Employee-based companies that perform project-based work could face significant costs and uncertainty in complying with the U.S. Department of Labor’s Occupational Safety and Health Administration (“DOL’s OSHA”) new Emergency Temporary Standard (“ETS”) to protect employees from the spread of the coronavirus on the job.
The ETS applies only to employees. But it creates an additional dimension of risk to companies that do business with large numbers of independent contractors, by exposing such companies to another set of potential penalties if the individuals whom it classifies as independent contractors are determined to have been misclassified for purposes of the ETS.
As applied to employee-based companies that perform project-based work, the ETS is unclear concerning the identification of “employees” who need to be counted for purposes of determining whether a company is a “covered employer” and who need to be included in a roster of “employees” that a “covered employer” is required to maintain, which shows the vaccination status of all it “employees.”
The ETS was officially published on Friday, November 5, 2021. It became effective immediately upon its publication. Covered employers must comply with most requirements of the ETS within 30 days of publication (December 5, 2021) and with its testing requirements within 60 days of publication (January 4, 2022).
The following discusses certain aspects of the ETS. It is not intended to be comprehensive.
1. General Overview of the ETS
The ETS requires a covered employer to develop, implement, and enforce either (i) a mandatory COVID-19 vaccination policy, or (ii) a policy requiring employees to choose to either (a) be vaccinated, or (b) undergo regular COVID-19 testing – every seven (7) days – and wear a face covering at work.
The ETS defines a covered employer as an employer with 100 or more employees at any time the ETS is in effect.
For purposes of the ETS, an employee is considered fully vaccinated (i) 2 weeks after completing primary vaccination with a specified COVID-19 vaccine, or (ii) 2 weeks after receiving the second dose of any combination of two doses of specified COVID-19 vaccines. In either case, an employee is not considered to satisfy this condition until 2 weeks after receiving the complete dosage of an acceptable vaccine.
Importantly, the ETS requires a covered employer to provide its employees with:
- up to four hours of paid time to get vaccinated (for each dose), and
- up to two days of paid leave to recover from any side effects from each dose.
The ETS also requires a covered employer to:
- determine the vaccination status of each employee,
- obtain acceptable proof of vaccination status from vaccinated employees,
- maintain records of each employee’s vaccination status, and
- maintain a roster of each employee’s vaccination status.
A covered employer must require its employees to promptly notify the employer if they test positive for COVID-19 or receive a COVID-19 diagnosis. The employer must then remove the employee from the workplace, regardless of vaccination status, and not allow the employee to return to work until satisfying specified criteria.
Salient aspects of the ETS are discussed in greater detail below, based on the ETS and its accompanying Preamble.
2. ETS Coverage Issues
As noted, the ETS only applies to a covered employer, defined as an employer with 100 or more employees at any time the ETS is in effect. Independent contractors do not count towards the total number of employees.
For purposes of determining whether an employer satisfies the 100-employee threshold, all temporary, part-time, and seasonal employees – directly employed by the employer – are counted. For these purposes, an employer must count the total number of workers it employs regardless of where they report for work on a particular day. Thus, for example, if a company has more than 100 employees spread out over multiple sites, that employer is covered under this ETS even if it does not have 100 or more employees present at any one worksite.
The determination of whether an employer satisfies the 100-employee threshold is initially made as of the effective date of the standard, i.e., November 5, 2021. If the employer has fewer than 100 employees on that date, the standard will not apply to that employer as of that date, but if the same employer subsequently satisfies the 100-employee threshold, the ETS would continue to apply to the employer for the remainder of the time the ETS is in effect, regardless of fluctuations in the size of the employer’s workforce.
Employees of a temporary staffing firm who provide services for an employer are counted by the staffing firm that directly employs them, but not by the employer for which they perform services.
In a traditional franchisor-franchisee relationship in which each franchise location is independently owned and operated, the franchisor and franchisees would be separate entities for coverage purposes. Thus, the franchisor would only count “corporate” employees, and each franchisee would only count employees of that individual franchise.
