USG Background_EO 14042 Contractor COVID Safety_20211104_for agencies.pdf

UPDATED Background and Information for Federal Agencies on Executive Order No. 14042 on Ensuring Adequate COVID Safety Protocols for Federal Contractors

(As of November 4, 2021)

Background

On September 9, 2021, President Biden announced his Path Out of the Pandemic: COVID-19 Action Plan. One of the primary goals of this science-based plan is to get more people vaccinated. As part of that plan, the President signed Executive Order 14042, Ensuring Adequate COVID Safety Protocols for Federal Contractors, which directs executive departments and agencies, including independent establishments subject to the Federal Property and Administrative Services Act, 40 U.S.C. 102(4)(A), to ensure that covered contracts and contract-like instruments include a clause requiring the contractor—and their subcontractors at any tier—to, for the duration of the contract, comply with all guidance for contractor or subcontractor workplace locations published by the Task Force.

Key Points on Executive Order 14042

The actions directed by the Executive Order will ensure that parties who contract with the Federal Government provide adequate COVID-19 safeguards in workplaces with individuals working on or in connection with a Federal Government contract or contract-like instrument.

Because COVID-19 is highly transmissible, these workplace safety protocols will apply to all covered contractor employees, including contractor or subcontractor employees in covered contractor workplaces who are not working on a Federal Government contract or contract-like instrument.

Agencies are strongly encouraged to incorporate a clause requiring compliance with the workplace safety protocols into contracts that are not covered or directly addressed by the order, specifically: (1) a contract under the Simplified Acquisition Threshold as defined in section 2.101 of the FAR, (2) a contract or subcontract for the manufacturing of products, or (3) existing contracts and contract-like instruments, prior to the exercise of an option, extension, or renewal.

These safeguards will reduce the spread of SARS-CoV-2, the virus that causes COVID-19, which will decrease worker absence, reduce labor costs, and improve the efficiency of contractors and subcontractors performing work for the Federal Government.

Guidance from the Safer Federal Workforce Task Force

Per the Executive Order, the Safer Federal Workforce Task Force (“Task Force”) released guidance on September 24, 2021, to set forth workplace safety protocols for contractors and subcontractors and provide definitions of relevant terms for contractors and subcontractors.

Pursuant to the order, the Director of the Office of Management and Budget has determined that compliance by Federal contractors and subcontractors with the COVID-19-workplace safety protocols detailed in Task Force’s guidance will promote economy and efficiency in Federal contracting.

Covered contractors, as defined in the guidance, are responsible for ensuring that covered contractor employees comply with the workplace safety protocols detailed in the Task Force guidance.

Agencies are encouraged to share the guidance, and the accompanying Frequently Asked Questions included therein, with their acquisition workforce and with industry partners.

Summary of Guidance Requirements for Contractors

Pursuant to the guidance issued on September 24, 2021, and in addition to any requirements or workplace safety protocols that are applicable because a contractor or subcontractor employee is present at a Federal workplace, Federal contractors and subcontractors with a covered contract will be required to conform to the following workplace safety protocols:

COVID-19 vaccination of covered contractor employees, except in limited circumstances where an employee is legally entitled to an accommodation;

Compliance by individuals, including covered contractor employees and visitors, with the Guidance related to masking and physical distancing while in covered contractor workplaces; and

Designation by covered contractors of a person or persons to coordinate COVID-19 workplace safety efforts at covered contractor workplaces.

Vaccination Required for Covered Contractor Employees

As to the vaccination requirement, covered contractors must ensure that all of their covered employees are fully vaccinated for COVID-19, unless the employee is legally entitled to an accommodation.

To make it easy for all employers to comply with the requirements and support the health, safety, efficiency, and effectiveness of their workforce, the deadline for the contractor vaccination requirement will be aligned with deadlines in the OSHA COVID-19 Vaccination and Testing Emergency Temporary Standard (“ETS”) and the Centers for Medicare & Medicaid Services (CMS) requirement that health care workers at facilities participating in Medicare and Medicaid be fully vaccinated (“CMS Rule”).

o This means Federal contractor employees covered under the requirements of EO 14042 will need now to have their final vaccination dose by January 4, 2022, so that they are fully vaccinated by January 18, 2022.

