Alerts & Newsletters

The United States’ Centers for Disease Control and Prevention (CDC) has issued an order that will take effect on January 26, 2021, requiring all arriving international airline passengers to provide proof of a negative COVID test taken within three days of the flight’s foreign departure. For those who have had it, the CDC will require proof of recovery.

The Department of Homeland Security (DHS) has published a final rule substituting last year’s random selection registration process with one based on the wage offered to the worker. Under this new rule, cases with higher wages are more likely to be chosen.

With the ability of public bodies to meet remotely under “any circumstances” set to expire on December 31, 2020, the Michigan Legislature recently amended the Open Meetings Act to extend any reason remote meetings through March 31, 2021. These amendments also now mandate certain safety protocols for in-person meetings held before April 1, 2021. Public bodies should remember that, separate from these new amendments, they must also still adhere to gathering restrictions and requirements issued by the Michigan Department of Health and Human Services.

Effective February 23, 2021, the 2016 Minimum Standard Detail Requirements for ALTA/NSPS Land Title Surveys are being replaced with the new 2021 Minimum Standard Detail Requirements for ALTA/NSPS Land Title Surveys (“2021 Standards”). The 2021 Standards include a variety of changes that seek to further limit a surveyor’s liability and provide better clarity. This alert highlights some of the more notable changes.

The President recently signed into law the Criminal Antitrust Anti-Retaliation Act, which amends the Antitrust Criminal Penalty Enhancement and Reform Act of 2004, granting stronger protections to employees who come forward with claims of antitrust violations. As protections strengthen, employees are empowered to act unilaterally, exposing employers to unforeseen accusations and unintended consequences. Perceived retaliation could result in damages even if the antitrust allegations are unproven.

This alert explores the key developments impacting California employers including the expansion of the COVID-19 related laws, the expanded California Family Rights Act, Paid Sick Leave, Workplace Safety, and Workers’ Compensation.

Ever since the beginning of the COVID-19 pandemic, the promise of an effective vaccine has been held out as a key component to a return to normality. Now, with the Pfizer vaccine approved, and the Moderna vaccine on the path to approval shortly, employers have begun struggling to determine what their legal obligations are towards employees who refuse to be vaccinated. While we have addressed these issues recently in a Dec. 16 webinar, the EEOC issued guidance to employers in the form of a Technical Assistance Bulletin to clarify how employers should address employee objections to vaccination that arise under Title VII of the Civil Rights Act, the Americans With Disabilities Act, or the Genetic Information Nondiscrimination Act. While that guidance is not binding upon employers or the Courts, it is nonetheless useful to employers contemplating the legal restrictions that may exist in addressing vaccination in the workplace.

The Centers for Disease Control and Prevention has expanded the definition of close contact to now evaluate exposure cumulatively over a 24-hour period such that “15 cumulative minutes of exposure at a distance of 6 feet or less can be used as an operational definition for contact investigation.” Because the newly expanded definition is not limited, it impacts many different industries (including transportation and logistics, health care, automotive, manufacturing, and educational industries) and different persons (e.g., first responders, health care professionals, customer-facing employees, and others). As winter is coming and the holiday season is upon us, the CDC’s new “close contact” definition greatly impacts all workers, employers, and workplaces, as everyone now needs to evaluate physical distancing in smaller, repetitive increments of time.

On November 15, 2020, Michigan’s Department of Health and Human Services (“DHHS”) issued a new Gatherings and Face Mask Order that further limits in-person gatherings and employer operations, but does not meaningfully change requirements for most businesses. These gathering limits do not apply to workplace gatherings that occur consistent with the Emergency Rules issued by the Michigan Occupational Safety and Health Administration (“MIOSHA”) on October 14, 2020.

While public attention focused on the federal and state elections, Michigan voters made an important decision—they adopted Proposal 20-2, which amended Michigan’s Constitution to extend its protection from unreasonable searches and seizures to electronic data and communications. With the proliferation of personal electronic devices and storage of business information on computers used at home in the past few decades, federal and state courts, including the Supreme Court, have grappled with how to apply Fourth Amendment protections against unreasonable searches and seizures in a digital age. Although Proposal 20-2 might not change investigative practice, it clarifies that electronic data and communications are subject to the same protection against unreasonable search and seizure as other “traditional” information, such as paper records.

