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Keeping You Well Ahead: Perspective and Analysis on the Latest Legal Developments in Health Care

Coronavirus

Biden Administration Announces Broad Employer-Based Vaccination Requirements

September 13, 2021

by Jillian Kornblatt, Gabrielle Wirth, Katie Ervin Carlson, Drew James, and Alyson Dieckman

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On September 9, 2021, the Biden Administration announced its new COVID-19 Action Plan (the “Action Plan”), which outlines a six-pronged approach to combat the pandemic.  The wide-ranging Action Plan lays out plans to vaccinate the unvaccinated, further protect the vaccinated, keep schools safely open, increase testing and masking, protect the economic recovery, and improve care for those with COVID-19.  Three components of the Action Plan’s “vaccinate the unvaccinated” prong impose new requirements for employers.  Those components are:

  • Require all employers with 100 or more employees to ensure their workers are vaccinated or tested weekly and to provide paid time off for employees to get vaccinated;
  • Require COVID-19 vaccination for all federal workers and all employees of federal contractors and subcontractors; and
  • Require COVID-19 vaccination for health care workers at Medicare and Medicaid participating hospitals and other health care settings.

On the same day he issued the Action Plan, President Biden issued two executive orders requiring vaccination for all federal employees and directing the Safer Federal Workforce Task Force to issue COVID-19 safety-related guidance.  President Biden also instructed the Occupational Safety and Health Administration (“OSHA”) to issue an Emergency Temporary Standard (“ETS”) to implement the Action Plan’s employer obligations.

A BRIEF HISTORY OF GOVERNMENT VACCINATION MANDATES, OSHA ETS AUTHORITY, AND EXISTING OSHA COVID-19 RULES

In 1905, the United States Supreme Court upheld Massachusetts’s compulsory small pox vaccination law in a case challenging the constitutionality of the state’s vaccination mandate.  The decision did not address the constitutionality of a federal vaccination mandate or, if permissible, whether such a mandate may be issued by President without legislative action.  The decision did, however, provide analysis of the government’s ability to enact laws intending to protect the health and welfare of citizens during an outbreak or pandemic that will likely be relied on in any upcoming challenges to the Action Plan.  In response to claims that notions of liberty preclude government vaccine mandates, the Court stated:

The liberty secured by the Constitution of the United States does not import an absolute right in each person to be at all times, and in all circumstances, wholly freed from restraint, nor is it an element in such liberty that one person, or a minority of persons residing in any community and enjoying the benefits of its local government, should have power to dominate the majority when supported in their action by the authority of the State.

OSHA has authority to issue an ETS when “employees are exposed to grave danger from exposure to substances or agents determined to be toxic or physically harmful or from new hazards” and when such emergency standard is “necessary to protect employees from such danger.”  OSHA’s ETS authority allows it to forego its normal what rulemaking process.  An ETS can remain in place for up to six months, at which time OSHA must replace it with a permanent standard adopted through the normal rule making process.  The last ETS OSHA issued before its June 2021 ETS for the prevention of COVID-19 in healthcare employment was a 1983 rule addressing workplace asbestos exposure that the Fifth Circuit Court of Appeals (covering Louisiana, Mississippi, and Texas) struck down months later in part on the grounds that OSHA did not provide sufficient support for its claim that 80 workers would die from asbestos exposure in the 6 months the ETS would cover.

On June 10, 2021, OSHA issued the first nationwide workplace-safety rule in an ETS for health care employers in response to the COVID-19 pandemic, and it was codified in the Federal Register on June 21, 2021.  The motivation behind OSHA’s June 2021 ETS addressing COVID-19 protections for health care workers was OSHA’s determination that a “grave danger” to employee health existed related to the virus.   OSHA’s August update states “OSHA has determined that CDC’s guidance on health care settings has not changed and that the requirements of the health care ETS released on June 10, 2021, remain necessary to address the grave danger of COVID-19 in health care.”  OHSA indicates it will monitor and assess monthly the need for any updates or changes to the health care ETS.

The Biden Action Plan in many ways follows OSHA’s August 13, 2021 advisory guidance aimed at mitigating and preventing the spread of COVID-19 in the workplace, but also imposes new legal obligations regarding COVID safety in the workplace.

