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Businesses Argue for Emergency Relief From Shot-or-Test Rule (1)

Nov. 9, 2021, 11:39 PMUpdated: Nov. 10, 2021, 1:12 AM

Several affiliated businesses told a federal appeals court that their operations will suffer harm that can’t be fixed unless they get emergency relief from the Biden administration’s rule requiring large employers to mandate Covid-19 vaccination or regular testing of workers.

The businesses, led by management company BST Holdings, asked the U.S. Court of Appeals for the Fifth Circuit on Tuesday to issue an injunction blocking the regulation. Failure to do so, they told the court, would make them unable to hire workers and place them at a disadvantage against smaller companies that aren’t subject to the rule.

The Fifth Circuit has already halted the vaccinate-or-test regulation via an administrative stay issued a day after the rule was officially published.

The Occupational Safety and Health Administration’s regulation, unveiled last week, applies to companies with at least 100 workers. The agency developed the rule under its authority to enact emergency temporary standards that are necessary to address a “grave danger” in the workplace.

In recent days, Republican state attorneys general, companies, business groups, and other challengers have filed a slew of lawsuits contesting the rule’s legality. Thus far, the regulation has attracted at least 12 petitions seeking judicial review in six different appellate courts, and more are expected.

Those cases will be consolidated and heard by one circuit court initially chosen by a lottery, according to the rules for multi-circuit litigation. While the various circuit courts can rule on stay requests, the court that wins the lottery can lift previous orders once it takes over the litigation.

A Fifth Circuit panel composed of three judges appointed by Republican presidents paused the rule in a Nov. 6 order. It also asked for briefing on a permanent injunction.

Stay Debate

The Biden administration on Monday asked the Fifth Circuit to lift the interim stay order blocking its regulation and let the multi-circuit process move forward. Given that the deadline for workers to be vaccinated or begin testing regularly isn’t until Jan. 4, the administration argued there’s no pressing emergency that requires the court to act immediately.

The BST group said in its brief Tuesday that the government can’t “have it both ways” and say Covid-19 is an emergency that requires a temporary OSHA rule but that there’s enough time for courts to address the challenges without hurrying.

VIDEO: President Biden’s vaccine mandate rule for companies, the likely legal challenges and what to expect next.

“If this is truly an emergency, then emergency consideration by this Court is appropriate,” the group said. “If not, OSHA should have followed the normal rulemaking procedures before imposing this mandate.”

In addition to BST Holdings, the brief was backed up by 15 locally owned supermarkets that conduct business under the names Ralph’s Market, Butcher Boy, and Save A Lot. The entities share ownership and management, according to BST’s petition for review.

Also Tuesday, three staffing firms filed a separate brief with the Fifth Circuit, arguing that the Biden administration has acted “in defiance” of the court’s previous stay order. The firms pointed to a Monday statement from a White House spokesman encouraging employers to get their workers vaccinated, calling it an attempt to coerce businesses to comply with an “unconstitutional vaccine mandate.”

Briefing will continue this week. The Fifth Circuit ordered the Biden administration to respond to a stay request from Texas on Wednesday. Texas has an opportunity to respond by the close of business on Nov. 11.

The case is BST Holdings v. OSHA, 5th Cir., No. 21-60845, Brief filed 11/9/21.

—With assistance from Laurel Calkins

(Updated with additional reporting, context.)

To contact the reporter on this story: Robert Iafolla in Washington at riafolla@bloomberglaw.com

To contact the editors responsible for this story: John Lauinger at jlauinger@bloomberglaw.com; Meghashyam Mali at mmali@bloombergindustry.com