US President Joe Biden gives an update on the Covid-19 response and vaccination program, in the Roosevelt Room of the White House in Washington, DC, on October 14, 2021.
Nicholas Kamm | AFP | Getty Images
The Biden administration ordered U.S. companies Thursday to ensure their employees are fully vaccinated by Jan. 4 or regularly tested for Covid-19 — giving them a reprieve over the holidays before the long-awaited and hotly contested mandate takes effect.
Workers must receive their second shot of Pfizer or Moderna’s two-dose vaccines or a single dose of Johnson & Johnson by that date, according to the requirements.
The administration on Thursday also pushed back the deadline for federal contractors to comply with a stricter set of vaccine requirements for staff from Dec. 8 to Jan. 4 to match the deadline set for other private companies and health-care providers.
The newly released rules, issued by the Occupational Safety and Health Administration under the Labor Department, apply to businesses with 100 or more employees. All unvaccinated workers must begin wearing masks indoors by Dec. 5 and provide a negative Covid test on a weekly basis after the January deadline, according to the requirements.
Companies are not required to pay for or provide the tests unless they are otherwise required to by state or local laws or in labor union contracts. Anyone who tests positive is prohibited from going into work. Employers are also not required to pay for face coverings.
The rules do not apply to people who go to a workplace where other people are not present, who work remotely from home or perform their work exclusively outside. Workers with sincerely held religious beliefs, disabilities, and those with medical conditions that do not allow them to get vaccinated can receive exemptions.
Companies also have until Dec. 5 to offer paid time for employees to get vaccinated and paid sick leave for them to recover from any side effects.
OSHA, which polices workplace safety for the Labor Department, will provide sample implementation plans and fact sheets among other materials to help companies adopt the new rules.
OSHA will also conduct on-site workplace inspections to make sure companies comply with the rules, a senior administration official said. Penalties for noncompliance can range from $13,653 per serious violation to $136,532 if a company willfully violates the rules.
The vaccine mandate, which covers 84 million people employed in the private sector, represents the most expansive use of federal power to protect workers from Covid-19 since the virus was declared a pandemic in March 2020.
The Centers for Medicare and Medicaid Services, the federal government’s health insurance plans for the elderly and poor, are also requiring the 76,000 health-care facilities that participate in the programs to ensure their workers are fully vaccinated by Jan. 4, affecting some 17 million employees, senior administration officials said. Facilities that violate the mandate could be at risk of losing their funding, they said.
The Labor Department developed the business mandate under emergency authority that shortcuts the process for issuing new workplace safety standards, which normally take years. OSHA can use its emergency authority when the Labor secretary determines workers face a grave danger from a new hazard, in this case Covid.
Business groups had called for the administration to delay the mandate until after the busy holiday season, worried that workers would choose to quit rather than follow the rules, further disrupting already strained supply chains and a tight labor market.
The U.S. Chamber of Commerce, which asked for a delay until after the holidays, praised OSHA on Thursday for “making significant adjustments” that “reflect concerns of the business community.” The Business Roundtable backed the administration’s vaccination policy.
The National Retail Federation, however, said the requirements “impose burdensome new requirements on retailers during the crucial holiday shopping season.” The NRF, which had requested a 90-day implementation period, said the mandate could disrupt the economy and “exacerbate the preexisting workforce shortage.”
The Retail Industry Leaders Association called the implementation period “insufficient” and said the potential fines for noncompliance are “unnecessary and unhelpful,” warning that “it pits government against private employers instead of working with them to create a safe working environment.”
“While the mandate on private employers technically begins post-holiday, the planning time to design and implement the mandate will fall during the busiest part of the shopping season,” the association said in a statement on Thursday.
The National Association of Manufacturers is worried about potential “undue cost burdens,” and the National Federation of Independent Business said it opposes the rule.
Nearly every Republican state attorney general in the U.S. has vowed to take legal action to halt the mandate, calling it “counterproductive and harmful” in a September letter to the White House.
Republicans and industry lobbyists have contended that the current threat from Covid does not amount to a grave danger as claimed by the Biden administration. They point to the growing level of vaccination and natural immunity in the U.S. from previous infections, and mitigation measures already taken by many businesses in the workplace.
Covid has killed more than 745,000 people in the U.S. and infected more than 46 million, according to data from the Centers for Disease Control and Prevention. The virus is infecting an average of more than 72,000 every day.
“A virus that has killed more than 745,000 Americans with more than 70,000 new cases per day currently is clearly a health hazard that poses a grave danger to workers,” said Labor Department Solicitor Seema Nanda during a press briefing Thursday.
Nanda said the mandate preempts rules at the state level on vaccination, Covid-19 testing and facemasks unless those rules are part of a federally approved state OSHA plan. States such as Texas have sought to ban vaccine mandates.
The AFL-CIO, which represents the largest group of unions in the U.S., had pushed for even more sweeping protections to be included in the mandate, such as standards on ventilation and physical distancing where appropriate. OSHA is not requiring those additional mitigation measures for private businesses at this time.
“OSHA has determined that it needs more information before imposing these requirements on the entire scope of industries and employers covered by the standard,” the agency said in the emergency safety standard laying out the details of the requirements.
The Biden administration could now face legal challenges on two fronts, from those who want the mandate overturned and those who want it expanded.
It’s unclear whether the mandates will survive legal challenges. OSHA emergency safety standards have a mixed track record in court. Before the pandemic, the agency had not issued an emergency standard since 1983. Courts have postponed or fully overturned four of the 10 emergency safety standards issued by OSHA in its 50-year history. A fifth was partially vacated.
Some business groups, such as the National Retail Federation and the National Federation of Independent Business on Thursday said the new requirements would burden employers.
Along with the new rules for companies with 100 or more employees, the Biden administration said it will extend the deadline for a similar but stricter set of rules for federal contractors until Jan. 4.
The federal contractor rules don’t include a regular Covid testing option for employees.
Workers for those companies, which include Boeing, American Airlines, IBM and smaller contractors like food service firms, have to ensure workers are vaccinated or receive exemptions for religious or medical reasons.
Those rules have faced opposition from some workers and some labor unions.
For example, Southwest Airlines pilots’ union sought to block the implementation of the mandate, arguing it needed to be negotiated with the union. A federal judge in Texas, however, denied that request and dismissed the union’s lawsuit last week.
The union that represents American Airlines’ pilots wrote to Biden administration officials in September seeking an alternative to the mandate such as regular testing and warning the 60-day implementation period could create labor shortages and disrupt holiday travel. Unions for both American’s and Southwest’s pilots cheered the deadline extension for federal contractors. Those airlines have government contracts to fly military members, federal employees and U.S. mail.
Executives at American and Southwest last month softened their tone over the vaccine rules after telling workers they need to be vaccinated or get an exemption to continue working there, urging staff to apply for exemptions. Both carriers as well as JetBlue and Alaska said they would mandate vaccines, complying with the order.
American and Southwest have told staff they would need to receive their second shot of a two-dose vaccine by Nov. 24, the day before Thanksgiving and one of the busiest travel days of the year. Executives said they don’t expect the mandate will impact holiday travel.
The White House on Monday issued guidelines for federal contractors that gives those employers broad latitude in meeting the rules. However, Biden administration officials have said contractors don’t face a hard deadline, but they must show they’re making a good-faith effort to get staff vaccinated and have plans for masking and social distancing in workplaces.
(With inputs from CNBC)