WHAT DOES THE BIDEN ACTION PLAN REQUIRE?

A.   Employers with 100+ Employees.

    1. Vaccination or Weekly Testing Requirement

OSHA is developing a rule that will require all employers with 100 or more employees to ensure their workforce is fully vaccinated or require any workers who remain unvaccinated to produce a negative test result on at least a weekly basis before coming to work.  OSHA will issue an ETS to implement the requirement.  This requirement is expected to affect over 80 million workers in private sector businesses with 100 or more employees.

Several questions remain regarding exactly how OSHA will implement the COVID-19 Action Plan for private employers, including how OSHA will determine whether an employer has more 100 or more employees for purposes of the ETS, who will pay for the weekly testing, the deadline for meeting the ETS standards, and how OSHA will apply penalties for non-compliance.  While there is little doubt that the ETS will contain exceptions for employees who are unable to be vaccinated due to a disability or sincerely held religious belief, as is protected under federal and state laws, it will remain to be seen whether states which have enacted laws prohibiting employers from mandating vaccinations for employees will bring legal challenges to the ETS and the Action Plan more broadly. It is widely anticipated they will.

    1. Paid Leave for Vaccination.

OSHA’s ETS will also require employers with more than 100 employees to provide paid time off for vaccination and, if needed, post-vaccination recovery.[1]

B.   The Federal Government, Federal Contractors, and Federal Subcontractors.

President Biden issued an Executive Order requiring all federal agencies to require COVID-19 vaccination for all of their employees, with exceptions only as required by law (e.g. religious and medical reasons).  The Order directs The Safer Federal Workforce Task Force to issue compliance guidance by September 16, 2021.

The President signed a second Executive Order that applies to organizations that contract with the federal government and subcontractors to those contracts.  While the Executive Order itself does not contain a vaccine mandate, President Biden’s Plan indicates that the requirement that all federal employees receive the COVID-19 vaccine will “be extended to employees of contractors that do business with the federal government.”

As to the contracts themselves, the Executive Order applies to any: (1) new contract, (2) new contract-like instrument, (3) new solicitation for a contract or contract-like instrument, (4) extension or renewal of an existing contract or contract-like instrument, or (5) exercise of an option on an existing contract or contract-like instrument.  The Executive Order covers these contracts or contract-like instruments that are for services, construction, or a leasehold interest in real property; for services covered by the Service Contract Act; for concessions; or in connection with federal property or lands and related to offering services for Federal employees, their dependents, or the general public. The Executive Order requires agencies to take steps to include by October 8, 2021 required language for all contracts and contract-like instruments entered into or otherwise meeting the criteria above on or after October 15, 2021.

Extensions and options are used by the federal government pursuant to the Federal Acquisition Regulation, which permits solicitations and contracts to include an option clause that allows the government “to require continued performance of any services within the limits and at the rates specified in the contract.”  An option provision can be exercised more than once, but the total time of extension cannot exceed six months.

The Executive Order governing federal contractors and subcontractors does not apply to: (1) grants, (2) contracts, contract-like instruments, or agreements with Indian Tribes under Public Law 96-638, (3) contract or contract-like instruments with value equal to or less than the simplified acquisition threshold as defined by the Federal Acquisition Regulation, (4) employees who perform work outside of the United States, or (5) subcontracts solely for the provision of products.

In defining “contract-like instruments,” the Executive Order refers to the Department of Labor’s proposed rule, “Increasing the Minimum Wage for Federal Contractors,” 86 Fed. Reg. 38816, 38887 (July 22, 2021).

The Executive Order requires executive departments and agencies to ensure that contracts and contract-like instruments include a clause that contractors and subcontractors must incorporate into lower-tier subcontracts.  The clause will mandate compliance with “all guidance for contractor or subcontractor workplace locations published by the Safer Federal Workforce Task Force” and will apply to any locations in which an individual works in connection with a federal contract or contract-like instrument.  The Task Force is to issue such guidance no later than September 24, 2021.  Thus, the Executive Order does not require contractors and subcontractors to create vaccination mandate language.  Rather, their responsibility will be to include required language in contracts and develop workplace plans that ensure compliance it.

For contracts not covered by the Executive Order, the President has “strongly encouraged” contractors and subcontractors to follow any safety protocols developed by the Safer Federal Workforce Task Force.

