What Michigan Supreme Court, AG Decisions on Governor’s Emergency Powers Mean for Business

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Register for a Town Hall discussion Thursday, Oct. 8 at 11 a.m. with experts from Miller Canfield to learn more about what these rulings mean for business.


The Michigan Supreme Court last week issued a ruling declaring the Emergency Powers of Governor Act to be an unconstitutional delegation of legislative authority of power to the Governor. Previously, Gov. Whitmer had issued orders under the Emergency Powers of Governor Act and the Emergency Management Act. The Emergency Management Act requires the Legislature to reaffirm a state of emergency after thirty days, which the Legislature has not done since April 30, so the Governor’s orders since then had been issued only under the Emergency Powers of Governor Act, which does not require legislative approval.

The Chamber and other experts are still sorting through the ramifications. This ruling effectively ends all executive orders issued under the Emergency Powers of Governor Act by Gov. Whitmer after April 30. Attorney General Dana Nessel agrees with the Governor that there is a 21-day appeal window but has stated that she will not enforce the Governor’s executive orders during that period. State legislators will meet Oct. 8 to address many of the questions these rulings create on issues like unemployment, business liability, and enforcement of COVID-19-related safety regulations. The Chamber will continue to track these conversations to ensure the best possible outcomes for its members.

While these developments create doubt about the status of public health orders and tremendous uncertainty for businesses, local governments and government agencies can continue to issue similar orders. In fact, the Michigan Department of Health and Human Services (MDHHS) on Oct. 5 issued an emergency order to require face coverings and restrict gatherings. Prior to the MDHHS’s order, Oakland County had issued its own mask requirements, which it has since rescinded in following the new MDHHS regulations. Gov. Whitmer has also indicated that many of her orders may be reissued under alternative legal authorization such as public health statutes and the Administrative Procedures Act. Further, the Governor has committed to working with the Legislature on reinstating some of the policies as well.

What Businesses Can Do

The Chamber is continuing to sort through the terms of these decisions and is working to provide the best guidance available. In partnership with experts at Miller Canfield, the Chamber is hosting a Town Hall Oct. 8 at 11 a.m. to help employers wade through the complex questions stemming from the ruling. Register today.

It is critical to remember that the absence of executive orders does not mean the absence of COVID-19, so the Chamber still advises members that they can enforce mask requirements and social distancing on private property. In fact, the Chamber urges businesses to use an abundance of caution during this time of greater uncertainty. This public health crisis has caused significant economic stress, and the best thing that you can do to keep businesses open is to continue safety protocols like requiring face coverings, enforcing social distancing, and conducting employee health screenings.

Businesses should contact their local county health department for advice and guidance about regulations in their communities. The Chamber will continue to assess the implications of the Supreme Court’s decision and the response of state and local officials, making recommendations based on member feedback – and as always – with members’ best interest in mind.

Join the Chamber’s #MaskUpMichigan campaign by signing the pledge to commit to enforcing the use of face coverings by employees and customers to keep businesses open and the local economy growing.


Related

Crain’s Detroit Business: Whitmer’s COVID executive orders are out. Here are the pandemic restrictions still in.

Michigan Attorney General Dana Nessel announced Sunday that she will not enforce any of Gov. Gretchen Whitmer’s pandemic executive orders after the Michigan Supreme Court narrowly ruled that the Governor has exceeded her authority for the past five months in managing the coronavirus pandemic.

But that doesn’t mean all government rules and regulations aimed at mitigating the spread of the airborne virus have gone away for businesses, schools, and individuals.

From the state public health code to business licensing and local health orders, there are multiple legal avenues for continued restrictions on business activity, though none nearly as broad and sweeping as a Governor’s executive orders.

The state Supreme Court’s four Republican-nominated justices ruled Friday in a 4-3 opinion that “the executive orders issued by the Governor in response to the COVID-19 pandemic now lack any basis under Michigan law.”

Depending on how the Whitmer administration proceeds, there may be a plethora of new legal challenges to trying to transfer the Governor’s executive orders to administrative rules and regulations.

Here are five questions and answers about what may happen next:

Do Whitmer’s executive orders remain in effect until Oct. 23 — 21 days after the state Supreme Court ruling — as she asserted Friday?
The Governor cited a Michigan Supreme Court rule that rulings from the high court do not take effect for 21 days to give the losing party a chance to seek a rehearing.

“We believe the 21-day rule applies,” Nessel spokesman Ryan Jarvi said Sunday in an email to Crain’s. “The AG is just choosing not to exercise her prosecutorial discretion during this 21-day time period.”

