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EEOC Issues New Guidance on Workplace Vaccine Policies

On May 28, 2021, the Equal Employment Opportunity Commission (“EEOC”) issued new guidance for employers regarding employment vaccination programs. As discussed below, the EEOC’s updated guidance provides additional information concerning key issues such as whether:

Employers may mandate vaccines
An employee’s vaccination status is confidential medical information
Employers may offer vaccination incentives to employees

Employer-Mandated Vaccination and Reasonable Accommodations

Under the EEOC guidance, employers may require all employees physically entering the workplace to be vaccinated for COVID-19, so long as employers comply with the reasonable accommodation provisions of the Americans with Disabilities Act (“ADA”), Title VII of the Civil Rights Act of 1964, and other equal employment opportunity law considerations. The EEOC does not directly enforce state anti-discrimination laws, and this Guidance should not be interpreted as giving vaccination requirements a “pass” under Michigan civil rights and worker protection laws. Under federal law, “reasonable accommodations” for vaccine-sensitive or other “disabled” workers who cannot due to a disability be vaccinated, may include requiring unvaccinated employees to wear face masks and periodic testing for COVID-19.

The Guidance also explains that when implementing a vaccination policy, employers should be aware that, “because some individuals or demographic groups may face greater barriers to receiving a COVID-19 vaccination than others, some employees may be more likely to be negatively impacted by a vaccination requirement.” Employers may not adopt vaccination policies that discriminate on the basis of a protected characteristic.

Voluntary Employer COVID-19 Vaccination Programs

The Guidance permits employers to adopt a voluntary COVID-19 vaccination policy as an alternative to a mandatory vaccination requirement. The ADA prohibits taking an adverse action against an employee for refusing to participate in a voluntary employer-administered vaccination program.

Vaccine Incentives

Employers may offer incentives for employees to receive vaccinations according to the EEOC. The EEOC requires that incentives offered by an employer not be “so substantial as to be coercive.”

However, the EEOC explained that federal equal employment opportunity laws do not prevent or limit employers from offering incentives to employees to voluntarily provide documentation or other confirmation of vaccination obtained from a third party in the community, such as a pharmacy, personal health care provider, or public clinic.

Documentation of Vaccination Status

Under the Guidance, employers may request documentation of vaccination status but must keep vaccination information confidential, including ensuring that such information is kept separate from employees’ general personnel files.

EEOC guidance on COVID-19 vaccination issues for employers is complex and is likely to be further updated. In some cases, state and local requirements may differ from federal guidance. If you have questions about these issues, please contact Dave Houston or your Fraser Trebilcock attorney.

This alert serves as a general summary, and does not constitute legal guidance. All statements made in this article should be verified by counsel retained specifically for that purpose. Please contact us with any specific questions.

Fraser Trebilcock Shareholder Dave Houston has over 40 years of experience representing employers in planning, counseling, and litigating virtually all employment claims and disputes including labor relations (NLRB and MERC), wage and overtime, and employment discrimination, and negotiation of union contracts. He has authored numerous publications regarding employment issues. You can reach him at 517.377.0855 or dhouston@fraserlawfirm.com.

Client Alert: PCORI Fees Due by July 31, 2021!

In Notice 2020-84, the Internal Revenue Service set forth the PCORI amount imposed on insured and self-funded health plans for policy and plan years that end on or after October 1, 2020 and before October 1, 2021.

Background

The Patient-Centered Outcomes Research Institute (PCORI) fee is used to partially fund the Patient-Centered Outcomes Research Institute which was implemented as part of the Patient Protection and Affordable Care Act.

The PCORI fees were originally set to expire for plan years ending before October 1, 2019. However, on December 20, 2019, the Further Consolidated Appropriations Act was enacted and extended the fee to plan years ending before October 1, 2029.

The fee is calculated by using the average number of lives covered under a plan and the applicable dollar amount for that plan year. Code section 4375 imposes the fee on issuers of specified health insurance policies. Code section 4376 imposed the fee on plan sponsors of applicable self-insured health plans. This Client Alert focuses on the latter.