C.  Medicare and Medicaid Participating Hospitals and Other Health Care Settings.

Prior to the Action Plan’s launch, organizations that advocate for long-term-care facilities urged the Administration to mandate the COVID-19 vaccine throughout the health care industry, citing concerns over existing staffing shortages that facilities feared would worsen if long-term-care workers who wished to decline the vaccine had the option to work in other health care facilities.  In response, on August 18, 2021, President Biden announced plans to require long-term-care facilities to have “fully vaccinated” workforces as a condition of receiving Medicare or Medicaid funding.  Details of those requirements are yet to be released, but in the Action Plan, he expanded that mandate to all healthcare workers at Medicare and Medicaid-participating healthcare organizations, including, but not limited to, hospitals, dialysis facilities, ambulatory surgical settings, and home-health agencies.

While OSHA’s June 2021 ETS was broadly aimed at protecting health care workers amid the COVID-19 pandemic, it stopped short of requiring vaccines. President Biden’s COVID-19 Action Plan goes further by requiring vaccinations for many employees in the healthcare industry.

D.   All Employers

For months, the Equal Employment Opportunity Commission (“EEOC”) has opined that all employers under its jurisdiction may elect to mandate COVID-19 vaccination for their employees. As we have previously discussed, employers that mandate the vaccine must make exceptions for medical and religious reasons or risk violating state and federal anti-discrimination laws.

Small employers who hope to avoid vaccine mandates may also incentivize employee vaccination.  The EEOC’s guidance explains that employers that administer vaccines may incentivize vaccination, as long as the incentives are non-coercive.

PRACTICAL STEPS FOR EMPLOYERS

  1. Employers with 100 or more employees should begin considering and developing a vaccination policy that will comply with the Action Plan.
  2. All employers mandating vaccines should consider the potential for exemptions for reasonable accommodations for religious belief and disabilities, pursuant to Title VII of the Civil Rights Act of 1964 (“Title VII”) and the Americans with Disabilities Act (“ADA”), as well as applicable state law.
  3. Employers should confirm whether they are a federal contractor or subcontractor. Federal contractor status is present if an organization has a contract with the federal government.  Federal subcontractor status can be determined through a letter from a government contractor stating your organization is a subcontractor necessary for the performance of a government contract or undertaking a federal contractor’s obligation under its contract.

Other ways to assess federal-contractor/subcontractor status include a search on the Federal Procurement Data System or USA spending either by searching for the organization name or Dun & Bradstreet number.

  1. Employers with under 100 employees, and those without existing federal contracts not subject to the Executive Order, should consider whether to adopt vaccine mandates or incentives as outlined by the EEOC.
  2. Employers should anticipate changes to new requirements due to COVID-19 itself (Delta, Mu, and other variants) and how to respond to such changes.

[1] President Biden’s COVID-19 Action Plan states that private employers with “100 or more” employees must require vaccination, but that private employers with “more than 100” employees must provide paid vaccination leave.  While this may be an unintentional typo, we recommend employers presume that if they are required to mandate the vaccine, they are also required to provide paid vaccination leave.

