Government Contractor Compliance & Regulatory Update

FAR Council Issues Contractor Vaccination Contract Clause and Guidance

As previously reported, the Biden Administration issued Executive Order 14042 (“the Order”) last month.  The Order requires, in part, that the Federal Acquisition Regulatory Council (“the FAR Council”) amend the Federal Acquisition Regulation (“FAR”) to include a clause specifying that contractors and subcontractors shall “comply with all guidance for contractor or subcontractor workplace locations published by the Safer Federal Workforce Task Force.”  The Task Force issued its COVID-19 Workplace Safety: Guidance for Federal Contractors and Subcontractors (the “Guidance”) on September 24, 2021, setting forth vaccine mandates, as well as masking, social distancing, and other requirements.  The Task Force then supplemented its Guidance with published FAQs on September 30, 2021.  Our summaries of these developments are available here and here.

The FAR Council has now issued the contract clause that, when included in new contracts and contract-like instruments, will impose the Guidance’s requirements on contractors and subcontractors, as well as a memorandum providing guidance to agencies regarding its implementation.  The new clause and memorandum to agencies are available here.  They provide additional insights on the recent federal mandate.

As we previously reported, despite the fact the Order limits the contracts subject to the Guidance, the Guidance strongly encourages agencies to include the clause in contracts and contract-like instruments beyond those expressly covered by the Order.  The FAR Council’s memorandum echoes this sentiment, noting it is part of an effort “[t]o maximize the goal of getting more people vaccinated and decrease the spread of COVID-19.”  To that end, agencies are advised that the clause should be broadly applied, with only two exceptions: (1) “contracts and subcontracts with Indian Tribes under the Indian Self-Determination and Education Assistance Act;” and (2) “solicitations and contracts if performance is outside the United States or its outlying areas.”

The FAR Council also provides information regarding the applicability and effective dates of the clause as follows:

  • “new contracts awarded on or after November 14 from solicitations issued before October 15 (this includes new orders awarded on or after November 14 from solicitations issued before October 15 under existing indefinite-delivery contracts);
  • new solicitations issued on or after October 15 and contracts awarded pursuant to those solicitations (this includes new solicitations issued on or after October 15 for orders awarded pursuant to those solicitations under existing indefinite-delivery contracts);
  • extensions or renewals of existing contracts and orders awarded on or after October 15, 2021; and
  • options on existing contracts and orders exercised on or after October 15, 2021.”

The actual clause published by the FAR Council is also informative.  It provides that contractors with contracts containing the clause need to comply not only with the Guidance itself, but also “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/.” (emphasis added).

We will continue to report on new developments regarding the Order and Guidance.

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Additional Contractor Vaccination Mandate Guidance Issued

The Safer Federal Workforce Task Force has released a set of frequently asked questions and answers (“FAQs”) regarding the Guidance for Federal Contractors and Subcontractors (the “Guidance”) it issued last week.  Our comprehensive summary of the Guidance is available here.

The new FAQs largely repackage the information provided in the Guidance.  However, they do provide additional detail and information regarding the Guidance, which includes the following.

  • Interplay with the Upcoming OSHA Emergency Temporary Standard. As previously reported, employers with 100 or more employees will be subject to a soon-to-be-issued emergency temporary standard that will include a testing option for those who choose not to vaccinate.  The new FAQs make clear that covered contractors and subcontractors (“Contractors”) must comply with the Guidelines – which do not contain a testing option –“regardless of whether they are subject to other workplace safety standards.”
  • Interplay with State and Local Laws. Many contractors have wondered how they can comply with the Guidance in jurisdictions that prohibit vaccine mandates or take adverse action against employees who refuse to vaccinate.  The new FAQs directly address this quandary, making clear that to the federal government there is an easy answer:  covered Contractors must comply with the Guidelines – the Guidelines’ “requirements are promulgated pursuant to Federal law and supersede any contrary State or local law or ordinance. Additionally, nothing in the Task Force Guidance shall excuse noncompliance with any applicable State law or municipal ordinance establishing more protective workplace safety protocols than those established under the Task Force Guidance.”
  • Monitoring Subcontractor Compliance. Covered prime contractors must ensure the requirements set forth in the Guidance are incorporated into their first-tier subcontracts and subcontractors are thereafter required to fully comply (including by flowing down the clause to lower-tier subcontractors).  The new FAQs provide that prime contractors do not have an affirmative obligation to monitor subcontractor compliance, but rather may “assume the subcontractor is complying with the [Guidance … unless] the prime contractor has credible evidence otherwise.”
  • Onsite Vaccinations. The FAQs make clear contractors do not have to provide onsite vaccination opportunities for their employees.