Adjusted Applicable Dollar Amount

Notice 2020-84 sets the adjusted applicable dollar amount used to calculate the fee at $2.66. Specifically, this fee is imposed per average number of covered lives for plan years that end on or after October 1, 2020 and before October 1, 2021. For self-funded plans, the average number of covered lives is calculated by one of three methods: (1) the actual count method; (2) the snapshot method; or (3) the Form 5500 method.

Deadline and How to Report

The PCORI fee is due by July 31, 2021 and must be reported on Form 720.

Instructions are found here (see Part II, pages 8-9).

The Form 720 itself is found here (see Part II, page 2).

Form 720, as well as the attached Form 720-V to submit payment, must be used to report and pay the requisite PCORI fee to the IRS. While Form 720 is used for other purposes to report excise taxes on a quarterly basis, for purposes of this PCORI fee, it is only used annually and is due by July 31st of each relevant year.

As previously advised, plan sponsors of applicable self-funded health plans are liable for this fee imposed by Code section 4376. Insurers of specified health insurance policies are also responsible for this fee.

For plan years ending on or after October 1, 2017 and before October 1, 2018, the fee is $2.39 per covered life.
For plan years ending on or after October 1, 2018 and before October 1, 2019, the fee is $2.45 per covered life.
For plan years ending on or after October 1, 2019 and before October 1, 2020, the fee is $2.54 per covered life.
For plan years ending on or after October 1, 2020 and before October 1, 2021, the fee is $2.66 per covered life.

Again, the fee is due no later than July 31 of the year following the last day of the plan year.

As mentioned above, there are specific calculation methods used to configure the number of covered lives and special rules may apply depending on the type of plan being reported. While generally all covered lives are counted, that is not the case for all plans. For example, HRAs and health FSAs that are not excepted from reporting only must count the covered participants and not the spouses and dependents. The Form 720 instructions do not outline all of these rules.

More information about calculating and reporting the fees can be found here.

Questions and answers about the PCORI fee and the extension may be found here.

As you are well aware, the law and guidance are continually evolving. Please check with your Fraser Trebilcock attorney for the most recent updates.

This alert serves as a general summary, and does not constitute legal guidance. Please contact us with any specific questions.

We have created a response team to the rapidly changing COVID-19 situation and the law and guidance that follows, so we will continue to post any new developments. You can view our COVID-19 Response Page and additional resources by following the link here. In the meantime, if you have any questions, please contact your Fraser Trebilcock attorney.

Elizabeth H. Latchana specializes in employee health and welfare benefits. Recognized for her outstanding legal work, in both 2019 and 2015, Beth was selected as “Lawyer of the Year” in Lansing for Employee Benefits (ERISA) Law by Best Lawyers, and in 2017 as one of the Top 30 “Women in the Law” by Michigan Lawyers Weekly. Contact her for more information on this reminder or other matters at 517.377.0826 or elatchana@fraserlawfirm.com.

Brian T. Gallagher is an attorney at Fraser Trebilcock specializing in ERISA, Employee Benefits, and Deferred and Executive Compensation. He can be reached at (517) 377-0886 or bgallagher@fraserlawfirm.com.

Michigan House Committee Advances Bill to Regulate delta-8 THC

On May 18, 2021, the Michigan House Regulatory Reform Committee unanimously approved a package of bills, including House Bill 4517, requiring hemp-derived delta-8 tetrahydrocannabinol (“THC”) to be regulated by the Michigan Marijuana Regulatory Agency (“MMRA”).

Delta-8 THC is a cannabis compound that has gained in popularity because of its similarity to delta-9 THC prevalent in marijuana plants. Delta-8 is produced by extracting CBD from industrial hemp and then using acetic acid to turn it into THC.

Producers of delta-8 THC argue that the product is legal under the federal 2018 Farm Bill, which legalized hemp extracts and other hemp products. However, the U.S. Drug Enforcement Administration (“DEA”) issued an interim final rule in 2020 declaring: “All synthetically derived (THC) remain Schedule I controlled substances.” The Hemp Industries Association and a South Carolina CBD manufacturer initiated a lawsuit against the DEA challenging the rule.

