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    United States Socialist Republic book by HG Goerner

    Can Private Businesses Legally and Morally Force Customers to Wear Masks?

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    The most shocking aspect of the viral video from Galveston wasn’t the police brutality directed against a “senior” citizen because unfortunately we have all grown accustomed to state-sanctioned violence. What shocked most was that a major U.S. bank would expose itself to such negative publicity, civil lawsuits, and regulatory chastisement by trying to enforce a private mask mandate, i.e., one no longer mandated by government, against depositors.

    The United States in the 21st century, after all, is a nation of laws — many, many, many laws, regulations, administrative rulings, and such. Business leaders that do not react quickly and intelligently to changing circumstances may be hoisted by the petard of the overgrown regulatory state to the detriment of their shareholders. Much of the regulatory guidance on the masking issue presumes that a state or local government mask mandate is in place, not just CDC guidelines. (While CDC guidelines may be constitutional, de facto federal mandates disguised as guidelines are not.)

    For starters, any bank that knows its business should prohibit anyone entering the bank from wearing a mask, which is standard bank robber attire. While bank robbery data for 2019 and 2020 are not yet official, clearly many robberies occurred in 2020. The notorious Too Tall Bandit remains at large after (presumably) his fifteenth hit last December. That same month, masked banditti struck four banks in Cambridge alone, including two in Harvard Square.

    Vault cash constitutes only a small percentage of bank assets these days, but shouldn’t the FDIC immediately close any bank that risks depositors’, stockholders’, and ultimately taxpayers’ money so recklessly? How could the bank’s private security not handle an unarmed elderly woman? Is the bank free-riding on the taxpayers of Galveston by not supplying its own security? Isn’t it announcing to bank robbers that it cannot defend its own vault cash?

    What the Galveston bank branch did was especially grievous because it denied a depositor timely access to her funds. In the past, banks used such tactics to stave off bank runs and on one infamous occasion a bank caused a panic because it did not clearly communicate with a depositor who went away thinking the bank was out of money rather than that he was out of money at the bank. Any business policy that endangers bank solvency runs afoul of numerous financial regulations, if not explicitly at least implicitly. Depositors might withdraw funds en masse in protest, or simply out of fear that the bank in question does not know its business.

    Yes, the bank is a private entity but that doesn’t mean that it can lawfully or morally treat its employees or customers however it wishes, even in some hypothetical Libertarian Land. Except for Walter Block and a few others, for example, no lover of liberty would think it acceptable for the bank to enslave anyone.

    ‘Tis true that mandating a mask is a far cry short of slavery but it’s also the case that forcing someone to wear a mask with (alleged) medical qualities (“staying safe”) without a government mandate to do so is a far cry beyond “No shirt, no shoes, no service” (NSx3). 

    Most importantly, any private entity that enforces a medical-grade mask mandate may be practicing medicine without a licensea serious offense in all 50 U.S. states. (If some highly paid lawyer can magically turn a regular business into a healthcare provider the business then would be subject to HIPAA and likely in breach of it.) Private entities enforcing medicinal masking may also run afoul of Title III of the Americans with Disabilities Act and the Rehabilitation Act if they do not provide reasonable alternative accommodations, like separate hours or rooms for those whose real doctors have advised them not to mask.

    Trying to enforce a more lenient “face covering” rule under NSx3 precedent is also fraught. NSx3 rules were created ostensibly to keep “hippies” out of stores circa 1970 but they have also been handy for excluding other “undesirables,” including a much younger and poorer version of myself and sundry other hyphenated Americans. I do not claim that NSx3 rules are inherently racist, only that they have been used by racists, which makes them suspect given that they serve no clear purpose.

    NSx3 rules falter legally at the retail level when inconsistently applied, as they often are. Visit any store on the Jersey Shore in high season and you’re bound to see topless young men and young ladies wearing nothing more than a thong and a waterproof brassiere happily shopping away. But then I saunter in with just a European-style speedo and carnage ensues because I am creating a negative externality (allegedly) while the younger folks are creating positive ones (indubitably).

    Inconsistency also stems from context. Imagine the silly Catch-22 of a shoe or clothing store with a rigidly applied NSx3 rule. “I’m sorry but I’ll have to call the cops and have you tasered if you try to come into my shoe (shirt) store without shoes (a shirt)!” I see shirtless women in stores all the time … because they are wearing one-piece dresses. But I have also seen a man wearing a torn tank top in a liberal part of Georgia told that he couldn’t shop because what he was wearing was not really a shirt. Really? Or was it really his MAGA cap and skull face mask that gave umbrage?

