Effective as of May 15, 2020, at 5 p.m., Governor Hogan has amended Maryland’s COVID-19 “Stay at Home Order” to ease certain restrictions on businesses and gatherings and to allow for the re-opening of certain businesses. This article discusses Order No. 20-05-13-01. A link to the complete Order appears at the end of this article.
These amendments include important changes that will affect Maryland businesses and other organizations and institutions. For example:
- Businesses defined as “Retail Establishments” are permitted to re-open at 50% of the maximum occupancy. However, not all retail businesses qualify as “Retail Establishments” and maximum occupancy limits are based on your specific occupancy permits which are set by local law, not state law.
- Beauty salons and barber shops may re-open, but only to provide certain services by appointment. For example, nail technicians and esthetic services are to remain closed. Salons and barber shops are also subject to stricter face coverings requirements than some other general retail businesses.
- Restaurants and bars are required to remain closed, except for some limited carry-out, drive-through, or take-out services, and for off-site deliveries.
- Enclosed Malls are to remain closed. This means that businesses that are accessed by interior pedestrian concourses, or located in congregation areas like food courts, are to remain closed. There is a limited exception for retail stores that can be accessed without entering the Mall and, additionally, local governments have allowance to ease some of these restrictions.
- Fitness Centers, including health clubs, gyms, aquatic centers and self-defense classes, are to remain closed except some exceptions for child care services.
The Governor’s new Order also gives more authority to political subdivisions (i.e., counties and incorporated cities) to make local decisions on whether to allow other businesses to re-open. Montgomery County and Prince George’s County have indicated a response that is likely to be less than the maximum allowed by the Governor, and new guidance continues to emerge.
Before you take any steps to re-open, it is important to understand how this Order impacts your specific type of business, your occupancy obligations, and your other state and local permits. You may also face additional challenges based on your private lease agreement, vendor contracts, and your obligations to employees. Our attorneys can help you analyze these new legal restrictions and your contracts and agreements.
There are also practical considerations and challenges: For example, does it make fiscal sense to re-open at 50% maximum customer traffic? Can you afford additional overhead for personal protective equipment, additional cleaning, and other disinfecting and other protection measures that may be required by the State or your landlord?
If you are a landlord: How does this Order effect lease requirements for continuous operation, hours of operation, percentage rent, and landlord’s provision of common area services. You may also need to grapple with unanticipated changes in operating costs. In some cases, landlords and tenants might consider reasonable alternatives to like lease amendments, short-term abatements or deferrals, or renegotiating the entire deal.
There are also important employment law considerations to consider when closing or re-opening your business, some of which may depend on the size of your business, the classification of your employees, and their compensation models. There are no easy answers and many of these questions require analysis of both governmental orders and private agreements. McMillan Metro’s attorneys are here to help your business make sense of the Governor’s Order and what may come next in your business’s plans to re-open.
Our business lawyers and our real estate lawyers are experienced in enforcing and renegotiating leases on behalf of Landlords and Tenants for retail centers, malls, offices, professional office buildings, and restaurants. If you need advice on re-opening your business in Maryland, please call Peter E. Ciferri, Esq. at (240) 778-2307 or e-mail firstname.lastname@example.org for a consultation.
For a copy of the Governor’s order, click here.