NEWS

PRESIDENT SIGNS “EXECUTIVE ORDER ON REGULATORY RELIEF TO SUPPORT ECONOMIC RECOVERY”

May 19, 2020 – On Tuesday, May 19, President Trump signed an Executive Order designed to ease federal agency enforcement actions against employers attempting in good faith to comply with the host of new statutes, regulations and guidance issued during the COVID-19 pandemic. In Section 1 of the Order, the President states that “It is the policy of the United States to combat the economic consequences of COVID-19 with the same vigor and resourcefulness with which the fight against COVID-19 itself has been waged. Agencies should address this economic emergency by rescinding, modifying, waiving, or providing exemptions from regulations and other requirements that may inhibit economic recovery…. They should also give businesses, especially small businesses, the confidence they need to re-open by providing guidance on what the law requires; by recognizing the efforts of businesses to comply with often-complex regulations in complicated and swiftly changing circumstances; and by committing to fairness in administrative enforcement and adjudication.”

Other more specific and notable directives set forth in the Order include the following:

*    “The heads of all agencies shall consider whether to formulate, and make public, policies of enforcement discretion that… decline enforcement against persons and entities that have attempted in reasonable good faith to comply with applicable statutory and regulatory standards….”

*    Recognizing that the Department of Health and Human Services, including the CDC and other agencies, have issued multitudinous guidance on actions to stem the spread of the disease, federal agency heads are instructed to “consider a situation in which a person or entity makes a reasonable attempt to comply with such guidance, which the person or entity reasonably deems applicable to its circumstances, to be a rationale for declining enforcement” under other COVID-era statutes and regulations.

*    In a section of the Order entitled “Fairness in Administrative Enforcement and Adjudication,” the President states, among other things, that “The Government should bear the burden of proving an alleged violation of law; the subject of enforcement should not bear the burden of proving compliance…,” and “penalties should be proportionate, transparent, and imposed in adherence to consistent standards and only as authorized by law.”

*    Agency heads are both directed to “identify regulatory standards that may inhibit economic recovery and… consider taking appropriate action, consistent with applicable law, including by issuing proposed rules… to temporarily or permanently rescind, modify, waive or exempt persons or entities from those requirements,” and in cases where regulations have been temporarily modified, to “determine which, if any, would promote economic recovery if made permanent….”

*    In the arena of “compliance assistance,” the Order provides that the “heads of all agencies, excluding the Department of Justice, shall accelerate procedures by which a regulated person or entity may receive a pre-enforcement ruling… with respect to whether proposed conduct in response to the COVID-19 outbreak, including any response to legislative or executive economic stimulus actions, is consistent with statutes and regulations administered by the agency….”

While this Executive Order should provide some solace to employers who are attempting in good faith to comply with an ever-changing regulatory landscape, the elephant in the room remains the prospect of aggressive legal action pursued by plaintiffs’ lawyers and other employee advocacy groups. This Order will obviously have no legal effect on those private actions, and employers will have to wait to see whether Congress or state legislatures enact tort reform or other protectionist legislation to shield them from liability for actions taken or not taken in response to the pandemic.

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Because legal developments pertaining to COVID-19 are constantly evolving, we recommend that our clients call the Kullman Firm attorney(s) with whom they work for the most current guidance on these matters.