“There is no precedent for a 100-person threshold,” said Thomas McGarity, who teaches administrative law at the University of Texas at Austin School of Law and follows the Occupational Safety and Health Administration’s regulations.
If the emergency rule the agency releases follows the administration’s plan to require that businesses with 100 or more employees ensure their workers are fully vaccinated or tested weekly, it also would be one of the few OSHA regulations that exempts employers based on the number of workers, said Jordan Barab, who served as OSHA’s deputy assistant secretary for eight years during the Obama administration.
The 100-plus employee threshold raises a range of concerns for employers and advocates, including whether people working from home will be included in an employer’s count and how the rule will consider temporary workers and independent contractors.
Some employers say that making 100 employees the all-important number could have unintended consequences.
Stephen Sandherr, chief executive officer of Arlington, Va.-based Associated General Contractors of America, a trade group representing commercial construction companies, told the Department of Labor in a Sept. 18 letter that its members “justifiably fear” that many workers will leave for small companies that are exempted from the standard rather than be vaccinated or tested weekly.
Dee Anna Hays, a shareholder with Ogletree, Deakins, Nash, Smoak & Stewart PC in Tampa, Fla., said the 100-employee threshold could be based on coronavirus exposure risk increasing proportionately with the number of employees in a workplace.
For the standard to survive a likely federal court challenge, OSHA will have to show Covid-19 poses a “grave danger” to employees covered by the mandate.
The Biden administration’s plan doesn’t seem to account for the type of industry or workplace at issue or for preventative measures an employer may have in place to safeguard workers, Hays said.
In fact, the White House has released few details about the emergency temporary standard OSHA is developing, which administration officials have said could take weeks to complete.
The National Retail Federation and the Retail Industry Leaders Association in a letter earlier this week asked Labor Department leaders to answer more than a dozen questions about the rulemaking, underscoring the level of employer uncertainty at this point.
Bill Principe, co-chair in Atlanta of Constangy Brooks Smith & Prophete LLP’s workplace safety practice group, said he expects OSHA will calculate based on a company’s total size, and not count each worksite separately.
The agency will need to detail how the 100-employee threshold is applied across a range of work arrangements such as employees of franchise businesses as well as contracted, temporary, and gig workers, Principe said.
The retail industry trade groups hit at the same points in their questions, and also asked how the agency will define remote workers.
How workers are counted is a central concern for franchise businesses, said Michael Layman, vice president for federal government relations at the International Franchise Association in Washington.
The group wants the agency to refrain from totaling workers across a franchiser’s brand, Layman said. That approach could make all franchise businesses subject to the rule even if individual companies have well under 100 employees.
Layman also called for the standard to be clear that where multiple workplaces are operated as separate corporate locations, each location should determine its employee headcount and not be added together as a group.
The 100-employee number is not one of OSHA’s go-to figures when considering business size.
The agency’s rules for keeping records of on-the-job injuries and illnesses exempt employers with 10 or fewer workers from the requirements unless OSHA specifically tells the employer to comply.
And employers with fewer than 20 workers don’t have to annually submit copies of the injury and illness reports. Filing requirements for larger firms vary based on the employee count and industry.
However, OSHA rules that deal directly with prohibiting workplace hazards don’t have exemptions based on an employer’s size. For instance, regulations mandating fall protection gear for construction workers at heights apply whether the employer has three or 300 workers.
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Small Business, Big Concerns
The 100-employee floor could pass a court review since courts allow agencies leeway in setting limits on otherwise legal regulations, said Michael Duff, a visiting professor of law at Saint Louis University School of Law in St. Louis who focuses on administrative law.
“Agencies have a great deal of administrative discretion,” Duff said.
The administration’s decision to limit the standard’s scope could be based on a desire to have OSHA focus enforcement on larger employers because it wouldn’t be practical to try covering every workplace, Duff said.
They may have been concerned about financial strains on small businesses absorbing testing costs, Duff said, a point shared by Ogletree Deakins’ Hays. Duff added that removing small businesses could “blunt political pressure” against the standard.
Barab said that during his tenure at the agency OSHA didn’t carve out a regulatory exemption for small businesses, despite employer objections over such issues as silica exposure limits for construction and manufacturing, exposure to beryllium dust, and fall protections.
The administration’s apparent decision to make an exception now could start a bad pattern for future rulemakings, Barab said.