On April 22, 2020 Governor Tom Wolf announced that all businesses in the construction industry will be permitted to resume in-person operations starting May 1, 2020. Resumption of projects requires observance of certain Guidance that the Wolf Administration developed in coordination with the General Contractors Association of Pennsylvania. The Guidance protocols are designed to mitigate the spread of COVID-19 while mandating the responsible management of construction sites. Governor Wolf’s announcement stresses that all businesses and employees in the construction industry must adhere to the Guidance, which provides for various measures for operational safety, including that all persons present at work sites wear masks/face coverings, social distancing, sanitization, and hand washing, the designation of “pandemic safety officers,” and steps that must be taken upon discovery of exposure or probable cases of COVID-19.
As projects reopen, owners and contractors will likely encounter claims due to delays, increased material and labor costs, and labor shortages. Although a PA Supreme Court order generally extends filing deadlines due to COVID-19 court closures, we have seen no precedents from the Pennsylvania courts specifically changing deadlines in the Mechanics’ Lien Law, the Contractor and Subcontractor Payment Act, or the Prompt Payment Act. Missing such deadlines has serious consequences. Contractors should work with their attorneys to ensure that liens are timely perfected. Likewise, owners withholding payment from contractors for defective work or billing issues (and contractors withholding payment from subcontractors) must continue to follow deadlines in the appropriate statutes. Contractors/subcontractors should track additional costs incurred as a result of the pandemic and, if appropriate, provide their owners/contractors with detailed notice of possible claims. Finally, contracts should be reviewed with attention to provisions governing delay and business interruption. These are just a few examples of steps that construction industry participants can take now in order to protect their interests. They will become increasingly important for companies dealing both with the immediate fallout of the pandemic and the evolving reopening process in the wake of COVID-19.
Steptoe & Johnson’s Construction team brings an array of experienced attorneys that can assist clients facing these issues. For more information on Steptoe & Johnson’s Construction Team, click here.