On November 5, 2021, the Occupational Safety and Health Administration (OSHA) issued its Emergency Temporary Standard (ETS), requiring private employers having at least 100 employees companywide (at any given time) to adopt written policies and procedures either mandating vaccination against COVID-19 or requiring employees to choose between vaccination or undergo weekly testing while wearing a face-covering at work.
Under the ETS, employees must be fully vaccinated or undergo weekly testing beginning January 4, 2022. All other requirements, summarized below, including an indoor mask mandate for unvaccinated workers, were to become effective December 5, 2021.
Almost immediately, private employers, labor unions, state governments, and citizens across the United States mounted legal challenges to the ETS. On November 12, 2021, the United States Court of Appeals for the Fifth Circuit, following an expedited review of the ETS, issued a written opinion staying the requirements imposed by the ETS and barring OSHA from enforcing them.
On December 17, 2021, the Sixth Circuit Court of Appeals, which “won” the obligation to conduct a consolidated review of the many legal challenges to the ETS as well as the Fifth Circuit’s November 12th decision, dissolved the stay entered by the Fifth Circuit and reinstated the ETS. Ultimately, the United States Supreme Court is expected to determine whether and when the ETS will take effect.
What’s the Current Deadline and What Have Some Employers Done?
As of now, covered employers must comply with the ETS, and must act swiftly to ensure compliance. Under the ETS, employers may choose to require vaccination or allow covered employees who are unvaccinated to wear a mask and provide proof of a negative COVID-19 test on a weekly basis. Essentially, all requirements except the testing will be enforced by OSHA effective January 10, 2022 (originally December 6, 2021). These include, for example, the requirements that employers determine the vaccination status of each employee and develop a written policy consistent with the mandate of the ETS. The start date for the testing requirement has been extended to February 9, 2022 (originally January 4, 2022).
Some employers, like Starbucks, have decided to require their United States based employees to be vaccinated against the coronavirus or undergo weekly testing to comply with reinstated federal requirements.
Other employers, like United Airlines, which already survived a legal challenge to its mandatory vaccination policy, will stay the course.
Some companies, like grocer giant Kroger, ended its paid leave program for unvaccinated employees and, in turn, implemented a policy requiring certain unvaccinated employees enrolled in the company’s health care plan to pay a $50 monthly surcharge. Though not requiring vaccination, Kroger has implemented stricter COVID-19 policies and procedures for its unvaccinated employees, which encourages employee vaccination.
Meanwhile, other employers that either did not immediately take steps to comply with the ETS, or which switched gears when the ETS was stayed by the Fifth Circuit Court of Appeals, are now shifting into fifth gear to bring their policies, procedures, and workforces into compliance as quickly as possible. This naturally begs certain questions, like (i) to whom does the ETS apply, and (2) what exactly is required?
The 100-Employee Threshold, Numerosity Nuances, Franchises, and “Joint-Employer” Scenarios
As indicated above, the ETS applies only to private employers having at least 100 employees. OSHA has published FAQs to address many questions and concerns raised by the ETS, including specifically the numerosity requirement. For instance, in determining the total number of employees, it does not matter where the employee works, whether in the field or remotely from home. All employees are counted in determining whether the employer is subject to the ETS. However, the requirements of the ETS would not apply to employees who work exclusively from their homes. Whether the ETS applies to companies using temporary/seasonal employees, employees from staffing agencies, or employers with fluctuating numbers of employees is even more nuanced.
With respect to counting employees in the setting of a franchisor-franchisee relationship, OSHA specifically provides as follows: “In a traditional franchisor-franchisee relationship in which each franchise location is independently owned and operated, the franchisor and franchisees would generally be separate entities for coverage purposes, such that the franchisor would only count “corporate” employees, and each franchisee would only count employees of that individual franchise. For example, if the franchisor has more than 100 employees but each individual franchisee has fewer than 100 employees, the franchisor would be covered by this ETS but the individual franchises would not be covered.” Of course, in this scenario, a franchisee would not automatically be excluded from the ETS.
If the franchise agreement obligates the franchisee to comply with certain requirements imposed by the franchisor, then, in theory and by extension, franchisees may be obligated to comply with the ETS. For instance, just as franchisors may impose certain brand standards, franchisors may impose – and many have imposed – reasonable safety protocols related to COVID-19 to protect their brand. In turn, franchisors should make sure their COVID-19 policies and responses to franchisee inquiries are consistent with their franchise agreements, and franchisors may not impose standards that would violate applicable law. Additionally, franchisors and franchisees alike should be reviewing and, if necessary, enhancing their procedures to maintain employee and customer safety, and both parties to the franchise engagement should be revisiting their force majeure provisions and operations manuals to confirm compliance with applicable federal, state, and local requirements related to COVID-19.
