause if there is a recognized
hazard and they do not take reasonable steps to prevent or abate the hazard. U.S. Department of Labor, Occupational Safety & Health
Administration, Guidance on Preparing Workplaces for an Influenza Pandemic, OSHA 3327-02N (undated, but issued in May 2007), at
http://www.osha.gov/Publications/influenza_pandemic.html. An employer can be found to be in violation of the general duty clause if it
can be shown that: 1. A hazard existed. 2. The hazard was likely to cause death or serious physical harm. 3. It had knowledge of the hazard or should have had knowledge because the hazard had been recognized by the employer, its industry, or common sense. 4. The
hazard was foreseeable. 5. Workers were exposed to the hazard. See, U.S. Chamber of Commerce Small Business Center?s Website:
http://www.uschamber.com/sb/business/P04/P04_8421.asp (last visited Aug. 6, 2007).
Quarantine
Individuals quarantined but who never develop disease probably have no compensable illness or injury.38
Nor do they enjoy any special protection from adverse employment decisions. Energy companies may wish to think carefully, however, about the effect in the court of public opinion of adverse job actions against such workers.
Health Insurance
Whether employees insured under the company?s policies will have adequate health care coverage will, of course, vary with the company. If influenza behaves as it has historically, however, the great majority of patients will probably either die or recover quickly ? within a week or two. In dollar terms, then, healthcare costs may be relatively modest.
Contracts
Every energy company is both a buyer and a seller. Most commercial contracts contain force majeureclauses.43 As a buyer, a company should consider whether, in a pandemic environment, its suppliers would be excused for nonperformance under the force majeure clauses of its existing contracts. As a seller, the company should determine whether its nonperformance will be so excused. Force majeure clauses vary, but they tend to be narrowly construed and seldom mention pandemic expressly. Omission of this specific ?force? from the list may preclude effective application of the clause.44 Sometimes force majeure law in a given jurisdiction will excuse nonperformance for natural phenomena beyond the control of the parties. In other jurisdictions, however, nonperformance is excused only if the natural phenomena were not only beyond human control, but unforeseeable.45 It would be difficult to characterize a pandemic as unforeseeable.
Even where a viable force majeure defense exists, it may fail in some jurisdictions if some other factor, not a force majeure or ?act of God,? played a role in the outcome.46 In some jurisdictions, where harm is caused concurrently by a force majeure and human acts, the defendant is liable for only that portion of the damagescaused by the latter.47
The party invoking force majeure has the burden of proof.48 Whether a force majeure arose is a question of fact for the jury.49
Energy companies should examine their contracts to see what provisions help and hurt them and may wish to renegotiate those agreements in pursuit of better terms, although renegotiation might well require payment of additional consideration.50
In addition, energy companies should be making inquiries of their suppliers, particularly those that supply
critical items (e.g., coal or nuclear fuel products and services) to determine what those companies are doing to prepare for a potential pandemic and to determine what those companies are doing to determine the adequacy of preparations farther down the supply chain. You might also consider asking them to allow you to see and evaluate the plans they have developed. And as discussed elsewhere, energy companies may wish to assess their policies regarding stockpiling critical supplies in light of a pandemic?s expected duration.
43 Force majeure (French: a ?superior force?) means an event or effect that cannot be anticipated or controlled; it includes both acts
of nature (e.g. fl oods or hurricanes) and acts of people (e.g. riots, strikes, or wars). BLACK?S LAW DICTIONARY 263 (Pocket Edition
1996). See, Glossary.
44 See, Seitz v. Mark-O-Lite Contractors, Inc., 210 N.J. Super. 646, 510 A.2d 319 (1986) (if a law refers to autos, trucks, tractors,
motorcycles, and other motor-powered vehicles, ?vehicles? would not include airplanes).
