Vaccine Mandate for Federal Contractors: What Employers Need to Know

LATEST UPDATE: On January 13, 2022, the Supreme Court of the United States upheld a stay on the vaccine mandate for private employers. An appeal against the vaccine mandates for federal contractors is currently in progress. 

On Thursday, December 2, 2021, Helios held a webinar for our clients and business colleagues on the Federal Vaccine Mandate: What Government Contractors Need to Know in partnership with NFP and Holland & Knight. We were fortunate to have Helios HR's Jenna Louis interview employment law specialist, Kara Ariail, Partner with Holland & Knight, to answer some of the most pressing questions on our minds today. 

Where We Are Today

If you do business with the government, then you’ve likely been following the news pretty closely since President Biden announced his Path Out of the Pandemic: COVID-19 Action Plan in early September. Shortly after the plan was announced, the Safer Federal Workforce Task Force issued Guidance for Federal Contractors and Subcontractors which called for a broad-based vaccine mandate for federal contractors. Initially, the deadline for contractors to comply was December 8, 2021, which has now been extended to January 18, 2022.

Coinciding with the extended deadline, OSHA released an Emergency Temporary Standard for large employers over 100 employees. While the OSHA ETS has been temporarily and does not apply to government contractors who are subject to the vaccine mandate, the standard and related implementation guidance is still helpful to review for ideas and information. However, for the purpose of this article, we will solely focus on the vaccine requirement for government contractors.

Who Does the Vaccine Mandate Apply to?

Under the Safer Federal Workforce Task Force Guidance and Executive Order 14042, federal contractors and subcontractors are subject to the vaccine mandate, pursuant to the inclusion of a contract clause developed by the FAR Council, in three situations:

• New contracts awarded on or after November 14, 2021.
• Contracts awarded between October 15 and November 13, 2021, where the agency exercises its option to apply the requirement.
• Existing contracts that are extended, modified, or renewed after October 15, 2021.

Certain contracts are not covered, for example, contracts to provide only products to the government are not covered, but for most this will apply. It also is important to note that this contract clause flows down to covered subcontractors. And while you may not have any covered contracts now, it may be a good idea to be prepared and anticipate the change. We recommend you assess and modify your contracts to evaluate future compliance obligations and have open dialogues with your government customers and/or prime.

One-point Ariail emphasized is this is a contract compliance clause, not a law that everyone must be vaccinated. Rather, this is a condition the government is requiring that in order to do business with them, they are executing their right to negotiate their contracts and minimize productivity disruptions from Covid-19. From the government’s perspective, they aren’t advising contractors what to do with their employees or suggesting that they terminate employees because they aren’t vaccinated.

Yet, it’s up to the employer to identify alternative positions or workplaces for those individuals, if any exist. If there aren’t alternative positions or workplaces, then an employer will need to make a business decision about how to proceed with the employment of an employee who is no longer qualified to work on a covered contract, and for whom no other position is available.

Which Employees Are Covered under the Vaccine Mandate for GovCons?

According to the GSA and Holland & Knight, unless there is a legal exception, it applies to:

• Any contractor or subcontractor employee working on a “covered contract” *
• Any contractor or subcontractor employee working “in connection with a covered contract” – think anyone in an overhead pool
• Any contractor or subcontractor employee who would likely come into contact with employees working on or in connection with a covered contract at a “covered contractor workplace.” **

Essentially, if you have an employee who is touching a contract in any way, they are covered. That includes people in overhead roles like operations, BD, marketing, accounting, etc. Any employee who is billing on a covered contract, even if they work from home, is still subject. The third category applies to any employee who would likely come into contact with covered employees in a workplace such as using the same restroom, elevator, parking garage, etc. The guidance is intended to be broad to cover as many employees as possible.

The only employees who are not applicable are those who are not working on or in connection with a covered contract and are either fully remote or who work in a facility that is entirely separate from your government contracting team facility.