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Coronavirus,

COVID-19,

Employment,

Executive Orders

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Contractual Disclaimers Are Not an Automatic Defense to a Misleading Pitch W&A next argued that disclaimers in its client contracts prevented consumers from claiming they had been misled by its advertising. Reiterating that individual reliance is not required under the MCFA and MDTPA, the Court of Appeals held that a contractual disclaimer does not necessarily defeat a claim based on a conflicting oral representation. And on the facts of this case, the Court of Appeals agreed with the district court that W&A’s contractual disclaimers were insufficient given the extensive misrepresentations by W&A and the unequal bargaining power between it and its customers. 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The Court of Appeals rejected a simple headcount approach, instead explaining that the state had a legitimate interest in protecting residents’ economic well-being as a whole. In any event, the Court of Appeals held that if restitution was not appropriate under the state’s parens patriae authority, then it would still be appropriate under the Attorney General’s enforcement powers under Minn. Stat. § 8.31. The decision reinforces that the broader and more sustained the deceptive advertising, the stronger the case for restitution to protect Minnesotans’ economic interests. Civil Penalties Accrue Per Violation, Not Per Defendant The Court of Appeals finally rejected W&A’s claim that the Attorney General’s enforcement powers under Minn. Stat. § 8.31 permit only civil penalties of up to $25,000 for each defendant. Rather, the Court of Appeals explained that penalties are limited to $25,000 per violation. Multiple violations can therefore produce substantially greater penalties. 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Separately, operators could demonstrate compliance with the operational NIE requirement by making repairs as soon as practicable, with an initial repair attempt within five days and final repair within 30 days, or by qualifying for the existing delay-of-repair provisions. A deviation of the operational requirement would occur if the applicable repair deadlines are not met and the delay-of-repair provisions do not apply. The proposal also establishes a new framework for addressing recurring or “chronic” emissions events. After the third emissions event or defect from the same cover or CVS within a year, the owner or operator would be required to conduct an investigative analysis within 10 days to determine whether the underlying cause relates to equipment design, operation, maintenance, or prior repair efforts. The results of that investigation would have important compliance implications. If recurring emissions are attributable to a design flaw, EPA would treat the issue as a deviation of the design requirements. If the emissions result from inadequate prior repairs, the deviation would be attributed to the repair requirements. If operations, maintenance, or other site practices are responsible, the deviation would be classified under the operational requirements. EPA would also require implementation of corrective measures identified through the analysis, including design modifications within 90 days and operational or maintenance-related corrective actions within 30 days. Taken together, these revisions would shift the NIE standard away from a framework in which the mere presence of emissions may establish noncompliance and toward one that focuses on whether operators identify emissions, complete timely repairs, investigate recurring problems, and address the root causes of repeated emissions events. IV.    Solicitation of Comment on “Legally and Practicably Enforceable” Standard EPA is also soliciting comment on the definition of “legally and practicably enforceable” (“LPE”), which industry has identified as one of the more problematic existing requirements. Under the 2024 rule, EPA adopted an interpretation of LPE that many commenters argued effectively disqualifies numerous state regulatory programs, permits, and other federally enforceable mechanisms from serving as the basis for remaining below applicable Subpart OOOOb storage tank thresholds. In particular, stakeholders have asserted that the current LPE framework makes it difficult for state air permitting programs and other state regulatory requirements to satisfy EPA's criteria, thereby causing more storage tanks and other emission units to remain subject to Subpart OOOOb requirements than would otherwise be the case. EPA now requests comment on whether its current interpretation of LPE is overly restrictive and whether alternative approaches would better account for the manner in which state permitting and regulatory programs are administered and enforced. The request is significant because a broader interpretation of LPE could allow a wider range of federally enforceable state permits and regulatory requirements to satisfy exemption criteria under OOOOb, potentially reducing the number of storage tanks and other sources subject to direct NSPS regulation. As a result, the LPE issue has implications that extend beyond compliance mechanics and could materially affect the scope of sources regulated under the federal methane program. V.    Revised Requirements for Marginal Wells EPA is also proposing significant revisions to the treatment of lower-producing wells under Subparts OOOOb and OOOOc. The agency notes that marginal wells constitute a substantial portion of the nation’s producing well inventory but account for a relatively small share of overall production. At the same time, EPA discusses studies estimating that marginal wells contribute a disproportionate share of methane emissions from oil and natural gas production. The agency is evaluating whether the 2024 rule appropriately accounts for the operational characteristics, emissions profiles, and compliance costs associated with these wells. To address those concerns, EPA is proposing two alternative approaches to well-site subcategorization. Under the first option, EPA would distinguish between marginal and non-marginal well sites. EPA proposes to define a marginal well as a well that produced no more than 15 barrels of oil equivalent (“BOE”) per day over the prior 12-month period and a marginal well site as a site consisting exclusively of marginal wells with total site-wide production of no more than 15 BOE per day over the same period. EPA is also soliciting comment on whether marginal wells should be further subdivided based on production levels, including a potential distinction between sites producing 6 BOE per day or less and sites producing more than 6 BOE but no more than 15 BOE per day, which could result in additional regulatory flexibility for the lowest-producing wells. Under the second option, EPA would distinguish between conventional and unconventional well sites and tailor requirements based on that classification, including reduced requirements for conventional wells. The agency is seeking comment on which framework better reflects the operational and emissions characteristics of different well sites, as well as whether additional subcategories should be established within the marginal-well population and the extent to which compliance requirements should differ among categories. VI.    