45 See, e.g., URI Cogeneration Partners, Inc. v. Board of Governors for Higher Education, 915 F. Supp. 1267, 1287 (D.R.I. 1996) (holding
that the court will extend a force majeure provision to only those situations that were unforeseeable at the time of the contract); Watson
Labs., Inc. v. Rhone-Poulenc Rorer, Inc., 178 F. Supp. 2d 1099 (holding that the shutdown of the plant was foreseeable and therefore
defendants would not rely on the force majeure clause). See also, Lane v. G&M Statuary, Inc., 156 S.W.3d 498 (Mo. Ct. App. 2005);
Bradford v. Stanley, 355 So.2d 328, 330 (Ala. 1978) (fl ood). For cases of possible historical interest, see Charing Cross Co. v. London
Hydraulic Co., 3 K.B. 442, 449 (1913); Pandorf v. Hamilton, 17 Q.B.D. 670, 675 (1886).
46 Cooper v. Horn, 248 Va. 417 (1994) (defendants allowed trees to grow in earthen dam, so even though dam failed during a three-day
storm, clearly a force majeure, human agency contributed to the fl ood damage and the defense failed). See also, Central Ga. Elec.
Membership Corp. v. Heath, 4 S.E.2d 700 (Ga. Ct. App. 1939) (lightening strike was an act of God, but failure to ground line was not
?free of human agency,? so liability lay).
47 Webb v. Platte Valley Pub. Power & Irrigation Dist., 18 N.W. Ind. 563 (Neb. 1945) (burst dam); Anderson v. Highland Lake Co., 258
S.W. 218 (Tex. Civ. App. 1924) (same).
Challenging Quarantine
Influenza is an equal opportunity threat. Your janitorial staff and your C-suite are more-or-less equally at risk.
There is a real possibility that members of your top leadership could be subjected to isolation or quarantine, and if that happens, their ability to lead and to make decisions could be threatened.
In proper circumstances, quarantine diminishes contagion and so saves lives. Quarantine is also a massive violation of civil liberties, however. The law does provide protections from abuse of power by the civil
authorities,54 and it may be possible to challenge imposition of quarantine orders if procedural requirements are not met or constitutional rights are violated. While a full discussion of this topic is beyond the scope of this document, you may wish to consider whether and under what circumstances you might challenge a quarantine order imposed on, for example, your CEO or Board Chairman.
Communications
We have already considered internal communications above, in connection with litigation that might be brought against the company by shareholders or others. Let us now consider briefly the vulnerability of external communications to exploitation by other adversaries.
To an extent greater than is perhaps the case in any other sector of the economy except public health, energy companies will be called upon in a pandemic to communicate clearly, early, and often. The audience will include customers, employees, suppliers, lenders, shareholders, regulators, legislators, and the media.
Co-author Regina Phelps discusses how companies can address these audiences in a previous chapter, Mobilizing the Enterprise ? Ready, Set, Go! One approach may be to identify topics likely to be important and
what the company wishes to say about them, so that templates are available for use when needed.
In a pandemic, all of the company?s audiences will want information quickly and frequently. Unfortunately, at the time they are called upon to speak, those responsible for such communications may have far less information and far less reliable information than they would ideally like to have, even if they have prepared templates or outlines in advance. They will be under tremendous pressure and will likely have significant difficulty in meeting the information demands of their various constituencies. The possibility of inaccuracy is high. To the extent that members of your audience detrimentally rely on your statements, you could be subject to claims.55 It may be prudent to confer with counsel about any templates you prepare in advance, to spot and, where possible, diminish legal pitfalls.
55 See, e.g., Hoeppner v. Jess Howard Elec. Co., 780 N.E.2d 290 (Ohio Ct. App. 2002) (to invoke the doctrine of equitable estoppel,
plaintiff must show detrimental reliance on misrepresentation).