o After that date, all covered contractor employees must be fully vaccinated by the first day of the period of performance on a newly awarded covered contract, and by the first day of the period of performance on an exercised option or extended or renewed contract when the clause has been incorporated into the covered contract.

o This change also will ensure that Federal contractors implement their vaccination requirements on the same timeline as other employers in their industries. In addition, the ETS will not be applied to workplaces subject to the Federal contractor requirements or CMS rule, so employers will not have to track multiple vaccination requirements for the same employees.

o The next step in implementing this change is for the Task Force to issue updated guidance, pursuant to Section 2 of EO 14042. The Task Force will notify agencies by email when its guidance for Federal contractors has been updated and approved by the Director of the Office of Management and Budget.

o Once the new Task Force guidance is issued and approved, it will be automatically incorporated into contractor requirements through the provision in the contract clause: “The Contractor shall comply with all guidance, including guidance conveyed through Frequently Asked Questions, as amended during the performance of this contract, for contractor or subcontractor workplace locations published by the Safer Federal Workforce Task Force (Task Force Guidance) at https://www.saferfederalworkforce.gov/contractors/.”

Contractor employees working on a covered contract from their residence also must comply with the vaccination requirement for covered contractor employees.

The Task Force has issued FAQs for Federal contractors, which cover common questions related to the vaccination requirement for Federal contractor employees, including on topics such as accommodations, enforcement, compliance, and affiliates.

Vaccination Required for Covered Contractor Employees

“Covered contractor employee” means any full-time or part-time employee of a covered contractor working on or in connection with a covered contract or working at a covered contractor workplace. This includes employees of covered contractors who are not themselves working on or in connection with a covered contract, but does not include contractor employees who only perform work outside the United States or its outlying areas.

“Covered contractor workplaces” are locations controlled by a covered contractor at which any employee of a covered contractor working on or in connection with a covered contract is likely to be present during the period of performance for a covered contract.

FAR Council Memorandum on Issuance of Agency Deviations

On September 30, 2021, the FAR Council released a memorandum on the Issuance of Agency Deviations to Implement EO 14042, which outlines the following:

Agencies should promptly review the FAR Council guidance and clause and act expeditiously to issue their deviations, so that their contracting officers may begin to apply the clause on or before October 15.

Agencies should also review, and update as necessary, any relevant guidance previously provided to contractors to ensure consistency with the deviated FAR text.

If a civilian agency intends to use clause text different than the deviated clause text provided by the FAR Council, the agency must consult with the CAAC Chair.

Vaccination Required for Covered Contractor Employees

As to the vaccination requirement, covered contractors must ensure that all of their covered employees are fully vaccinated for COVID-19, unless the employee is legally entitled to an accommodation.

To make it easy for all employers to comply with the requirements and support the health, safety, efficiency, and effectiveness of their workforce, the deadline for the contractor vaccination requirement will be aligned with deadlines in the OSHA COVID-19 Vaccination and Testing Emergency Temporary Standard (“ETS”) and the Centers for Medicare & Medicaid Services (CMS) requirement that health care workers at facilities participating in Medicare and Medicaid be fully vaccinated (“CMS Rule”).

This means Federal contractor employees covered under the requirements of EO 14042 will need now too have their final vaccination dose by January 4, 2022, so that they are fully vaccinated by January 18, 2022.

Civilian agencies should furnish a copy of their approved class deviations (including direction to the workforce, prescription for use of clause, and clause text) to the FAR Secretariat by emailing the deviation to GSARegSec@gsa.gov by October 15.

Agencies may reference Acquisition.gov here to view posted deviations provided by agencies.

Evidence for Vaccination Requirements

The following provides evidence on effectiveness and limited attrition with respect to vaccination requirements. Agencies may use this information as they engage in discussions with or address questions from contractors regarding implementation of the requirements of EO 14042 and Task Force guidance.

Effectiveness of Vaccination Requirements

Data from a breadth of industries show that mandates work to substantially increase employee vaccination rates. For instance:

United Airlines implemented its vaccination mandate in 53 days, and now 99% of its workforce has met the requirements, up from 80% prior to the mandate.

In around 3 months, Tyson Foods went from less than half of its workforce vaccinated to 96% of the company.

The Orange County, Florida Tax Collector’s office went from 45% of staff vaccinated to above 90% in little more than a month.

The Department of Defense went from 80% of active duty service members with one shot to 96% in a month.

