Liability Protections a Top Priority for Businesses

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Last week, the Detroit Regional Chamber led 14 statewide business groups in a letter that requested Michigan’s Congressional Delegation to unify behind smart compromise Federal legislation to provide financial relief to Michigan, and other states, to address tax revenue loss due to the COVID-19 crisis.

The letter noted the following on liability protection for businesses operating in good faith:

Liability Protection for Businesses Operating in Good Faith
In addition to federal assistance to help address the significant budget imbalance left by tax revenue losses due to the COVID crisis, we also urge a bipartisan compromise that will help ensure businesses are able to safely bring back their employees through careful liability protection for businesses. While a statewide poll by the Detroit Regional Chamber found that 77% of voters “trust their employer to keep them safe,” employees and employers alike are nervous about resuming operations. Business owners fear that if they can survive to idle their business in order to help flatten the curve of the virus, they will not be able to survive legal action resulting from an infected employee – even if they follow all national, state, local, and industry guidelines.

While businesses that act with negligence, ignorance, or malice should be offered no protections, businesses that operate in good faith need liability protection in order to welcome their employees and customers. We urge you to find a reasonable compromise that balances protections for employers and employees as well as recognizes the unchartered health, economic and legal landscape the COVID crisis has forced upon us.”

Read the full letter. Additionally, as Congress and the White House negotiate a new package, view the Chamber’s priorities for businesses and families.


More in Crain’s Detroit Business

Business groups look at key coronavirus relief priorities

  • Republican Senate working on $1 trillion stimulus proposal
  • Much of the proposal aligns with priorities of Michigan business groups
  • State and local governments still clamoring for federal bailout
The emerging details of a second federal relief plan appear to match up with some of the key priorities of Michigan’s business community, while falling far short in others.

The $1 trillion proposal from Republican senators — expected to be revealed this week — hits on key points that various trade groups have been emphasizing for weeks. Chiefly, a reduction of the $600 weekly federal unemployment enhancement that business leaders have said created a disincentive for employees to return to work. The package is also set to contain a liability shield to protect businesses, schools and others from coronavirus-related lawsuits, another priority for Michigan business groups.

The GOP proposal, which would serve as the starting point for negotiations with the House, is unlikely to include money for state and local governments, which have had their fiscal houses shattered as sales tax collections and other revenue streams have diminished.

Unemployment benefits

The $600-weekly pandemic unemployment assistance payment, approved in March by Congress and President Donald Trump and set to expire Friday, has had myriad economic impacts, as Crain’s has previously reported. It will likely be reduced to $200 a week, and ultimately adjusted according to state jobless benefits rates. Some Republicans say the assistance is a disincentive to work, while others prefer a phased approach.

But reports have also been quick to point out the strong economic impact the enhanced federal benefits have had, largely helping the U.S. economy remain relatively stable during a time of double-digit unemployment.

The left-leaning Economic Policy Institute, citing data from the Bureau of Economic Analysis, said in late June that the $600 federal benefit had boosted incomes by a total of $842 billion in May when expressed at an annualized rate. Additionally, the labor-funded think tank estimated that extending the $600 benefit through the middle of 2021 would lead to an average quarterly GDP boost of 3.7 percent.

The Republican bill is unlikely to touch on the potential housing crisis as a federal eviction moratorium on millions of rental units expired Friday.

Business liability

Some form of liability protection for businesses should a worker or customer contract COVID-19 also makes for a top priority for business leaders and is likely to be at the forefront of U.S. Senate Majority Leader Mitch McConnell’s legislation.

Dozens of Michigan trade groups and state and local chambers of commerce signed a July 21 letter to Gov. Gretchen Whitmer and state legislative leaders urging that “common-sense legislation” be passed.

“Our organizations support common-sense legislation to assure that all employers in all sectors who take reasonable steps to follow public health guidelines, will be protected against needless lawsuits,” the letter reads. “The legislation we are seeking would be a win-win in that it will incentivize employers to protect and promote workplace and customer safety and protect organizations against the acute economic threat of COVID-19 related lawsuits.”

Specific policy recommendations the groups offer in their letter include protecting businesses and other entities from claims alleging that they negligently exposed an individual to COVID-19; clarifying that a business should not be liable in a lawsuit alleging that the steps it took were insufficient to protect a person from exposure to COVID-19 when it followed public health guidance applicable to employers at that time; and supporting legislation that distinguishes legitimate claims from no-injury lawsuits.

The proposals have the support of Michael Tierney, president and CEO of the Community Bankers of Michigan trade group.

Paycheck Protection Program

Various elements related to the federal Paycheck Protection Program are also popping up in talks with business groups and among politicians.

For starters, an entirely new round of the potentially forgivable grants to small business could be possible. U.S. Sen. Marco Rubio said this week that he’s finalizing a proposal for a second round that would be targeted toward companies that meet standards from the U.S. Small Business Administration and/or have 300 workers or less. The companies also would have to have incurred “substantial revenue loss,” tweeted the Florida Republican who chairs the Senate’s Committee on Small Business and Entrepreneurship.

“It’s going to be big,” Rubio said.

Additionally, there’s also hope for legislative action that would vastly simplify the forgiveness process for banks and businesses that participated in the initial round of PPP, which included $650 billion over two tranches of funding.

Tierney’s group was among the signatories of a letter from the national Independent Community Bankers of America. The letter, sent earlier this month to federal lawmakers, asks for simplified forms and procedures for business owners seeking forgiveness on PPP loans.

Such a proposal also has the support of Calley, the SBAM president.

Money for state, local government

Not expected to be found in the Republican proposal is additional funds for cash-strapped state and local governments struggling to balance budgets.

Michigan lawmakers on Wednesday began taking action on filling some of the budget gaps caused by the coronavirus crisis.

But looking to the 2021 fiscal year remains priority No. 1 for Doug Rothwell, president and CEO of Business Leaders for Michigan, the state’s business roundtable. Rothwell, who’s set to retire at the end of the year, said he expects relief dollars for state and local governments to become something of a political football in the coming weeks as Republicans put their initial number at $0 and Democrats will insist on something around $750 billion.

“If they come out around $500 billion I think that’s going to be a good number,” Rothwell said. “Based on the way that money should be appropriated, Michigan should be able to basically cover its entire deficit in FY 21 if that happens.”

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