New OSHA Emergency Temporary Standard for COVID-19
OSHA issued an Emergency Temporary Standard (“ETS”) requiring all private companies with 100 or more employees to implement a COVID-19 vaccination policy ensuring their workforces are either fully vaccinated or undergo weekly testing and wear masks. The effective date of publication of the ETS is November 5, 2021.
The ETS is almost 500 pages and incredibly complex. We expect additional guidance if the ETS survives judicial scrutiny. The ETS requires all private companies with 100 or more employees to be vaccinated or offer the opportunity to undergo COVID-19 testing at least once per week in lieu of being vaccinated. It is important for a private company to understand how to calculate 100 or more employees to determine if it falls within the scope of the ETS.
When is a company covered by the ETS?
Private companies must initially determine the total employee count as of the effective date of the ETS, or November 5, 2021. Should the company have 100 or more employees at any point from November 5, 2021, to the end of the standard in May 2022, then the company must comply with the ETS for the duration of the standard. For example, if an employer has 109 employees on November 6, 2021, and then loses 11 employees, that employer would continue to be covered by the ETS. This is because the employer had 100 or more employees after the effective date of the ETS.
On the other hand, if the employer has fewer than 100 employees, the standard will not apply to that employer. However, if that same employer hires more employees and eventually employs over 100 total employees while the ETS is in place, then the employer is required to comply with the ETS requirements for the entire duration. For example, if the employer has 95 employees and then hires seven employees, that employer would have 102 employees and would have to start complying with the ETS requirements and continue to comply for the remaining duration.
Generally, all employees, including but not limited to remote workers, part-time workers, and seasonal workers, are to be counted towards the threshold. Independent contractors are excluded and should not be counted towards the 100-employee threshold. Keep in mind, the ETS is only effective for six months (May 2022), and then a decision will be made on whether or not to make it permanent.
In addition, under the ETS, employers must have an employment policy that mimics the standards of the ETS at a minimum (mandatory vaccination can be required). In addition, employers must educate employees on the ETS, the importance of vaccines (the ETS cites a CDC document on the benefits of vaccination), the whistleblower standards for non-compliance, and the criminal risks of falsifying vaccination records.
Which workers are not required to comply with the ETS?
Even though the employees mentioned above count towards the total number of employees, there are certain workers who are excluded and do not have to comply with the ETS. Specifically, the ETS does not apply to employees who work from home, employees who work in a workplace without any other individuals present, and employees who work exclusively outdoors (defined as no shared trucks or equipment, de minimis contact with administrative offices, etc. – see https://www.osha.gov/coronavirus/ets/faqs).
How do unvaccinated employees comply with the ETS?
For employees who are unvaccinated, the ETS requires, at a minimum, weekly testing for the entire duration. Employers must ensure those employees undergo weekly COVID-19 testing and promptly provide a negative test result. The ETS does not require companies to pay for the weekly testing. That said, a covered employer must ensure compliance with state laws, regulations, or collective bargaining agreements which may require the employer to cover the costs of COVID-19 testing.
Over-the-counter tests may be used to evidence a negative result but cannot be self-administered and read by the employee – either a healthcare professional or the employer must oversee.
Proof of Vaccination Status
Private companies must develop and implement a vaccination policy or require unvaccinated workers to undergo weekly COVID-19 testing and comply with CDC guidelines, including wearing masks while at work. This means that the employer must obtain proof of vaccination from each covered employee, subject to the previous exceptions identified.
To prove their vaccination status, covered employees may include the immunization record from a health care provider or pharmacy, a U.S. COVID-19 Vaccination Record Card, medical records proving vaccination, among others. Similarly, employers are required to keep evidence of the testing records of unvaccinated employees and a ledger that shows whether employees are vaccinated or subject to weekly testing. All documents referenced above are medical records and, as a result, must be kept strictly confidential.
What happens if covered companies do not comply?
The effective date of the ETS is November 5, 2021. Private companies have the information necessary to determine whether or not the ETS applies. Once employers determine the total count, they must develop and implement a vaccination policy within 30 days to comply with most of the provisions or by December 5, 2021. Similarly, employers have until January 4, 2022, to implement and enforce weekly testing for unvaccinated employees.
As of the drafting of this article, the Fifth Circuit Court of Appeals has issued a temporary stay of the ETS. However, it remains to be seen whether the Court will take permanent action against the ETS. As a result, employers should assume the standard will move forward. At a minimum, employers should carefully review and implement a policy that complies with the ETS requirements, start the education process of training employees, and prepare for the documentation required for the ETS. The risks associated with non-compliance can amount to approximately $14,000.00 per violation (and more for repeated violations).
Recognize that the guidance on this new standard is constantly changing. For more information, please review NRCA’s other resources on the OSHA ETS as well as www.osha.gov.