How to Handle Medical and Religious Exemption Requests

• Medical Conditions - Ask employees to identify their medical condition and present information from a healthcare provider confirming that the employee shouldn’t be vaccinated for a medical condition.
• Religious Exemptions – You want to make sure the employee has identified a religious belief- not a belief based on science or politics. At the same time, a sincerely held religious belief does not have to be a formal religious belief, it could be a spiritual or moral belief. Make sure the employee explains how complying with your vaccine policy would violate their stated belief.

When administering exemption requests, it is critical that the same questions are asked to everyone and you remain consistent in your practice. You can download a Medical and Religious Exemption Request Form Template from the Safer Federal Workforce website.

Reviewing and Communicating Exemption Requests

Next, you want to approve accommodation requests on a case-by-case basis. Ariail advised employers to get awareness of who has verified their vaccination and who is requesting an exemption. Understand who is exempt or not exempt, and then Holland & Knight’s recommendation is to slow roll any related adverse employment decisions in hopes that more clarifying guidance is provided in the weeks leading up to the implementation deadline - either through additional Task Force guidance, resolution of current legal challenges, or direct feedback from your customer.

Generally, if the employee works remotely, then no other accommodations may be needed. If they work onsite or at a customer’s site, remote work may or may not be an option. It all depends on who controls the employee’s worksite and whether that decision is up to the employer or the customer. We anticipate there will be some situations where employees will be deemed legally entitled to an exemption from your vaccination policy, but you won’t’ be able to accommodate them due to not having another place to put them.

Rather than taking any immediate actions, focus on having open and transparent communication with your employees who are requesting the exemptions. Let your employees know that 1) once the mandate comes into enforcement, they may not be able to work on the federal client site, but 2) you want to keep them as a valuable employee and to stay the course as we continue to learn more about what options are available. Manage their expectations and be forthcoming about continuity concerns, and that, unfortunately, you are being put in a really tough place.

As an employer, you want to fulfill your contract requirements for your customers, but you also don’t want to create legal risks that may not even come to light. The government could change their requirements a month from now. There are a lot of other factors that need to be considered. Give yourself the flexibility to wait to make any final decisions.

For HR leaders advising your company decision-makers, Ariail’s guidance was:

• Use the wording, this is “subject to change.”
• Be nimble in practices and communication.
• Look at the big picture and consider compliance actions holistically.

Determining how you are going to handle your next steps is a matter of risk tolerance and your business objectives.

Another recommendation for HR leaders is to reach out to individuals who are making exemption requests to gain greater awareness about their concerns and share the business position too. For some people, it could be a matter of helping them with further education, and while others may never budge on their stance, you can show empathy and determine if there is a way to resolve the situation. That personal outreach will be well worth your time investment and can go a long way.

Sharing Employee Vaccination Status with Your Government Client

Ariail’s suggested best practice is rather than sharing vaccination status, share who has verified their vaccination status. Don’t share the employees who have not been vaccinated, instead, confirm those who have not verified their vaccination status. This is a subtle distinction between sharing medical information vs. meeting a requirement set forth in the contract. You can let your customers know they were approved for an exemption, but do not share any of the details around religious or medical information. If they ask for more detail, reach out to counsel on how to best navigate that.

Legal Challenges

With so many unanswered questions right now, 27 different state challenges pending in 8 different federal courts, a tri-state temporary injunction, 6 private industry challenges, and the new Florida state law, it remains unclear exactly how compliance requirements will play out. Employers are in a tough position on how to proceed. We are all wondering, is this January 18, 2022 date going to be further extended?

The deadline, parameters, and other possibilities remain to be seen, but the general guidance is compliance is the objective. We know the Biden Administration’s goal is to increase vaccinations in this country. Therefore, it’s probably best to still be working towards compliance because you don’t want to be in a position where you are scrambling at the last minute should it continue to take place in January. 

So, as you continue to navigate the coming weeks, remember to think about what your objective is and how you can remain flexible and open. Think about your tolerance for risk and compliance. Do you want to ensure you are protecting the business and minimally comply, or do you want to be more aggressive? There is no right or wrong approach. Just make sure you know what percentage of your employees don’t want to comply and how will it impact you operationally as you are determining the next steps for your business.

For more guidance and insight from our employment law partners at Holland & Knight, visit https://www.hklaw.com/en/insights.