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Waivers Alone Don’t Cure COVID-19 Risk For Restaurants

Aaron N. Colby

Like many businesses and educational institutions operating during the pandemic, restaurants are considering whether to seek COVID-19 waivers from customers and employees. Restaurants should be wary, though, because seeking a waiver could end up doing more harm than good.

What Is A Waiver?

A waiver (or “hold harmless” or “assumption of risk”) agreement is a contract between two parties — such as a restaurant and a customer — limiting one party’s future legal rights (usually the customer’s) against the other. Waiver language is often found in a written agreement that requires acknowledgment or simply in a posted sign.

A robust waiver agreement typically includes different sections aimed at protecting the restaurant against legal claims from the customer:

  1. Informing of safety protocols — i.e., “the restaurant and customer will adhere to health screening, social distancing, face covering, sanitizing, etc.”
  2. Assumption of risk — i.e., “customer is aware of the inherent risk and is willing to take the risk.”
  3. Covenant not to sue — i.e., “customer promises not to sue the restaurant.”
  4. Waiver of liability — i.e., “customer gives up the right to hold the restaurant liable.”
  5. Hold harmless / indemnification — i.e., “customer will pay for any claims against the restaurant relating to the customer.”

But, just because a waiver agreement says something does not mean it is legally enforceable.

The Legal Limits Of A Waiver

Many restaurants hesitant to seek written waivers from customers, because of the optics and (for those savvy operators who understand) the limited protection it brings. This is because even a well-drafted waiver agreement may not be enforceable, depending on the context.

A waiver is not a complete defense — the equivalent of legal “silver bullet” — by any means. In fact, its name is misleading as to its legal effect.

Generally, a waiver does not cover future conduct, gross misconduct, or a government investigation or proceeding (like OSHA). And, a waiver may not be enforceable if the conduct is intertwined with food and safety-related regulations.

While a waiver agreement may be a deterrent to suing, legally speaking, it is simply one piece of evidence to help prove that the customer was put on notice of the risk and agreed to incur it. It is like a “slippery when wet” sign on a wet floor: if the customer walks through the area and slips, there still may be liability, but it may be less because the customer engaged in behavior they were warned was risky, and thus the customer should share in the fault (the legal doctrine is “comparative fault”).

Waivers Can Backfire And Add Risk

Using a waiver can actually backfire, increasing the risk to a restaurant.

If a customer waiver identifies safety procedures that the restaurant ultimately does not follow, the customer may use it against the restaurant. The customer could argue that they were misled into believing the dining experience was safe. A restaurant failing to follow its own policies is never a good fact in any litigation.

A restaurant that seeks a waiver from its employees may violate workers’ compensation laws that require coverage no matter what an agreement says.

For instance, California law prohibits any agreement between an employer and employee that waives workers’ compensation protection. This is exactly what a waiver agreement seeks to do.

Forcing employees to sign waivers may lead to civil penalties for violating California Labor Code Section 432.5, which states that “no employer, ... shall require any employee or applicant for employment to agree, in writing, to any term or condition which is known by such employer ... to be prohibited by law.” The end result is a waiver agreement that may encourage claims instead of deterring them.

Seeking a waiver from a worker classified as an independent contractor does not raise the same concerns, so long as the worker is properly classified, and not actually an employee per law.

There is no “quick fix” or shield against the risks of operating in a pandemic. An enforceable waiver in the right context can help, but it does not replace the need for creating and maintaining a safe dining and work environment.

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I’m an employment lawyer at Colby Law Firm who represents California employees in workplace disputes.  