Currently, delta-8 THC is unregulated in Michigan. The new bills, which have been sent to the full House of Representatives for consideration, would bring the delta-8 THC within the MMRA’s regulatory framework.

The move to regulate delta-8 THC has the support of the Michigan Cannabis Manufacturer’s Association (“MCMA”). In a statement, MCMA executive director Stephen Linder said: “Any product considered medicine should adhere to the same health and safety standards as medicines dispensed in pharmacies. Currently these products are available to anyone and can be found in gas stations, party stores and smoke and vape shops.”

Michigan is not the only state to take action to crack down on access to delta-8 THC. According to Hemp Industry Daily at least 12 states have imposed bans on the product.

We will continue to keep you updated about developments with respect to the delta-8 THC legislation. In the interim, if you have questions, please contact Fraser Trebilcock shareholder Paul Mallon.

Paul C. Mallon, Jr. is Shareholder and Chair of Fraser Trebilcock’s cannabis law practice. You can reach him at pmallon@fraserlawfirm.com or (313) 965-9043.

Client Alert: IRS Issues Important Information on COBRA Subsidies

The IRS has recently issued 86 questions and answers regarding the COBRA premium assistance requirements under the American Rescue Plan Act of 2021 (“ARPA”). See IRS Notice 2021-31.

As explained in previous Client Alerts, the ARPA requires that employers provide 100% COBRA subsidies to certain assistance eligible individuals from April 1, 2021 through September 30, 2021. Not only will COBRA be fully paid for these individuals during this time period, but eligible individuals who had previously declined COBRA (or who had elected COBRA and dropped it) have a second chance to elect and take advantage of the subsidized COBRA coverage. Notices of such subsidies and new election rights are due by May 31, 2021, so time is of the essence.

Q&A Highlights

Here are some highlights of these IRS Q&As but please note that the IRS guidance is extensive. This Client Alert just touches on some of the issues.

Who is an AEI?

Notice 2021-31 reiterates that an assistance eligible individual (AEI) is defined as an individual who (1) is a qualified beneficiary with respect to a period of COBRA continuation coverage during the period from April 1, 2021, through September 30, 2021, (2) who is eligible for that COBRA continuation coverage by reason of a qualifying event that is an involuntary termination of employment (except for gross conduct) or reduction of hours, and (3) who elects COBRA continuation coverage. This includes employees, spouses, and dependent children.

However, the IRS now explains that an individual can become an AEI more than once. As we know, being eligible for certain other group health plan coverage or Medicare will disqualify one from AEI status. Losing such eligibility at a later date may result in regaining AEI status. For example, an employee is terminated, loses coverage, and becomes an AEI on May 1, 2021. On June 1, 2021, the individual becomes eligible for his spouse’s employer’s group health plan and loses AEI status. However, on July 1, 2021, the spouse has an involuntary termination and loses coverage. Both the individual and spouse become AEIs as of July 1, 2021.

The notice goes on to provide that because eligibility for other group health coverage and/or Medicare will disqualify one from being an AEI, employers may required individuals to provide a self-certification or attestation that they are not eligible for any disqualifying group health plan coverage or Medicare. Employers must keep a record of such attestations.

The IRS clarifies that eligibility for other group health plan coverage will only create a loss in AEI status once that individual is permitted to enroll in that coverage (i.e., AEI status continues during a waiting period or until the next enrollment opportunity). Please note that the Emergency Relief Notices and the Outbreak Period extensions of deadlines have prolonged enrollment for HIPAA special enrollment events. So if an individual is able to enroll in a spouse’s plan (or another group health plan) due to HIPAA special enrollment extensions, that individual will not be an AEI. This can be a complicated determination.

Moreover, the IRS has explained that an individual who elected and remained on COBRA beyond the initial 18-month period due to a disability determination or a second qualifying event is also an AEI and eligible for the subsidy if the COBRA extended period falls within April 1 to September 30, 2021. For example, a qualified beneficiary who lost coverage 3 years ago due to termination/reduced hours may still be on COBRA as of April 1 due to a second qualifying event (e.g., divorce). The IRS recent Q&As clarified that these individuals will also be AEIs…

What is a Reduction in Hours?

