‘It puts employers in a difficult position’: Businesses are stuck waiting for federal vaccine mandate rules

The White House said on Sept. 9 that it would require private employers with more than 100 employees to ensure their workers are vaccinated or tested weekly against COVID-19. But employers are still waiting for more details.Christiana Botic for The Boston Globe

Almost a month after the Biden administration announced it would impose a vaccine mandate for large employers, businesses are grappling with mounting uncertainty about how it will play out.

The White House said on Sept. 9 that it would require private employers with more than 100 employees to ensure their workers are vaccinated or tested weekly for COVID-19. The move came as a surprise to local employers but seemed like it could alleviate pressure on companies that had encouraged but not yet mandated vaccines.

But critical questions remain to be answered. When the mandate goes into effect, exactly what it requires, whom it applies to, and how it will be enforced all hinge on a rule still being drafted by the federal Occupational Safety and Health Administration, which might not be ready for weeks.

In the meantime, Fidelity Investments, TJX Companies, Thermo Fisher Scientific, and Stop & Shop, which employ thousands of people in Massachusetts, are among the large employers that have yet to announce vaccine policies for their workforce. Others such as State Street, HubSpot, and many of the area’s biotech companies have announced vaccine requirements, but it’s unclear how those policies will fit with the OSHA rule.

“At this point, there is not much to say other than we are evaluating what this could mean for our firm and our employees,” Michael Aalto, a spokesperson for Fidelity, wrote in an e-mail.

The delay has thrown businesses into a holding pattern in which they are hesitant to make progress on their own policies and lack the information they need to meaningfully plan ahead.

“It puts employers in a difficult position,” said Erika Todd, a litigation expert at Sullivan & Worcester. “We know that there are extremely important federal rules forthcoming, but we don’t know what they are, and we really don’t know much about how to prepare for compliance.”

For example, Todd said it is unclear whether weekly testing will be an option for all employees who choose not to get vaccinated, or be reserved for those with a medical or religious exemption.

Jeffrey Gilbreth, a partner in the labor and employment practice at law firm Nixon Peabody’s Boston office, said he’s waiting to see how OSHA will define businesses with more than 100 employees, such as franchises and companies that employ independent contractors. While Gilbreth did not discuss specific companies, it raises questions of how the rule will apply to franchise giants like McDonald’s and companies like Uber that classify their drivers as independent contractors, rather than employees.

And everyone wants to know who will pay for the weekly testing of unvaccinated employees.

Massachusetts business owners have been mulling over these questions for weeks to little avail, said Bob Luz, president of the state’s restaurant association. “Employers have a thousand questions, and we don’t have answers.”

He said restaurateurs who run multiple locations need to know whether OSHA will count employees by individual restaurant location or by a company’s tax identification number. If businesses are asked to front the cost for testing, and potentially paid time off for that, he thinks some owners will opt for a strict vaccine mandate.

“Why would an employer pay for that if it is a choice the employee made?” Luz said. “It might cost $50 for the test and $45 for the time off, every week. That’s kind of a big deal.”

Terry MacCormack, the press secretary for Governor Charlie Baker, said the administration “has been eagerly awaiting” OSHA’s employer vaccination requirement since it will impact not only the state’s private sector employers, but potentially cities and towns. Massachusetts adopts OSHA guidelines as the minimum standard for public sector workplaces.

The long wait doesn’t surprise Jordan Barab, a former deputy assistant secretary of labor for OSHA. He said that OSHA was caught off guard by Biden’s announcement and that drafting a new rule, called an emergency temporary standard, is a “process that takes time.”

“There are all kinds of legal issues that have to be dealt with in order for it to be actually enforceable,” Barab said. “I imagine we’re not going to see it tomorrow. . . . Maybe a few more weeks.”

Barab said the questions are “the kinds of decisions that OSHA is making right now,” and he attributed the lack of information to the agency’s protocol to clamp down on external communication during the process.

Somewhat opposite to the rule’s intended effect, Gilbreth said, employers have been wary of moving forward with their own vaccination policies since Biden’s announcement, worried they will need to overhaul it once OSHA issues its rule. But he sees an upside to the delay.

“Usually when an order is rushed — and sometimes they have to be during the pandemic — they come out with unanswered questions,” he said. “I’d much prefer they take the time to think it through.”

One effect of the long timeline, he said, is that some groups are likely preparing lawsuits to challenge whether OSHA has the authority to issue a private employer mandate. The agency must prove a COVID-19 vaccination and testing policy would protect employees from “grave danger,” but the rule can be challenged in court. (Attorneys general of more than 20 states, but not Massachusetts, have sent Biden a letter indicating they would “seek every available legal option” to oppose the rule).

While large companies wait for details, companies with fewer than 100 workers will likely be exempt and left contemplating a vaccination or testing policy on their own. Barab said it’s unusual that OSHA wouldn’t include all businesses in its rule, since small businesses are at no less risk for COVID-19, but that perhaps the mandate would require too heavy an administrative burden.

“OSHA by law is required to issue rules that are technologically and economically feasible,” he said.

Gilbreth said many small businesses have already issued vaccine mandates, but that those on the fence might have preferred backing from OSHA. “Smaller employers want to keep their employees, customers, and vendors just as safe as large employers do,” he said. “But they can’t point to the federal government and say, ‘Hey look, they are making us do this.’ ”

Luz said a policy that creates a rift between large and small businesses could have unintended consequences. Unvaccinated employees could choose to work at companies with less than 100 people to sidestep the federal mandate, or there could be a perception that only large restaurant groups have a vaccinated workforce, when in fact any business can make COVID-19 vaccination a condition of employment.

“The 100 number is arbitrary and it creates winners and losers,” he said.

Meanwhile, local COVID-19 testing companies including PerkinElmer, CIC Health, and AllClear Healthcare say they are starting to see an uptick in demand from employers. But Matt McKnight, chief commercial officer at Ginkgo Bioworks, which offers testing for schools, employers, and individuals through its biosecurity arm, said many of the conversations at Ginkgo are in the early stages.

“You are starting to see distributor networks preparing for more demand, but actually in conversations with private businesses, the vast majority are holding off until they know more,” he said.

Experts agreed that employers should do at least one thing while they await the OSHA rule: survey their workforce to see who is vaccinated.

The concept of, ‘Hey, this rule is not out yet, I don’t know what it’s going to say, I’m just going to wait,’ is a bad idea,” Gilbreth said. “Smart employers should be preparing.”