On Thursday, January 13, 2022, the U.S. Supreme Court satisfied anxious employers and attorneys by issuing opinions on two of the Biden Administration’s controversial vaccine mandates.  In King Solomon-esque fashion, the Court divided the cases evenly by allowing the Centers for Medicare and Medicaid Services’ (“CMS”) vaccine mandate to proceed but staying enforcement of the OSHA Emergency Temporary Standard (“ETS”) applicable to businesses with 100 or more employees. The Court expedited briefing on the two cases and heard oral arguments on the matters just six days ago. The two opinions came a few hours later than expected, but nevertheless provide a breath of fresh air for many employers throughout the country.

Court Grants Stay of OSHA’s ETS

In staying OSHA’s ETS, the Court provided two main grounds for doing so: (1) the likelihood that the States challenging the ETS would succeed in a full trial of the matter, and (2) the fact that a stay was justified given the billions of dollars in costs for employers arising from compliance efforts and the resignations or terminations of non-compliant employees. The Court pointed out that OSHA only has exercised its power to issue an ETS in nine other instances.  Six of those faced legal challenges and, of those six, only one survived legal scrutiny with no changes.  The Court did acknowledge OSHA’s authority to issue regulations aimed at protecting workers from COVID dangers, but only in situations where the virus poses special dangers due to the particular features of certain workplaces. Still, the Court viewed this ETS as going beyond OSHA’s statutory authority as it was more akin to a public health measure rather than a regulation aimed at work-related dangers.  If Congress intended OSHA to have such broad power, it would have clearly authorized it through more deliberate and identifiable action. Here, the Court held that Congress did not and the ETS is therefore unlawful.

The ETS, also referred to as a vaccination or testing mandate, was clearly the most significant of the two issues.  Had the Court allowed the ETS to proceed, it would have impacted an estimated 84 million American workers.  OSHA had previously set a compliance deadline of January 4 for all covered employers to require full vaccination to enter into the workplace or implement a testing/facemask protocol for unvaccinated employees. It subsequently pushed that deadline back to February 9 after the Court set oral arguments on the ETS for January 7.  To ensure meeting that deadline and avoid potentially significant penalties, many employers had already begun to develop or implement comprehensive vaccine mandate plans.  The Court’s opinion staying the ETS now allows employers to pause or even revoke such internal mandates, should they so choose.  Of course, employers may regulate their workplaces any way they choose so long as they do not conflict with existing federal or state law.  Employers in most states are within their rights to move forward with internal vaccine mandates, masking policies, or testing regiments.

Court Upholds the CMS Vaccine Mandate

On the other hand, the CMS Mandate that just a week ago was only enforceable in half the nation may now proceed in all 50 states.  The Court was clear that CMS has the authority to mandate vaccination (or provide medical or religious exemptions) for all healthcare workers who work in healthcare facilities that receive Medicaid or Medicare funding, and it always has had such authority.  Federal law is clear that CMS may impose conditions on the receipt of its funding, including conditions imposed for the protection of patient health and safety.  The COVID-19 vaccines fall into this realm.  The Court noted how vaccination requirements are common in the healthcare field with workers having long been required to be vaccinated against the flu, Hepatitis B, and other diseases.  COVID-19 is now added to that list.  Opponents of the CMS Mandate will likely note that the Court did not substantively address arguments regarding CMS’s failure to acknowledge natural immunity or include any mask and testing option.  Seemingly, the Court was encouraged in reaching this outcome by the substantial support the CMS Mandate received from numerous healthcare agencies and organizations.

What’s Next for Employers Covered By the CMS Mandate?

Prior to the CMS Mandate coming before the Supreme Court, CMS issued a December 28, 2021 memorandum advising of its new enforcement deadlines.  CMS has broken up compliance with the Mandate into two phases.  Phase 1 requires that all covered facilities ensure that they have developed policies and procedures to implement the CMS Mandate by January 27, 2022, approximately two weeks from the date of the Court’s decision.  January 27 is also the deadline for healthcare workers at covered facilities to either have received their first dose of an approved vaccine, received an exemption, have an exemption request pending, or be granted a temporary delay in vaccination. Phase 2 requires that covered healthcare workers have their primary vaccination series completed by February 28, 2022.  The CMS Mandate does not require any booster doses at this time and workers will be considered fully vaccinated so long as the second vaccine dose has been administered on or before the deadline.

The Fight Over Mandatory COVID-19 Vaccines Is Not Over

Be aware that the Supreme Court’s opinions in the OSHA and CMS cases technically have not ended the litigation in either matter.  The Court has sent each case involved back down to the lower courts for further proceedings.  All parties could dismiss their respective claims and attempt other strategies to obtain their desired relief.  For OSHA, that could mean attempting to implement a vaccine mandate through the normal rulemaking process or a new emergency standard.  To succeed, such a rule or standard would need to, at minimum, provide industry-specific regulations tailored to the varying threat levels in different workplaces rather than the broad approach taken via the ETS.  Based on the Department of Labor’s statement released after the Court decision, OSHA is not finished with its COVID-19 mitigation efforts. For the States involved with the CMS Mandate, the path forward is bleak as it appears CMS stands on firm legal footing to place conditions on the receipt of federal funds by healthcare facilities.

 Also, there is one final vaccine mandate still working its way through the federal courts.  President Biden previously established a vaccine mandate for all federal contractors via Executive Order 14042.  That mandate was blocked on December 7, 2021 by an injunction from the U.S. District Court for the Southern District of Georgia.  The Eleventh Circuit Court of Appeals upheld the injunction on December 17, 2021.  The Eleventh Circuit will hear additional arguments on the federal contractor vaccine mandate this month.  Regardless of that outcome, this third vaccine mandate will certainly wind up before the Supreme Court later this year.

Authored by: Michael D. Pierce & Wood W. Lay