Employer vaccine mandates require consideration and documentation
Businesses opting for their own mandates can take steps to minimize claims and exposure.
More than two years into the pandemic, COVID-19 is still impacting the way businesses operate and the evolution of procedures and policies. Even as pandemic-related restrictions and mask mandates begin to lift across the country, companies remain split on how to approach vaccine mandates for employees.
When the U.S. Supreme Court blocked the Biden Administration’s vaccine-or-test mandate in mid-January, pending the final outcome from the lower courts review (which we believe is more procedural and will not change the Supreme Court ruling) for now it placed the decision—and the accompanying risks—squarely on individual businesses’ shoulders. Regardless of their decision, businesses can minimize claims and exposures through thorough communication, comprehensive documentation, and a deep understanding of their worker base.
Considerations when enforcing vaccine mandates
Business leaders must be prepared to absorb the risks and backlash that accompanies vaccine mandates. Given nationwide labor shortages, companies should carefully calculate the costs and determine whether they can afford to fire workers who may refuse vaccination and/or if the company would be severely impacted by mandate-triggered resignations. Labor and staffing considerations are especially relevant for essential businesses with front-line workers (i.e., in the retail and service industry).
If the mandate put in place allows workers to submit frequent negative COVID-19 tests instead of receiving vaccines, businesses must be intentional about the scope of the testing requirements. If testing is not paid for by the company and conducted onsite, or if an employee is not compensated for the time it takes to test, businesses could be accused of non-compliance with wage and hour laws.
Though they are becoming less common as case counts drop, certain state and local jurisdictions require businesses to mandate employee vaccinations or face litigation. Under federal ordinance and OSHA regulation, all federal employees, businesses that receive federal compensation and Health care industry organizations are required to implement vaccine mandates. In addition, if workers are covered by a collective bargaining agreement, businesses should be prepared to negotiate with their union before proceeding with a vaccine mandate. When developing procedures, business leaders must consult legal counsel with comprehensive knowledge of the jurisdictions in which they operate, as well as labor and anti-discrimination laws.
When implementing vaccine mandates, companies must be able to illustrate—through thorough documentation—that they provided religious and medical exemptions that were fully compliant with the Americans with Disabilities Act (ADA). The Equal Employment Opportunity Commission (EEOC) guidance is a valuable resource for those looking for immediate answers to workplace vaccination questions. Under the guidance, if an employee with a disability is unable to be vaccinated, employers must make reasonable accommodations for that worker before firing them. Accommodation may include extended remote work or temporary paid leave.
If businesses choose to fire employees that don’t comply with vaccine mandates, they must be able to prove that the firings were in no way discriminatory. This can be done through documentation of the lengthy notice they gave employees and evidence that they made every effort to provide accommodations for religious and medical exemptions. If litigation does arise, this documentation could protect businesses from substantial payouts/damages.
Employers not requiring vaccines must still prioritize safety
Depending on the employee base and company leadership, not mandating vaccines may be the best choice for a business. However, this does not mean that all other health and safety protocols can be ignored. To mitigate claims and potential litigation, companies of all sizes must document and enforce procedures and policies that create a safe work environment.
Measures include ventilation/air filtration, mask mandates (in compliance with local ordinances), proper cleaning/sanitation of the workspace, sick leave for workers who contract COVID-19, social distancing whenever possible and minimizing close contact between employees and customers through workspace reorganization.
Failing to put the above procedures in place could lead to disgruntled employees, worker attrition and unsafe work environments claims.
Looking ahead: Claims and insurer reactions
Claims and lawsuits related to vaccine mandate decisions and pandemic workplace policies are still working their way through the court system. The results and long-term impact of these claims won’t become clear until late 2022 at the earliest. Regardless of the ultimate verdict, any business facing litigation will have to pay defense and attorneys’ fees, which may lead to changes to its insurance policies and overall approach to workplace policies. The larger the awards/payouts, the more likely it is that underwriters will take corrective action by tightening Management Liability underwriting requirements and raising Employment Practices Liability Insurance (EPLI), Directors & Officers and Errors & Omissions coverage rates.
The best way to mitigate risks and exposures when making vaccine mandate decisions is to understand the litigious landscape and to document everything as thoroughly as possible. Businesses that put the health, safety and needs of their employees first are more likely to avoid high-impact claims.
Alex Maza is national account director, national management liability practice, for Risk Strategies.
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