3 immediate steps for restaurants and bars to take amid COVID-19 shutdown

Denver Mayor Michael B. Hancock announced the closure of all Denver restaurants and bars, except airport concessioners, to onsite seating, effective 8 a.m. on March 17, for eight weeks until May 11 due to coronavirus (COVID-19). Shortly after, Colorado Gov. Jared Polis ordered bars and restaurants across the state to follow suit for the next 30 days (which makes the estimated reopen date April 16).

As such, dining rooms are closed, but delivery, carryout and drive-through services are currently permitted and highly encouraged. For restaurants, manufacturers, brewpubs, distillery pubs and vintner’s restaurants, please work with your retail liquor store partners to facilitate the delivery of alcohol products in compliance with Colorado liquor code. If your current establishment already allows for the production of food, you may continue delivery, carryout and curbside offerings.

Some restaurants and bars can immediately pivot towards delivery and takeout services. You may also consider retooling your delivery service engagements, liquor licenses agreements and/or general food and beverage industry-specific offerings.

Immediate Tasks

Here are three steps that we recommend restaurant and bars take immediately to address this temporary closure:

1. Check internally. Assess the direction you can and want to take your business. If you determine you want to offer take-out, delivery or curbside food services, communicate with your staff regarding the decision, continue to execute rigorous cleaning methods and implement a regimented cautious social distancing in your takeout and curbside order procedures.
2. Launch externally. Retool your website and call line to accept online orders and deliveries. Publish all information regarding ordering and delivery services. 
3. Continue Vigilance. Continue to check resources for hourly updates and check in with your staff during this unique time.

Business Considerations

In addition to refreshing offerings and service options, restaurants and bars may also want to re-examine a few business arrangements, including those listed below.

Insurance 

Now is a good time to check in with your insurance carrier to see what may be covered by the current pandemic. This includes reviewing your business liability and business interruption insurance, short-term disability insurance and medical insurance for unpaid leaves. Please remember that each insurance carrier and policy is different.

Employment 

This week, Colorado’s employment COMPS Order went into effect regarding overtime minimum pay. The pandemic will not excuse anyone from misapplying the new standards, which include break and meal-time rules that once only applied to Retail/Service, Food/Beverage, Health/Medical and Commercial Support Services, but now covers break and meal-time rules for all private sector work.

In addition, there is a significant uptick in the number of inquiries regarding unemployment and severance. If you need to file a claim for unemployment, visit the Colorado Department of Labor and Employment website.

Finally, there are a lot of questions regarding implementing emergency paid-sick-leave policy or concerns related to staff reductions, please review your HR policies and seek legal advice, if needed.

Leases 

Be sure to review and understand your lease and obligations under the lease, especially during this time.

Bank Relationships 

Consider reaching out to your bank to examine options for capital infusion with your bank. However, be sure to read all loan agreements and consider the long-term impact of any changes.

In addition to the guidance above, restaurants and bars, or anyone in the food service industry may need more assistance. The list of resources below is a good place to start:

• City of Denver: Mayor’s Office COVID-19 updates | City of Denver Public Health Ordinance 3/16/2020  | Cancelations & Postponements COVID-19
• Liquor Enforcement Division: Lawful Product Returns For Event Cancellations Attributable to COVID-19 Concerns
• Colorado Department of Public Health & Environment (CDPHE): Coronavirus Updates
• TTB: Returns of Products Purchased for Events Cancelled Due to Coronavirus (COVID-19)
• National Restaurant Association: Coronavirus Information and Resources
• Colorado Restaurant Association: Coronavirus Information and Resources
• Colorado Brewers Guild: COVID-19 (Coronavirus) Resources

Jessica Hunter is an attorney at Moye White. She provides counsel to clients on corporate formation and deal structuring, regulatory compliance, intellectual property protection and portfolio management, corporate governance, and corporate law. As part of her practice, Hunter also focuses her efforts in the alcoholic beverage industry, including working with brewing, distilling, and restaurant/retail clients.