Even with the new FAQs, we expect additional guidance to be issued and for the Guidance itself to be updated in the coming weeks.  We will continue to monitor and report on any developments here.

In the meantime, contractors should assess the Guidelines, determine when and how they may apply to their businesses, consider what the impact of the Guidelines will mean for their businesses, and begin planning for implementation now.  From our numerous conversations with contractors since the Guidelines were issued, the new requirements present a host of practical challenges for contractors that require careful assessment of the complex and ever-changing legal landscape to determine how best to meet those challenges while also ensuring compliance.

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Subscribe to Proskauer’s Law and the Workplace blog to stay current on the latest Biden administration developments impacting your business. Proskauer’s cross-disciplinary, cross-jurisdictional Coronavirus Response Team is focused on supporting and addressing client concerns. Visit our Coronavirus Resource Center for guidance on risk management measures, practical steps businesses can take and resources to help manage ongoing operations.

Potential Government Shutdown – What Every Federal Contractor Needs to Know

We appear to be on the precipice of a federal government shutdown.  Absent a political compromise, the federal government’s funding will run out on September 30, 2021, and the White House has instructed federal agencies to prepare for a possible shutdown.  During previous government shutdowns, government agencies and departments issued stop-work orders, grinding work on government projects and contracts to a halt.  Contractors were then faced with the difficult task of remaining in compliance with their obligations to their employees while work and funding for those contracts has ceased.

With a possible shutdown on the horizon, contractors are beginning to consider how to handle these complex employment issues.  Although the discussion below is not comprehensive, it discusses many of the significant employment-related issues a shutdown presents for contractors.

Wage and Hour Considerations

During a shutdown, non-essential government employees are typically furloughed and the federal government does not have to be concerned with wage and hour legal issues.  Contractors, on the other hand, must remain mindful of obligations under both federal and state wage and hour laws.  For example, a contractor that begins a furlough mid-week may consider not paying its employees for the days during that week the employees are on furlough.  However, doing so for employees exempt from overtime under federal and state laws could place their exempt status in jeopardy.

Generally, to be exempt from overtime under the federal Fair Labor Standards Act (“FLSA”), an employee must be paid on a salary basis of at least $684 per week, regardless of the amount of work performed.  Accordingly, while an employer can withhold payment for any full week in which the employee does not work, it cannot do so for any part of a week in which the employee does not work due to a furlough without jeopardizing exempt status.

During previous shutdowns, some contractors mitigated various wage issues by requiring exempt employees to use vacation pay or paid time off (“PTO”) to cover compensation for non-working days during partial furlough weeks.  Although this practice complies with the FLSA’s exemption requirements, contractors must still ensure that they do not run afoul of state wage and hour laws.  For example, some states require employers to comply with their own published leave policies.  Therefore, in such states, employers should review their policies and applicable laws before mandating the use of vacation time or PTO.

Contractors should also instruct employees not to perform any work while on furlough.  If an exempt employee performs work during the week (such as checking and responding to emails), he or she must be paid his or her salary for the entire week.  If a non-exempt employee performs work, he or she must be paid for all work performed.  For this reason, employers should clearly communicate to supervisors and employees that work may not be performed while they are on furlough.  During past shutdowns, some contractors confiscated company-issued smartphones and computing devices to ensure no work was performed.

Another approach contractors have considered during previous shutdowns is requiring exempt employees to work a reduced workweek.  Contractors considering this approach must be mindful of the salary basis implications.  That being said, in limited circumstances it may be permissible to adopt a reduced work-hours program during a period of economic hardship.  The Department of Labor has stated in various opinion letters that “a fixed reduction in salary effective during a period when a company operates a shortened workweek due to economic conditions would be a bona fide reduction not designed to circumvent the salary basis payment. Therefore the exemption would remain in effect as long as the employee receives the minimum salary required by the regulations and meets all the other requirements for the exemption.”  Opinion Letter FLSA2009-18.

