Zana Tomich
Dalton & Tomich
Dalton & Tomich
With 2026 underway, many Michigan business owners are feeling something they have not felt in a while: a bit of breathing room. Supply chains have steadied. The pace of change feels less frantic. Yet from where I sit, advising mid-sized Michigan companies day in and day out, this is not a year to get comfortable. The risks have not disappeared; they have simply become quieter and more complex.
The businesses that struggle in 2026 will not be caught off guard by a brand-new law. More often, problems grow out of familiar issues that were left unattended for too long. The companies that do well tend to be the ones that treat legal planning as part of running the business, not something reserved for emergencies.
Artificial Intelligence Is Now a Business Risk, Not a Tech Experiment
Most Michigan companies I work with are already using artificial intelligence in some form, often without calling it that. It shows up in hiring platforms, marketing tools, customer communications, and internal drafting. As 2026 unfolds, the legal conversation around artificial intelligence has shifted. The question is no longer whether businesses are using it, but whether they understand how it is being used and who is responsible when something goes wrong.
Michigan does not yet have a stand-alone artificial intelligence statute, but federal guidance is increasingly shaping how courts and regulators evaluate automated decision-making, particularly in employment and consumer-facing contexts. At the same time, contracts are quietly doing much of the regulating. Vendors and customers are asking for representations about artificial intelligence use, data sources, human oversight, and cybersecurity safeguards. Under Michigan law, those
provisions are likely to be enforced as written, which means companies need to be comfortable with the commitments they are making before they sign.
—————
Data privacy expectations are catching up with smaller companies
Many Michigan business owners still assume data privacy is an issue only for large technology companies. That assumption is becoming riskier each year. As additional state privacy laws take effect across the country, Michigan businesses can find themselves subject to new requirements simply by collecting data from customers or users who live elsewhere.
Michigan’s Identity Theft Protection Act has been in place for years, but expectations around compliance have matured. Regulators increasingly expect written policies, documented safeguards, and a clear plan for responding to a breach.
Informal practices that once seemed reasonable can look careless when reviewed after an incident, especially when multiple states are involved.
Worker Classification and Remote Work Remain High-Risk Areas
Few areas create more avoidable exposure for Michigan companies than worker classification. In 2026, both federal agencies and Michigan regulators continue to scrutinize independent contractor arrangements, particularly in professional services, logistics, and remote roles. The analysis remains highly fact-specific, and mistakes often lead to cascading consequences that include wage claims, tax exposure, and benefit issues.
Remote and hybrid work have added another layer of complexity. Wage and hour compliance, overtime tracking, and expense reimbursement obligations do not disappear simply because work happens off-site. Many employee handbooks and compensation structures no longer reflect how work is actually performed, which can leave well-intentioned employers exposed.
Michigan Business Transitions Are Accelerating
Across Michigan, more owners are beginning to think seriously about what comes next. For some, that means a sale. For others, it means an internal buyout or a generational transition. Private equity interest remains strong, but buyers are far less forgiving of informality than they once were. Gaps in governance, undocumented processes, and weak cybersecurity practices tend to surface quickly during due diligence and often affect value.
Even companies that are not actively marketing themselves benefit from thinking like a future buyer. Clear decision-making authority, clean financial practices, and documented systems tend to make businesses easier to operate and more resilient, regardless of whether a transaction occurs.
Nonprofits and Mission-Driven Entities Face More Oversight
Michigan nonprofits and organizations that work closely with them are operating under increased scrutiny in 2026. The Michigan Attorney General’s Charitable Trust Section continues to focus on governance practices, conflicts of interest, and fundraising transparency, while the Internal Revenue Service remains attentive to board independence and compliance.
At the same time, more organizations are exploring benefit corporations and other hybrid structures to balance mission and sustainability. These models can be effective, but only when the underlying governance documents clearly define roles, authority, and fiduciary obligations.
Final Thought
What unites these trends is accountability. Regulators, customers, employees, and business partners are asking better questions and expecting clearer answers. Michigan law has long favored preparation over improvisation, and that remains true in 2026.
Companies that integrate legal foresight into everyday decision-making, rather than treating counsel as a last resort, will be best positioned to manage risk, protect value, and grow with confidence.
