On November 5, 2021, OSHA released a COVID-19 Emergency Temporary Standard (“ETS”) providing that employers with at least 100 employees adopt a vaccination policy requiring employees to be fully vaccinated or submit to weekly testing. The ETS further required employers to provide paid time off to recover from and receive the vaccine, and unvaccinated employees must wear a mask when in contact with coworkers.  Under the ETS, the test for the number of employees is counted by the enterprise, not the location. Part-time employees are counted, but independent contractors are not. In a traditional franchisor-franchisee relationship in which each franchise location is independently owned and operated, the franchisor and franchisees would be separate entities for coverage purposes.

This rule took effect immediately upon publication in the Federal Register.

After the ETS was released, lawsuits were filed in the U.S. Courts of Appeals for the Fifth, Sixth, Seventh, Eighth, Eleventh and D.C. Circuits requesting a stay, in which the petitioners outlined the irreparable economic harm that would be suffered if the ETS remained in effect. On November 6, 2021, the Fifth Circuit, in a per curiam decision, issued an order staying OSHA’s mandate pending further action of that court.

On November 12, 2021, the Fifth Circuit issued a sweeping order continuing its initial stay of the ETS. The Fifth Circuit found the ETS “imposes a financial burden upon [private employers] by deputizing their participation in OSHA’s regulatory scheme, exposes them to severe financial risk if they refuse or fail to comply, and threatens to decimate their workforces (and business prospects) by forcing unwilling employees to take their shots, take their tests, or hit the road.” The Order is silent as to whether it applies only to the Firth Circuit, but the petitioners did not limit their request to any jurisdiction.

While the ETS is stayed, employers do not have to comply with the terms outlined by OSHA. However, employers should continue to monitor the legal developments and begin preparing policies and procedures for compliance with the ETS should the stay be lifted.