Conclusion
A pandemic is first and foremost a threat to public health. All other issues pale in comparison. As discussed at the outset, however, the ability of energy companies to operate in a pandemic environment will have a direct impact on the extent a pandemic poses a threat to public health. Also, for any business organization, but especially for energy companies and other segments of the ?critical infrastructure,? a pandemic implicates an array of legal issues as well. In developing their plans, energy companies must factor in these issues to be in the best position to survive the disease and its aftermath.
http://www.ems-solutionsinc.com/pdfs/EnergyRoundtableWhitePaper.pdf
Advanced Pandemic Planning for Utilities Executives
The General Duty Clause
The Occupational Safety and Health (OSH) Act25 is the primary federal law regulating safety and healthconditions in the workplace, and it applies to virtually all private sector employers in the United States.26
In addition to complying with all duly promulgated safety and health standards, employers must comply with the OSH Act?s general duty clause, which provides that each employer ?shall furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.?27 Violations do not give rise to aprivate right of action, however.
-snip-
Several of these factors could weigh in favor of compensability in the context of influenza vaccinations or other prophylaxis or treatment. In other states, injuries suffered as a result of an adverse reaction to a
voluntary inoculation or vaccination have been determined to be compensable workers? compensation injuries.37
Thus, depending on the state, it is possible that an adverse reaction to a fl u vaccine or medication could be a compensable injury whether the vaccination is voluntary or involuntary, if the factors discussed above
are met. This possibility does not mean, of course, that providing access to vaccines and/or to antivirals is unwise. It merely means that, in weighing risks and benefits, companies should factor in the cost of the risk that, among that faction of those treated who can show they were thereby harmed, some may become entitled to compensation.
26 See generally, Mark A. Rothstein, Occupational Safety and Health Law ? 12, St. Paul: West Group (4th ed. 1998).
27 29 U.S.C. ? 654(a)(1), ? 5(a)(1) of the OSH Act. Employers can be cited for violating the General Duty Clause if there is a recognized
hazard and they do not take reasonable steps to prevent or abate the hazard. U.S. Department of Labor, Occupational Safety & Health
Administration, Guidance on Preparing Workplaces for an Influenza Pandemic, OSHA 3327-02N (undated, but issued in May 2007), at
http://www.osha.gov/Publications/influenza_pandemic.html. An employer can be found to be in violation of the general duty clause if it
can be shown that: 1. A hazard existed. 2. The hazard was likely to cause death or serious physical harm. 3. It had knowledge of the hazard or should have had knowledge because the hazard had been recognized by the employer, its industry, or common sense. 4. The
hazard was foreseeable. 5. Workers were exposed to the hazard. See, U.S. Chamber of Commerce Small Business Center?s Website:
http://www.uschamber.com/sb/business/P04/P04_8421.asp (last visited Aug. 6, 2007).
Quarantine
Individuals quarantined but who never develop disease probably have no compensable illness or injury.38
Nor do they enjoy any special protection from adverse employment decisions. Energy companies may wish to think carefully, however, about the effect in the court of public opinion of adverse job actions against such workers.
Health Insurance
Whether employees insured under the company?s policies will have adequate health care coverage will, of course, vary with the company. If influenza behaves as it has historically, however, the great majority of patients will probably either die or recover quickly ? within a week or two. In dollar terms, then, healthcare costs may be relatively modest.
Contracts
Every energy company is both a buyer and a seller. Most commercial contracts contain force majeureclauses.43 As a buyer, a company should consider whether, in a pandemic environment, its suppliers would be excused for nonperformance under the force majeure clauses of its existing contracts. As a seller, the company should determine whether its nonperformance will be so excused. Force majeure clauses vary, but they tend to be narrowly construed and seldom mention pandemic expressly. Omission of this specific ?force? from the list may preclude effective application of the clause.44 Sometimes force majeure law in a given jurisdiction will excuse nonperformance for natural phenomena beyond the control of the parties. In other jurisdictions, however, nonperformance is excused only if the natural phenomena were not only beyond human control, but unforeseeable.45 It would be difficult to characterize a pandemic as unforeseeable.