The high court’s decision did not indicate otherwise. The ruling was a response to certified questions from U.S. District Judge Paul Maloney in a federal lawsuit challenging Whitmer’s spring ban on elective medical procedures that was brought by the Mackinac Center Legal Foundation.

“As a practical matter, this is a final decision of the issues that the Supreme Court considered,” said Maria Dwyer, a labor and employment law attorney at Clark Hill and managing member in charge of the firm’s Detroit office.

As soon as this week, Maloney could enforce the Supreme Court ruling on just the executive orders at issue in his case or extend them to all of the executive orders, said Patrick Wright, director of the Mackinac Center Legal Foundation.

“Assuming the Governor wants to have something in place for 21 days, what person is going to enforce something the Supreme Court has said is clearly unconstitutional?” said Wright, who also is vice president for legal affairs at the Mackinac Center for Public Policy, a Midland-based conservative think tank.

Wright said Whitmer’s claim of a 21-day continued enforcement window is pointless, especially after the attorney general said she won’t pursue criminal enforcement of the orders.

“A sports analogy would be essentially blitzing the quarterback when they’re kneeling down in victory formation,” Wright said.

What powers do state agencies have to restrict business capacities or impose other regulations?
The Administrative Procedures Act gives regulatory agencies such as the Department Health and Human Services, the Department of Licensing and Regulatory Affairs, and the Michigan Occupational Safety and Health Administration the ability to impose “emergency” rules for a period of six months.

Whitmer used this law in 2019 to temporarily ban retailers from selling flavored nicotine products for e-cigarette vaping, arguing it was an immediate threat to public health that necessitated bypassing the Legislature.

Former Gov. Rick Snyder used these executive branch powers in 2014 to impose emergency rules on Las Vegas-style charitable gambling venues that were exploiting charities, said attorney Steve Liedel, managing member of the Dykema law firm’s Lansing office.

These emergency rules can remain in effect for six months until a department can properly promulgate administrative rules.

“There are many things in these executive orders, I think, that could have been justified through the regular rule-making process,” said Brian Calley, president of the Small Business Association of Michigan. “The problem is, the regular rulemaking process didn’t happen — and that’s what I’m hoping will be the outcome of this period here where we’ve got some uncertainty.”

MDHHS Director Robert Gordon has already issued several emergency orders requiring mandatory COVID-19 testing for nursing home residents and workers, migrant farm and agricultural workers, and prison guards in state prisons.

“To the extent that anything affects public health, the Department of Health and Human Services director has pretty broad authority under the public health code to issue health and safety rules,” said Liedel, a former chief legal counsel under then-Gov. Jennifer Granholm.

In recent weeks, MIOSHA has been fining businesses that do not have COVID-19 preparedness and response plans, don’t have employees wearing masks, or have failed to do daily health screenings of workers.

MIOSHA’s definition of a safe workplace as it relates to COVID-19 “comes from the executive orders,” Calley said.

The agency will need to write new administrative rules that adopt new COVID-related standards, said Michael Huff, a corporate attorney at Mika Meyers PLC in Grand Rapids.

“I think the answer is we have a lot more litigation coming in the next few months to figure out how these administrative agencies are legally authorized or not authorized to continue to act in this space in the midst of a pandemic,” Huff said. “Which is not going to be the answer some people want to hear. On the other hand, I think for some businesses this has just become a way of life at this point.”

During a Facebook Live briefing Saturday for SBAM members, Calley advised them against immediately dropping all COVID-related workplace safety protocols.

“Probably in the near term, the smart thing to do would be to let this sort out a bit before you make drastic changes,” said Calley, a former lieutenant governor.

What can counties do?
County-level health departments retain significant powers under public health laws to order businesses to take measures to protect the health and safety of their patrons.

For example, if a COVID-19 outbreak can be traced to a particular restaurant or other public-facing business, the county health department could shut it down for a period of time, legal experts said.

State law allows county health officers to issue orders “during the epidemic to insure continuation of essential public health services and enforcement of health laws.”

Oakland County’s health department issued an order Saturday requiring mask use among residents when they’re in public places. The order, which mirrors Whitmer’s mask orders, applies to schoolchildren while inside school buildings.

Oakland County is planning to issue additional health orders “in the coming days to cover capacity at restaurants, bars, employee health screenings, and other public health concerns,” according to a news release.

