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Leadership at All Levels

Risk Management in a COVID-19 World

Tricia Kagerer | April 10, 2020

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Orange and white construction sign reads coronavirus

It seems just yesterday that I was preparing for Women in Construction Week (WIC) by writing an article about how women could save the labor shortage in the construction industry, "Supporting Women in Construction." What a difference a pandemic makes. In 3 short weeks, priorities have shifted from bringing much-needed diversity to the construction industry to how our industry and our country can survive the pandemic crisis called COVID-19.

I recently narrowed my writing and speaking focus to two main topics―empowering women in nontraditional workplace roles and dealing with the aftermath of crisis―both focusing on the human side that is often overlooked and forgotten. March started as a high-profile month for both of these topics. The first week of March is dedicated to WIC; the second week of March, I was invited to speak at the Associated General Contractors of America (AGC) and ConExpo Convention in Las Vegas, Nevada. With two purposes in mind, I spent the morning packing for the convention. First, what to wear during my speech called "The Aftermath of Crisis: Identifying and Managing the Human Impact on Survivors, Family, Co-workers, and Community." Second, how do I carve out time to celebrate my 25th wedding anniversary during my 3-day trip? My husband decided to come along so that we could celebrate early.

Who would have guessed that less than a month later, I would be grateful that we celebrated early because the notion of a trip to Vegas to celebrate anything today is a distant memory? How could I have known just how important the topic of the "Aftermath of Crisis" would be to every one of us living daily through the horrors of the COVID-19 crisis? The world changed, our society changed, and our work environments changed. After this crisis, the lessons learned will reveal themselves. I can only hope that we will emerge stronger.

Proud to Be Essential

The Department of Homeland Security Cyber and Infrastructure division has deemed the construction industry an "essential business." Why is this so? According to construction industry experts, shutting down construction companies means shutting down a mobilized, skilled workforce with access to materials, equipment, and supply chains that can respond to hospital systems, grocery stores, food production facilities, housing, critical infrastructure, and other essential operations that are absolutely necessary during this time. There will be a need to build temporary health facilities and retrofit and expand existing ones.

Additionally, the workforce must remain intact for us to continue natural disaster cleanup areas and be ready to answer the call for help in the wake of any future natural disasters. Mobilizing the men and women of the construction industry will be more expedient if workers continue on the job.

As an essential business, the construction industry must keep our projects running, and most importantly, we must keep our employees safe. The coronavirus creates new challenges for every organization that is deemed essential. As the executive vice president of risk management for Jordan Foster Construction, I find myself in a unique role. I'm very grateful construction is deemed an "essential business." But we have to create a new normal and implement recommended best practices to provide a safe work environment for everyone on our projects.

Emergency Response and Business Continuity Take Center Stage

I have been speaking and writing about the overall need to prepare for emergencies in advance for the past 10 years. Having worked in manufacturing, public entities, and construction, I have found that most organizations were not prepared. The biggest challenge for emergency response planning is the human tendency to think, "That will not ever happen to me." Until it does, companies believe that emergency preparation requires time and effort that they don't really have or want to spend. Why waste money and time to train, implement, and test emergency response efforts when the event may never happen in the first place?

COVID-19 has officially blasted through that barrier. The AGC presents daily best-practice sessions for how organizations must respond. These efforts are detailed and time-consuming and require long-existing industry and company silos to finally break down. Shared services must work with operations, risk, and safety, while human resources must be aligned. In addition, information technology (IT) must be at the forefront to keep teams now working at a distance operational. And it all happens in an instant. Communication at all levels of an organization is the new norm, and it is a good thing!

Behind-the-scene steps that construction companies must consider in our COVID-19 world include the following.

  • Visible Executive Leadership Involvement

    Our executive team is meeting regularly to stay abreast of the ever-changing landscape and the deluge of information. It is critical that the executives are evaluating the situation daily and planning for the future in order to protect the long-term sustainability of the business. 

