The COVID-19 vaccine mandate debate: Factors every employer must consider

The COVID-19 vaccine mandate debate: Factors every employer must consider | Insurance Business America

The COVID-19 vaccine mandate debate: Factors every employer must consider

The Biden administration introduced a new COVID-19 Action Plan on September 09, called ‘The Path Out of the Pandemic,’ which includes measures to reduce the number of unvaccinated Americans through regulatory powers and authorities.

President Biden has signed two Executive Orders that will require COVID-19 vaccinations for all federal workers and contractors. He has also instructed the Department of Labor’s Occupational Safety and Health Administration (OSHA) to draft regulation that would require all companies with 100 or more employees to ensure their workforce is fully vaccinated. Any employees that receive accommodations and do not have to take the vaccine will have to produce a negative COVID-19 test result on at least a weekly basis.

For employers, the decision on whether to mandate COVID-19 vaccination is highly complex and fraught with exposures and liabilities. There have already been several high-profile lawsuits, including a case against United Airlines, which mandated vaccination and planned to put employees with medical and/or religious exemptions on leave (in most cases, unpaid). Approximately 97% of United’s 67,000-peson workforce complied with vaccine mandate, but six exempted workers challenged the policy in a federal lawsuit in Texas. Meanwhile, lawsuits against employers who haven’t implemented COVID-19 vaccination policies, or suitable alternative health and safety measures, are likely waiting in the wings.

“The issue of vaccination is very sensitive, mainly because it’s a new vaccine and nobody fully understands the degree that it’s going to affect people,” said Alex Maza, national management liability director at Risk Strategies. “It’s been bifurcated in terms of some people being fully onboard and they’re happy to take the vaccine, while others are against it for various reasons, whether they have underlying health issues, it goes against their religious beliefs, or they’re wary about the unknowns relating to the vaccine itself. There are people on both sides that have strong beliefs one way or another.”

Read next: What are the concerning trends in D&O insurance?

Even before the Biden administration ordered OSHA to produce a vaccine decree, many employers decided to mandate COVID-19 vaccinations because they felt it was in the best interest of their business – especially in sectors like retail, hospitality, healthcare, and manufacturing, where they often have a large number of employees congregated on-site. Before vaccines became widely available, many companies in these hard-hit sectors had to furlough or layoff employees due to the impacts of the pandemic on their businesses. One idea behind mandatory vaccination is to prevent the risk of a large part of their employee base falling sick with COVID-19, being out of work, and causing further financial strife.

Throughout the pandemic, Maza has been working closely with clients on risk mitigation relating to COVID-19, including advising on considerations employers should make around vaccination, whether they are impacted by OSHA’s incoming vaccine mandate or not.

“First and foremost, they need to make sure that they’re seeking the advice of their legal counsel, before instituting any sort of policies, procedures, or mandates. They really need to have that discussion, so they’re protecting themselves to the extent possible,” Maza told Insurance Business. “For companies that are below that 100 employee threshold, they then need to decide what’s in the best interest of their employee base and their business. And how can they marry the two together?

“If they decide they’re going to require the vaccine mandate for all their employees, they have to make sure that they do it in such a way that it doesn’t seem to be discriminatory or targeting certain segments of their employee base. They have to look at their employee base and understand the demographic. Do they have older employees, or people with potential medical issues that they need to be sensitive to? And if they do mandate vaccines, are they going to provide accommodations for people with religious exemptions, underlying health issues, and for compliance with the Americans with Disabilities Act?”

When employers do provide accommodations for employees with reasonable exemptions, they still have to consider the stance of their fully vaccinated staff, Maza added, who may express discomfort at working in close proximity with unvaccinated employees. This is why it is essential for all employers, whether they require a vaccine or not, to ensure they are providing a safe work environment by following health and safety advice around personal protective equipment, proper sanitation, face masks, and COVID-19 testing.

Read more: EPL underwriting consistency is key amid economic uncertainty

“There are lots of things for employers to take into consideration,” Maza continued. “If they decide not to mandate a vaccination, will they lose current employees? And are those employees replaceable? If not, what will be the financial impact? Can they attract employees that don’t feel comfortable coming into a work environment where they don’t require vaccinations?

“The other thing a company has to take into account if they don’t require vaccinations is that they properly disclose their stance on vaccination to all of their existing and new employees. Going above and beyond, they would probably put it in their employee handbook as one of the policies that they have in place, and list what they’ve done to make the work environment safe. If they don’t even require testing, that’s another thing, from a good risk management perspective, that they probably should think about disclosing, so that employees can’t claim later on that they weren’t advised and then they got sick.”

The big debate around mandatory vaccination has serious implications from an employment practices liability (EPL) standpoint. In the early months of the pandemic, EPL claims were primarily linked to accusations of discrimination and/or wrongful termination around employee furloughs and layoffs.

“Post March 01, 2021, when vaccines really started to be more readily available, we’ve definitely seen an uptick in discrimination claims related to religious beliefs, and also claims where employers haven’t taken into account someone’s unwillingness to get vaccinated because of underlying health issues. Those are some of the claims that we’re definitely starting to see happen,” Maza commented.

“The Equal Employment Opportunity Commission (EEOC), which is the oversight committee for any type of employment litigation, have come out and said that it is legal for companies to mandate vaccinations. And so, the fact that we’re now starting to see suits by certain segments of an employee base, suing their employer for wrongful termination, we’ll see how that plays out. But at the end of the day, a lot of these companies, especially in the healthcare, retail, or hospitality space, have purchased EPL insurance, as they should. So, we’re going to continue to see upticks in these claims, and we’re forecasting they will probably increase in terms of the defense costs that are paid and ultimately the severity of the settlements.”