In other situations, two or more related entities may be regarded as a single employer for OSHA purposes if they handle safety matters as one company, in which case the employees of all entities making up the integrated single employer must be counted.
The ETS requirements do not apply to employees of a covered employer who satisfy any of the following criteria:
- who do not report to a workplace where other individuals such as coworkers or customers are present;
- while working from home; or
- who work exclusively outdoors.
These provisions are intended to exempt workplace settings where workers do not interact indoors with other individuals, and to exempt work performed in the employee’s home regardless of whether other individuals may be present in the home.
Practice Pointers: An open issue of particular concern to a company that hires large numbers of employees and offers them project-based work is how to determine which individuals to count as an employee. It is not unusual for some individuals to complete the employment process with such a company but not accept projects on a regular basis. Also, it is rare for a company to formally terminate such an employee. So, for an individual to be counted as an employee, it is not clear whether the individual would need to have performed at least one project within the last month, within the last six months, within the last year, or within the last five years. Moreover, it is possible that a company would need to count as an employee any individual whom the company has employed and not formally terminated. The ETS provides no clear guidance on this issue. But the answer could have a profound impact on whether a company is compliant with the ETS for purposes of determining coverage and also for purposes of the recordkeeping requirements discussed below in Section 7.
3. Required Paid Time Off for Obtaining the Vaccine or Recovering from Side Effects
The ETS requires a covered employer to provide its employees:
- reasonable time, including up to four hours of paid time off, at the employee’s regular rate of pay, to receive each primary vaccination dose, and
- reasonable time and paid sick leave to recover from side effects experienced following each primary vaccination dose.
- The paid sick leave can be in the form of an employee’s accrued sick leave, if available.
- If the employee does not have available sick leave, leave must be provided.
- Employers may set a cap on the amount of paid sick leave available to employees to recover from any side effects. The Preamble accompanying the ETS states that up to two days of paid sick leave per primary vaccination dose for side effects would be sufficient.
The Preamble accompanying the ETS clarifies that reasonable time to receive each primary vaccination dose may include, but is not limited to, time spent during work hours related to the vaccination appointment(s), such as
- registering, completing required paperwork,
- all time spent at the vaccination site (e.g., receiving the vaccination dose, post-vaccination monitoring by the vaccine provider), and
- time spent traveling to and from the location for vaccination (including travel to an off-site location (e.g., a pharmacy), or situations in which an employee working remotely (e.g., telework) or in an alternate location must travel to the workplace to receive the vaccine).
Employers are not, however, obligated to reimburse employees for transportation costs (e.g., gas money, train/bus fare, etc.) incurred to receive the vaccination.
If an employee chooses to receive a primary vaccination dose outside of work hours, an employer is not required to grant paid time to the employee for the time spent receiving the vaccine during non-work hours. However, even if an employee receives a primary vaccination dose outside of work hours, the employer must still afford the employee reasonable time and paid sick leave to recover from side effects that the employee experiences during scheduled work time.
Practice Pointers: The foregoing indicates that an employer is obligated to provide paid time off in connection with an employee obtaining a vaccine dose in two circumstances: (i) if the employee obtains the dose during work hours, and (ii) if the employee experiences side effects from a dose during scheduled work time. Thus, it appears thatan employer would have no such obligation if an employee obtains a vaccine dose outside of work hours and is not scheduled to work during the days subsequent to obtaining the dose when the employee experiences side effects from the dose.
4. Mandated COVID-19 Vaccination Policy
The ETS provides an employer with two different options to satisfy the mandated COVID-19 vaccination policy requirement.
A covered employer can satisfy the COVID-19 vaccination policy requirement by establishing, implementing, and enforcing a written mandatory vaccination policy. Such a policy requires each employee to be fully vaccinated, except those who fall into one of three categories:
(1) those for whom a vaccine is medically contraindicated,
(2) those for whom medical necessity requires a delay in vaccination, or
(3) those who are legally entitled to a reasonable accommodation under federal civil rights laws because they have a disability or sincerely held religious beliefs, practices, or observances that conflict with the vaccination requirement.
The policy must also require all new employees to be vaccinated as soon as practicable.