Even where a viable force majeure defense exists, it may fail in some jurisdictions if some other factor, not a force majeure or ?act of God,? played a role in the outcome.46 In some jurisdictions, where harm is caused concurrently by a force majeure and human acts, the defendant is liable for only that portion of the damagescaused by the latter.47
The party invoking force majeure has the burden of proof.48 Whether a force majeure arose is a question of fact for the jury.49
Energy companies should examine their contracts to see what provisions help and hurt them and may wish to renegotiate those agreements in pursuit of better terms, although renegotiation might well require payment of additional consideration.50
In addition, energy companies should be making inquiries of their suppliers, particularly those that supply
critical items (e.g., coal or nuclear fuel products and services) to determine what those companies are doing to prepare for a potential pandemic and to determine what those companies are doing to determine the adequacy of preparations farther down the supply chain. You might also consider asking them to allow you to see and evaluate the plans they have developed. And as discussed elsewhere, energy companies may wish to assess their policies regarding stockpiling critical supplies in light of a pandemic?s expected duration.
43 Force majeure (French: a ?superior force?) means an event or effect that cannot be anticipated or controlled; it includes both acts
of nature (e.g. fl oods or hurricanes) and acts of people (e.g. riots, strikes, or wars). BLACK?S LAW DICTIONARY 263 (Pocket Edition
1996). See, Glossary.
44 See, Seitz v. Mark-O-Lite Contractors, Inc., 210 N.J. Super. 646, 510 A.2d 319 (1986) (if a law refers to autos, trucks, tractors,
motorcycles, and other motor-powered vehicles, ?vehicles? would not include airplanes).
45 See, e.g., URI Cogeneration Partners, Inc. v. Board of Governors for Higher Education, 915 F. Supp. 1267, 1287 (D.R.I. 1996) (holding
that the court will extend a force majeure provision to only those situations that were unforeseeable at the time of the contract); Watson
Labs., Inc. v. Rhone-Poulenc Rorer, Inc., 178 F. Supp. 2d 1099 (holding that the shutdown of the plant was foreseeable and therefore
defendants would not rely on the force majeure clause). See also, Lane v. G&M Statuary, Inc., 156 S.W.3d 498 (Mo. Ct. App. 2005);
Bradford v. Stanley, 355 So.2d 328, 330 (Ala. 1978) (fl ood). For cases of possible historical interest, see Charing Cross Co. v. London
Hydraulic Co., 3 K.B. 442, 449 (1913); Pandorf v. Hamilton, 17 Q.B.D. 670, 675 (1886).
46 Cooper v. Horn, 248 Va. 417 (1994) (defendants allowed trees to grow in earthen dam, so even though dam failed during a three-day
storm, clearly a force majeure, human agency contributed to the fl ood damage and the defense failed). See also, Central Ga. Elec.
Membership Corp. v. Heath, 4 S.E.2d 700 (Ga. Ct. App. 1939) (lightening strike was an act of God, but failure to ground line was not
?free of human agency,? so liability lay).
47 Webb v. Platte Valley Pub. Power & Irrigation Dist., 18 N.W. Ind. 563 (Neb. 1945) (burst dam); Anderson v. Highland Lake Co., 258
S.W. 218 (Tex. Civ. App. 1924) (same).
Challenging Quarantine
Influenza is an equal opportunity threat. Your janitorial staff and your C-suite are more-or-less equally at risk.
There is a real possibility that members of your top leadership could be subjected to isolation or quarantine, and if that happens, their ability to lead and to make decisions could be threatened.
In proper circumstances, quarantine diminishes contagion and so saves lives. Quarantine is also a massive violation of civil liberties, however. The law does provide protections from abuse of power by the civil
authorities,54 and it may be possible to challenge imposition of quarantine orders if procedural requirements are not met or constitutional rights are violated. While a full discussion of this topic is beyond the scope of this document, you may wish to consider whether and under what circumstances you might challenge a quarantine order imposed on, for example, your CEO or Board Chairman.