On Sunday, Ingham County’s health officer issued four emergency orders that adopted Whitmer’s mask mandate, require employers to screen employees for COVID-19 symptoms, setting restaurant and bar capacities at 50% or 125 people, whichever is less. Ingham County also set capacity limits for outdoor event venues at a maximum of 1,000 attendees and no more than 30% of seating capacity.

“Health and science experts agree that facial coverings, social distancing and health screenings are critical to controlling the virus,” Ingham County Health Officer Linda Vail said in the release. “We have made too much progress to regress. We are working hard to get our young people back to school, keep our businesses and government open, and make progress in our economic recovery.”

In recent weeks, other local health departments have issued several public health orders that go beyond Whitmer’s statewide edicts.

Ottawa County’s health department quarantined an entire campus community at Grand Valley State University in Allendale after a spike in COVID-19 cases.

On Friday, Washtenaw County’s health officer issued an order limiting indoor social gatherings to 10 or fewer people in a private residence in Ann Arbor and Ypsilanti, the respective homes of the University of Michigan and Eastern Michigan University.

Lenawee County’s health officer issued a similar order in September after a coronavirus outbreak on the campus of Adrian College. Ingham, Isabella, and Ottawa counties also have limited indoor gatherings to 10 or fewer people.

Are government-imposed mask mandates completely gone?
On a statewide basis, maybe.

Whitmer’s “no mask, no service” executive order for retailers and public-facing businesses is no longer enforceable.

MIOSHA may be able to require masks in workplaces it inspects under its general authority to regulate the health and safety of workplaces, Liedel said. “It may be only within the scope of MIOSHA,” he said.

Senate Majority Leader Mike Shirkey, R-Clarklake, said Saturday that the Senate Republican caucus would not support legislation requiring statewide mandatory mask use.

Shirkey said private business owners are free to require customers to wear masks to gain entry to their establishments, much like restaurants require patrons to wear shoes and a shirt.

The next battle over masks may rest with the MDHHS director’s powers to protect public health.

In his July 29 order, Gordon said he was seeking to “control the epidemic and protect public health by reinforcing the Governor’s executive orders.” That order specifically “incorporated” Executive Order 153, Whitmer’s most recent mask mandate.

“(Gordon’s orders) actually are emergency orders issued under the Michigan Health Code that do the exact same thing that the Governor’s executive orders did,” Huff said. “So it’s kind of a belt-and-suspenders means of trying to protect the administration’s actions by putting the same order out there under multiple different authorities.”

It’s unclear whether the mask mandate portion of Gordon’s order remains in effect. An MDHHS spokesman referred questions about Gordon’s epidemic order to a statement the Governor’s press secretary, Tiffany Brown, issued Sunday.

“The Supreme Court’s ruling raises several legal questions that we are still reviewing,” Brown said. “While we are moving swiftly, this transition will take time.”

Does the Governor have any other options to keep Michigan under a state of emergency?
The Governor’s spokeswoman said Sunday that Whitmer would use “every tool at her disposal to keep Michigan families, frontline workers, and small businesses safe from this deadly virus.”

Liedel, an ally of the Whitmer administration, said he believes the Governor retains the ability to declare a new 28-day state of emergency under the Emergency Management Act of 1976 at a later date. “That may be an option as well,” Liedel said.

The Supreme Court’s ruling Friday suggested the 1976 law is off the table.

“We conclude that the Governor did not possess the authority under the (1976 law) to renew her declaration of a state of emergency or state of disaster based on the COVID-19 pandemic after April 30,” Justice Stephen Markman wrote in the majority opinion.

Whitmer previously used the 1976 law when the Legislature granted her a 28-day extension of her initial state of emergency declaration in mid-March. That legislative authorization expired April 30; the Supreme Court ruled she exceeded her authority after that date by issuing emergency declarations under a separate law from 1945.

The 1976 Emergency Management Act could be susceptible to a legal challenge by the Governor herself because the law requires a concurrent resolution of both houses of the Legislature to extend an emergency by 28 days, Liedel said.

“Generally, the courts have said and the constitution has said the Legislature acts by bill, not by concurrent resolution,” Liedel said. “There may be a constitutional issue that’s not been raised.”

A new legal challenge of the 1976 law would not likely make it the Supreme Court until early 2021, when the makeup of the court will change when retiring Justice Markman is no longer on the bench.

“I think there’s a lot of options in terms of the Governor’s ability to address what she thinks is necessary to protect the public health and safety of the people the state,” Liedel said. “The notion that she’s can’t do anything, that she’s going to have to sit down and negotiate something with the Legislature, I don’t think that’s a requirement for anything that might be needed.

“She still has sufficient power to be particularly responsive on most items,” he added.


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