Government Contracts & Defense Industries Team Client Alert – The Government Contractor Mandate
By Labor & Employment, Government Contracts & Construction Government Contracts & Defense Industries
President Biden issued Executive Order 14042 on September 9, 2021, requiring federal contractors to comply with COVID-19 vaccination requirements. Federal contractors who are covered by this Executive Order are exempted from the new OSHA ETS. However, please note that the government contractor mandate requires vaccination; the government contractor employer does not have the option, available under the OSHA ETS, to implement an alternative and less-protective “test-and-mask” option.
The government contractor vaccination requirement is not, however, “self-executing.” Executive Order 14042 itself does not impose any regulation saying that government contractors must require their employees to be vaccinated. Rather, the Executive Order, and the accompanying Safer Federal Workforce Task Force Guidance (Sept. 23, 2021), set up a framework where new government contracts, contract extensions, or contract modifications, must now include a contract clause that requires the contractor and any subcontractors to have a mandatory vaccination policy. Until the effective date of a new, modified, or extended contract containing that clause, there is no obligation.
However, most government contractors have been contacted for a conforming contract modification or have already signed a contract modification. If possible, it is critical to review the proposed modification. We have seen proposed “mods” that purport to be “bilateral,” and some that are unilateral, but contain a clause waiving any claim for equitable adjustment based on the mod. If the mandatory vaccination requirement for covered government contract employees will impose costs on the employer – for example, possible “mask and test” accommodations for those persons granted medical or religious exemptions – a contractor should be very careful not to sign a proposed modification that waives the right to ask for reimbursement of those costs on an equitable adjustment basis. Contractors should consider refusing to sign a bilateral mod so the government then may issue a unilateral mod that will allow the contractor to give notice of a change and then submit a request for an equitable adjustment.
Once the contract contains the clause for a mandatory vaccination policy, government contractors have until January 4, 2022, to comply with the vaccination mandate. The original deadline for compliance was December 8, 2021, but in an announcement issued November 4, 2021, the White House extended the compliance deadline to January 4, 2022.
Scope of the Requirement
The vaccination requirement is intended to be very broad, but does depend on the nature and scope of the “covered contract workplace.” According to the Task Force Guidance, the terms “covered employee” and “covered workplace” each derive from the term “covered contract” which is defined as “any contract or contract-like instrument that includes the clause described in Section 2(a) of the (Executive) order.” That Section, in turn, requires incorporating a clause into the federal contract:
Executive departments and agencies, including independent establishments subject to the Federal Property and Administrative Services Act, 40 U.S.C. 102(4)(A) (agencies), shall, to the extent permitted by law, ensure that contracts and contract-like instruments (as described in section 5(a) of this order) include a clause that the contractor and any subcontractors (at any tier) shall incorporate into lower-tier subcontracts. This clause shall specify that the contractor or subcontractor shall, for the duration of the contract, comply with all guidance for contractor or subcontractor workplace locations published by the Safer Federal Workforce Task Force (Task Force Guidance or Guidance), … This clause shall apply to any workplace locations (as specified by the Task Force Guidance) in which an individual is working on or in connection with a Federal Government contract or contract-like instrument (as described in section 5(a) of this order).
Under the Task Force Guidance employees who are working in a “covered contract workplace” – and all support and overhead employees who provide any support to them — are considered to be covered by the government contractor mandate. A “covered contractor workplace” means a location controlled by a covered contractor at which any employee of a covered contractor working on or in connection with a covered contract is likely to be present during the period of performance for a covered contract. A covered contractor workplace does not include a covered contractor employee’s residence. Even so, an employee who works primarily from home but comes to a contractor’s office even occasionally must be vaccinated.
The Task Force Guidance requires the following mandates for government contractors:
- Covered contractors must ensure that all covered contractor employees are fully vaccinated for COVID-19, unless the employee is legally entitled to an accommodation. Covered contractor employees must be fully vaccinated no later than January 4, 2022 (unless a later date is set forth in a contract mod). Again, under the government contractor mandate, employers do not have the option of adopting a “test-and-mask” requirement for covered employees, although the “test-and-mask” system might be a reasonable accommodation for an employee claiming a religious or disability-based exception.