2026 is already underway. The opportunity now is to mind your Michigan business before someone else is forced to do it for you.
—————
Zana Tomich is a seasoned attorney based in Detroit with over two decades of experience advising businesses and nonprofit organizations.
The businesses that struggle in 2026 will not be caught off guard by a brand-new law. More often, problems grow out of familiar issues that were left unattended for too long. The companies that do well tend to be the ones that treat legal planning as part of running the business, not something reserved for emergencies.
Artificial Intelligence Is Now a Business Risk, Not a Tech Experiment
Most Michigan companies I work with are already using artificial intelligence in some form, often without calling it that. It shows up in hiring platforms, marketing tools, customer communications, and internal drafting. As 2026 unfolds, the legal conversation around artificial intelligence has shifted. The question is no longer whether businesses are using it, but whether they understand how it is being used and who is responsible when something goes wrong.
Michigan does not yet have a stand-alone artificial intelligence statute, but federal guidance is increasingly shaping how courts and regulators evaluate automated decision-making, particularly in employment and consumer-facing contexts. At the same time, contracts are quietly doing much of the regulating. Vendors and customers are asking for representations about artificial intelligence use, data sources, human oversight, and cybersecurity safeguards. Under Michigan law, those
provisions are likely to be enforced as written, which means companies need to be comfortable with the commitments they are making before they sign.
—————
Data privacy expectations are catching up with smaller companies
Many Michigan business owners still assume data privacy is an issue only for large technology companies. That assumption is becoming riskier each year. As additional state privacy laws take effect across the country, Michigan businesses can find themselves subject to new requirements simply by collecting data from customers or users who live elsewhere.
Michigan’s Identity Theft Protection Act has been in place for years, but expectations around compliance have matured. Regulators increasingly expect written policies, documented safeguards, and a clear plan for responding to a breach.
Informal practices that once seemed reasonable can look careless when reviewed after an incident, especially when multiple states are involved.
Worker Classification and Remote Work Remain High-Risk Areas
Few areas create more avoidable exposure for Michigan companies than worker classification. In 2026, both federal agencies and Michigan regulators continue to scrutinize independent contractor arrangements, particularly in professional services, logistics, and remote roles. The analysis remains highly fact-specific, and mistakes often lead to cascading consequences that include wage claims, tax exposure, and benefit issues.
Remote and hybrid work have added another layer of complexity. Wage and hour compliance, overtime tracking, and expense reimbursement obligations do not disappear simply because work happens off-site. Many employee handbooks and compensation structures no longer reflect how work is actually performed, which can leave well-intentioned employers exposed.
Michigan Business Transitions Are Accelerating
Across Michigan, more owners are beginning to think seriously about what comes next. For some, that means a sale. For others, it means an internal buyout or a generational transition. Private equity interest remains strong, but buyers are far less forgiving of informality than they once were. Gaps in governance, undocumented processes, and weak cybersecurity practices tend to surface quickly during due diligence and often affect value.
Even companies that are not actively marketing themselves benefit from thinking like a future buyer. Clear decision-making authority, clean financial practices, and documented systems tend to make businesses easier to operate and more resilient, regardless of whether a transaction occurs.
Nonprofits and Mission-Driven Entities Face More Oversight
Michigan nonprofits and organizations that work closely with them are operating under increased scrutiny in 2026. The Michigan Attorney General’s Charitable Trust Section continues to focus on governance practices, conflicts of interest, and fundraising transparency, while the Internal Revenue Service remains attentive to board independence and compliance.
At the same time, more organizations are exploring benefit corporations and other hybrid structures to balance mission and sustainability. These models can be effective, but only when the underlying governance documents clearly define roles, authority, and fiduciary obligations.
Final Thought
What unites these trends is accountability. Regulators, customers, employees, and business partners are asking better questions and expecting clearer answers. Michigan law has long favored preparation over improvisation, and that remains true in 2026.
Companies that integrate legal foresight into everyday decision-making, rather than treating counsel as a last resort, will be best positioned to manage risk, protect value, and grow with confidence.
2026 is already underway. The opportunity now is to mind your Michigan business before someone else is forced to do it for you.
—————
Zana Tomich is a seasoned attorney based in Detroit with over two decades of experience advising businesses and nonprofit organizations.
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