Alternatively, a covered employer can satisfy the COVID-19 vaccination policy requirement by establishing, implementing, and enforcing a written policy allowing any employee to choose either to:
(1) be fully vaccinated against COVID-19, or
(2) provide proof of regular testing for COVID-19 every 7 days and wear a face covering.
The ETS imposes the following requirements with respect to an employee who is not fully vaccinated:
- An employee who reports at least once every 7 days to a workplace where other individuals, such as coworkers or customers, are present:
- must be tested for COVID-19 at least once every 7 days; and
- must provide documentation of the most recent COVID-19 test result to the employer no later than the 7th day following the date on which the employee last provided a test result.
- An employee who does not report during a period of 7 or more days to a workplace where other individuals, such as coworkers or customers, are present (e.g. teleworking for two weeks prior to reporting to a workplace with others):
- must be tested for COVID-19 within 7 days prior to returning to the workplace; and
- must provide documentation of that test result to the employer upon return to the workplace.
If an employee does not provide documentation of a COVID-19 test result, the employer must keep that employee removed from the workplace until the employee provides a test result.
Practice Pointers: From a compliance perspective, Option #1 would be simpler to administer and would expose a company to less risk of being responsible to provide employees paid time off in connection with obtaining a COVID vaccine. But this option would deny the company access to individuals who are not fully vaccinated. Option #2 would provide a company with greater access to individuals who are not fully vaccinated but would expose the company to the risk of such individuals scheduling a vaccination dose during working hours, to qualify for paid time off for obtaining the vaccine dose, or on a day preceding a scheduled work time, to qualify for paid time off to recover from side effects experienced following the vaccination dose.
5. Employer’s COVID-19 Vaccination Policy Must be Written
The ETS requires an employer to first determine its ETS policy and then create a written record of that policy. The employer must then ensure that it is following the policy and enforces the requirements of the policy with respect to its workforce, through training and the use of such mechanisms as work rules and the workplace disciplinary system, if necessary.
A written ETS policy should address all of the applicable requirements, including, among others:
- requirements for COVID- 19 vaccination;
- applicable exclusions from the written policy (e.g., medical contraindications, medical necessity requiring delay in vaccination, or reasonable accommodations for workers with disabilities or sincerely held religious beliefs);
- information on determining an employee’s vaccination status and how this information will be collected;
- paid time and sick leave for vaccination purposes;
- notification of positive COVID-19 tests and removal of COVID-19 positive employees from the workplace;
- information on how the employer is making that information available to employees;
- how the policy will apply to new employees;
- disciplinary action for employees who do not abide by the policy;
- all relevant information regarding the policy’s effective date;
- who the policy applies to;
- deadlines (e.g., for submitting vaccination information, for getting vaccinated); and
- procedures for compliance and enforcement.
6. Requirement to Notify Employees of COVID-19 Vaccination Policy
A covered employer is required to inform each employee, in a language and at a literacy level the employee understands, about:
(1) The requirements of the ETS as well as the employer’s policies and procedures established to implement the ETS;
(2) COVID-19 vaccine efficacy, safety, and the benefits of being vaccinated, by providing the document, “Key Things to Know About COVID-19 Vaccines,” available at https://www.cdc.gov/coronavirus/2019- ncov/vaccines/keythingstoknow.html;
(3) Specified regulatory prohibitions against the employer discharging, discriminating, or retaliating against an employee for reporting a work-related injury or illness, and against the employer discriminating or retaliating against an employee for exercising rights under, or as a result of actions that are required by, the ETS; and
(4) Specified statutory provisions which provide for criminal penalties associated with knowingly supplying false statements or documentation.
An employer can communicate this information to employees using any effective methods that are typically used in its workplace and may choose any method of informing employees so long as each employee receives the information in a language and at a literacy level they understand. For example, an employer may provide this information to employees through email communications, printed fact sheets, or during a discussion at a regularly scheduled team meeting.
7. Recordkeeping Requirements
The ETS requires a covered employer to:
- determine the vaccination status of each employee;
- maintain records of each employee’s vaccination status;
- preserve acceptable proof of vaccination for each employee who is fully or partially vaccinated; and
- maintain a roster of each employee’s vaccination status.