  • Setting Up/Engaging an Emergency Response Committee

    The executive committee charts the course, makes decisions, and creates the plan. An emergency response committee is necessary to make things happen. This committee must include representatives from legal, human resources, IT, marketing/social media, operations, accounting, risk management, and safety. Important discussion items include the following.

    • Shared services remote work arrangements―procedures, pay, protocol, and connectivity
    • Compliance with federal, state, and local emergency directives
    • Legal implications of new rules
    • Identifying external sources for supplies of personal protective equipment
      • How to ensure that workers have handwashing capabilities on-site
      • How to provide cleaning supplies and hand sanitizer that are now in short supply
      • How to ensure enough toilets/portapotties and wash stations are on-site
      • How to obtain masks for all workers when they are not available
  • Defining, Educating, and Implementing the New Normal

Construction has defined processes with procedures and task-hazard analysis, and yet the industry still has one of the highest fatality rates. Even when all conditions were excellent, the industry was plagued with safety challenges. COVID-19 adds another dimension to the already challenging world of construction. 

Safety Challenges in a COVID-19 World

The following are just a few of the safety challenges our industry faces. While some have always been challenges, the risks are exacerbated in our new normal and new ones keep popping up.

Hydration. How do you make sure all workers have access to water when community water stations pose a risk? Water bottles, like toilet paper, are a high-commodity item. Shared water stations are a common way to provide water to our workforce. They are now considered a potential source of contamination. The Occupational Safety and Health Administration (OSHA) requires employers to provide water for all workers. With water bottles in short supply and shared water stations creating exposure issues, we are working on creative ways to comply. For example, we are asking all workers to bring their own water bottles to the job site. We are also asking our external supply partners to provide pallets of water bottles on a regular basis. Water bottles can be stored in CONEX boxes.

Hygiene. Once again, water can be difficult to find on construction projects. Handwashing stations and hand sanitizer are typically the best options. Both of these options are in short supply and high demand. This leaves construction operations to come up with creative ways to meet new local emergency directives. Some creative choices include designing portable sink stations and water trucks for handwashing stations. Distilleries across the United States, including my own personal favorite, Tito's Vodka, have switched to making hand sanitizer in bulk. We are now working on ways to get the bulk orders out to our project teams scattered across Texas.

Temperature. A best practice is to have every employee take their temperature before they come to work. If their temperature is above 99.6°F, they should not report to work. We have set up a communication system to remind all our employees to take their temperature and record it in a mobile app. This will be one more way to prevent exposure to the virus.

Breathing. For the last month, dust masks were not deemed a necessity. On Friday, April 3, 2020, everything changed. The Centers for Disease Control and Prevention (CDC) now recommends dust masks for everyone to prevent the spread of COVID-19. Does that mean that employers need to provide them? Where does one get them? Luckily, our resourceful safety team has sourced them through a local vendor and hopes to have them early this week. How they will be distributed, cleaned, and cared for is in development.

When it comes to respiratory protection, OSHA has strict rules. Dust masks are not considered respirators. N-95 masks are respirators, which have very specific requirements, including fit-testing, training, and shaving for men to properly wear. Out of an abundance of caution, we have had several workers show up with various "respirator" apparatuses at our projects, including several of the coveted N-95 masks. The challenge is if they should be allowed when technically OSHA says they require a full-blown respiratory protection program. I don't want to be in the position to tell someone they can't use a mask. If the mask brings them comfort to work under this unique situation, then where does one draw the line? These are questions that don't have good answers and will evolve as the situation changes.

Separation. "Social distancing" is a new concept for all of us, and it creates new challenges for construction. Some areas that must be addressed are obvious, including limiting the number of people using an elevator or a buck hoist, reminding employees to take breaks and lunch separately, and performing daily huddles at 6 feet apart. Some things get a bit trickier. How can two tradesmen use a boom lift and maintain social distancing? How can we stagger the schedule to minimize direct contact? These challenges require communication with all trade partners, operations, and safety team members to create plans that work. The daily task plan that used to be a checkbox is more important than ever before to facilitate change and protect our people closest to the work.