Loss of coverage due to reduction in hours would cause the qualified beneficiary to potentially become an AEI regardless of whether the reduced hours is voluntary or involuntary. Furloughs and strikes are considered reduction in hours, so long as the employee and employer intend on maintaining the employment relationship.

What is an Involuntary Termination?

Many questions have arisen regarding involuntary terminations, such as whether resignations or non-renewal of temporary contracts can be deemed involuntary terminations. The determination of whether a termination is involuntary will be based on the facts and circumstances.

The IRS defines involuntary termination of employment as a “severance from employment due to the independent exercise of the unilateral authority of the employer to terminate employment, other than due to the employee’s implicit or explicit request, where the employee was willing and able to continue performing services.” See Q&A-24. This includes circumstances where the employee is terminated while the employee is off work due to illness or disability if there was a reasonable expectation that the employee would return to work after he or she had recovered. Moreover, an employee-initiated termination will also constitute an involuntary termination if it is due to employer action that resulted in a material negative change in employment, similar to a constructive discharge.

With regard to resignations or other terminations which are designated as voluntary, if the facts and circumstances indicate that the employee was able and willing to work and that the employer would have terminated the employee absent the resignation or “voluntary“ termination, the IRS will deem this an involuntary termination.

A resignation resulting from a material change in the geographic location of employment for the employee is also deemed an involuntary termination.

An employee who leaves employment due to health concerns, however, is generally not a involuntary termination. Neither is an employee who terminates due to child-care reasons.

Some of these circumstances could result in AEI status if the individual lost coverage due to a reduction in hours. Moreover, if the employer involuntarily and materially reduced the employee’s hours, an employee who terminates employment in response will be deemed to have been involuntarily terminated.

Temporary employees also present an interesting situation. Typically, temporary employees are hired on a short-term contractual basis. Whether the non-renewal of the contract at its expiration is deemed an involuntary termination is again a factual determination.

Q-34. Does an involuntary termination of employment include an employer’s decision not to renew an employee’s contract, including for an employee whose employer is a staffing agency?

A-34. Generally, yes. An employer’s decision not to renew an employee’s contract will be considered an involuntary termination of employment if the employee was otherwise willing and able to continue the employment relationship and was willing either to execute a contract with terms similar to those of the expiring contract or to continue employment without a contract. However, if the parties understood at the time they entered into the expiring contract, and at all times when services were being performed, that the contract was for specified services over a set term and would not be renewed, the completion of the contract without it being renewed is not an involuntary termination of employment.

See Q&A-34.

What Plans is the Subsidy Available For?

The IRS confirms that the subsidy is available for any group health plan subject to COBRA (including certain HRAs, as well as vision-only and dental-only plans), except for health FSAs offered under Code section 125 plans.

Extended Election Period Information

With regard to AEIs who previously had not elected or dropped their COBRA coverage, they may now elect COBRA during the extended election period. This includes spouses and dependents who were covered under the group health plan along with the employee on the day before the involuntary termination or reduced hours resulting in the loss of coverage.

The IRS clarifies that these AEIs may waive COBRA for any period before their election. If COBRA for an HRA is elected during the extended period, the AEI is not entitled to reimbursement of expenses incurred after the qualifying event and before the first period of COBRA coverage beginning on or after April 1, 2021.

Tax Credit Information

Those to whom COBRA premiums are payable (generally the employer for most purposes) are entitled to a refundable tax credit against their share of Medicare taxes. This is now allowed under newly added Code section 6432. Notice 2021-31 includes numerous questions and answers regarding the calculation of this tax credit as well as how to claim it.

Conclusion

This Client Alert sets forth highlights of these Q&As but by no means addresses them all. Moreover, the IRS indicates further guidance may be forthcoming. Please seek out advice on these complicated issues.

As you are well aware, the law and guidance are rapidly evolving in this area. Please check with your Fraser Trebilcock attorney for the most recent updates.

Fraser Trebilcock is committed to providing you valuable information. Please watch for upcoming alerts on these and other topics.