Communications
We have already considered internal communications above, in connection with litigation that might be brought against the company by shareholders or others. Let us now consider briefly the vulnerability of external communications to exploitation by other adversaries.
To an extent greater than is perhaps the case in any other sector of the economy except public health, energy companies will be called upon in a pandemic to communicate clearly, early, and often. The audience will include customers, employees, suppliers, lenders, shareholders, regulators, legislators, and the media.
Co-author Regina Phelps discusses how companies can address these audiences in a previous chapter, Mobilizing the Enterprise ? Ready, Set, Go! One approach may be to identify topics likely to be important and
what the company wishes to say about them, so that templates are available for use when needed.
In a pandemic, all of the company?s audiences will want information quickly and frequently. Unfortunately, at the time they are called upon to speak, those responsible for such communications may have far less information and far less reliable information than they would ideally like to have, even if they have prepared templates or outlines in advance. They will be under tremendous pressure and will likely have significant difficulty in meeting the information demands of their various constituencies. The possibility of inaccuracy is high. To the extent that members of your audience detrimentally rely on your statements, you could be subject to claims.55 It may be prudent to confer with counsel about any templates you prepare in advance, to spot and, where possible, diminish legal pitfalls.
55 See, e.g., Hoeppner v. Jess Howard Elec. Co., 780 N.E.2d 290 (Ohio Ct. App. 2002) (to invoke the doctrine of equitable estoppel,
plaintiff must show detrimental reliance on misrepresentation).
Conclusion
A pandemic is first and foremost a threat to public health. All other issues pale in comparison. As discussed at the outset, however, the ability of energy companies to operate in a pandemic environment will have a direct impact on the extent a pandemic poses a threat to public health. Also, for any business organization, but especially for energy companies and other segments of the ?critical infrastructure,? a pandemic implicates an array of legal issues as well. In developing their plans, energy companies must factor in these issues to be in the best position to survive the disease and its aftermath.
http://www.ems-solutionsinc.com/pdfs/EnergyRoundtableWhitePaper.pdf
Advanced Pandemic Planning for Utilities Executives
The General Duty Clause
The Occupational Safety and Health (OSH) Act25 is the primary federal law regulating safety and healthconditions in the workplace, and it applies to virtually all private sector employers in the United States.26
In addition to complying with all duly promulgated safety and health standards, employers must comply with the OSH Act?s general duty clause, which provides that each employer ?shall furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.?27 Violations do not give rise to aprivate right of action, however.
-snip-
Several of these factors could weigh in favor of compensability in the context of influenza vaccinations or other prophylaxis or treatment. In other states, injuries suffered as a result of an adverse reaction to a
voluntary inoculation or vaccination have been determined to be compensable workers? compensation injuries.37
Thus, depending on the state, it is possible that an adverse reaction to a fl u vaccine or medication could be a compensable injury whether the vaccination is voluntary or involuntary, if the factors discussed above
are met. This possibility does not mean, of course, that providing access to vaccines and/or to antivirals is unwise. It merely means that, in weighing risks and benefits, companies should factor in the cost of the risk that, among that faction of those treated who can show they were thereby harmed, some may become entitled to compensation.
26 See generally, Mark A. Rothstein, Occupational Safety and Health Law ? 12, St. Paul: West Group (4th ed. 1998).
27 29 U.S.C. ? 654(a)(1), ? 5(a)(1) of the OSH Act. Employers can be cited for violating the General Duty Clause if there is a recognized
hazard and they do not take reasonable steps to prevent or abate the hazard. U.S. Department of Labor, Occupational Safety & Health
Administration, Guidance on Preparing Workplaces for an Influenza Pandemic, OSHA 3327-02N (undated, but issued in May 2007), at
http://www.osha.gov/Publications/influenza_pandemic.html. An employer can be found to be in violation of the general duty clause if it
can be shown that: 1. A hazard existed. 2. The hazard was likely to cause death or serious physical harm. 3. It had knowledge of the hazard or should have had knowledge because the hazard had been recognized by the employer, its industry, or common sense. 4. The
hazard was foreseeable. 5. Workers were exposed to the hazard. See, U.S. Chamber of Commerce Small Business Center?s Website:
http://www.uschamber.com/sb/business/P04/P04_8421.asp (last visited Aug. 6, 2007).