Of course, evaluative metrics, such as the single/integrated employer test, may still be used and relied on to determine whether a franchisor and franchisee (or parent and subsidiary) constitute a singular employee within the purview of the ETS or are separate and distinct legal entities. These tests look at things like common management, the interrelation between operations, centralized control of labor relations, common ownership and/or financial control, and other factors to determine whether the “joint” entity meets the 100-employee threshold. In conducting this fact-sensitive analysis, employers would be wise to document how they arrived at their employee headcount; should OSHA eventually audit the employer’s compliance with the ETS, OSHA likely will request information supporting the employer’s tabulation. Furthermore, employers that may not have 100 employees (whether singularly or, where lines may be blurred, jointly) but may be close to the 100-employee threshold would be wise to consider complying with the ETS, as the ETS applies to any employee having 100 employees at any time during its enforcement period. In short, it’s better to be safe than be sorry, and this general principle aligns nicely with another important aim: ensuring employee and customer safety.
The ETS Applies to My Business, so What Else Must I Do?
For employers that have determined the ETS applies to them, some may be inclined to wait and see what the Supreme Court says. Those employers proceed at their peril. Covered employers should take steps to ensure compliance despite the pending appeal. First, it remains to be seen when the Supreme Court will rule on the ETS, and the high court is not receiving oral argument until January 7, 2022. Second, the Supreme Court refused to (re-)stay the ETS and block its requirements pending the court’s decision. Consequently, unless the Supreme Court rules before January 10, 2022, the ETS will become effective. Furthermore, OSHA has taken the position that the ETS preempts state laws that prohibit employer vaccination requirements, so employers having workforces in States like Montana and Tennessee, which have banned private employers from mandating employee vaccination, must take care to comply with the directives of the ETS while also navigating applicable state law (and the interrelationship between the two).
Among other things, the ETS requires private employers to do the following:
- Provide up to four hours of paid time off to allow employees to get vaccinated, as well as reasonable paid sick leave to allow employees to recover from any side effects preventing them from going to work;
- Determine the vaccination status of each employee, obtain acceptable proof of vaccination status from vaccinated employees, and maintain records of vaccination and a roster of employee vaccination statuses, all of which represent confidential medical information that must be properly protected;
- Require employees to promptly notify the employer if the employee tests positive for COVID-19 and, when that happens, the employer must remove the employee from the workplace, irrespective of vaccination status, and may not allow the employee to return to work until the employee meets certain criteria;
- Provide employees with various notices and information about the requirements of the ETS, the policies and procedures adopted by the employer to implement it, the CDC’s “Key Things to Know About COVID-19 Vaccines,” key protections against retaliation and discrimination under OSHA regulations, and the penalties for supplying false statements or documentation; and
- Reiterating the above, establish a COVID-19 mandatory vaccination policy with exceptions for religious or disability-related accommodations, or a vaccine-or-testing policy.
Although the ETS does not itself require employers to pay for the weekly testing (or face coverings) for those employees who decline the vaccine, businesses in certain states may not be permitted to pass that cost along to employees. Also, for employers who have unionized or partially unionized workforces, the General Counsel of the National Labor Relations Board issued a Memorandum on November 10, 2021, indicating that employers must collectively bargain with their unions over the implementation of the ETS.
According to the ETS, OSHA is authorized to separately cite employers for each instance of noncompliance, with penalties for serious violations up to nearly $14,000 per violation, and substantially higher for those deemed to be willful or egregious. Beyond the possibility of steep penalties handed down from OSHA itself, New Jersey employers must remain mindful of state whistleblower laws that may be implicated where employees complain about or object to violations of health and safety laws and regulations in the workplace. Employers should not take the possibility of enforcement and liability under such laws lightly; these statutes have sharp teeth.
Though it remains to be seen if the ETS will survive judicial scrutiny, given the immediacy of its implementation, employers must plan accordingly. Of course, even if the ETS is struck down at the federal level, a similar mandate could issue at a state or even local level, which, in theory, could survive similar legal challenges at the state or local level. Either way, businesses covered – or potentially covered – by the ETS should take steps to comply with the ETS’s requirements right away.