Risk Management Challenges

As an "essential business," the construction industry is expected to keep building. Every construction project begins with a contract between the owner and the general contractor. Contractors are held to all aspects of that agreement. Most contracts have provisions related to delays. If the contractor does not meet the schedule and turn the job over on time, they are in breach of contract, which can trigger delay penalties such as consequential or liquidated damages. The only way these penalties are void is if an owner or a local, state, or national party decides to shut down construction. This is called force majeure, which is a contractual defense that allows a party to suspend or discontinue performance of its contractual obligations under specific circumstances.

Over the course of the last few weeks, I have been asked on numerous occasions, "Why don't you just shut down for a few weeks?" The answer is clear: we can't. As an essential business, we must keep going!

There are numerous issues related with shutting down construction sites that create hidden risks that people may not realize. Abandoned projects create major security risks. A new project with an open trench is an attractive nuisance to the community and invites opportunities for bodily injury, property damage, vandalism, and theft. Speaking of theft … I never expected to have to plan for simple things we take for granted in everyday life, like toilet paper. In risk management, theft on construction projects is an unfortunate common occurrence. Supplies, tools, and even equipment sometimes vanish in the night. I never thought I would be working on a toilet-paper-theft prevention plan.

Toilet paper is vanishing from porta potties as quickly as it vanished from Costco shelves. And the shortage is impacting our external supply partners. We are required to provide the necessary facilities and paper, but what can we do if the toilet paper is stolen? We have the same issue with hand sanitizer. A creative safety manager devised a way to lock down the hand sanitizer. He built hand sanitizer stations out of wood and wrapped the containers with metal banding.

Risk and legal construction professionals are scrambling to review both upstream and downstream contracts to determine how best to manage the ever-changing COVID-19 environment. Some cities and states have required construction shutdowns but provided little guidance as to how to protect and resolve these issues in the future. The AGC and IRMI provide sage advice that every risk manager and legal professional needs to review and understand. The implications are endless but crucial to business continuity.

Risk managers are also reviewing insurance policies to determine if there is any coverage for this deadly threat. Unfortunately, coverage for a pandemic event today is virtually nonexistent. Insurance policies are triggered by a "covered event." Any policy that may have a business interruption component, such as property or builders risk, will have an exclusion for a pandemic. It will be up to the courts to determine if definitions expand to trigger coverage. That may be good for the policyholder but very bad for the insurance industry. Policies were not underwritten in consideration of a pandemic exposure, so premium was not collected to fund such losses. It will be interesting to see how things play out, but it is likely to be a long, costly legal battle.

HR and Coping

The Families First Coronavirus Response Act mandates that employers with under 500 employees provide paid sick leave, and it extends the Family Medical Leave Act. The rules are specific and will be enforced.

A more ambiguous dilemma is the question of when someone is afraid to come to work. Some family members have specifically asked members NOT to leave the house. How is that handled? This is another grey area that is difficult to manage. If someone doesn't report to work because they are afraid, is it considered abandonment of a job? If everyone goes on vacation at the same time because they are afraid to work, will it impact production and the ability to keep the projects running? I believe that the most important part of the human side of the crisis is how we perform when we are worried and scared to death!

How do we deal with the panic in our minds? Over the last few weeks, most of us have probably experienced the following.

  • Anxiety or excess worry
  • Doom or gloom
  • Anger or impatience
  • Loss of concentration
  • Difficulty sleeping

These are all real symptoms of stress. No one is telling you NOT to feel this way. In fact, we are all feeling that way.

If we are honest, what we are all experiencing is a normal reaction to an abnormal event. A pandemic crisis is not normal: none of us has ever experienced anything like this in our lifetime. This health crisis is scary and constantly changing, but we are doing our best to manage it as best as we can. Our first reaction may be to live in panic and fear. However, that will make things worse and get us nowhere.