Before instituting such a change, however, employers must consider a number of issues, including:  (1) any contractual obligations to employees; (2) state and local notice requirements for changes in compensation; (3) requirements for foreign workers on work authorizations (discussed below) and (4) compliance with other requirements for overtime exemptions (including state requirements).

The WARN Act

The looming government shutdown also brings with it the prospect of furloughing large numbers of employees.  These potential furloughs may implicate the federal Worker Adjustment and Retraining Notification (“WARN”) Act and its state equivalents.  The WARN Act requires, with some exceptions, that employers provide 60 days’ notice to employees affected by a “plant closing” or “mass layoff.”  However, depending on what a government contractor plans to do in response to the shutdown, the WARN Act may not apply.

Historically, some contractors have furloughed workers on suspended projects until they are resumed.  The WARN Act only applies if there is an “employment loss,” which is defined as: (1) an employment termination; (2) a layoff exceeding six months; or (3) a reduction in an employee’s hours of work of more than 50 percent in each month of a six-month period.  Because it is not anticipated that a government shutdown will exceed six months, for most government contractors the WARN Act will not apply.  In the unlikely event that the government shutdown continues for more than four months, contractors will have to consider whether to provide the notices required under the WARN Act.

However, even if the WARN Act does not apply to a government contractor’s furlough program, contractors should be aware that analogous state laws may be triggered by their furloughs.

E-Verify

Government contractors are required to utilize the Internet-based employment verification system called E-Verify to confirm the employment eligibility of their new hires and current employees.  The website, which is administered by the Department of Homeland Security, has historically been unavailable during government shutdowns.

If this is the case again, government contractors should complete I-9 paperwork in an accurate and timely fashion while E-Verify is unavailable.  In addition, if an employee has received a “Tentative Non-Confirmation” notice from E-Verify, he or she likely will not be able to resolve the issue during the shutdown.  If that is the case, the deadline for responding to the Tentative Non-Confirmation will likely be extended for the duration of the shutdown.  During this period, the employer should not take any adverse action against the employee as a result of the notice.

Benefits Issues

If a government shutdown lasts longer than anticipated, there may also be certain benefits implications for furloughed employees.  First, reduction in employees’ hours may cause some employees to lose coverage under the terms of the employer’s COBRA-covered health plans.  In this case, employers are required to send out qualifying event notices to impacted employees.  The employees and dependents must be offered the ability to continue coverage under these plans during the period of the furlough (up to the maximum COBRA continuation period) at their own expense.  If a furloughed employee is later terminated, the termination generally will not be considered a second qualifying event that would entitle the employee to an extension of the COBRA continuation period.

Unemployment Benefits

Government contractors should also be aware that furloughing their employees may make the employee eligible for unemployment benefits.  Contractors should consult their state laws to determine the impact of furloughs on unemployment benefits.

Conclusion

A government shutdown will require many contractors to make difficult choices.  If there is a shutdown, contractors should consult with employment counsel familiar with government contracting requirements to ensure that short-term reactions to the shutdown do not result in costly legal liabilities.

Vaccination Guidance Issued For Federal Contractors and Subcontractors

On September 24, 2021, the Safer Federal Workforce Task Force (the “Task Force”) issued Guidance for Federal Contractors and Subcontractors (the “Guidance”), advising covered federal contractors and subcontractors of their new COVID-19 safety requirements.  The Guidance, which still must be approved by the Office of Management and Budget, fleshes out the requirements set forth in Executive Order 14042 (the “Executive Order”) which announced that certain contractors with new contract or contract-like instruments (and their subcontractors) will be subject to COVID-19 safety requirements.  Our discussion of the Executive Order is available here.

The Guidance provides that covered federal contractors and subcontractors (“Contractors”) will be required to (1) impose vaccination requirements on certain employees; (2) comply with masking and physical distancing requirements, and (3) designate person(s) to coordinate COVID-19 workplace safety efforts.

The Guidance is subject to change based on new Centers for Disease Control and Prevention (“CDC”) guidance “and as warranted by the circumstances of the pandemic and public health conditions.”  When such changes are made, they will automatically be imposed on covered Contractors.