Client Alert: IRS Clarifies Taxation of Dependent Care Benefits Due to Extended Grace Periods or Expanded Carryovers

In Notice 2021-26, the IRS clarifies the taxable nature of benefits under dependent care assistance programs (“DCAPs”) that adopted the extended grace period or expanded carryover options for 2021 and/or 2022. See Notice 2021-26 (irs.gov).

Specifically, the IRS states that amounts which are available under the extended grace period or expanded carryover options will be excludable from the employees’ gross income if:

The amounts would have been excluded from employees’ income had they been used during the original taxable year ending in 2020 or 2021; and
If the available amounts due to the extended grace period or expanded carryover options are actually used during the following taxable year (i.e., 2021 as extended from 2020, or 2022 as extended from 2021).

Additionally, these DCAP benefits will not be counted toward the maximum exclusion from gross income that is applicable to other DCAP benefits for the 2021 and 2022 taxable years. Under previous guidance, the maximum DCAP exclusion from income has been increased from $5,000 to $10,500 (or for taxpayers who are married but filing separately, from $2,500 to $5,250) for calendar year 2021. Special rules apply for non-calendar year DCAPs.

Background

Traditionally, qualifying DCAP benefits utilized during a calendar year are subject to an income exclusion of $5,000 (or $2,500 in the case of married individuals filing separate returns). These benefits are generally forfeited at the end of the plan year, unless the plan has adopted a 2 ½ grace period. Carryovers have not previously been allowed for DCAPs as they have for health FSAs.

However, due to the COVID-19 pandemic, numerous temporary relief was implemented, including for DCAP benefits. Under the Taxpayer Certainty and Disaster Tax Relief Act of 2020 (also known as the Consolidated Appropriations Act, 2021 or CAA) and IRS Notice 2021-15, the following relief was provided with regard to DCAPs:

Expanded Carryover Rules

Carryover to the 2021 Plan Year: This provision allows any unused benefits or from plan years ending in 2020 to be carried over to the plan year ending in 2021;
- Significantly, DCAPs were not previously allowed to have a carryover provision.
Carryover to the 2022 Plan Year: This provision allows any unused benefits or contributions from plan years ending in 2021 to be carried over to the plan year ending in 2022.

Extended Grace Periods

Grace Periods: DCAPs may adopt an extended grace period for plan years ending in 2020 or 2021, which is extended from the traditional two months and 15 days to a full 12 months after the end of such plan year in order for unused benefits or contributions to be utilized.

Thereafter, the American Rescue Plan Act (“ARPA”) temporarily amended Code section 129(a) to increase the amount of dependent care expenses that may be excluded from gross income.

DCAPs have historically been capped at reimbursing $5,000 per calendar year. However, under the ARPA, and only for taxable years beginning after December 31, 2020 and before January 1, 2022, DCAPs can reimburse over double! The maximum amount to be excluded for calendar year 2021 is now $10,500 (or $5,250 for married individuals filing single returns).

Note: To implement the carryovers or grace periods, or to increase the DCAP election amount to $10,500 for calendar year 2021, employers must amend their plans. Although generally Code section 125 cafeteria plans cannot be amended retroactively, the ARPA states that retroactive amendments are allowed for this purpose as long as: (1) the amendment is adopted no later than the last day of the plan year in which it is effective, and (2) the plan is operating consistent with the term of the amendment as of its effective date.

We thought this was the welcome news for employers who were struggling with allowing carryovers or grace periods for DCAPs that would exceed the $5,000 max. However, the IRS further expanded and clarified taxation relief in its newest guidance, Notice 2021-26 (irs.gov).

IRS Notice 2021-26

In Notice 2021-26, the IRS clarifies that DCAP amounts carried over (or available due to the extended grace period) from 2020 to 2021 or from 2021 to 2022 are excluded from income when used in that subsequent year if they would have been excluded from income if used during the original taxable year ending in 2020 or 2021.