On June 5, 2020 the  Department of the Treasury and the Internal Revenue Service (“IRS”) issued Notice 2020-43 (the “Notice”) proposing two alternative methods to satisfy tax capital account reporting requirements as the only methods for reporting partner’s capital accounts under the tax basis method for taxable years that end on or after December 31, 2020. While some taxpayers may have concerns about these changes, the implementation of the new reporting requirement should not change or adversely affect the partners and should provide a better understanding of their tax capital accounts. With the year-end approaching, partners and partnerships should review the IRS guidance and begin conversations with their accountants about the use of tax capital reporting and conversion from other methods used in prior periods.

Governor Whitmer announced last week that MIOSHA is increasing enforcement of its October 14 Emergency COVID-19 Rules, with a focus on promoting more remote work for offices. Specifically, the Governor’s announcement indicated that the increased enforcement efforts will focus on ensuring compliance with Emergency Rule 5(8)’s “requirement that employer COVID-19 Preparedness and Response Plans contain policies prohibiting in-person work to the extent that work activities can feasibly be completed remotely.” Employers should anticipate increased, unannounced inspections to verify compliance with this requirement beginning immediately.

After months of predictions of a possible Democratic wave, Tuesday’s election delivered mixed results. Joe Biden appears poised to narrowly defeat President Trump after one of the most contentious election cycles in recent memory. Republicans are favored to retain their Senate majority despite having to defend twice as many seats as their Democratic counterparts. However, Democrats will have one last chance to wrestle back the Senate majority from Republicans if they are able to pull off upset wins in two Senate runoff elections in Georgia scheduled for January 5. In the biggest surprise of election night, House Republicans picked up seats, knocking off at least seven Democratic incumbents, with more races still too close to call. Despite Republican gains, Democrats did retain control of the House of Representatives, leaving Speaker Pelosi to preside over a razor-thin majority.

Dykema’s M&A transaction volume was up sharply in the third quarter with 25 deals closing during that three-month period. The transactions involved a wide variety of industries including Dental Service Organizations (DSOs) and Medical Service Organizations (MSOs), alcoholic beverages, precious metals, automotive, waste management, health & fitness and cloud services.

While some results are still being tabulated, we can now reasonably assess the outcome of the 2020 Election in Illinois. As expected, Democrats maintained their supermajority status in both the Illinois House of Representatives and Senate in this election cycle. What is unexpected, however, is the first challenge to Michael J. Madigan’s speakership in more than 40 years. Additionally, the defeat of the constitutional amendment to replace the state’s flat income tax with a progressive income tax deals a major blow to Governor Pritzker. Overall, the results could lead up to what may be a volatile and unpredictable legislative environment going forward. We’ll also take a look at legislation that is likely to be introduced.

Michigan’s Open Meetings Act (“OMA”) was officially amended this past Friday when Governor Whitmer signed SB 1108 (now Public Act 228 of 2020). The new law permits public bodies to conduct electronic meetings under certain circumstances and for a set period of time. With the new amendments in place, public bodies should be sure to conduct electronic meetings—when permitted—in full compliance with the amended OMA requirements. Failure to do so could result in challenges to decisions made by public bodies.

Recent rulings by the Michigan Supreme Court effectively terminated executive orders from Governor Whitmer that enabled municipalities to meet virtually by suspending certain requirements of Michigan’s Open Meetings Act (OMA). In response, the Michigan Legislature swiftly passed SB 1108 that amends the OMA to allow for public bodies to continue meeting electronically under certain circumstances, including statewide or local states of emergency or disaster, through December 31, 2021. The bill will now be enrolled and presented to Governor Whitmer for signature. As a result, while not yet law until signed, it seems that virtual meetings of municipalities may continue for the time being upon the adoption of these new amendments. However, conducting virtual meetings until the bill is signed by the Governor is not without risk.

