SCOTUS Stays OSHA ETS But Allows CMS Mandate to Proceed

January 13, 2022 | by Jennifer Hataway Kara E. Shea

The wait is finally over. Today, January 13, 2022, the Supreme Court of the United States (SCOTUS) rendered two much-anticipated opinions announcing whether federal regulations mandating workplace COVID-19 precautions should be stayed pending a definitive decision on the merits of each.

In National Federation of Independent Business v. Department of Labor, Occupational Safety and Health Administration, SCOTUS held that the Occupational Safety and Health Administration (OSHA)’s Emergency Temporary Standard (the ETS), which generally requires employers of 100 or more employees to require vaccination or weekly COVID testing of their employees is stayed pending the disposition of the case on the merits.

Although SCOTUS blocked the implementation of the ETS, in a related decision, Biden v. Missouri, it allowed the Centers for Medicare and Medicaid Services (CMS) vaccine mandate (the CMS Mandate), which requires vaccination of all healthcare workers at certain CMS-covered facilities, subject to religious and medical exemptions, to stand and be enforced while it is being litigated in the lower courts. This article will focus only on the ETS; however, our healthcare clients can read more about the CMS Mandate and the impact of today’s decisions on health care providers in this article by Butler Snow’s healthcare group.

Path to the Supreme Court 

It is important to understand the ETS’ unusual path to SCOTUS. As you will recall, on Nov. 4, 2021, OSHA issued an emergency temporary standard (ETS) requiring all private employers with 100 or more workers to mandate vaccinations or implement a mask and weekly testing policy for unvaccinated workers. Various organizations immediately filed suit contesting OSHA’s authority to issue the ETS. The ETS was temporarily stayed by the Fifth Circuit on November 6, 2022.

When the legal challenges were consolidated in the Sixth Circuit, a three-judge panel dissolved the Fifth Circuit’s stay of the ETS. Following this surprising decision, OSHA announced that the ETS would go into effect on January 4, 2022, but that it would delay issuing citations for non-compliance with its testing requirements until February 9, 2022 and with its other requirements until January 10, 2022. Writs were immediately filed with SCOTUS and employers were left wondering whether to begin taking steps to comply with the ETS or risk waiting on a decision.

Justice Brett Kavanaugh took the almost unprecedented action of not deciding the immediate stay issue himself, but instead referred the stay request to the full Court. In an unusual emergency proceeding, all of the justices heard oral arguments on Friday, January 7, 2022, concerning legal challenges to the ETS. Specifically, the challengers argued that OSHA overstepped its statutory authority when it issued the ETS and asked SCOTUS to reimpose a stay of its enforcement.

The Decision – A Stay of the ETS Is Justified

In its nine-page per curiam opinion, SCOTUS held that the challengers were likely to succeed on the merits of their claim that OSHA lacked the authority to impose the mandate. The Court stated that ordering 84 million Americans to either obtain a COVID-19 vaccine or undergo weekly medical testing at their own expense is “no everyday exercise of federal power” but instead is a “significant encroachment into the lives –and health—of a vast number of employees.”

SCOTUS expressed its view that the OSH Act empowers OSHA to set workplace safety standards, not broad public health measures. SCOTUS was careful to note that OSHA could have authority to regulate occupation-specific risks related to COVID-19 where the virus poses a danger because of the particular features of an employee’s job or workplace. But it held that the ETS, instead, acted as a blunt instrument, drawing no distinctions based on industry or risk of exposure.

The Court addressed the Federal Government’s compelling argument that the ETS would save over 6,500 lives and prevent hundreds of thousands of hospitalizations, but ultimately concluded that in America’s system of government, those “chosen by the people through democratic processes,” not OSHA, must weigh the economic trade off of implementing the ETS. Justices Gorsuch, Thomas and Alito concurred with the opinion and wrote separately to clarify that the question before SCOTUS is not how to respond to the pandemic, but who holds the power to do so. The concurring opinion answered that question with “the State and Congress.” Not unexpectedly, Justices Breyer, Sotomayor and Kagan dissented, and answered that question with “OSHA,” which they described as “an agency charged by Congress with safeguarding employees from workplace dangers.”

What Does the Stay of the ETS Mean for Employers?

So, where does this important SCOTUS decision leave employers? Like most issues surrounding COVID-19, the answer is unclear. What is clear is that the ETS is stayed for now and there will be no penalties for noncompliance with its provisions at this time. As such, employers who scrambled to implement an ETS-complaint policy by the January 10 deadline have the option to leave that policy in place (unless otherwise prohibited by applicable state law) or to withdraw the policy until further direction is provided. Of course, employers must continue to provide a safe workplace for employees under the OSH Act’s General Duty Clause.

As far as the ultimately legality of the ETS, the case will proceed on the merits in the Sixth Circuit. That said, SCOTUS’s decision will likely control the outcome in the Sixth Circuit, given that the majority of SCOTUS has made it very clear that it views the ETS to be unlawful. In addition, the inherently time-limited ETS may expire well before the Sixth Circuit can even review the matter on its merits. To further complicate things, OSHA is continuing to develop a permanent standard, currently due May 5, 2022. However, whether the permanent standard will include the same broad vaccination or testing requirements as the current form of the ETS is unknown at this time.

In the meantime, employers will need to continue to abide by state and local laws pertaining to vaccination, testing, and masking mandates, and other aspects of workplace safety. Employers should seek the latest, state-specific advice in all jurisdictions where they have employees. And health care employers should make sure they understand the ramifications of SCOTUS’s ruling on CMS Mandate for their organizations.

Butler Snow attorneys are happy to assist with these issues if needed.