Across just these examples, this represents an increase in new vaccinations of hundreds of thousands of people as a result of mandates.

Minimal Workforce Attrition

One concern that may be raised about vaccination requirements is the potential cost to organizations if there is workforce attrition due to resignations and terminations. Although the loss of even a small number of employees can present challenges for an organization of any size, the evidence to date shows that turnover at institutions that implement vaccine mandates is low across industries and regions of the country.

United Airlines is in the process of terminating less than 0.5% of its workforce for failure to comply with its mandate – those employees will still have a chance to be vaccinated in response.

o Out of 67,000 employees, initially 593 employees faced termination. But 273 employees subsequently provided proof of vaccination, leaving only 320 employees not complying.

Methodist Hospital in Houston lost less than 0.6% of its employees after imposing a vaccine mandate.

o Out of 26,000 employees, Methodist Hospital lost only 153 employees.

Truman Medical Centers/University Health in Missouri had fewer than 0.8% of its employees lose their job for failure to comply with a mandate.

o Out of 5,000 employees, only 39 employees lost their jobs.

Novant Health in North Carolina had roughly 0.5% of its employees lose their job due to its mandate.

o Initially, 375 employees were suspended for failure to comply, but in response 200 employees changed their minds and became vaccinated. Out of 35,000 employees, only 175 employees ultimately lost their job.

As Maine implements its requirement that health care worker be vaccinated by the end of October, fewer than 0.2% of staff Maine Health and approximately 0.2% of staff at Northern Light have quit.

o Out of 23,000 employees, only 45 employees left Maine Health.

o Out of 10,000 employees, only 20 employees left Northern Light.

On the whole, these examples—with workforce attrition rates from mandates remaining below fractions of one percent— show the vast majority of employees subject to a vaccination requirement choose to get vaccinated and keep their jobs, including after disciplinary action such as suspension for non-compliance.

Next Steps for Federal Agencies

Agencies should refer to the For Federal Contractors section on the Task Force website as new information will be posted as available.

Agencies are encouraged to circulate the Task Force guidance, and the associated Frequently Asked Questions, to their workforce and ensure that their workforce is familiar with the Task Force guidance requirements. Agencies are encouraged to consider an internal communications plan to ensure their workforce is familiar with these new changes and any agency-specific requirements.

Agencies are also encouraged to develop an industry engagement plan to ensure their contractors are aware of the new requirements and implementation activities.

The FAR Council will conduct a rulemaking to amend the FAR to include a clause that requires covered contractors performing under FAR-based contracts to comply with the Task Force guidance for contractor and subcontractor workplace locations.

Agencies should take the following steps immediately:

o Review contracts that are not covered or directly addressed by the order because the contract is under the

Simplified Acquisition Threshold as defined in section 2.101 of the FAR or is a contract or subcontract for the manufacturing of products to identify additional contracts to which the clause can be added.

o Review existing contracts and contract-like instruments to identify opportunities to put the clause into contracts prior to the exercise of an option, extension, or renewal.

o Prepare to take any necessary action by October 8 to ensure that contracts and contract-like instruments that are not covered by the FAR include the clause, starting no later than October 15.

Questions?

If your agency receives media or press inquiries related to EO 14043, your agency should coordinate any responses with the Office of Management and Budget (OMB) Communications via media@omb.eop.gov

For questions related to the COVID-19 Workplace Safety Protocols detailed in the Task Force guidance, agencies may contact SaferFederalWorkforce@gsa.gov

For questions related to the acquisition and contracting aspects of implementation of EO 14042, agencies may contact MBX.OMB.OFPPv2@OMB.eop.gov

For questions from industry partners or contractors that agencies are unable to directly address, agencies may contact MBX.OMB.OFPPv2@OMB.eop.gov

Important References

For Federal Contractors | Safer Federal Workforce https://www.saferfederalworkforce.gov/new/ President Biden's COVID-19 Plan | The White House September 24, 2021: Blog Post on COVID-19 Workplace Safety for Federal Contractors, by Jason Miller, Deputy

Director for Management, OMB September 10, 2021: Blog Post on Implementation of EO 14042, also by Jason Miller, Deputy Director for

Management, OMB FAR Council guidance to agencies on "Issuance of Agency Deviations to Implement Executive Order 14043"