LDAR, Pneumatic Controllers, Control Device Monitoring, and Facility Modifications EPA's proposal also includes several targeted revisions to the 2024 rule's leak detection and repair (“LDAR”) requirements. Most notably, EPA proposes additional flexibility in the use of advanced monitoring technologies and seeks to move away from compliance frameworks that rely heavily on a single detection method. The agency is proposing changes intended to facilitate the use of multiple monitoring technologies, including optical gas imaging and other alternative detection approaches, and is seeking comment on whether technology-neutral compliance options can achieve equivalent emissions reductions at lower cost. EPA also proposes revisions for components and equipment that are particularly difficult to monitor using conventional LDAR methods, reflecting concerns that certain 2024 requirements may not be practical or cost-effective in the field. More broadly, EPA questions whether some of the monitoring frequencies adopted in 2024 appropriately balance compliance burdens and emissions-reduction benefits and seeks comment on additional opportunities to tailor LDAR obligations based on emissions risk and source characteristics. EPA also proposes technical revisions to requirements governing control devices and related equipment. These include changes addressing continuous pilot-flame requirements, flame-monitoring data deviations, control-device alerts, visible-emissions test conditions, temporary or backup control devices, temporary process controllers, and control-device categories. The agency’s stated objective is to provide additional compliance flexibility while maintaining appropriate emissions controls. The practical effect will depend on the final requirements and the equipment and circumstances to which each amendment applies. The proposal also addresses pneumatic controllers and equipment leaks at gas processing plants. For certain high-pressure process controllers at transmission compressor stations, EPA proposes a separate regulatory approach based on its reassessment of technical feasibility and cost. The proposal should not be read as establishing a general exemption for pneumatic controllers across the industry. EPA also proposes changes to other equipment-specific requirements, including requirements applicable to pumps, storage vessels, and equipment leaks at gas plants, in response to concerns raised following promulgation of the 2024 rule. Finally, EPA proposes changes to certain requirements governing liquids unloading and other well-site operations, as well as technical corrections and clarifications to the existing regulatory text. These provisions form part of EPA’s broader effort to address implementation concerns and reassess the costs and expected emissions reductions associated with selected requirements in the 2024 rule. Operators should evaluate the specific proposed amendments applicable to their facilities rather than assume that the proposal would provide across-the-board relief from existing monitoring, equipment, or control-device obligations. VII.    Implications for States and Future Congressional or Administrative Action EPA’s proposal would substantially revise several consequential elements of the 2024 methane rule, but it would not eliminate regulation of existing oil and natural gas sources under Clean Air Act § 111(d). As a result, states remain subject to the existing obligation to develop and submit plans for existing sources. If the proposed revisions are finalized, states currently developing those plans may need to reevaluate key program elements, including requirements relating to associated gas, well-site subcategories, the Super Emitter Program, and other compliance obligations. The proposal does not itself extend the January 22, 2027 deadline for state-plan submissions established under the existing framework. The Congressional Review Act (“CRA”) remains a potential source of uncertainty. Depending on when EPA submits a final rule to Congress and the applicable congressional-session timing, a future Congress and President could seek to disapprove the rule under the CRA. A successful disapproval would invalidate the rule and generally restrict the agency from issuing a rule in substantially the same form absent subsequent statutory authorization. The CRA’s lookback provisions can affect the period during which a rule remains subject to congressional review, so the risk cannot be assessed solely by reference to the calendar year in which the rule is finalized. The timing of finalization and submission to Congress, together with the applicable congressional calendar, will determine the extent of that exposure. Finally, unlike the CRA, which can nullify a recently promulgated rule through legislative action, a future administration seeking to unwind this rule would generally need to proceed through a new notice-and-comment rulemaking. EPA would need to revisit the underlying BSER determinations, cost analyses, technical feasibility findings, and enforceability conclusions that support the final rule. Because this proposal is grounded heavily in findings regarding achievability, legal and practical enforceability, and cost-effectiveness, a future administration would need to develop a sufficient record supporting different conclusions before reinstating more stringent requirements. Consequently, the final rule may prove more durable than prior pendulum swings, even if it remains politically controversial.

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