Government Contractor Q&A: Impact of Nationwide Injunction Prohibiting Enforcement of Federal Contractor Vaccine Mandate

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Scott ArnoldJustin A. Chiarodo, and Stephanie M. Harden

Stephanie Harden's Headshot Photo

Yesterday the U.S. District Court for the Southern District of Georgia issued a preliminary injunction against enforcement of Executive Order (“EO”) 14042, under which prime contractors and subcontractors are required to ensure that all of their employees working “on or in connection with” covered federal contracts are fully vaccinated against COVID-19 (“Vaccine Mandate”). The order was issued in a lawsuit filed by the States of Georgia, Alabama, Idaho, Kansas, South Carolina, Utah, and West Virginia; governors of several of those states; and various state agencies that challenged the Biden Administration’s authority to issue the Vaccine Mandate. In its decision, State of Georgia, et. al. v. Biden, No. 1:21-cv-163, the court agreed with the plaintiffs’ argument that the Administration improperly relied on the Federal Property and Administrative Services Act (“FPASA”) to issue the Vaccine Mandate, concluding that the FPASA’s authorization for the President to impose policies to promote economy and efficiency in procurement did not extend to polices focused primarily on public health.

What is the immediate effect of the preliminary injunction?

For now, the executive branch is prohibited from enforcing the Vaccine Mandate included in EO 14042. Because all the new provisions in the FAR and agency FAR supplements imposing the Vaccine Mandate are predicated on directives in EO 14042—an Executive Order that the court found to be beyond the Administration’s authority—it appears that, at least for now, these Vaccine Mandate provisions in the FAR and agency FAR supplements are similarly unenforceable.

Does the decision impact all federal government contracts including the Vaccine Mandate provisions?

Yes, the court issued a nationwide injunction. This renders inoperative, for as long as such an injunction remains in place, any contract clauses that require federal contractor and subcontractor employees to be vaccinated by January 18, 2022. Such clauses, whether contained in contracts awarded after EO 14042 was issued, or imposed through modifications to pre-existing contracts, now appear to be unenforceable.

Why did the court issue a nationwide injunction when only seven states filed suit?

After the lawsuit was filed, additional parties moved to intervene and present their own arguments as to why the Vaccine Mandate was improperly imposed. One of these parties, Associated Builders and Contractors, Inc., a trade organization with members “all over the country” (“ABC”), was allowed to intervene, and its motion for preliminary injunction, along with an amended motion for preliminary injunction filed by the original plaintiffs, were each granted. The court decided that, based on the breadth of ABC’s membership, the large number of contracts plaintiffs are involved in, and the fact that EO 14042 applies not only to prime contractors but to “subcontractors and others, limiting relief to only those before the Court would prove unwieldy and would only cause more confusion.” Accordingly, the Court concluded a nationwide preliminary injunction was necessary.

What should contractors who were, or may have been, subject to the Vaccine Mandate do in light of this decision?

It is too soon to tell what this decision ultimately means for the Vaccine Mandate. The Administration will likely appeal and could ask the court to stay the preliminary injunction while an appeal is pending. So it is possible that the Vaccine Mandate could return, although, even if it does, the current January 18, 2022 deadline for full vaccination will likely need to be extended.

For now, contractors should:.

    1. Refrain from taking any employment action based solely on EO 14042.
    2. Continue to follow the laws (i.e., state and local) remaining in force and be aware that agencies may still require vaccination for contractor employees who will perform on site at federal facilities.
    3. Continue to follow corporate policies regarding COVID-19 safety (e.g., encouraging vaccinations, physical distancing, telework policies, etc.).
    4. Resist the inclusion of Vaccine Mandate clauses in new prime contract actions.

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