Some key details from the Guidance are provided below:

Which Contractors Are Subject to the New Requirements?  Covered Contractors are those who enter into a new contract or contract-like instrument that contains a clause incorporating the Guidance, which is to be developed by October 8, 2021 by the Federal Acquisition Regulatory Council (“FAR Council”) prior to a formal rulemaking.  The new requirements must be incorporated into covered[1] contracts awarded prior to October 15, 2021 whenever an option is exercised or an extension is made.  The new clause will have to be incorporated into covered contracts awarded on or after November 14, 2021; for covered contracts awarded between October 15 and November 14, 2021, agencies are encouraged to include the clause but are not required to do so except where the solicitation for the contract was issued on or after October 15, 2021.  Prime contractors must also include flow-down provisions incorporating the clause into subcontracts, which must flow the clause down to all lower-tier subcontractors.

Small businesses will not be exempted from the requirement.  As reflected in the Task Force’s previously issued guidance, reported on here, even though the Executive Order expressly excludes specific types of contracts, the Guidance “strongly encourages” agencies to incorporate the Guidance into contracts not covered by the Executive Order.  As the Guidance states:

Consistent with applicable law, agencies are strongly encouraged to incorporate a clause requiring compliance with this Guidance into contracts that are not covered or directly addressed by the order because the contract is under the Simplified Acquisition Threshold … or is a contract or subcontract for the manufacturing of products. Agencies are also strongly encouraged to incorporate a clause requiring compliance with this Guidance into existing contracts and contract-like instruments prior to the date upon which the order requires inclusion of the clause.

What Are The Requirements?

  • Vaccinations.
    • Required employee vaccinations: All covered employees are required to be vaccinated for COVID-19, except where an accommodation is required due to a disability or the agency has “an urgent, mission-critical need” to have an employee begin work on a covered contract at a covered workplace prior to becoming fully vaccinated.  There is no exception for employees who have had a prior COVID-19 infection.  There is no testing requirement in the Guidance for employees who receive an exception.
    • Deadline for vaccination compliance: Non-exempted employees must be fully vaccinated by December 8, 2021, or “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.”  Consistent with guidance from the CDC, individuals are fully vaccinated if two weeks have passed since they “received the second dose in a two-dose series, or two weeks after they have received a single-dose vaccine.”  The Guidance discusses which vaccines are acceptable.  It also notes that “[t]here is currently no post-vaccination time limit on fully vaccinated status; should such a limit be determined by the [CDC], that limit will be considered by the Task Force and OMB for possible updating of this Guidance.”
    • Verification of compliance: Contractors must review employee vaccination documentation to confirm their employees meet the vaccination requirement.  Acceptable forms of documentation are “a copy of the record of immunization from a health care provider or pharmacy, a copy of the COVID-19 Vaccination Record Card (CDC Form MLS-319813_r, published on September 3, 2020), a copy of medical records documenting the vaccination, a copy of immunization records from a public health or State immunization information system, or a copy of any other official documentation verifying vaccination with information on the vaccine name, date(s) of administration, and the name of health care professional or clinic site administering vaccine.”  Helpfully, the Guidance expressly provides that a “digital copy of such records, including, for example, a digital photograph, scanned image, or PDF of such a record” is acceptable.  A recent antibody test is not sufficient proof of vaccination status.
    • Employees exempted from the vaccination requirement: In addition to the “urgent, mission-critical” exception noted above (which can only have a temporary duration), the Guidance provides that Contractors “may be required to provide an accommodation to covered contractor employees who communicate to the covered contractor that they are not vaccinated against COVID-19 because of a disability (which would include medical conditions) or because of a sincerely held religious belief, practice, or observance.  A covered contractor should review and consider what, if any, accommodation it must offer.  Requests for ‘medical accommodation’ or ‘medical exceptions’ should be treated as requests for a disability accommodation.”  (emphases added).  The Guidance provides no further information regarding how such accommodation requests should be assessed, through a prior Task Force publication suggested further guidance on this subject will be forthcoming.
  • Masking and Social Distancing. Although coverage of the Executive Order focused on the likely vaccine requirement, the Guidance also lays out masking and social distancing requirements.  In addition to following CDC guidelines, covered Contractors will be required to adhere to the following protocols:
    • Masks are required: (1) indoors in areas of high and substantial community transmission for all employees (regardless of vaccination status); (2) for non-fully vaccinated employees indoors in areas of moderate and low transmission; and (3) for non-fully vaccinated employees in “crowded outdoor settings or during outdoor activities that involve sustained close contact with other people who are not fully vaccinated.”  Where masks are required, they must be worn “consistently and correctly.”
      • Masks are not required: for fully vaccinated employees indoors in areas of moderate and low transmission and in outdoor spaces. Contractors can also provide exceptions from masking requirements where consistent with CDC guidelines (such as where the employee is alone in an enclosed personal office or for a limited time while eating or drinking).  Other exceptions based on the activities the employee engages in or other factors may also be available, but must be determined by a workplace risk assessment and approved in writing by a “duly authorized representative” of the Contractor.
      • The Guidance recognizes exceptions to masking requirements may be required due to disability or religious accommodations, but notes providing accommodations may not always be required: “A covered contractor should review [accommodation requests] and consider what, if any, accommodation it must offer.”
      • Contractors must refer to the CDC COVID-19 Data Tracker County View website to determine the level of community transmission “in all areas where they have a covered contractor workplace at least weekly to determine proper workplace safety protocols.” When the level increases from low/moderate transmission to substantial or high, the Contractor “should put in place more protective safety protocols,” but when the level is reduced, the Contractor cannot reduce the level of safety protocols unless and until the transmission rate remains at the lower level for at least two consecutive weeks.
    • Social distancing of six-feet or more is required “[t]o the extent practicable” for non-fully vaccinated employees, “including in offices, conference rooms, and all other communal and work spaces.”
      • Social distancing is not required for fully vaccinated employees, and for situations where the contractor provides exceptions consistent with CDC guidelines (such as where the employee is alone in an enclosed personal office or for a limited time while eating or drinking).
    • Designation of COVID-19 Workplace Safety Coordinator. Covered Contractors are required to designate a person(s) to “coordinate implementation of and compliance with this Guidance and the workplace safety protocols detailed herein at covered contractor workplaces.”  This person(s) must “ensure that information on required COVID-19 workplace safety protocols is provided to covered contractor employees and all other individuals likely to be present at covered contractor workplaces.”  They “must also ensure that covered contractor employees comply with the requirements in this guidance related to the showing or provision of proper vaccination documentation.”