Quarantine
Individuals quarantined but who never develop disease probably have no compensable illness or injury.38
Nor do they enjoy any special protection from adverse employment decisions. Energy companies may wish to think carefully, however, about the effect in the court of public opinion of adverse job actions against such workers.
Health Insurance
Whether employees insured under the company?s policies will have adequate health care coverage will, of course, vary with the company. If influenza behaves as it has historically, however, the great majority of patients will probably either die or recover quickly ? within a week or two. In dollar terms, then, healthcare costs may be relatively modest.
Contracts
Every energy company is both a buyer and a seller. Most commercial contracts contain force majeureclauses.43 As a buyer, a company should consider whether, in a pandemic environment, its suppliers would be excused for nonperformance under the force majeure clauses of its existing contracts. As a seller, the company should determine whether its nonperformance will be so excused. Force majeure clauses vary, but they tend to be narrowly construed and seldom mention pandemic expressly. Omission of this specific ?force? from the list may preclude effective application of the clause.44 Sometimes force majeure law in a given jurisdiction will excuse nonperformance for natural phenomena beyond the control of the parties. In other jurisdictions, however, nonperformance is excused only if the natural phenomena were not only beyond human control, but unforeseeable.45 It would be difficult to characterize a pandemic as unforeseeable.
Even where a viable force majeure defense exists, it may fail in some jurisdictions if some other factor, not a force majeure or ?act of God,? played a role in the outcome.46 In some jurisdictions, where harm is caused concurrently by a force majeure and human acts, the defendant is liable for only that portion of the damagescaused by the latter.47
The party invoking force majeure has the burden of proof.48 Whether a force majeure arose is a question of fact for the jury.49
Energy companies should examine their contracts to see what provisions help and hurt them and may wish to renegotiate those agreements in pursuit of better terms, although renegotiation might well require payment of additional consideration.50
In addition, energy companies should be making inquiries of their suppliers, particularly those that supply
critical items (e.g., coal or nuclear fuel products and services) to determine what those companies are doing to prepare for a potential pandemic and to determine what those companies are doing to determine the adequacy of preparations farther down the supply chain. You might also consider asking them to allow you to see and evaluate the plans they have developed. And as discussed elsewhere, energy companies may wish to assess their policies regarding stockpiling critical supplies in light of a pandemic?s expected duration.
43 Force majeure (French: a ?superior force?) means an event or effect that cannot be anticipated or controlled; it includes both acts
of nature (e.g. fl oods or hurricanes) and acts of people (e.g. riots, strikes, or wars). BLACK?S LAW DICTIONARY 263 (Pocket Edition
1996). See, Glossary.
44 See, Seitz v. Mark-O-Lite Contractors, Inc., 210 N.J. Super. 646, 510 A.2d 319 (1986) (if a law refers to autos, trucks, tractors,
motorcycles, and other motor-powered vehicles, ?vehicles? would not include airplanes).
45 See, e.g., URI Cogeneration Partners, Inc. v. Board of Governors for Higher Education, 915 F. Supp. 1267, 1287 (D.R.I. 1996) (holding
that the court will extend a force majeure provision to only those situations that were unforeseeable at the time of the contract); Watson
Labs., Inc. v. Rhone-Poulenc Rorer, Inc., 178 F. Supp. 2d 1099 (holding that the shutdown of the plant was foreseeable and therefore
defendants would not rely on the force majeure clause). See also, Lane v. G&M Statuary, Inc., 156 S.W.3d 498 (Mo. Ct. App. 2005);
Bradford v. Stanley, 355 So.2d 328, 330 (Ala. 1978) (fl ood). For cases of possible historical interest, see Charing Cross Co. v. London
Hydraulic Co., 3 K.B. 442, 449 (1913); Pandorf v. Hamilton, 17 Q.B.D. 670, 675 (1886).
