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Arent Fox LLP

12/03/2021 | News release | Distributed by Public on 12/03/2021 11:07

Federal Contractor Vaccine Mandate Enforcement Halted in 3 States/Deadline Delayed Nationwide

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What to Know

  • On November 30, 2021, a federal judge granted an injunction barring the government from enforcing the federal contractor vaccine mandate in Kentucky, Ohio, and Tennessee.
  • While the injunction bars enforcement only in those three states, similar litigation remains pending in Arizona, Florida, Georgia, Missouri, Oklahoma, and Texas, in which Alabama, Alaska, Arkansas, Idaho, Iowa, Kansas, Montana, Nebraska, New Hampshire, North Dakota, South Carolina, South Dakota, Utah, West Virginia, and Wyoming have joined.
  • The Biden Administration had already pushed the deadline for enforcement of the federal contractor vaccine mandate back to January 18, 2022 to align with what was intended to be the deadline for enforcement of the private employer vaccine mandate/testing requirements imposed by the separately enjoined OSHA Emergency Temporary Standards for employers with more than 100 employees.
  • Shifting standards and deadlines place additional burdens on contractors seeking to remain in compliance.

Background of the Federal Contractor Vaccine Mandate

As described in our earlier alerts (here and here), President Biden's Executive Order 14042, Ensuring Adequate COVID Safety Protocols for Federal Contractors, directed agencies to include a clause in new contracts, options, and extensions requiring compliance with safety standards promulgated by the Safer Federal Workforce Task Force. While the Executive Order stated that the clause was to be included in contracts and subcontracts for services (as opposed to contracts for the supply of goods) over $250,000, the OMB encouraged agencies to apply the clause more broadly in areas not required by the Executive Order.

When the clause is included in a contract, the Task Force Guidance mandates vaccination for almost all employees that perform services under a covered contract (even if they perform work entirely remotely), perform administrative and back-office work supporting a covered contract (such as human resources, billing, and legal review), or work at a location where employees performing such services also work. Exceptions are permitted for disability or sincerely held religious beliefs where required by law under the ADA or Title VII.

Enforcement of Federal Contractor Vaccine Mandate Halted in Kentucky, Ohio, and Tennessee

On November 30, 2021, a federal judge issued an injunction preventing the government from enforcing the federal contractor vaccine mandate in the three states that were parties to the suit, Kentucky, Ohio, and Tennessee.

The core issue in the litigation was whether the president could use congressionally delegated authority to manage the federal procurement of goods and services under the Federal Property and Administrative Services Act ("FPASA"), 40 U.S.C. 101 et seq., to impose vaccines on the employees of federal contractors and subcontractors. U.S. District Judge Gregory F. Van Tatenhove of the U.S. District Court for the Eastern District of Kentucky found President Biden overstepped his authority in this regard. While describing the FPASA delegation as "broad," Judge Van Tatenhove noted the authority was not absolute.

Prior courts have held there must be a "close nexus" between an executive order and FPASA's goal to create an "economical and efficient system for. . . procurement and supply." Here, the government argued the nexus was "self-evident" because the vaccination mandate would: (1) decrease worker absence; (2) decrease labor costs; and (3) improve efficiency at worksites (as described in the Executive Order itself).

Judge Van Tatenhove disagreed, noting that "it strains credulity that Congress intended the FPASA, a procurement statute, to be the basis for promulgating a public health measure such as mandatory vaccination."

The decision reflected concerns that extending FPASA authority was a slippery slope, with Judge Van Tatenhove noting it would allow the government to "enact virtually any measure at the president's whim under the guise of economy and efficiency." The judge noted that it could be extended to mandate free grocery delivery for the sick or vulnerable, require manufacturers to provide free computers to enable people to work from home, order telecommunications companies to provide free high-speed Internet service to facilitate remote work, mandate contractors keep their employees under a certain BMI, or restrict crowded indoor office layouts.

The vaccine mandate proved problematic to the Court in other ways, with Judge Van Tatenhove noting that it likely: (i) unduly restricted competition in violation of the Competition in Contracting Act, 41 U.S.C. § 3301; (ii) ran afoul of the nondelegation doctrine by using a procurement statute to promulgate a vaccine mandate; and (iii) violated the Tenth Amendment to the Constitution by intruding on an area traditionally reserved to the states.

