On September 9, the White House announced Executive Order 14042, which requires covered federal contracts to include a clause mandating compliance with guidance that had yet to be issued by the Safer Federal Workforce Task Force (Task Force). On Friday, the Task Force released its much-anticipated guidance.

Covered Contracts

At the outset, it is important to note that not all federal contracts or contractors will be subject to the Order. The following federal contract or subcontracts are covered by the Order:

• Procurement contracts for services, construction, or a leasehold interest in real property

• Contracts for services covered by the Service Contract Act, 41 U.S.C. § 6701, et seq.

• Contracts for concessions

• Contracts 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

For contracts that fall under one of these covered categories, there are five exceptions to coverage that could apply. The Order does not apply to:

• Grants

• Contracts or agreements with Indian Tribes

• Contracts whose value is equal or less than the simplified acquisition threshold defined in the Federal Acquisition Regulation (generally $250,000)

• Employees performing work outside the United States

• Subcontracts solely for the provision of products

In general, federal contracts solely for the provision of products, as opposed to services, are likely not covered by the Order. However, each contract should be reviewed on a case by case basis before making this determination.

If covered, the Order requires all new federal contracts and “contract-like instruments” to include a clause reflecting that the contractor and any subcontractors will comply with the Task Force Guidance (the “Guidance”). “Contract-like instruments” includes subcontracts, solicitations for federal contracts, extensions and renewals of federal contracts, the exercise of options in existing federal contracts, and other such materials. The Guidance directs that the Order’s requirements must be “flowed down” by the contractor to first-tier subcontractors, who then must “flow the clause” down to the next lower-tier subcontractors, and so on, until the point at which the subcontracts are solely for the provision of products.

The required clause will be incorporated into new covered contracts starting on November 14, 2021, with solicitations for such contracts including the clause language beginning October 15, 2021. The clause will be incorporated into covered contract extensions, renewals, and options starting October 15, 2021.

Even if the Order does not apply to a contractor’s contracts or subcontracts, a contractor may not be entirely free from its requirements. The Guidance directs that federal agencies are “strongly encouraged to incorporate a clause requiring compliance with this Guidance into contracts that are not covered or directly addressed by the order.” Pursuant to this language, some federal agencies are likely to do just that, and begin to voluntarily incorporate the required clause into new contracts that are being entered into, or extensions, renewals, or exercise of options in existing contracts, or routine transactional documents related to contract fulfillment, such as purchase orders.

Complying With the Vaccination Mandate

The vaccination compliance clause will be incorporated into covered contract extensions, renewals, and options starting October 15, 2021, and will be incorporated into new covered contracts starting on November 14, 2021 with solicitations for those new contracts including the clause language beginning October 15.

Pursuant to said clause, covered contractors must ensure that all “covered contractor employees” are fully vaccinated for COVID-19 by December 8, 2021, or the first day of performance of the contract, whichever later occurs, unless the employee is entitled to a legal exemption from the requirement.

“Covered contractor employees” is defined as “any full-time or part-time employee of a covered contractor working on or in connection with a covered contract or working at a covered contractor workplace.” A “covered contractor workplace” is a location controlled by the contractor at which an employee working “on or in connection with” a covered contract is likely to be present during the contract’s performance. Significantly, work performed “in connection with” a covered contract includes work that is necessary to the performance of the contract, even if the employee is not directly engaged in performing the specific work called for by the contract; the Guidance lists examples as potentially including employees working in human resources, billing, and legal review.

Employers with remote employees should note that “workplace” as used in this context does not extend to employees’ homes. Thus, the vaccination mandate does not apply to members of the household of a remote employee who is working on an applicable contract. However, remote employees who work “on or in connection with a covered contract” must themselves be fully vaccinated.

Exceptions to Vaccination Mandate

Exceptions to the vaccination mandate exist if accommodations are needed based on a medical reason or religious objection. Requests for “medical accommodation” or “medical exceptions” should be treated as disability accommodation requests. The contractor is responsible for ensuring compliance with the vaccination requirement, and must review covered employees’ documentation to prove vaccination status, or document the applicable accommodations.

In addition, federal agency heads are permitted to approve an exception to the vaccination requirement for contracts that fill an “urgent, mission-critical need” for the agency. Under this exception, covered employees would be required to become fully vaccinated within 60 days of beginning work on the contract, and, starting at the outset of the contract, must be masked and physically distance if not fully vaccinated.

Masking and Physical Distancing Requirements

The Guidance provides that covered contractors must adopt masking and physical distancing procedures at covered contractor workplaces, and follow all applicable CDC guidelines. These requirements apply to both the covered contractor’s employees and any visitors to the workplace.

CDC requirements vary based on community transmission level, specifically:

• Regardless of community transmission level, individuals who are not fully vaccinated must wear a mask indoors, in crowded outdoor settings, and during outdoor activities that involve sustained close contact, and maintain a distance of six feet.

• In areas of low or moderate community transmission, fully vaccinated individuals do not need to wear masks in indoor settings.

• In areas of high or substantial community transmission, fully vaccinated individuals must wear masks in indoor settings, but are not required to socially distance.

To comply with the masking and physical distancing rules, the contractor must check the CDC’s COVID-19 Data Tracker County View website at least once each week to determine the level of community transmission for its worksites.

If a community transmission level increases from one level to the next, the contractor must immediately adopt procedures consistent with the higher transmission level. However, if the transmission level decreases to “low or moderate” community transmission, the guidance directs that contractors should not alter procedures until the lowered level has been in place for at least two weeks.

Any area of a building, site, or facility controlled by the contractor is a “covered contractor workplace” if an employee working on or in connection with a covered contract is likely to be present in said area during the performance of the contract, unless the contractor can “affirmatively determine” that no employees on another floor, in separate areas of the building, or in another building “will come into contact with a covered contractor employee during the period of performance of a covered contract.” This includes in common areas such as lobbies, security areas, elevators, stairwells, meeting rooms, kitchens, dining areas, and parking garages.

According to the Guidance, accommodations related to mask wearing can be approved by the contractor in some cases based on medical reasons or religious objection. Furthermore, contractors can make certain exceptions to mask-wearing if consistent with CDC guidance, such as for those who will be alone in an enclosed office with floor-to-ceiling walls, engaging in activities that may make the mask wet, in high intensity activities where the wearer will have difficulty breathing, or for health and safety reasons.

Designation of COVID-19 Workplace Safety Coordinator

Finally, the Guidance directs covered contractors to designate a person or several people to coordinate the implementation and coordination of the vaccination requirement, workplace safety protocols, and any applicable CDC requirements. This function need not be a stand-alone position and can be performed in addition to an employee’s other duties. The coordinator must ensure information on appropriate protocols is communicated to employees and visitors, and must also ensure compliance with the vaccination requirements.

Penalties for Non-Compliance

The Guidance and applicable FAQs are conspicuously silent on specific penalties or consequences arising from a contractor’s violation of the Order. The omission may be intentional to afford the government some flexibility in enforcement, but that is unclear at this time. Consideration of potential consequences of non-compliance should be a part of a contractor’s decisionmaking, in consultation with counsel, if appropriate, as to whether to enter into or continue on with federal contracts or subcontracts containing Executive Order 14042-required language.