- Covered contractors must ensure that all individuals, including covered contractor employees and visitors, comply with current, published CDC guidance for masking and physical distancing at a covered contractor workplace.
Note regarding masking: Virginia contractors must comply not only with the Executive Order and the Task Force guidance but also with the VOSH Final Permanent Standard (FPS). The FPS requires that in areas of high or substantial community transmission (presently nearly all of Virginia, even fully vaccinated people must wear a mask in indoor settings, except for limited exceptions, including persons working alone in an office with floor to ceiling walls and while eating or drinking. In areas of low or moderate community transmission, fully vaccinated people do not need to wear a mask. Fully vaccinated individuals do not need to physically distance regardless of the level of transmission in the area. Individuals who are not fully vaccinated must wear a mask indoors and in certain outdoor settings regardless of the level of community transmission in the area. To the extent practicable, individuals who are not fully vaccinated should maintain a distance of at least six feet from others at all times, including in offices, conference rooms, and all other communal and workspaces.
- Covered contractors shall designate a person or persons to coordinate the implementation of and compliance with this Guidance and the workplace safety protocols detailed herein at covered contractor workplaces.
Consistent with guidance of the federal Equal Employment Opportunity Commission, the government contractor rule requires “reasonable accommodation,” for individuals who are “legally exempt.” The Task Force issued Frequently Asked Questions explaining that covered contractors may be required to provide exemptions from the vaccination requirement for those demonstrating a sincerely held religious objection to vaccination (under Title VII of the Civil Rights Act), and those who have a “disability” (under the Americans with Disabilities Act) which prevents or would make a vaccination dangerous to their health. Such exemption requests should be treated as requests for “reasonable accommodation” using the standards of Title VII and the ADA. This requires employers to engage in an interactive discussion with the employee to see if some accommodation can be reached without causing undue hardship to the employer. Some courts have held that a religious exemption is not required to state-imposed mandatory vaccination requirements (a ruling affirmed in the federal court of appeals and left standing by the U.S. Supreme Court – for now). Although the Task Force FAQs do not expressly say religious exemptions must be accommodated, we believe it is prudent and lawful to do so.
It is important to remember that whether an employee who has refused vaccination has a valid claim for exemption does not end the analysis. If there is no reasonable accommodation that will allow the employee to perform her or his essential job functions without undue hardship to the employer, the employee may be excluded from the workplace temporarily, or the employment may be terminated.
Alternative to Termination Offered
Significantly, the Task Force issued supplemental FAQs on November 1, 2021, indicating that termination of employment is not mandatory as of January 4, 2022. An employer may, but is not required to, place an employee who has refused vaccination into its progressive discipline process beginning with education and/or counseling regarding the benefits of the vaccine to the employee, co-workers, and the employer. The FAQs do not indicate how long an employee may be offered education or counseling before removal from the workplace must be accomplished. Federal contracting officers are directed to monitor employers using this alternative to be sure that it is not used to unduly delay or circumvent the vaccination requirement.
The OSHA Emergency Temporary Standard is subject to modification. Comments can be submitted to the agency on or before December 5, 2021. It is possible that revisions to text or to official interpretations of the Task Force and resulting contractor mandate will also occur in response to the efficacy of the mandated vaccinations and any other changes in prevailing COVID-19 transmission.
FOR FURTHER ASSISTANCE:
Our Labor and Employment Law Section has been working with our clients daily on COVID-19 issues, including compliance with law and regulation and strategies for mitigation, since March 2020. We have developed model policies, forms, and procedures that can be adapted for the needs of our individual clients. Please feel free to contact us for prompt assistance at any time.
The contents of this publication are intended for general information only and should not be construed as legal advice or a legal opinion on specific facts and circumstances. Copyright 2023.