What Locations and Employees Are Subject to the Requirements?  As suggested by the Executive Order, the new requirements will apply to covered Contractor workplaces.  The Guidance defines such “covered contractor workplaces” as “a location 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.  A covered contractor workplace does not include a covered contractor employee’s residence.”  (emphasis added).  Therefore, all employees, whether or not they work on or in connection with a covered contract, will be subject to the requirements if anyone at their workplace works on or in connection with a covered contract or is likely to be present at their workplace during the applicable contract’s performance period.  Further, employees who work on or in connection with a covered contract – regardless of whether they work in a covered contractor workplace – must comply with the vaccination requirement even if they perform their work remotely.

The guidance includes a set of Frequently Asked Questions (“FAQs”) which provides additional detail.  For example:

  • Covered workplaces include outdoor workplace locations.
  • Where employees working on or in connection with a covered contract work on only one floor or area of a workplace (including a building/site/facility on a larger Contractor-controlled campus), the requirements will still apply to all employees at the worksite unless the Contractor “can affirmatively determine that none of its employees on another floor or in separate areas of the building will come into contact with a covered contractor employee during the period of performance of a covered contract … including interactions through use of common areas such as lobbies, security clearance areas, elevators, stairwells, meeting rooms, kitchens, dining areas, and parking garages.”
  • Employees working “in connection with” a covered contract are those “who perform duties necessary to the performance of the covered contract, but who are not directly engaged in performing the specific work called for by the covered contract, such as human resources, billing, and legal review.” The FAQ includes no threshold for the amount of “connected” work required for such employees to be covered by the requirements.