How can we reshape our thinking and put it into perspective? We need to tell ourselves that it is okay not to feel okay. It is completely normal to NOT feel okay. If we all felt okay and didn't acknowledge what is going on around us, then we would really have a problem.

Now that we have admitted that it is okay to not be okay, what can we do? Humans deal with stress and uncertainty by using coping mechanisms. Some of those mechanisms are healthy; others are not. For example, ineffective coping mechanisms include the following.

  • Letting our thoughts run wild
  • Dwelling on a doomsday scenario and living in alarm mode 24 hours a day
  • Self-medicating through drugs, overeating, and drinking

How do you get control over the voice in your head? I recommend acknowledging that you have one. If you don't think you do, you are probably saying to yourself, "I don't have a voice in my head!" That is the voice I am talking about. You need to name that voice and claim it. Once you hear it, you can listen to it and acknowledge when your alarm bells are sounding. Of course, in this situation, alarms in our minds should be going off. But if we can't control the outcome when we go to doomsday scenarios, we make things worse for ourselves, our families, our employees, and our colleagues.

Focusing on the doomsday scenario too much will have a ripple effect in our brain. We begin to believe the worst-case scenario is inevitable, and we may withdraw from others or get so absorbed by the media that we stop taking care of ourselves.

How do we stop this thinking in the COVID-19 world? First and foremost, proceed with the facts and not emotions.

This is a serious matter; we need to be concerned, but we also need to keep in perspective that there are other health risks. Stay focused on safely performing your work while on projects and while driving.

One coping strategy is to actively focus on what we can control today in this present moment. When we focus our thoughts on what we have control over, we will feel better. Here is a simple exercise: ask yourself, "What do we have control over today?"

  • We have a job. We are employed, and we have work to do.
  • We can control our personal hygiene. We can take the time to clean our work areas, our tools, our cell phones, and our vehicles.
  • We can practice social distancing. We can respectfully stay 6-feet apart from one another at work. We can brainstorm ways to do work in new ways to avoid contact.
    • Can we split our work into shifts?
    • Can we use technology to engineer a better way of doing something?
    • Now is the time to brainstorm and try new ways.
    • We can make sure we get enough rest.
    • We can work on eating healthy to stay healthy and keep our immune system working optimally.
    • We can exercise: go for a walk after work. Research shows that a walk can actually reduce our risk of getting sick.
    • We can stay connected with positive people. If the people we surround ourselves with are constantly thinking negatively and planning for the worst, that can impact our own view of the world.
    • We have control over who we listen to and how much media we watch. Experts say to limit our media consumption to reliable sources for only 30 minutes a day.

Another tool you can use if worry is impacting the quality of your life is to take a moment and write down your worries. Actually write them on a piece of paper. Examine them. Ask yourself if you are worrying about things under your control or if they are things outside of your control. Ask what you can do to get the control back. What is causing my worry? Are my fear and my anxiety really in proportion to what is going on in my life and my sphere of influence? If you are feeling so anxious that you can't put your life in perspective, then it is time to reach out for help. Check in with your HR department and health insurance benefits to find a counselor. Also, check out your local and church communities. Reconnect with friends and family. Now is the time.


In today's world, we do need to be concerned, and we should be cautious. By taking care of your whole self and living in each moment of each day, you will notice that you will feel better. You will also influence others and, hopefully, become a role model and a source of strength for others―your coworkers, your families, and, most importantly, your children.

Finally, remember the serenity prayer. Accept the things you cannot change, have the courage to change the things you can, and find the wisdom to the know the difference. We cannot change the fact that COVID-19 is here in the United States and in our communities. We can change our behavior at work and home and take steps to stay healthy. We can wisely name and claim our thoughts and control them so that we reduce panic and live in the present. We can have faith that we will get through this together.

Opinions expressed in Expert Commentary articles are those of the author and are not necessarily held by the author's employer or IRMI. Expert Commentary articles and other IRMI Online content do not purport to provide legal, accounting, or other professional advice or opinion. If such advice is needed, consult with your attorney, accountant, or other qualified adviser.