The Michigan Supreme Court’s October 2, 2020, ruling in In re Certified Questions essentially removed the Governor’s authority to issue any executive orders related to COVID-19 after April 30, 2020. The Court made clear on October 12, 2020, that the orders are “of no continuing legal effect.” Now that the Safe Start orders and Workplace Safety requirements are no longer effective or enforceable, what should a business or public body consider as it moves forward? What restrictions are in place?

On Saturday, September 12, 2020, the Internal Revenue Service (“IRS”) updated a marijuana industry frequently asked questions (“FAQ”) page that provides relief to state-legal cannabis businesses. The FAQ announces that state-legal cannabis businesses can reduce their gross receipts by using an alternative accounting method under Section 471 of the Internal Revenue Code (the “Code”).

On September 2, 2020, we issued an e-alert discussing the deferral of the employee portion of Social Security taxes (“SS Tax Deferral Program”). However, on September 3, 2020, the IRS confirmed that the SS Tax Deferral Program is optional and that employers may, but are not required to, utilize this relief. Thus, the employer, and not the employee, can decide whether or not it will participate in the SS Tax Deferral Program.

On August 13, 2020, President Trump issued a Presidential Memorandum directing the Secretary of the Treasury to use his authority to defer the withholding, deposit and payment of the employee portion of Social Security taxes (“SS Tax Deferral Program”). On August 28, 2020, the Secretary of the Treasury and IRS issued Notice 2020-65 (“Notice”) to implement the SS Tax Deferral Program. This FAQ-style alert addresses the key provisions of the Notice and the many remaining uncertainties about the SS Tax Deferral Program.

On August 27, Michigan Governor Gretchen Whitmer released Executive Order 2020-172, entitled “Protecting workers who stay home, stay safe when they or their close contacts are sick,” which replaces Executive Order 2020-166. The new executive order is nearly identical to the one it replaces, with two important differences. First, the new order recognizes that an employee’s symptoms could be explained by other medical conditions, which should not prevent an employee from reporting to work. Second, the new order recognizes that an employee should not be required to stay home simply because he or she displays one of the more innocuous symptoms of COVID-19 on its own.

Not surprisingly, Dykema's volume of closed deals for the first half of the year slowed from last year’s record pace. What was somewhat surprising is that the volume of transactions in the Dental Services Organization (DSO) space did not seem to miss a beat. All told, we closed 18 DSO deals, including four in the adjacent Medical Services Organization (MSO) space (in this case, all Optometry), slightly ahead of last year’s pace. In addition, we closed deals in the hospitality, cell tower and litigation services sector. Overall, the transactions trended smaller, averaging $16M, down from 2019’s average of $117M.

Businesses across the country have wondered how the new Special Inspector General for Pandemic Recovery (SIGPR) will enforce the CARES Act’s loan requirements, especially with the large number of loan and forgiveness applications. Until recently, the answer was unclear. Press releases have announced Memoranda of Understanding (MOU) between SIGPR and three U.S. Attorney’s Offices to collaborate on investigating and prosecuting CARES Act violations. With this strengthened enforcement model being put in place, CARES Act loan recipients need to ensure their eligibility for loan forgiveness and double-check their documentation of that eligibility.

On Monday, August 3, 2020, a New York federal judge issued a decision invalidating portions of the DOL’s regulations implementing the Families First Coronavirus Relief Act (“FFCRA”). The decision’s impact changes the legal landscape employers confronting FFCRA compliance—a landscape that is unstable as the DOL and the courts sort out the legality of the disputed regulations.

On July 29, 2020, Governor Whitmer issued Executive Order Nos. 2020-160 and 2020-161. Executive Order 2020-160 replaces the prior executive orders that address stay home, stay safe restrictions in Michigan. In general, this Order moves the State to a more uniform approach to business operations and restrictions. Northern Michigan will experience the most change under the new Order as Regions 6 and 8 join the rest of Michigan with a 10-person limit on indoor gatherings and the closure of all bars. Executive Order No. 2020-161 addresses workplace safety requirements and replaces Executive Order No. 2020-145.