Moreover, the amounts carried over (or available due to the extended grace period) are also disregarded for purposes of the income exclusion limits in that subsequent tax year. Take the following example: An employee elects $5,000 in 2020 but used none of it. The full $5,000 is carried over to 2021. Additionally, the employee elects $10,500 (as allowed by ARPA) for the 2021 tax year. If the employee incurs $15,500 in DCAP expenses in 2021, none of the $15,500 will result in taxable income. This is because the $5,000 carryover amount is disregarded, and under ARPA, up to $10,500 of DCAP expenses can be excluded for 2021.

The IRS includes some examples to explain how this works with both calendar year plans as well as non-calendar year plans.

Moreover, with regard to the ARPA increase to $10,500 of DCAP benefits for which employees may exclude, Notice 2021-26 clarifies that this is for the 2021 taxable year only (generally the calendar year). Therefore, a DCAP that runs on a non-calendar year basis, starting in 2021 and ending in 2022 will not have this full relief available. The Notice provides that the increased exclusion amount (i.e., in most cases the amount over $5,000) will not apply to the reimbursement of expenses incurred during the 2022 portion of the plan year.

If you have any questions about these products or would like assistance with updating documentation or employee communications, feel free to contact us.

As you are well aware, the law and guidance are rapidly evolving in this area. Please check with your Fraser Trebilcock attorney for the most recent updates.

Fraser Trebilcock is committed to providing you valuable information. Please watch for upcoming alerts on these and other topics.

IRS Announces 2022 Adjustments for HSAs & Excepted-Benefit HRAs

The IRS has released its 2022 annual inflation adjustments for Health Savings Accounts (“HSAs”) as determined under Section 223 of the Internal Revenue Code. Specifically, IRS Revenue Procedure 2021-25 provides the adjusted limits for contributions to a HSA, as well as the high deductible health plan (“HDHP”) minimums and maximums for calendar year 2022.

Additionally, Revenue Procedure 2021-25 sets forth the maximum amount that may be made newly available for excepted-benefit health reimbursement arrangements (“HRAs”) as provided under 26 CFR 54.9831-1(c)(3)(viii).

The 2022 HSA/HDHP limits are as follows:

Annual Contribution Limit
- Single Coverage: $3,650
- Family Coverage: $7,300
HDHP-Minimum Deductible
- Single Coverage: $1,400
- Family Coverage: $2,800
HDHP-Maximum Annual Out-of-Pocket Expenses (including deductibles, co-payments and other amounts, but not including premiums)
- Single Coverage: $7,050
- Family Coverage: $14,100
The catch-up contribution for eligible individuals age 55 or older by year end remains at $1,000.

Plans and related documentation, including employee communications, should be updated to reflect these new limits which are effective for calendar year 2022.

As always, please keep in mind that participation in a health FSA (or any other non-HDHP) will result in HSA ineligibility, unless the health FSA is limited to: (1) limited-scope dental or vision excepted benefits; and/or (2) post-deductible expenses.

The 2022 EBHRA limit is as follows:

The maximum amount that may be made newly available for the plan year for an excepted benefit HRA (“EBHRA) is $1,800. This amount is effective for plan years beginning in 2022 (but it is unchanged since EBHRA’s inception in 2020).

If you have any questions about these products or would like assistance with updating documentation or employee communications, feel free to contact us.

As you are well aware, the law and guidance are rapidly evolving in this area. Please check with your Fraser Trebilcock attorney for the most recent updates.

Fraser Trebilcock is committed to providing you valuable information. Please watch for upcoming alerts on these and other topics.

Can Employers Ask Their Employees if They Have Been Vaccinated?

One of the biggest challenges of the past year for employers has been keeping up with the complex and constantly evolving employment law issues that have arisen during the COVID-19 pandemic. The roll-out of COVID-19 vaccines has been a welcome relief for employers hoping to create safe and productive workplaces, but issues related to vaccines create a new set of questions.

One of the most common is whether employers can inquire about whether their employees have been vaccinated. Employers are wise to seek legal counsel regarding this issue, as any medical inquiry by an employer could give rise to legal risks. In this case, one of the main risks is that such an inquiry could be interpreted as a prohibited disability inquiry under the Americans with Disabilities Act (“ADA”).