46 Cooper v. Horn, 248 Va. 417 (1994) (defendants allowed trees to grow in earthen dam, so even though dam failed during a three-day
storm, clearly a force majeure, human agency contributed to the fl ood damage and the defense failed). See also, Central Ga. Elec.
Membership Corp. v. Heath, 4 S.E.2d 700 (Ga. Ct. App. 1939) (lightening strike was an act of God, but failure to ground line was not
?free of human agency,? so liability lay).
47 Webb v. Platte Valley Pub. Power & Irrigation Dist., 18 N.W. Ind. 563 (Neb. 1945) (burst dam); Anderson v. Highland Lake Co., 258
S.W. 218 (Tex. Civ. App. 1924) (same).
Challenging Quarantine
Influenza is an equal opportunity threat. Your janitorial staff and your C-suite are more-or-less equally at risk.
There is a real possibility that members of your top leadership could be subjected to isolation or quarantine, and if that happens, their ability to lead and to make decisions could be threatened.
In proper circumstances, quarantine diminishes contagion and so saves lives. Quarantine is also a massive violation of civil liberties, however. The law does provide protections from abuse of power by the civil
authorities,54 and it may be possible to challenge imposition of quarantine orders if procedural requirements are not met or constitutional rights are violated. While a full discussion of this topic is beyond the scope of this document, you may wish to consider whether and under what circumstances you might challenge a quarantine order imposed on, for example, your CEO or Board Chairman.
Communications
We have already considered internal communications above, in connection with litigation that might be brought against the company by shareholders or others. Let us now consider briefly the vulnerability of external communications to exploitation by other adversaries.
To an extent greater than is perhaps the case in any other sector of the economy except public health, energy companies will be called upon in a pandemic to communicate clearly, early, and often. The audience will include customers, employees, suppliers, lenders, shareholders, regulators, legislators, and the media.
Co-author Regina Phelps discusses how companies can address these audiences in a previous chapter, Mobilizing the Enterprise ? Ready, Set, Go! One approach may be to identify topics likely to be important and
what the company wishes to say about them, so that templates are available for use when needed.
In a pandemic, all of the company?s audiences will want information quickly and frequently. Unfortunately, at the time they are called upon to speak, those responsible for such communications may have far less information and far less reliable information than they would ideally like to have, even if they have prepared templates or outlines in advance. They will be under tremendous pressure and will likely have significant difficulty in meeting the information demands of their various constituencies. The possibility of inaccuracy is high. To the extent that members of your audience detrimentally rely on your statements, you could be subject to claims.55 It may be prudent to confer with counsel about any templates you prepare in advance, to spot and, where possible, diminish legal pitfalls.
55 See, e.g., Hoeppner v. Jess Howard Elec. Co., 780 N.E.2d 290 (Ohio Ct. App. 2002) (to invoke the doctrine of equitable estoppel,
plaintiff must show detrimental reliance on misrepresentation).
Conclusion
A pandemic is first and foremost a threat to public health. All other issues pale in comparison. As discussed at the outset, however, the ability of energy companies to operate in a pandemic environment will have a direct impact on the extent a pandemic poses a threat to public health. Also, for any business organization, but especially for energy companies and other segments of the ?critical infrastructure,? a pandemic implicates an array of legal issues as well. In developing their plans, energy companies must factor in these issues to be in the best position to survive the disease and its aftermath.
http://www.ems-solutionsinc.com/pdfs/EnergyRoundtableWhitePaper.pdf