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What Contractors Must Know About Biden Vaccine Order: Explained

Sept. 10, 2021, 4:27 PM

The White House’s latest order requiring federal contractors to mandate Covid-19 vaccines for their employees has raised numerous legal questions about its scope and practical implementation—and businesses are pressing for answers.

President Joe Biden‘s executive order, announced Thursday, will affect a wide range of companies that do business with the federal government in industries from information technology and banking to legal services, construction, and manufacturing. Collectively, federal contractors employ about one-quarter of the U.S. workforce, according to the U.S. Labor Department.

The new order appears to go farther than requirements Biden issued in July for contractor employees working on government job sites to either prove they had received a shot or submit to regular Covid-19 testing. It could be subject to litigation, attorneys say.

At the same time, contractors await more guidance from the White House’s Safer Federal Workforce Task Force.

The “devil is in the details” of how the vaccine order will substantively play out, said Leigh Nason, a shareholder with Ogletree, Deakins, Nash, Smoak & Stewart PC in Columbia, S.C., who advises federal contractors on compliance and enforcement issues.

1. Which contractors are covered?

Generally, businesses that enter into new federal pacts on or after Oct. 15 will be required to adhere to contractual provisions that mandate compliance with upcoming guidance from the task force. This will also apply to companies extending or renewing existing contracts after that date, as well as subcontractors.

Based on Biden’s remarks Thursday, and his companion executive order requiring federal employees to be vaccinated, “we can very well expect that the task force’s guidance concerning safety protocols will include a COVID vaccine mandate,” said Ian Carleton Schaefer, chair of Loeb & Loeb LLP’s New York labor and employment practice, in an email.

Covered contracts include those that provide services to the federal government, including construction. The order doesn’t apply to businesses with contracts valued below the “simplified acquisition threshold,” which is generally set at $250,000; grant holders; and subcontractors that provide only products.

2. What’s the timeline?

Contractors will get more clarity on what’s next by Sept. 24, when the task force is expected to provide further explanation of compliance requirements and potential exceptions.

The vaccine mandate or any other specific requirements won’t take effect until the White House’s Office of Management and Budget approves the task force’s guidance.

3. Do contractors already have vaccine mandates?

Some top federal contractors, based on Bloomberg Government rankings, have already joined dozens of businesses in requiring Covid-19 vaccinations.

Science and technology company Leidos Holdings Inc. said it announced internally at the end of August that employees must be fully vaccinated, or provide a negative Covid-19 test, by Oct. 1 to access a company facility.

Health insurer Humana Inc. requires full vaccination for associates and select contractors who conduct work outside of their home, and is demanding proof of inoculation by Oct. 29. It said it will consider medical and religious exemptions.

Others, such as the Boeing Co., don’t require Covid-19 shots as a condition of employment, but said they will evaluate the order. Lockheed Martin Corp. and Huntington Ingalls Industries said they are monitoring updates for worker health and safety, and Dell Technologies Inc. said it is looking into how it would require and implement a mandated vaccine.

4. What are some lingering questions?

The exact timeline and details of any sort of contractor vaccination requirement are hazy. White House Press Secretary Jen Psaki said during a Thursday press call that federal agency employees will have about 75 days to be fully vaccinated. It’s unclear whether that also may apply to federal contractor workers.

Uncertainty also exists about when a contractor’s workforce vaccination status will be checked and when they must resolve religious or disability exemptions—before or after contracts are awarded, for example.

The order also didn’t specify which agencies might enforce the order—or when.

To Learn More:

Biden Orders Shots for Millions, Calling Unvaccinated a Threat

Businesses Question Logistics, Cost of Biden Vaccine Plan

U.S. Contractors Grapple With Biden Vaccine Proof or Test Order

To contact the reporters on this story: Paige Smith in Washington at psmith@bloomberglaw.com; Erin Mulvaney in Washington at emulvaney@bloomberglaw.com

To contact the editors responsible for this story: Jay-Anne B. Casuga at jcasuga@bloomberglaw.com; John Lauinger at jlauinger@bloomberglaw.com

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