US Supreme Court stays OSHA vaccine-or-test rule, halting enforcement

Yesterday, the United States Supreme Court reinstated a stay of the Occupational Safety and Health Administration’s (OSHA) COVID-19 Vaccination and Testing Emergency Temporary Standard (ETS). For information about the ETS, please see our prior client alert.

As a result, employers with 100 or more employees covered by the ETS are no longer required to comply with its terms, including the vaccine-or-test rule. While most private employers may still voluntarily adopt such measures, certain state laws – which are not pre-empted by the ETS while it is stayed – may restrict or even prohibit vaccine mandates. At the same time, other states and localities may require certain employers to mandate vaccination and/or regular testing.

Prudent employers considering a vaccine mandate will continue to review and abide by applicable state and local laws, rules and guidance and monitor the ongoing litigation.  

Below we discuss additional background, the Supreme Court’s decision and what employers should watch for next.

Decision to dissolve stay by the Sixth Circuit and enforcement by OSHA

As summarized in our prior client alert, the various legal challenges to the ETS, pending in almost every circuit court of appeals, were consolidated into a single case that was randomly assigned for review to the Sixth Circuit (In Re: MCP No. 165, OSHA Interim Final Rule: COVID-19 Vaccination and Testing; Emergency Temporary Standard 86 Fed. Reg. 16402, No. 21-07000).

In a 2-1 decision on December 17, 2021, the Sixth Circuit granted a request to dissolve the Fifth Circuit’s stay of the ETS, holding that the ETS was likely consistent with OSHA’s statutory and constitutional authority. This controversial decision was immediately met with multiple applications to the Supreme Court.

Following the Sixth Circuit’s decision, OSHA provided employers additional time to come into compliance with the ETS, stating that it would not issue citations for noncompliance with any ETS requirements before January 10, 2022 and would not issue citations for noncompliance with the ETS testing requirements before February 9, 2022, so long as the employer was exercising reasonable, good-faith efforts to come into compliance with the ETS.

The Supreme Court stays OSHA’s ETS

Opponents of the ETS filed challenges to the Sixth Circuit decision with the Supreme Court, and the Court consolidated the challenges and set the ETS for expedited argument (along with the federal vaccine mandate for healthcare facilities regulated by the Centers for Medicare and Medicaid, or CMS). During a special argument session held on January 7, several Supreme Court justices expressed skepticism over the ETS, questioning whether OSHA exceeded its authority in promulgating the ETS.

On January 13, 2022, in what has been characterized as a split decision, the Supreme Court reinstated the stay of the ETS. Invoking the “major questions doctrine,” the Supreme Court concluded that those challenging the ETS are likely to succeed on the merits because, while OSHA indisputably has the power to regulate workplace safety standards and occupational dangers, it does not have the power to regulate public health more broadly. Although COVID-19 is a risk that occurs in many workplaces, a majority of the Supreme Court justices opined that it is not a uniquely occupational hazard, as the virus “can and does spread at home, in schools, during sporting events, and everywhere else that people gather” and that the threat being regulated “is untethered, in any causal sense, from the workplace.”

As such, the Court found that the ETS falls into the category of regulating public health more broadly – which is outside of OSHA’s authority without clear congressional authorization – and granted the applications for stays pending disposition of the applicants’ petitions for review in the Sixth Circuit. As a result, OSHA must immediately cease ongoing enforcement of its ETS.

In a separate decision, the Supreme Court granted the government’s applications to stay two district courts’ preliminary injunctions of the CMS vaccine rule pending disposition of the government’s appeals in the Fifth and Eighth Circuits. The Court agreed with the government that the rule is within the Secretary’s authority to impose conditions on the receipt of Medicaid and Medicare funds that it deems necessary in the interest of the health and safety of individuals who receive services.

Next steps

While the ultimate fate of the “vaccine or test” mandate in ETS remains to be seen, employers subject to the ETS currently are relieved of any compliance obligations related to the ETS. Practically speaking, the ETS may have served its intended purpose of increasing vaccination rates at businesses across the country as many employers instituted mandatory vaccination requirements in advance of OSHA’s January 10 deadline. For these employers, this decision does not require them to cease enforcing or otherwise alter their corporate requirements (although employers are urged to consider the impact of state and local laws).

Employers that deferred compliance with the ETS pending the Supreme Court’s decision are urged to continue to monitor the situation closely.  While highly unlikely, the ETS could be revived again by the Sixth Circuit upon a favorable ruling on the substance of the claims presently before it. However, such decision would likely again trigger appeals to the Supreme Court, which has made known its view of the ETS.

Finally, OSHA could engage in formal rulemaking and publish the ETS as a formal regulation on or before May 5, 2022, or may instead decide to reissue a more targeted or occupation-specific regulation in instances “where the virus poses a special danger because of the particular features of an employee’s job or workplace,” such as “working in particularly crowded or cramped environments,” given the Supreme Court’s observation that such regulation would appear to be “plainly permissible.”

If you have any questions regarding this development or other COVID-19 related requirements, please contact the authors, your DLA Piper relationship attorney, or the DLA Piper Employment group at CoronavirusEmployment@dlapiper.com.

UPDATE 1/25/2022: In the wake of this Supreme Court decision blocking its enforcement, OSHA announced on January 25, 2022 that it is withdrawing its ETS in the advanced version of the Federal Register. As part of the withdrawal announcement, OSHA noted that it will continue to work on a permanent COVID-19 standard. Subsequently, government lawyers filed a motion asking the Sixth Circuit to dismiss the pending legal challenge to the ETS, stating its withdrawal of the rule will make the case moot. By withdrawing the ETS, OSHA avoids the possibility that the Sixth Circuit or the Supreme Court would issue a decision restricting future regulations. For many, particularly employers who deferred compliance with the ETS’s requirements, this clarification as to the mandate’s future or lack thereof is a welcomed resolution, as it has been in doubt since the Supreme Court decision earlier this month. Employers are encouraged to continue to monitor the situation in their states and localities while awaiting the anticipated permanent COVID-19 standard from OSHA.