    Walk-in retail NSx3 rules are a bit different from rules established by clubs or by businesses with established customers, where contracts, express or implied, proliferate. One can relatively cheaply buy shoes or a shirt at a more amenable establishment but clubs and banks require investment of money and/or time, making voting with one’s feet more costly.

    Clubs can establish any rules they like, so long as they are legal, but they also have to establish procedures for changing those rules that require checks like due notice, quorums, and so forth. Moreover, morally, if not contractually/legally, they should allow membership transfers or refunds whenever a rule change takes place, even if it simply adjusts its hours of operation, or implements a new mandate that a piece of clothing, be it a face covering or a blazer, be worn on the premises.

    Businesses with established customers inhabit sketchier ground because the contract with customers is often more implied than explicit, especially in weird areas like mask wearing. Suffice it to say, like clubs, they cannot break occupational licensing or other laws. They have more discretion in changing hours of operation and other “terms of service” but if they try to block customers from changing service providers they may well run afoul of antitrust or even racketeering laws, depending on the nature of the barriers put in place.

    Outside of healthcare and food prep requirements pre-dating Covid, forcing employees to wear masks without a government mandate to do so also must run afoul of numerous labor laws and OSHA regulations. It is true that employees who don’t like to mask can quit but the same could be said for employees being sexually harassed. Should they have to quit too? The law says no! And forcing someone, especially someone who has survived Covid or had a “vaccine,” to wear a mask 8 hours a day is a form of harassment, even if all employees are instructed to wear masks. A boss who propositions all employees regardless of age, gender, and so forth isn’t guilty of discrimination but s/he has harassed employees because the behavior is legally and morally unacceptable. Depriving employees of oxygen and normal human interaction without clear cause is also unacceptable. If you don’t believe me, just ask 2019. Or 1900. Or 1800.

    At least one lawyer’s page, which I refuse to link to, asserts (wrongly) that the legal presumption is that masks protect others, so employers can mandate them because employers have a right, and even a responsibility, to “protect” their employees and customers. Without a government mandate, though, that argument could be used to justify any form of humiliation or torture. What if an employer claimed, after hiring employees, that kilts or mercury purges served to protect others? Employers cannot be left to decide what constitutes harassment or public health and safety.  

    In terms of tort law, businesses in places without government mask mandates should now be more concerned about getting sued for the obvious harms caused by masks than from people contracting Covid in their businesses. Transmission is difficult to track, which is why contact tracing was such a bust. 

    In practical terms, businesses may fear that if they do not keep up pandemic LARPing frightened members of the public may take their business elsewhere. Any decent business, though, knows how to handle heterogeneous customer preferences. Transition back to normal by initiating masked and maskless hours or locations and allow customers and employees to opt into either based on their preferences.

    Needing to sic the coercive power of the state on peaceful people is not good management practice and suggests that harm is being done to employees and customers, harm that is definitely greater and more actionable than any harm caused by not enforcing mandates that governments are rapidly abandoning as ineffective.


    Robert E. Wright

    Robert E. Wright

    Robert E. Wright is a Senior Research Fellow at the American Institute for Economic Research.

    He is the (co)author or (co)editor of over two dozen major books, book series, and edited collections, including AIER’s Financial Exclusion (2019).

    Robert has taught business, economics, and policy courses at Augustana University, NYU’s Stern School of Business, Temple University, the University of Virginia, and elsewhere since taking his Ph.D. in History from SUNY Buffalo in 1997.

    Get notified of new articles from Robert E. Wright and AIER.


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    David Puu
    David Puu
    3 years ago

    Well written piece.

    It is odd how County and City officials acted as if all existing Public Health and Safety as well as Cal Osha workplace code was nullified by a State Governor’s Emergency declarations and mandates which actually were carefully worded as being “guidance”.

    It was sketchy watching City Zoning and Code Enforcement “Officers” enter area businesses pretending to be law enforcement. (They are not).

    This really had the smell of blackmail of the companies, and in turn violation of all manner of existing laws regarding Civil Rights and Public Safety

    When we asked one mayor about why he was complying with what the State was asking the City to do, he stated that the City had to, or the State could bankrupt it.

    So there you go.

    Mike Smith
    Mike Smith
    3 years ago

    “Can Private Businesses Legally and Morally Force Customers to Wear Masks?”
    These are 2 different questions.

    1. Legally? Depends on the jurisdiction.

    2. Morally? Not in any jurisdiction.

    ‘Legal’ and ‘moral’ do not always overlap. Most people in the world understand this. And most people outside America are (actually) not free.

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