Spearin Doctrine Influences Recent Case
Lawsuits involving construction projects can be complex, and litigation is often overly expensive. Therefore, many cases do not go to trial. But in recent months, such a lawsuit made its way to the Washington Supreme Court, and on September 2, 2021, that court cited the Spearin Doctrine in its ruling.
Understanding the Spearin Doctrine
The Spearin Doctrine originated from a lawsuit in the early 1900s. The United States hired a contractor named Spearin to build a dry dock and relocate a storm sewer at the Brooklyn Navy Yard. Spearin followed the plans that the U.S. government provided and relocated the sewer. However, the sewer system later backed up and flooded the dry dock excavation site. After an investigation, a dam was discovered within the sewer system that was not shown on the plans, and that dam caused water to divert to the section of sewer that was relocated. The government claimed that Spearin was at fault and should make the repairs. He was willing to make the repairs if the government paid him to do so and revised the design. Instead, the government hired another contractor to do the remaining work.
In reaction, Spearin filed a lawsuit against the U.S. government for wrongful termination and lost profits. The Court of Claims ruled in favor of Spearin, as did the U.S. Supreme Court after appeal. In United States v. Spearin, 248 U.S. 132 (1918), the Supreme Court ruled that contractors are responsible for completing projects per plans that clients provide and are not liable for issues resulting from inaccurate plans.
Today, per the Spearin Doctrine, project owners on design-bid-build projects (also known as traditional fixed sum contracts) impliedly warrant that provided plans and specifications are suitable and accurate. Therefore, if contractors build according to those plans, they are not responsible for any defects.
The Washington State Case
The case heard by the Washington Supreme Court involved Lake Hills Village, a development project located in Bellevue, near Seattle. This project involved several structures, including townhouses, commercial buildings, mixed-use buildings, and a public library. During construction, the owner accused the contractor of doing defective work. However, the contractor countered that the construction defects were due to the owner’s incomplete and defective design plans. The dispute continued when the owner refused to pay millions of dollars in progress payments and filed a lawsuit for breach of contract. The contractor then filed a claim for breach of contract as well.
During the trial, the owner stated that the contractor was liable for defective work and delays totaling $16 million. In response, the contractor claimed it was due payments totaling more than $5 million. The contractor also cited the Spearin Doctrine, arguing that due to faulty plans provided by the owner, it was protected from liability for the defects. After a two-month trial, the jury offered a mixed verdict, but the net judgment was more than $9 million for the contractor.
The Case on Appeal
The Lake Hills Village owner appealed the decision and argued that some instructions to the jury were questionable. Specifically, the owner complained that the Spearin Doctrine dictates the defect must “solely” be the result of inaccurate plans supplied by the owner. However, the instructions to the jury did not include the word “solely”—which could imply that the contractor might be partially at fault and still not be liable—so the owner believed the ruling was unjust. The appeals court agreed, reversed the verdict, and remanded for a new trial.
The case was then reviewed by the Washington Supreme Court, which disagreed with part of the appellate court’s decision. The Supreme Court conceded that the instructions to the jury could have been misleading, but the jury’s ruling was not prejudiced. It therefore reversed the appellate court remand for a new trial. At that point, the case was sent back to the appellate court to rule on attorney fees.
What This Means for Future Cases
The Washington Supreme Court explained that the Spearin Doctrine was applicable in this case because if an owner provides a faulty design or plan, a contractor should not be liable for damage due to the defective design. However, the damage must be “solely” caused by the inaccurate design. If the defect is partially due to contractor error, the liability is shared between both parties.
Even 100 years later, the Spearin Doctrine has been proved to be a fundamental tenet of construction law. In this case, the Supreme Court reaffirmed the doctrine and upheld the jury decision. Owners will undoubtedly take notice of this decision and should remain vigilant regarding design plans and their accuracy. Meanwhile, contractors are advised to know their rights when owners provide project plans and understand when they are liable and when they are not.
Shipping and Fuel Charge Price Increase Provision
As the current supply chain crisis continues, many contractors are seeing higher prices for shipping and trucking costs associated with the delivery of materials. These increased fees are unexpected and can impact your bottom line. By inserting the following provision in your contracts, you can ensure that you will not be held responsible for those increased costs. Instead, they will be passed along to your customers.
Due to current shipping and trucking volatility experienced nationwide, if there is an increase in the actual cost of shipping and/or trucking materials in excess of 5% subsequent to the making of this Agreement, the price set forth in this Agreement shall be increased without the need for a written change order or amendment to the Agreement to reflect the price increase and additional direct cost to the Contractor. Contractor will submit written documentation of the increased costs to Customer upon request; however, Customer acknowledges that any additional costs associated with shipping and/or trucking charges under this Agreement are the sole responsibility of Customer, and Contractor shall not be held liable or responsible for same.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.