As noted above, the Guidelines are subject to change and we will report on any noteworthy changes and other developments here.  Contractors should become familiar with these requirements and be aware that any new federal government contract, contract extension, or contract renewal will likely include these requirements.  Those expecting to be subject to the new requirements should assess which workplaces may be impacted and how the Guidance differs from their current COVID-19 protocols.

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[1] As we previously reported, the Executive Order explains that the requirement will apply to a new contract and contract-like instrument if: “(i)  it is a procurement contract or contract-like instrument for services, construction, or a leasehold interest in real property; (ii)  it is a contract or contract-like instrument for services covered by the Service Contract Act, 41 U.S.C. 6701 et seq.; (iii)  it is a contract or contract-like instrument for concessions, including any concessions contract excluded by Department of Labor regulations at 29 C.F.R. 4.133(b); or (iv)  it is a contract or contract-like instrument entered into with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public.”

Per the Executive Order, the new requirement will not apply to “(i)  grants; (ii)  contracts, contract-like instruments, or agreements with Indian Tribes under the Indian Self-Determination and Education Assistance Act (Public Law 93-638), as amended; (iii)  contracts or subcontracts whose value is equal to or less than the simplified acquisition threshold, as that term is defined in section 2.101 of the Federal Acquisition Regulation [generally $250,000]; (iv)  employees who perform work outside the United States or its outlying areas, as those terms are defined in section 2.101 of the Federal Acquisition Regulation; or (v)  subcontracts solely for the provision of products.”  As noted above, even though the Executive Order expressly carves out these contracts from its COVID-19 safety requirement mandate, the Guidelines may still be incorporated into such new contracts and contract-like instruments.

Subscribe to Proskauer’s Law and the Workplace blog to stay current on the latest Biden administration developments impacting your business. Proskauer’s cross-disciplinary, cross-jurisdictional Coronavirus Response Team is focused on supporting and addressing client concerns. Visit our Coronavirus Resource Center for guidance on risk management measures, practical steps businesses can take and resources to help manage ongoing operations.

OFCCP Moves One Step Closer To AAP Verification

In a step toward implementation of OFCCP’s Affirmative Action Program (“AAP”) Verification Initiative, the Office of Management and Budget (OMB) approved an Affirmative Action Program Verification Interface (AAP-VI) that OFCCP developed for federal contractors to submit AAPs.

Although the verification program has not yet launched, and details are scarce, the OFCCP already has an AAP-VI website which promises the program is “Coming Soon” and explains that “Affirmative Action Program Verification Interface (AAP-VI) is a secure web based interface created to improve communication and the transfer of Affirmative Action Program data, between Federal Contractors and the Office of Federal Contract Compliance Programs.”

As previously reported, in furtherance of Directive 2018-07, on September 14, 2020, OFCCP published a notice soliciting comments concerning its proposal to obtain approval from the OMB to implement the AAP-VI.  The notice stated the AAP-VI would be used to assist with a yet-to-be-established AAP online certification process for federal contractors and provide a secure method for federal contractors to submit AAPs electronically to OFCCP when they are scheduled for a compliance evaluation.

Presently, federal contractors are only required to submit their AAPs via mail or email and are not required to certify annually to the OFCCP that their AAPs are compliant.  According to the OFCCP AAP-VI Federal Contractor User Guide, “[t]he AAP-VI system will be the primary source for entering, tracking and submitting [] Affirmative Action Programs for review by OFCCP.  AAP-VI will provide federal contractors a system to submit their Programs in a more efficient manner and provide visibility and reporting capabilities of the data submitted by the Programs.”

We are still awaiting further details from the OFCCP, we will continue to closely monitor and report on new developments.  In the meantime, additional information can be found in OFCCP’s AAP-VI Administrative Guide and OFCCP’s AAP-VI Federal Contractor User Guide.  Further, contractors should be getting ready for the launch of the verification interface by making sure their AAPs are prepared and ready for “prime time,” including ensuring they meet all of OFCCP’s requirements.

Federal Government Issues New Guidance on Vaccination Requirements for Contractors

As previously reported, the Biden Administration issued an executive order on September 9, 2021 setting forth new COVID-19 safety protocols for certain federal contractors (the “Executive Order”). The Safer Federal Workforce Task Force (the “Task Force”) is tasked with developing the COVID-19 safety requirements that covered contractors and subcontractors will be required to follow.