As with most legal issues, this one is nuanced. The U.S. Equal Employment Opportunity Commission (“EEOC”) has issued guidance stating that a mere inquiry of vaccination status does not constitute a disability-related inquiry under the ADA. The EEOC explains that there are many reasons that may explain why an employee has not been vaccinated, which may or may not be disability-related. Therefore, pursuant to the guidance, “simply requesting proof of receipt of a COVID-19 vaccination is not likely to elicit information about a disability and, therefore, is not a disability-related inquiry.”

However, the guidance suggests that delving further into vaccination status may be problematic. For example, asking why an employee did not receive a vaccination may elicit information about a disability. Such follow-up questions could implicate the ADA and must be considered in light of the ADA’s framework that requires such inquiries to be “job-related and consistent with business necessity.”

The EEOC’s guidance on these issues is just that—guidance—and it is subject to change. As with any workplace policy, before establishing rules concerning vaccines, employers should consult legal counsel in order to understand their rights and responsibilities. If you have any questions about these issues, please contact Klint Kesto or your Fraser Trebilcock attorney.

Fraser Trebilcock attorney and former Michigan State Legislator Klint Kesto has nearly two decades of experience working in both the public and private sectors. You can reach him at kkesto@fraserlawfirm.com or 517.377.0868.

Can Higher Education Institutions Make COVID-19 Vaccinations Mandatory for Students?

On April 23, 2021, the University of Michigan announced that all students who choose to live on its Ann Arbor campus during the 2021 fall term will be required to be fully vaccinated for COVID-19. It’s not the first university to make such a pronouncement, and almost certainly will not be the last, which raises an interesting question: Can higher education institutions legally mandate vaccinations?

As with most complex legal issues, it is a nuanced one, and different schools have taken different stances. As of May 6, 2021, according to the Chronicle of Higher Education, 225 schools have made vaccinations mandatory. Others are leaving the decision to students. And Virginia Tech University announced that it does not believe that it has the legal authority to mandate that students be vaccinated.

While many higher education institutions have routinely required students to be vaccinated for viral diseases such as measles and mumps, the COVID-19 vaccines fall into a gray area. The difference—which is the issue cited by Virginia Tech in suggesting that it lacks authority for a mandate—is that the U.S. Food and Drug Administration has only allowed the emergency use of the COVID-19 vaccines and has not given them its full approval.

In some states, the vaccine decision is being directed by state governments. In states such Arizona, Idaho, Florida, Montana and Texas, governors have issued executive orders prohibiting government entities from requiring proof of COVID vaccination for access to buildings or services. However, the breadth and scope of such orders differs by state. Texas’ order, for example, is one of the broadest, in that it affects both public colleges and private colleges that receive state funding.

In Michigan, there is no similar executive order, but a Michigan House of Representatives version of a spending bill includes language prohibiting the state’s public universities from requiring COVID vaccines as a condition of enrollment or attendance.

It is also important to note that, even if a higher education institution mandates vaccinations, exemptions may apply. For instance, both public and private colleges and universities are subject to the requirements of the Americans with Disabilities Act (“ADA”). A student could potentially seek an accommodation from a requirement to take a vaccine on medical grounds, but a school’s obligations with respect to each such request—whether an accommodation is necessary and, if so, the extent of any such accommodation—must be evaluated on a case-by-case basis.

In short, this is a complex issue involving a number of considerations—from the legal and regulatory landscape to the political environment. That may explain why some higher education institutions, such as Wayne State University, have adopted a middle-ground position short of a mandate that involves offering students incentives for getting vaccinated. In April, Wayne State University announced that it would deposit $10 into the student account of any student who uploaded proof of vaccination by May 7.

If you have any questions regarding these issues, or require assistance in evaluating your institution’s COVID-19 vaccination program, please contact Ryan Kauffman.

Ryan K. Kauffman is a Shareholder at Fraser Trebilcock with more than a decade of experience handling complex litigation matters. You can contact him at rkauffman@fraserlawfirm.com or 517.377.0881.