- The roster must list all employees and indicate whether each employee is:
- partially (not fully) vaccinated,
- not fully vaccinated because of a medical or religious accommodation, or
- not fully vaccinated because they have not provided acceptable proof of their vaccination status.
The employer’s maintenance of these records is subject to applicable legal requirements for confidentiality of medical information. Required records of vaccination status can be maintained physically or electronically, but the employer must ensure it has access to the records at all times.
Practice Pointers: The requirement to maintain a roster listing all employees and their respective vaccination status presents a significant issue to a company that hires large numbers of employees and offers them project-based work. This issue, discussed above in Section 2 Practice Pointers, concerns how to determine which individuals qualify as “employees” and must be included on the roster. As noted, the ETS does not appear to answer this question. But a covered employer’s failure to include all “employees” on its roster could cause the employer to be noncompliant with the ETS.
8. Conflicts with State Laws
Several states have enacted laws that conflict with the ETS requirements by prohibiting an employer from imposing a COVID-19 vaccine mandate. In these states, a company that complies with the ETS would violate the state law, and a company that complies with the state law would violate the ETS.
The ETS and its accompanying Preamble explicitly state that the ETS preempts and invalidates any State or local requirements that ban or limit an employer’s authority to require vaccination, face covering, or testing. The Preamble states that the ETS is intended to preempt all State and local workplace requirements that “relate” to these issues, except pursuant to a State Plan that OSHA approves – even to the extent such laws regulate employers with fewer than 100 employees, notwithstanding that the ETS requirements only apply to employers with at least 100 employees.
Practice Pointers: Legal challenges to the ETS already have been filed and at least one federal court has temporarily barred DOL from enforcing it. If the ETS ultimately is upheld by the courts, its effective date generally will be the stated effective date in the ETS. The same likely would be true of a state law. The uncertain legality of the ETS places covered employers in such states in a difficult dilemma. If such an employer believes the ETS will be upheld and complies with the ETS (in violation of state law), but the ETS is ultimately invalidated, the employer could be subject to penalties under applicable state law for imposing a COVID-19 vaccine mandate in violation of state law. On the other hand, if such an employer believes the ETS will be invalidated and complies with the state law (in violation of the ETS), but the ETS is ultimately upheld, the employer could be subject to penalties under the ETS for noncompliance.
9. Beware Penalties
The Preamble accompanying the ETS makes clear that the specific measures the ETS requires covered employers to implement will make it easier for DOL’s OSHA to determine whether an employer has intentionally disregarded its obligations or exhibited a plain indifference to employee safety or health. In such instances, according to the Preamble accompanying the ETS, DOL’s OSHA can classify the citations as “willful,” allowing it to propose higher penalties, with increased deterrent effects.
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If you have any questions or comments concerning the foregoing, please let me know.
The foregoing is intended solely as general information and may not be considered tax or legal advice; nor can it be used or relied upon for the purpose of (i) avoiding penalties under any taxing statute or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein. You should not take any action based upon any information contained herein without first consulting legal counsel familiar with your particular circumstances.
 OSHA refers to the Occupational Safety and Health Act of 1970, as amended.
 The ETS does not require a covered employer to pay for testing or face coverings. But it notes that an employer may be required to pay for such items to comply with other laws, regulations, or collectively negotiated agreements.
 Employees who are confirmed to have COVID-19 must be removed from the workplace to prevent transmission to other employees. An employer must require each employee to promptly notify the employer when the employee receives a positive COVID-19 test or is diagnosed with COVID-19 by a licensed healthcare provider. This notification must occur regardless of employee’s vaccination status. The employer should establish notification procedures and inform employees about these procedures, so that employees are aware of the appropriate method for providing this notification to their employer. ETS does not require an employer to provide paid time to any employee for removal as a result of a positive COVID-19 test or diagnosis of COVID-19. The ETS notes, however, that paid time may be required by other laws, regulations, or collective bargaining agreements or other collectively negotiated agreements.