On March 23, 2020, Governor Whitmer issued Executive Order 2020-21 (“Order”). The Order took effect March 24, at 12:01 am and continues through April 13, 2020 at 11:59 pm. It requires residents to stay in their homes other than for exempted activities. These exemptions include work under very limited circumstances.
The Order is expected to have a profound effect on Michigan businesses. The following are answers to common questions posed by business owners relating to the Order.
How can I operate my business?
A business may not operate if it requires workers to leave their homes except as necessary to conduct minimum basic operations or if it employs “critical infrastructure workers”.
What are minimum basic operations?
Workers can work on premises if they must be present to maintain minimum basic operations including to maintain the value of inventory and equipment, to care for animals, to conduct essential transactions such as payroll and employee benefits and as required to allow others to work remotely, e.g. information technology personnel.
What if I employ “critical infrastructure workers”?
The Order exempts employees required to protect or sustain life (“critical infrastructure workers”) which include workers in the following fields:
- Health care and public health;
- Law enforcement, public safety, and first responders;
- Food and agriculture;
- Water and wastewater;
- Transportation and logistics;
- Public works;
- Communications and information technology, including news media;
- Other community-based government operations and essential functions;
- Critical manufacturing;
- Hazardous materials;
- Financial services;
- Chemical supply chains and safety;
- Defense industrial base;
- Child care workers;
- Certain volunteer workers related to economically disadvantaged or needy individuals; and
- Certain critical labor union functions.
For more information see Director of Homeland Security memorandum on identification of essential critical infrastructure workers during covid-19 response.
What if my business supplies or supports a business employing critical infrastructure workers?
For purposes of the Order, suppliers, distribution centers, or providers necessary to support critical infrastructure workers can also fall under the definition of critical infrastructure workers. However, the business being supplied or supported must designate in writing what businesses are acting in a support capacity to its critical infrastructure employees.
What if I am not sure whether my business employs critical infrastructure workers?
The determination of whether workers can be present in person or in the field should be approached cautiously. The determination can be fact sensitive and vary from project to project. For example, in response to a question about the construction trade, the Michigan Department of Licensing and Regulatory Affairs states:
Some limited forms of construction are permissible, including construction to maintain and improve essential public works like roads, bridges, the telecommunications infrastructure, and public health infrastructure. Construction workers may also undertake such projects as necessary to maintain and improve the safety, sanitation, and essential operations of residences. In addition, businesses may designate construction firms to provide necessary support to the work of the businesses’ critical infrastructure workers. All construction work that is carried out while the order is in effect must be done in accordance with the mitigation measures required under section 5(c) of the order.
What steps must I take to maintain business operations?
A business owner must take certain steps if intending to operate during the period covered by the Order, including the following:
- Determine whether the Critical Infrastructure Worker exception applies;
- Determine what workers, if any, are required to conduct minimum basic operations on your business premises;
- Inform the designated workers in writing through electronic means, on a website or otherwise by March 31 at 11:59 pm.
- Limit the number of workers on the business premises to those strictly necessary;
- Require remote work to the greatest extent possible;
- Enforce social distancing whenever possible (e.g., at least six feet distance between workers);
- Increase cleaning and disinfecting standards;
- Prevent workers from entering your premises if they have respiratory symptoms or possible COVID-19 exposure; and
- Review and adopt social distancing practices and preventive measures recommended by the Centers for Disease Control and Prevention.
What if something goes wrong?
It is unclear at this point what sanctions or penalties may apply for employers that are not in compliance with the Order. A willful violation of the Order in general is a misdemeanor but separate sanctions will likely apply to a business that operates without being exempt. There will be a record of hours worked and the State of Michigan may take action later against employers that did not abide by the Order.
The above is intended to provide general information. The determination of how the Order will affect your specific business is fact sensitive and requires analysis. If you have questions about whether you can continue to operate your business under the Order, you should contact a Kerr Russell labor and employment attorney as soon as possible.
Liam K. Healy focuses his practice on helping clients maintain compliance with the myriad of state and federal tax laws and regulations that govern individuals and businesses. A particular focus of Liam’s practice is in the area of employee benefits and ERISA. Liam specializes in designing pension and executive compensation plans to benefit business owners and executives. His practice includes drafting and reviewing deferred compensation agreements, severance agreements and non-compete agreements, representing employers in multi-employer plan collection and withdrawal liability matters.
Mark C. Knoth chairs the firm’s Labor, Employment, Employee Benefits & ERISA Practice Group. He counsels and advises business owners, managers and human resources professionals on workplace issues. These include civil rights and anti-discrimination laws; employee discipline; wage and hour; overtime; employee leaves; reasonable accommodations; veterans issues; picketing; secondary boycotts; reductions in force; drug testing; unemployment compensation; affirmative action; and union organizing campaigns, among other matters. He additionally drafts employee policies, handbooks, contracts, and covenants not to compete, and investigates threats of violence, allegations of harassment, and other employee misconduct.
Olivia V. Hankinson counsels and advises business owners, managers and human resources professionals on various labor and employment related issues. These often involve concerns which may implicate employment laws including the Americans with Disabilities Act, Title VII of the Civil Rights Act, the Fair Labor Standards Act, the Michigan Persons with Disabilities Civil Rights Act, the Family and Medical Leave Act, the National Labor Relations Act, and the Michigan Occupational Safety and Health Act. Olivia represents employers with respect to unemployment insurance hearings, MIOSHA violation allegations, EEOC investigations, and other employment law matters. She also drafts employee handbooks, employment agreements, restrictive covenants, and various other employment policies.
Brandi M. Dobbs is an associate at Kerr Russell who supports the business and litigation needs of clients. She focuses on bankruptcy and restructuring. Brandi has successfully guided consumer debtors through Chapter 7 and assisted business debtors through the Chapter 11 process.
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