The Biden Administration is significantly expanding its efforts to ensure that federal contractors' employees receive COVID-19 vaccinations. Previous White House direction required contractor personnel working onsite to attest to their vaccination status and, if they are unvaccinated, to comply with masking, physical distancing, testing, and travel requirements. Yesterday, President Biden issued an Executive Order on Ensuring Adequate COVID Safety Protocols for Federal Contractors that requires executive departments and agencies to "include a clause" in certain federal contracts and subcontracts mandating compliance "with all guidance for contractor or subcontractor workplace locations published by the Safer Federal Workforce Task Force[.]"
Based on the President's remarks yesterday, it is expected that the Task Force's guidance will include vaccination. President Biden issued the Protocols for Federal Contractors executive order on the same day as another executive order that he said "will now require all executive branch federal employees to be vaccinated—all." The President then stated that he had "signed another executive order that will require federal contractors to do the same."
Venable's Government Contracts Practice Group provides a summary of the key things contractors should know about this new executive order.
Didn't the Administration Already Require Vaccination for Contractor Employees?
No. Prior executive action from earlier this summer was not as broad as yesterday's order. While the President's remarks on July 29, 2021 were blunt ("If you want to do business with the federal government, get your workers vaccinated"), a White House fact sheet announced measures that did not mandate a COVID vaccine for federal contractor personnel. The fact sheet said "that to help protect workers and their communities, every federal government employee and onsite contractor will be asked to attest to their vaccination status" and that "[a]nyone who does not attest to being fully vaccinated will be required to wear a mask on the job no matter their geographic location, physically distance from all other employees and visitors, comply with a weekly or twice weekly screening testing requirement, and be subject to restrictions on official travel." The Safer Federal Workforce Task Force issued "COVID-19 Workplace Safety: Agency Model Safety Principles," confirming the fact sheet's summary and providing more details the same day.
What Is the Purpose of the New Executive Order?
The executive order states that "adequate COVID-19 safeguards" will "decrease the spread of COVID-19, which will decrease worker absence, reduce labor costs, and improve the efficiency of contractors and subcontractors at sites where they are performing work for the Federal Government." Accordingly, "ensuring that Federal contractors and subcontractors are adequately protected from COVID-19 will bolster economy and efficiency in Federal procurement."
What Does the New Executive Order Require?
The order states that executive departments and agencies "shall, to the extent permitted by law, ensure that contracts and contract-like instruments … include a clause that the contractor and any subcontractors (at any tier) shall incorporate into lower-tier subcontracts." This clause "shall specify that the contractor or subcontractor shall, for the duration of the contract, comply with all guidance for contractor or subcontractor workplace locations published by the Safer Federal Workforce Task Force," provided that "the Director of the Office of Management and Budget … approves the Task Force Guidance and determines that the Guidance, if adhered to by contractors or subcontractors, will promote economy and efficiency in Federal contracting." The clause "shall apply to 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."
As noted above, it is expected that the clause will include a vaccine requirement for government contractors similar to the one issued in President Biden's Executive Order on Requiring Coronavirus Disease 2019 Vaccination for Federal Employees, which states: "Each agency shall implement, to the extent consistent with applicable law, a program to require COVID-19 vaccination for all of its Federal employees, with exceptions only as required by law."
How Do I Know Whether the New Executive Order Affects Me?
The new executive order applies to:
…any new contract; new contract-like instrument; new solicitation for a contract or contract-like instrument; extension or renewal of an existing contract or contract-like instrument; and exercise of an option on an existing contract or 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[.]
In contrast, it does 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;
(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.
Will This Clause Apply to Any Federal Contract That Involves Services, or Only Federal Contracts That Are Subject to the Service Contract Act?[1]
Despite the language quoted above, it is likely the clause will not apply to procurement contracts for services that are not subject to the SCA.
The phrase "procurement contract or contract-like instrument for services" is likely to mean "a contract the principal purpose of which is to furnish services in the United States through the use of service employees, and any subcontract of any tier thereunder," which is the same test as determining whether the SCA applies. This is because the executive order uses much of the same terminology, and will likely apply to the same extent, as President Biden's Executive Order 14026, Increasing the Minimum Wage for Federal Contractors, and former President Barack Obama's Executive Order 13658, Establishing a Minimum Wage for Contractors.
The new COVID-19 executive order states that "the term 'contract or contract-like instrument' shall have the meaning set forth in the Department of Labor's proposed rule" implementing Executive Order 14026. And Executive Order 14026 stated that "[a]ny regulations issued pursuant to" the order "should, to the extent practicable, incorporate existing definitions, principles, procedures, remedies, and enforcement processes under … Executive Order 13658." Moreover, the Department of Labor's proposed rule to implement Executive Order 14026 relies extensively on the definitions contained in Executive Order 13658 (and ultimately implemented at 29 C.F.R. Part 10).
When implementing Executive Order 13658, and in the proposed rule to implement Executive Order 14026, the Department of Labor determined that the phrase "procurement contract for services" should "mean a contract the principal purpose of which is to furnish services in the United States through the use of service employees, and any subcontract of any tier thereunder," and so "a procurement contract that is subject to the SCA, as amended, and its implementing regulations." See 79 Fed. Reg. 60634, 60650-51 (Oct. 7, 2014); 86 Fed. Reg. 38816, 38822 (July 22, 2021); id. at 38826-27.
How Long Until We Know the Terms of This Clause?
The Task Force has until September 24, 2021 to issue its Guidance, including providing "definitions of relevant terms for contractors and subcontractors, explanations of protocols required of contractors and subcontractors to comply with workplace safety guidance, and any exceptions to Task Force Guidance that apply to contractor and subcontractor workplace locations and individuals in those locations working on or in connection with a Federal Government contract or contract-like instrument."
Then the Federal Acquisition Regulatory Council has until October 8, 2021 to "take initial steps to implement appropriate policy direction to acquisition offices for use of the clause by recommending that agencies exercise their authority under subpart 1.4 of the Federal Acquisition Regulation [FAR]." FAR Subpart 1.4 concerns deviations from the FAR.
Similarly, agencies have until that same date "to exercise any applicable authority to ensure that contracts and contract-like instruments … that are not subject to the Federal Acquisition Regulation and that are entered into on or after October 15, 2021, consistent with the effective date of such agency action, include the clause[.]"
If It Applies to Me, When Can I Expect the Clause to Be Added to My Contract?
While the executive order is "effective immediately," it applies only "to new contracts; new contract-like instruments; new solicitations for contracts or contract-like instruments; extensions or renewals of existing contracts or contract-like instruments; and exercises of options on existing contracts or contract-like instruments … where the relevant contract or contract-like instrument will be entered into, the relevant contract or contract-like instrument will be extended or renewed, or the relevant option will be exercised, on or after" October 15, 2021.
The executive order also includes more specific implementation criteria for recently issued solicitations and contracts entered into between the date of the order and October 15, 2021.
Does Compliance with the New Clause Mean That I No Longer Have to Comply with More Restrictive Federal, State, or Local COVID-19 Requirements?
No, the executive order states: "Nothing in this order shall excuse noncompliance with any applicable State law or municipal ordinance establishing more protective safety protocols than those established under this order or with any more protective Federal law, regulation, or agency instructions for contractor or subcontractor employees working at a Federal building or a federally controlled workplace."
[1] The FAR now refers to the McNamara-O'Hara Service Contract Act of 1965 (SCA), codified at 41 U.S.C. chapter 67, as the "Service Contract Labor Standards." See FAR 22.1000. We refer to the SCA for the sake of familiarity.