COVID-19 Lingering Effects on Government Contracting: New Guidance
November 29, 2022
By Brett W. Johnson and Mary Colleen Fowler
Although not receiving much media attention, in October 2022, the nationwide injunction on Executive Order 14042, Ensuring Adequate COVID-19 Safety Protocols for Federal Contractors (the “EO”) was lifted. The injunction, issued by a federal court in Georgia in December 2021, barred agency enforcement of the EO’s mandatory vaccine requirement for federal contractors.1 Even with the lifting, new guidance by the federal government on COVID-19 mandates related to contractors may impact current and future contract performance.
As way of background, in August, the U.S. Court of Appeals for the Eleventh Circuit held that the injunction should be narrowed to specific states—Alabama, Georgia, Idaho, Kansas, South Carolina, Utah, and West Virginia—to a specific industry group—federal contracts and subcontracts with members of the Associated Builders and Contractors—and in the narrow situation when deciding whether to grant a contract to those specific members or to other contract bidders. 2
On October 19, the Safer Federal Workforce Task Force (the “Task Force”) announced that the Office of Management and Budget (“OMB”) issued new interim guidance addressing the lifting of the nationwide ban.3 The guidance serves as a placeholder until the Safer Federal Workforce Task Force updates its original guidance for agencies.
Meanwhile, OMB guidance to federal agencies recommend the following steps that may impact contracting officer decisions related to contract performance:
- Agencies should not enforce any contracts with clauses implementing the EO. This applies regardless of the party or jurisdiction involved.
- Agencies should not modify existing contracts to include clauses implementing the EO. This applies for any contract renewals, term extensions, new purchase orders, or exercise of a contract option.
- Agencies should not require clauses implementing the EO for new solicitations, including any new orders to be issued under existing indefinite delivery/indefinite quantity contracts.
Currently, the Task Force is updating its guidance concerning COVID-19 safety protocols for covered contractor and subcontractor workplaces. Once the Task Force issues its guidance, it also will provide protocols for implementation of the clause, as well an expected timeline for contractor compliance. The OMB will review the Task Force’s guidance to ensure it “promotes economy and efficiency in Federal contracting” and provide further guidance for agencies going forward.
Notably, the OMB expressly states that the interim guidance does not change vaccine requirements related to federal government worksites. This means federal contractors must continue to comply with federal government worksite COVID-19 protocols. Specifically, “contractor employees working onsite in those facilities must still follow those Federal agency workplace safety protocols.”
Contractors should review current policies, related justifications, and develop a potential plan of action to address the new updates and potential implementation of the EO. Specifically, contractors should consider whether costs have already been expended related to the mandate compliance for which an equitable adjustment may be appropriate. Furthermore, contractors should seek clear guidance from contracting officers as to what controls the contract performance. If a contracting officer intends to follow the OMB guidance, then it may be appropriate to ensure this is followed by a contract modification for purposes of clarity, as the contract terms will always control performance. Finally, companies may want to consider providing guidance to employees as to updated expectations related to the mandate and direct to support to federal government agencies to avoid ambiguities and misunderstandings. Businesses, including federal contractors, should work with their counsel to keep abreast of developments as the COVID-19 vaccine mandate legal cases proceed.
Georgia v. Biden, 574 F.Supp.3d 1337 (S.D. Ga. 2021).
Georgia v. President of the U.S., 46 F.4th 1283 (11th Cir. 2022).
The OMB’s guidance is available at https://www.saferfederalworkforce.gov/downloads/OMB%20Guidance%20for%20Agencies_EO%2014042_20221019.pdf
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