The Task Force has now released FAQs providing some information on what the forthcoming COVID-19 safety requirements for covered federal contractors and subcontractors will look like. Some of the key information disclosed in the FAQs is as follows:

  1. Remote Workers May Be Covered. As we previously reported, the new COVID-19 requirements will be imposed on contractors who enter into certain new contracts or contract-like instruments beginning October 15, 2021. While the precise requirements have yet to be issued, it appears – based on the requirements imposed on federal employees – covered contractors may be required to have covered employees vaccinated regardless of whether they work remotely.
  2. Disability and Religious Exceptions. Also gleaned from the federal employee guidance is that there will likely be “limited” exceptions from the vaccination requirements for “employees who communicate to the agency that they are not vaccinated against COVID-19 because of a disability or because of a sincerely held religious belief, practice, or observance.” The FAQs note the exception analysis is fact-specific and must be conducted on a case-by-case basis, but also indicate “[a]dditional guidance on legally required exceptions will be forthcoming.”
  3. Expanded Applicability of Vaccination Requirements. Notwithstanding the fact the Executive Order only imposes the new COVID-19 requirements on certain contractors based on the type and date of their federal government contracts, the FAQs state “[a]gencies are strongly encouraged to incorporate [employee] vaccination requirements into contracts that are not covered by [the] Executive Order… This might include, for example, incorporating vaccination requirements into contracts in advance of when they are otherwise required by the Executive Order or incorporating requirements into contracts that are not covered by the Executive Order, such as contracts under the Simplified Acquisition Threshold.” (emphasis added). Accordingly, contractors that thought they would not be covered by the COVID-19 safety requirements based on the types of contracts they have with the government – e.g., contracts solely for the provision of products – will need to check their new and renewed contracts after October 15, 2021 to determine whether the new requirements are incorporated.
  4. Additional Guidance for Onsite Contractor Employees. Prior to the time contractors are required to implement vaccination requirements, agencies must ask about the vaccination status of all “onsite” contractor employees and should provide all onsite contractor employees with a Certification of Vaccination form before they enter any federal building or worksite. Onsite contractor employees must attest to the truthfulness of their response regarding their vaccination status, and anyone who fails to respond will be treated as not fully vaccinated for purposes of safety protocols onsite. Onsite contractor employees who are not fully vaccinated and are not required to be vaccinated are required to demonstrate proof of a negative COVID-19 test, dated within the prior three days, in order to enter a federal building or worksite. Agencies may determine the type of tests they will permit, but the test must be FDA-authorized to detect current infection and indicate the date of the results. There is an exception for contractor employees who are “regularly tested pursuant to an agency testing program.” Such workers “do not need to provide proof of a negative COVID-19 test from no later than the previous 3 days prior to entry to a federal building unless required to by the agency testing program.”

Further guidance and details will be issued in the coming days and weeks. We will continue to report on developments as further information is released.

Government Contractor Employees To Be Subject To Mandatory Vaccine Requirements

On September 9, 2021, the Biden Administration announced a host of vaccine-related initiatives, reported on here. One of those initiatives is an Executive Order which requires contractors to implement the guidance to be published by the Safer Federal Workforce Task Force (the “Task Force”) in “any workplace locations (as specified by the Task Force Guidance) in which an individual is working on or in connection with a Federal Government contract or contract-like instrument.”  This guidance has yet to be issued, but will include mandatory vaccinations for covered workers.  It expands on the initiative announced in July that required vaccination or testing for government contractor employees working onsite at federal government facilities.  The new Task Force guidance is not expected to include a testing option.

The new requirement will apply to certain new contracts and contract extensions and renewals entered into on or after October 15, 2021.  The Executive Order explains that the requirement will apply to a new contract and contract-like instrument if:

(i)    it is a procurement contract or contract-like instrument for services, construction, or a leasehold interest in real property;
(ii)   it is a contract or contract-like instrument for services covered by the Service Contract Act, 41 U.S.C. 6701 et seq.;
(iii)  it is a contract or contract-like instrument for concessions, including any concessions contract excluded by Department of Labor regulations at 29 C.F.R. 4.133(b); or
(iv)   it is a contract or contract-like instrument entered into with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public.

