Companies Ban Business Travel, Cancel Events & Close Stores As Coronavirus Spreads

Samantha McDonald
·5 min read

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As the deadly coronavirus continues to spread across the world, many companies and organizations are taking precautions to not only alleviate their workers’ concerns but also to mitigate the potential impact on their businesses.

As of Tuesday, more than 90,000 people have contracted the coronavirus, which has led to at least 3,100 deaths. The Centers for Disease Control and Prevention has advised Americans to cancel all nonessential travel to China, where the illness originated, as well as encouraged employers to make short- and long-term plans in the event of a possible outbreak in the U.S. (More than 100 cases and six deaths have been confirmed stateside.)

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From corporate travel bans to store closures, here are the big steps companies are taking to keep employees safe.

Corporate Travel Bans

The coronavirus — which has now affected more than 70 countries — has upended travel across the world. In the U.S., alone, new restrictions on travel from Iran and travel advisories for certain parts of South Korea and Italy have been enforced, on top of screening already in place for travelers coming from China.

Companies including e-tail behemoth Amazon, tech titan Google, professional services firm Ernst & Young and social networking giant Twitter are among the companies that have requested their employees to either cancel or postpone non-critical business travel. Trade organizations including the Footwear Distributors and Retailers of America and the American Apparel and Footwear Association have also advised members to sequester themselves or conduct business remotely from their own homes as a precaution.

“Although in pandemics, there is often a high level of fear, in this current situation, the fears are likely valid if they involve international travel to high-risk areas,” said Rebecca Bernhard, a Dorsey & Whitney partner in Minneapolis. “If an employee is willing to travel, the employer should make sure the employee is aware of all the risks, including the possibility that the employee won’t be permitted to return to the U.S. without undergoing a quarantine in another country, and the employer should impose a quarantine of the employee upon return.”

Preventative Protocols

Beyond restricting travel and cutting back on store operations, some companies have released tips including minimizing physical contact by suggesting a no-handshake policy and upping the rate of disinfecting frequently touched areas, such as door handles and public bathrooms. Such suggestions were also made by the AAFA in a memo distributed to attendees ahead of today’s Executive Summit.

“That may become the ‘new norm’ for the time being,” the organization wrote in an email to attendees, adding that it would continue to follow the guidance of the CDC and the World Health Organization regarding the coronavirus.

As fears mount over the possibility of infection, numerous conferences and events have been either postponed — the FDRA’s Executive Summit has been moved tentatively to the early fall — or canceled. For instance, Target’s investor day in New York City and Tokyo Fashion Week were both called off.

“If there is evidence of an outbreak in the U.S., employers should plan to be able to respond in a flexible way to varying levels of severity and be prepared to refine their business response plans as needed,” said the CDC. The agency advised companies to make decisions based on key considerations such as the number of people who are infected or have died in the community where their business is located, as well as prepare for a possible increase in employee absences and coordinate with state and local health officials for the most up-to-date information about the illness.

Store Closures

China is responsible for producing the bulk of apparel, footwear and accessories sold around the world, and travel restrictions in the country have impeded both manufacturing and foot traffic to stores. To help curb the spread of the illness, many retailers have either temporarily shuttered their stores in China or reduced operating hours at those locations that remain open.

The closures have led several companies including Ralph Lauren Corp. and Kate Spade parent Tapestry Inc. to issue revenue and profit warnings for the year, as lower sales are forecasted to dent their fiscal-year bottom lines.

“Because of the trade war, companies brought in a lot of product earlier than normal, so they do have some inventory to work with, but trying to replenish in-demand product might be a challenge in the near term,” said FDRA president and CEO Matt Priest. “My hope is that demand is not severely impacted on this side of the globe, but as you see from a lot of earnings reports — not just footwear-specific, but also broader consumer goods — there is potential for a negative impact.”

An analysis published last month by Moody’s Analytics estimated that the coronavirus could lower the world’s gross domestic product growth this year by as much as 0.3 percentage points, or more than $200 billion. In the U.S., the research firm predicted that GDP growth would hit 1.7% this year — below the economy’s 2% potential growth rate — due to the fallout from the illness.

“The [coronavirus] has suddenly become a serious threat to the Chinese, global and U.S. economies. How serious is difficult to gauge given large unknowns as to how widespread and virulent the virus will be,” wrote chief economist Mark Zandi. “However, there are no good scenarios, particularly given the fragility of the global economy even before the virus was on the scene, and the already-long list of significant geopolitical threats.”

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