The Supreme Court Has Ruled on the OSHA and CMS Vaccine Mandates – What Now?

As reported here, the U.S. Supreme Court stayed the OSHA Emergency Temporary Standard (ETS), finding it exceeded OSHA’s authority to regulate workplace safety rules. In a separate decision issued the same day, the Court allowed the CMS vaccine mandate for covered health care workers to take effect, finding it is within CMS’s statutory authority. The vaccine mandate for federal contractors currently is stayed pending appellate court review. See our Federal Vaccine Mandate Scorecard.

What do these Supreme Court decisions mean for employers?

Continued Litigation

The litigation involving the ETS is not over. While the ETS is stayed currently, the case remains pending before the Sixth Circuit. Many believe, given the Supreme Court’s pronouncement that OSHA exceeded its statutory authority, that the ETS has little or no chance of surviving ultimately. Even if the Sixth Circuit upholds the ETS, the case inevitably will be appealed to the Supreme Court, where it seems likely the standard will be struck down for lack of agency authority.

OSHA Enforcement

OSHA does not intend to take its foot off the enforcement pedal. In a statement issued by Labor Secretary Marty Walsh immediately following the Supreme Court ruling, he urged all employers to require workers to get vaccinated or tested weekly to most effectively fight this deadly virus in the workplace.

“Employers are responsible for the safety of their workers on the job, and OSHA has comprehensive COVID-19 guidance to help them uphold their obligation,” he said. The Secretary also cautioned that “[r]egardless of the ultimate outcome of these proceedings, OSHA will do everything in its existing authority to hold businesses accountable for protecting workers, including under the Covid-19 National Emphasis Program and General Duty Clause.”

Secretary Walsh further said that OSHA stands by the ETS as the best way to protect the nation’s workforce from the virus and that OSHA will be evaluating all options to ensure workers are protected from this deadly virus. OSHA still could promulgate a traditional standard outside the emergency temporary standard process. OSHA also could promulgate industry-specific standards in response to the Supreme Court’s criticism that the ETS was an “indiscriminate approach” to regulation and its observation that OSHA can regulate certain higher-risk industries, such as "particularly crowded or cramped environments."

COVID-19 Policies

In the wake of these decisions, President Biden issued a statement urging states and employers to mandate vaccines in the workplace.

“As a result of the Court’s decision, it is now up to states and individual employers to determine whether to make their workplaces as safe as possible for employees, and whether their businesses will be safe for consumers during this pandemic by requiring employees to take the simple and effective step of getting vaccinated,” said President Biden. “The Court has ruled that my administration cannot use the authority granted to it by Congress to require this measure, but that does not stop me from using my voice as President to advocate for employers to do the right thing to protect Americans’ health and economy. I call on business leaders to immediately join those who have already stepped up—including one third of Fortune 100 companies—and institute vaccination requirements to protect their workers, customers, and communities.” 

Employers must decide how to deal with the vaccine issue, notwithstanding the Supreme Court stay of the OSHA ETS. OSHA still can, and will, enforce the duty to maintain a safe and healthy workplace through the General Duty Clause, and the possibility remains that the ETS—or some modified version—will become effective through traditional rulemaking.

Employers need to decide whether they will mandate the vaccine, or offer a vax-or-test option, or take other measures to address COVID-19 in the workplace. State and local laws remain relevant to these decisions (see State/Local Laws below). In addition, the ability to hire and retain employees is a consideration. Employers also need to address the consequences of employee non-compliance with the policy, particularly where there is no OSHA mandate driving the policy. In addition, logistics—particularly around testing—remain an obstacle. 

Many employers started the process using the OSHA ETS model policies. This can continue, although employers have greater latitude about what aspects of the ETS to embrace. This also means they may poll the workforce about who is and who is not vaccinated, as permitted by the EEOC. 

Employers also should address in their policies the process for seeking an exemption from the policy’s mandates, whether it be vaccines, testing, and/or masking. Medical and religious exemptions under the ADA and Title VII, respectively, should be processed in accordance with the law, including an interactive dialogue with employees seeking such exemptions. 

Other key issues to address in a policy include: 

• Reporting positive tests or close contact situations;
• Isolation and quarantine expectations;
• Return to work following such incidents;
• Whether leave will be offered to obtain vaccines and for post-vaccination symptoms; and
• Face coverings. 

Finally, employer policies may subject unvaccinated employees to more stringent health and safety protocols to ensure their own safety, as well as minimizing the spread of COVID-19 to vaccinated employees. 

Testing Issues

Issues remain related to testing and whether employers are required to pay for tests and/or time spent getting tested (in the case of non-exempt employees). OSHA largely punted on these issues in the ETS, when it made payment for testing optional unless otherwise dictated by federal, state, or local law. State laws will be relevant to these issues, as well as FLSA considerations for paying for testing, particularly when required by the employer. Now that testing will be an employer requirement, as opposed to a federally mandated one, for most employers, it may make it more likely that employers are required to pay both for any costs for the test and the time spent testing.

Duty to Bargain

For unionized employers, the Supreme Court’s decision means that COVID-19 policies no longer are the subject of a federal legal mandate (unless subject to another federal mandate, such as the CMS rule or the federal contractor mandate, if it takes effect). This means that many aspects of the policy may be subject to the duty to bargain with unions, unless the applicable bargaining agreement contains contractual language conferring the right to adopt such policies unilaterally. 

In the wake of the OSHA ETS, the NLRB issued Memorandum OM 22-03 addressing employers’ duty to bargain with unions over the OSHA ETS rule. The NLRB espoused the view that employers have decision bargaining obligations where the OSHA ETS provided employers with implementation choices. Now, with the stay of the ETS, unions may argue that most or all aspects of an employer COVID-19 policy present implementation choices and are thus subject to bargaining.  

State/Local Laws

For employers located in states or locales that have laws barring, limiting or otherwise restricting vaccine mandates or testing, these laws continue to apply. The OSHA ETS would have superseded conflicting laws, but that will not be the case unless and until the ETS is upheld again in the future. Similarly, where states or locales have vaccine, testing, or masking mandates in place, these continue to apply and should be considered in developing any COVID-19 policy.

There are 26 states with their own workplace health and safety agencies. These states may move forward with their own vaccine mandate standards. The Supreme Court decision is unlikely to be directly applicable to the question of whether these agencies have the statutory authority to create such mandates, but it may signal that the legal basis for such regulation may be lacking, depending on the scope of the authority the agency has been given under state law.

CMS and Federal Contractor Mandates

With the Supreme Court decision upholding the CMS vaccine mandate, covered Medicare- and Medicaid-certified providers must implement the CMS vaccine mandate for all employees, licensed practitioners, students, trainees, volunteers, and any individual who provides care, treatment, or other services for a covered provider and/or its patients, regardless of clinical responsibility or patient contact. The federal contractor executive order, on the other hand, remains stayed, with cases pending in multiple appellate courts. This situation poses challenges for employers that have parts of their workforce covered by the CMS rule while others are covered by the federal contractor mandate, if it takes effect, or no federal legal mandate at all with the ETS stayed.

Employers that have some, but not all, entities or employees subject to the CMS vaccine mandate now have to decide whether to implement different policies for different entities and employees or whether to implement one policy for all.  Doing so will implicate morale and equity questions, as well as recruitment and retention.  In addition, without the OSHA ETS, employers may have to bargain over imposing a vaccine mandate for any unionized employees not subject to the CMS mandate.

Ballard Spahr’s Labor and Employment Group counsels employers regarding the changing requirements and status of the COVID-19 vaccine mandates and workplace safety and compliance.

Find more guidance for employers on our HR Law Watch blog.

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