Per the Executive Order, the new requirement will not apply to

(i)    grants;
(ii)   contracts, contract-like instruments, or agreements with Indian Tribes under the Indian Self-Determination and Education Assistance Act (Public Law 93-638), as amended;
(iii)  contracts or subcontracts whose value is equal to or less than the simplified acquisition threshold, as that term is defined in section 2.101 of the Federal Acquisition Regulation [generally $250,000];
(iv)   employees who perform work outside the United States or its outlying areas, as those terms are defined in section 2.101 of the Federal Acquisition Regulation; or
(v)    subcontracts solely for the provision of products.

We will report on new developments related to this initiative.

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New Census Data Available for Development of AAPs

On September 3, 2021, OFCCP issued a notice requiring federal contractors to use the recently released 2014-2018 Equal Employment Opportunity Tabulation (“2018 EEO Tab”) to develop any Affirmative Action Programs (“AAPs”) that commence on or after January 1, 2022. The 2018 EEO Tab was released earlier this year by the U.S. Census Bureau. It replaces the 2006-2010 EEO Tabulation contractors have been using for AAP purposes.

Under OFCCP regulations, federal contractors are required to “use the most current and discrete statistical information available… includ[ing] census data” to conduct availability analyses, which determine the availability of qualified minorities and women for job openings. Determining availability is a key requirement of an AAP because it is used “to establish a benchmark against which the demographic composition of the contractor’s incumbent workforce can be compared in order to determine whether barriers to equal employment opportunity may exist within particular job groups.”

Although contractors must begin using the 2018 EEO Tab starting next year, they may begin using it in the development of their AAPs earlier if they so choose. The EEO Tab and additional information can be found on the Census Bureau’s website.

As always, we will continue to report on developments as further details emerge.

OFCCP to Reconsider Use of EEO -1 Component 2 Data

OFCCP announced on September 1, 2021 that it plans to rescind a November 2019 notice regarding EEO-1 Component 2 data. EEO-1 Component 2 data was required to be submitted in 2019, and consists of aggregated employee wage and hours worked data, categorized by EEO-1 classification, race, ethnicity, and sex. The 2019 notice provided OFCCP would not “request, accept, or use Component 2 data, as it [did] not expect to find significant utility in the data given limited resources and [the data’s] aggregated nature.”

Now, OFCCP has announced its 2019 decision was “premature and counter to the agency’s interests in ensuring pay equity.” As such, the agency intends to evaluate the Component 2 data’s utility in investigating potential pay discrimination, noting the data may offer “insight into pay disparities across industries and occupations and strengthen Federal efforts to combat pay discrimination.”

It is important to note that OFCCP has not stated definitively whether it will request, accept, or use Component 2 data in the future. The announcement only provides that OFCCP is reconsidering its November 2019 decision not to request, accept, or use the data.

One might wonder why, given that the EEOC elected not to renew the Component 2 aspect of the EEO-1 report, the OFCCP is reconsidering its prior determination regarding the data. Indeed, in every standard compliance evaluation, OFCCP receives far more detailed and useful contractor compensation data which it uses to assess pay equity. The answer may be that OFCCP does not intend to request such information from contractors in audits (which, unless the Component 2 report is reinstituted, would be beyond the proper temporal scope of any future audit), but rather intends to analyze the data submitted by employers in 2019 to assess and refine its audit practices and procedures. In its rescission notice, OFCCP states its review of the data “could improve OFCCP’s ability to efficiently and effectively investigate potential pay discrimination. Also, analyzing compensation data in conjunction with other available information, such as labor market survey data, could help OFCCP identify neutral criteria to select contractors for compliance evaluations.”

We will continue to monitor this matter and report on developments as new details emerge.

OFCCP Announces More Audits– Was Your Company Selected?

On September 1, 2021, OFCCP announced the release of a new Corporate Scheduling Announcement List (CSAL). The list consists of 400 federal construction contractors, federally assisted contractors and subcontractors.  Note that the list merely notifies these construction contractors that they will be audited in the future, which gives them time to prepare.

Construction contractors are advised to review the CSAL (available here) to see if they have been selected for an audit, and consult with counsel as necessary.

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