During his January 2021 State of the State address, Arizona Governor Doug Ducey called for “COVID liability protection, so that a statewide emergency doesn’t line the pockets of trial attorneys with frivolous lawsuits.” On March 30, 2021, the Arizona State Legislature answered Governor Ducey’s call and passed Arizona’s pandemic-related liability shield legislation. Senate Bill (SB) 1377 establishes civil immunity for employers and health care providers for actions (or omissions to act) related to “a public health pandemic that is the subject of the state of emergency declared by the Governor.” Governor Ducey is widely expected to sign the bill into law, and presuming he does so, SB 1377 will be retroactive to March 11, 2020.

SB 1377 applies to a wide range of persons and providers, including the following:

1. A person who furnishes consumer or business goods or services or entertainment.

2. An educational institution or district.

3. A school district or charter school.

4. A property owner, property manager or property lessor or lessee.

5. A nonprofit organization.

6. A religious institution.

7. Th[e] State [of Arizona] or an agency or instrumentality of th[e] state.

8. A local government or political subdivision of th[e] state, including a department, agency or commission of a local government or political subdivision of th[e] state

9. A service provider as defined in [Arizona Revised Statutes] Section 36-551.

10. A health professional as defined in [Arizona Revised Statutes] Section 32-3201, including a person who is supervised by the health professional in the course of providing health care services.

11. A health care institution as defined in [Arizona Revised Statutes] Section 36-401.

Employers falling within any of these broad categories may find the following provisions of SB 1377 of particular note:

• “A person or provider that acts in good faith to protect” another individual “from injury from the public health pandemic is not liable for damages in any civil action for any injury, death or loss to person or property.” (Emphasis added.)

• SB 1377 creates a presumption that “[a] person or provider … acted in good faith if the person or provider adopted and implemented reasonable policies related to the public health pandemic.” (Emphasis added.)

• To overcome this good faith presumption, an injured individual must prove “by clear and convincing evidence that the person or provider failed to act or acted and the failure to act or action was due to … wilful misconduct or gross negligence.” (Emphasis added.)

SB 1377 imposes a high burden for potential plaintiffs seeking pandemic-related damages. To succeed against a covered and qualifying employer, potential plaintiffs must point to clear and convincing evidence that (1) an employer’s policies were unreasonable, and (2) an employer’s actions constituted willful misconduct or gross negligence. Although SB 1377 does not expressly define “reasonable policies,” the bill does state that “[a] health professional or health care institution is presumed to have acted in good faith if the health professional or health care institution relied on and reasonably attempted to comply with applicable published guidance relating to the public health pandemic that was issued by a federal or state agency.”

Moving forward, Arizona employers may want to review their existing COVID-19 policies to ensure consistency with applicable federal and state guidance. Employers may also want to review the recent changes to Arizona’s business requirements under Executive Order 2021-06 (“New Phase of COVID-19 Mitigation: Business Guidelines Transition From Requirements To Recommendations”).