While the court rejected challenges that the government failed to follow appropriate procedures and refused to apply the injunction nationwide, the court enjoined enforcement of the federal contractor vaccine mandate in the three states that were parties to the suit: Kentucky, Ohio, and Tennessee. Similar litigation remains pending in Arizona, Florida, Georgia, Missouri, Oklahoma, and Texas, in which Alabama, Alaska, Arkansas, Idaho, Iowa, Kansas, Montana, Nebraska, New Hampshire, North Dakota, South Carolina, South Dakota, Utah, West Virginia, and Wyoming have joined.

The court enjoined the Government from "enforcing the vaccine mandate for federal contractors and subcontractors in all covered contracts in Kentucky, Ohio, and Tennessee." This clearly enjoins enforcement of the mandate at all "covered contractor workplaces" located in those three states, whether or not the contract is also performed at sites outside of those states. The injunction also can be reasonably understood as applying to contracts awarded to contractors and subcontractors headquartered in those states, though this is not expressly stated.

The government is expected to appeal the decision. An appeal would go to the United States Court of Appeals for the Sixth Circuit.

Enforcement Deadline Previously Pushed Back

Before the federal contractor vaccine mandate was partially enjoined, the Biden Administration announced that the federal contractor vaccine mandate deadline would be pushed back to align with what were to be the OSHA ETS deadlines that required employers with over 100 employees to mandate vaccination or testing (before the OSHA ETS requirements were separately enjoined). The move had the effect of pushing the deadline for employees to be "fully vaccinated" back to January 18, 2022.1 This was just recently added as an update to the Safer Federal Workforce Task Force Guidance.

Until and unless the federal contractor vaccine mandate is enjoined nationwide, federal contractors with workers outside of Kentucky, Tennessee, and Ohio, or headquartered outside those states, remain subject to the January 18, 2021 deadline for complying with the vaccine mandate.

Shifting Standards and Deadlines Place Additional Burdens on Contractors Seeking to Comply

The continuously shifting standards and deadlines for complying with the federal contractor vaccination mandate have left contractors scrambling to understand the scope and applicability of the requirements.

There has been a steady beat of revisions to Task Force guidance. Recent significant changes include:

  • Expanding the meaning of "covered contractor employee" to include employees of affiliates in some cases;
  • Granting flexibility by encouraging agencies to work with contractors that are proceeding in good faith yet encounter challenges with compliance with COVID-19 workplace safety protocols;
  • Suggesting contractors use a phased enforcement policy for employees that refuse to get vaccinated that includes a limited period of counseling and education, followed by additional disciplinary measures if necessary, and removal only after continued non-compliance; and
  • Requiring contractor employees who work on-site at federal facilities to provide a "Certification of Vaccination" form.

Additionally, as the government works to implement the Executive Order, agencies have taken differing approaches as to conditions under which the agency will require compliance with the clause.

The General Services Administration ("GSA"), for instance, is requiring the clause in all existing Federal Supply Schedule contracts (although the mandate will only apply to future orders) and is seeking to bilaterally modify all other existing contracts and leases to include the clause, without waiting for one of the events identified in the Executive Order as a trigger for adding the clause (which is only mandatory before extending or renewing a contract or entering into a new contract). Although OMB guidance encouraged agencies to do this, whether legal authority exists to do so is questionable.

Other agencies are including the clause in contracts and subcontracts below the simplified acquisition threshold or in contracts for the supply of goods as well as services. The National Aeronautics and Space Administration ("NASA"), for example, is requiring the clause be inserted in new contracts above the micro-purchase threshold ($10,000) with no limitation on applicability to contracts for the provision of goods. Again, although the OMB encouraged agencies to take this approach, the legal authority for the agency to act in areas where the Executive Order did not is subject to doubt.

As a result, it is necessary to look at the rules for each separate agency that seeks to include the clause in a particular contract.

We will continue to monitor changes in this area and remain prepared to assist clients with maneuvering the complicated compliance landscape as it develops.

[1] Biden's announcement required employees to have received all required shots by January 4, 2022, but an employee is not considered "fully vaccinated" until two weeks following the last shot, or January 18, 2022.

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