On September 9, 2021, President Biden signed Executive Order 14042, Ensuring Adequate COVID Safety Protocols for Federal Contractors (“Order”), which directed the executive agencies to begin amending federal contracts to require federal contractors to take specific actions to combat COVID-19 and to, in turn, require covered subcontractors to take the same actions (the federal contractor COVID-19 workplace safety mandates or “Mandates”).

Pursuant to the Order, on September 24, 2021, the Safer Federal Workforce Task Force (“Task Force”) released Guidance for Federal Contractors and Subcontractors (“Guidance”), explaining what was required of contractors subject to the new contract provisions. Thereafter, on September 30, 2021, the Federal Acquisition Regulation (“FAR”) Council published a memorandum on the Issuance of Agency Deviations to Implement Executive Order 14042.  This memorandum provides instructions to the executive agencies as to how to incorporate the new contractual requirements into new, as well as existing, contracts and specifies the language that is to be used.  Because the FAR Council has not yet satisfied the procedural requirements for formally amending the FAR, this new provision is referred to as a “deviation” from the FAR.  The clause has been incorporated into the numbering system used by the FAR as FAR Deviation Clause 52.223-99, Ensuring Adequate COVID Safety Protocols for Federal Contractors (“Clause”).  The obligation to comply with the Mandates only applies to those employers that are parties to a contract that includes the Clause.

Over the last month agencies have quickly and broadly incorporated the Clause into contracts covered by the Order, as well as contracts that are not covered or directly addressed by the Order, including contracts or subcontracts that are under the Simplified Acquisition Threshold or for the manufacturing of products. In fact, many of these amendments have been characterized by agencies as “bilateral” modifications, but are being presented to contractors as a document that they are expected to sign without negotiation.  As a result, federal contractors and subcontractors have been discerning whether they need to comply with the Order, which employees are covered by the Order, and how best to implement and comply with the safety protocols for federal contractors and subcontractors.

During this same time, several lawsuits were filed challenging the legality of the Order and Guidance. It is unclear whether the Order and Guidance will be upheld and if so, to what extent. As we said previously, there are substantive and procedural grounds to challenge the enforceability of the Order. We will continue to monitor these actions and report on any significant developments.

Since September 30, 2021, the Task Force has published additional FAQs to guide federal contractors and subcontractors working to comply with the requirements of the Order and Guidance.

Compliance Timeline

The Task Force takes the position that compliance should not cause disruptions to critical operations and encourages federal contractors to work with federal agencies to operationalize the Guidance.  The White House has repeatedly indicated that December 8, 2021 (or the date of performance for a contract that is newly entered into or modified after December 8, 2021) is not a hard deadline so long as federal contractors and subcontractors are working in good faith toward compliance. The Task Force provides the following direction on this topic:

• Covered contractors and subcontractors may still be reviewing requests for accommodation as of its deadline for compliance but are required to have such employees follow workplace safety protocols for individuals who are not fully vaccinated.

• Where covered contractors are working in good faith and encounter challenges with compliance with the Guidance, the agency contracting officer should work with them to address these challenges.

However, covered contractors that fail to make good faith efforts to comply with the Guidance may face significant action, including but not limited to, termination of their contract.

Vaccination and Safety Protocols

The Task Force makes clear that federal contractors and subcontractors are responsible for the reasonable accommodation process and such process should be completed on a case-by-case basis. The Task Force does not specify or provide examples of reasonable accommodations.

The Task Force provides that in limited circumstances, covered contractors and subcontractors may grant an extension to the vaccination deadline based on medical considerations even if the covered contractor employee does not meet the legal definition of “disability” (e.g., receipt of monoclonal antibodies or convalescent plasma for COVID-19 treatment). The Task Force provides a non-exhaustive list of conditions the CDC considers a contraindication to vaccination with COVID-19 vaccines, and circumstances under which the CDC recommends delaying vaccination for COVID-19. The Task Force also offers information related to assessing requests for vaccine accommodations based on the CDC recommendations with regard to pregnancy, seasonal influenza vaccines, and clinical trials for COVID-19.

Where covered contractor employees who are not vaccinated (e.g., the covered contractor has granted them a legal exemption, the request is pending, or a limited (non-legal) extension was approved) will be required to work onsite at a federal workspace, the covered contractor must notify the contracting officers of this fact. Such employees will be required to follow the federal agency’s workplace safety protocols in the federal workplace. In most circumstances, following applicable masking, physical distancing, and testing protocols will be sufficient. However, there may be circumstances in which an agency determines that there are no safety protocols other than vaccination that is adequate. In such circumstances, the covered contractor is not relieved from meeting its contractual requirements. Thus, the covered contractor will need to be prepared to reassign employees in order to meet deadlines.

The Task Force also explains that if a covered contractor or subcontractor already has access to its covered contractor employees’ vaccination documentation because it has existing documentation from an employee vaccination program or can access information through a state’s immunization database, the covered contractor or subcontractor does not need to require its employee to show or provide documentation.

Scope and Applicability of Guidance

The new FAQs take the position that the federal contractor mandates will, under certain circumstances, extend to corporate affiliates that do not have a covered contract (i.e., any government contract at all, let alone a government contract that includes the Clause).  The FAQs state that “For purposes of Task Force Guidance, business concerns, organizations, or individuals are affiliates of each other if, directly or indirectly: (i) either one controls or has the power to control the other; or (ii) a third party controls or has the power to control both.” As stated in the FAQs, if a corporate affiliate of a covered contractor does not otherwise qualify as a covered contractor, the employees of that affiliate are still considered covered contractor employees subject to the Guidance if they perform work at a covered contractor workplace. The Task Force makes clear the conclusion is the same even where the workplace in which the covered contractor employees perform work on or in connection with a covered contract is a location owned, leased, or otherwise controlled by a corporate affiliate that does not otherwise qualify as a covered contractor.

Compliance

Where an employee refuses to be vaccinated, the Task Force recommends that covered contractors use their usual processes for enforcement of workplace policies (e.g., employee handbook or collective bargaining agreements), or the federal agency model, which encourages compliance through a limited period of counseling and education, followed by additional disciplinary measures if necessary. In the federal agency model, removal occurs only after continued noncompliance. During the period of enforcement, covered contractors are directed to require the employees to follow workplace safety protocols for individuals who are not fully vaccinated (not place them on administrative leave). Notwithstanding, during this same period, agencies may deny the employee entry to federal workplaces.  The White House has indicated that it should also be acceptable to retain critically important non-complying employees for some period of time while the contractor finds and trains vaccinated replacements who will be able to continue the critical functions.

The Task Force also clarifies that a prime contractor can assume that the subcontractor is complying with the Clause unless it has credible evidence otherwise. The prime contractor has no duty to police compliance after the Clause is flowed down into applicable subcontracts, independent contractor agreements, and vendor contracts.

Conclusion

The implementation of the federal contractor COVID-19 workplace safety mandates has been unprecedented in its scope and speed and for the absence of formal rulemaking.  The various state efforts purporting to prohibit contractors from complying with the mandates are likewise unprecedented.  Under the circumstances, it is not surprising that there is a great deal of confusion and many unanswered questions.  Among other things, we see contractors struggling to understand how to comply with both the federal mandates and contrary state laws.  We see contractors that are attempting to require suppliers or vendors to agree to the mandates under circumstance where this is clearly not required.  And we see vendors struggling with customer demands for compliance that appear to be unnecessary or even inappropriate. 

In the midst of this confusion, Littler will continue to monitor and report on significant new developments.