Michigan Workplaces May Return to In-Person Work on May 24 Under “MI Vacc to Normal” Plan

Michigan workers may return to in-person work in all sectors of business on May 24 now that 55 percent of residents age 16 or older have received at least one dose of a COVID-19 vaccine.

Under Governor Whitmer’s “MI Vacc to Normal” plan, Michigan Department of Health and Human Services COVID restrictions are relaxed or eliminated once certain vaccination thresholds are met. Pursuant to the plan, a return to in-person work is allowed two weeks after the 55 percent threshold is reached, which occurred on May 10.

Additional restrictions, such as limitations on attendance at sporting events and conferences, and capacity limits for indoor dining indoor gatherings, will be eased at the 60 and 65 percent thresholds. Once 70 percent of Michigan residents 16 and older are vaccinated, all COVID restrictions, including orders regarding face coverings, will be lifted.

While prohibitions on in-person work are set to be lifted on May 24, it is unclear whether additional COVID-19 workplace rules and restrictions from the Michigan Occupational Safety and Health Administration (MIOSHA) will be altered. Sean Egan, COVID-19 workplace safety director for the Department of Labor and Economic Opportunity, said in a statement:

“MIOSHA is in the process of reviewing both the emergency rules and draft permanent rules as the state meets and exceeds certain vaccination rates. MIOSHA’s rule-making is flexible in that the agency has the ability to modify or rescind all or parts of each rule set to best protect Michigan workers as the pandemic moves closer to ending.”

In addition, on May 14, Governor Whitmer announced that the Michigan Department of Health and Human Services (MDHHS) will be updating the Gatherings and Mask Order to align with the CDC’s latest guidance on face coverings. Beginning May 15 at 9:00 a.m., fully vaccinated individuals do not need to wear a mask while outdoors. While indoors, fully vaccinated Michiganders will no longer need to wear a mask, but residents who are not vaccinated, or have not completed their vaccinations, must continue to wear a mask or face covering to protect themselves and others.

We will continue to keep you updated as to any new developments affecting workplace safety. If you have any questions about your workplace, and the state or federal rules and regulations concerning COVID-19, please contact Dave Houston or your Fraser Trebilcock attorney.

Michigan Marijuana Regulatory Agency Expands Eligibility for Adult-Use Licenses

Effective March 1, 2021, applicants for multiple classes of adult-use marijuana (i.e., recreational marijuana) licenses are no longer required to hold an active medical marijuana permit to be eligible.

The Michigan Marijuana Regulatory Agency announced that the eligibility requirement has been removed for five license types:

Marijuana retailer
Marijuana processor
Class B marijuana grower
Class C marijuana grower
Marijuana secure transporter

In short, as of March 1, 2021, more opportunities to become eligible for licenses became available to more competitors in Michigan fast-growing adult-use marijuana industry.

A Brief Summary of the Two-Step Application Process

The application process involves two steps. Step one is prequalification. The main applicant and any supplemental applicants must submit prequalification applications. Thereafter, background checks are conducted on the main applicant and all supplemental applicants.

The “main applicant” is the entity (e.g., limited liability company, corporation, partnership) or individual (sole proprietor) seeking to hold the marijuana establishment license. A $6,000 nonrefundable application fee is due during step one.

Once prequalification is obtained, a main applicant can move to step two and submit applications for all adult-use marijuana establishment state licenses it seeks to hold. At this time, the MRA will vet the proposed marijuana establishment.

The MRA’s vetting process includes business specifications, proof of financial responsibility, municipality information, and general employee information. Among other requirements, the establishment to be used for marijuana operations must pass an inspection by the MRA within 60 days of submission of a complete application.

In addition to comply with the MRA’s process, applicants will need to concurrently ensure compliance with any and all local regulations and permitting requirements relating to the operation of businesses within the unit of local government in which they seek to operate.

If you have any questions about the application processes—at the state and/or local level in Michigan—for either medical or adult-use marijuana, please contact Paul Mallon, Jr.

Paul C. Mallon, Jr. is Shareholder and Chair of Fraser Trebilcock’s cannabis law practice. You can reach him at pmallon@fraserlawfirm.com or (313) 965-9043.