COVID-19 Vaccines: Questions and Answers for Employers

Amid another wave of COVID-19 cases as virus variants spread in many parts of the United States, vaccination efforts led by federal, state, and local governments and health officials are becoming more urgent. At the same time, questions are arising for employers, including whether and how to support vaccination efforts, whether to mandate vaccination for employees, and potential risks they may face.

Note: The following should not be taken as advice regarding any individual situation. New vaccine developments are occurring rapidly and every employer’s situation is unique. Moreover, the facts and circumstances of every potential workers’ compensation, employment practices liability, and general liability claim, as well as the language in individual policies, will determine coverage. Employers should consult with their brokers, legal advisors, and others on vaccination best practices and potential risks.

How Employers Can Support Ongoing Vaccination Efforts

In December 2020, the Food and Drug Administration (FDA) began granting emergency use authorization for three COVID-19 vaccines. After completing its standard process for reviewing the quality, safety, and effectiveness of medical products, the FDA approved the Pfizer-BioNTech vaccine on August 23, 2021.

As of August 31, more than 174 million people in the United States have been fully vaccinated, according to Marsh's COVID-19 Insights Dashboard. This represents slightly over half of the US population, according to 2020 Census data.

The percentage of people vaccinated in a given area — whether an individual state, a city, or other community — can vary significantly. In addition, new variants and resulting outbreaks are creating confusion over vaccine mandates, potential boosters, and social interaction protocols.

Employers and businesses have an important role to play. Even as government and public health officials continue their efforts to vaccinate more people, businesses should be considering their options to support and enable the vaccination of their employees. As they do so, employers should carefully consider a variety of questions related to their risks, responsibilities, and rights — as well as those of their employees — and how they can address potential challenges that could arise as vaccination efforts proceed.

First, employers should focus on communication. Employers — and employees — can benefit from strong communication campaigns that keep employees informed about important COVID-19 safety and vaccination effort decisions. Such campaigns provide an opportunity to reiterate best practices recommended by the Centers for Disease Control and Prevention (CDC), such as wearing masks indoors in areas of substantial or high transmission even after vaccination. Campaigns should direct employees to reliable resources, such as the CDC website and local health authorities, where employees can learn about the safety and efficacy of vaccines, potential side effects, and answers to common questions.

As employers make these plans, the following are a sampling of frequently asked questions for risk professionals and others to consider.

What stakeholders should be involved in employers’ decisions related to COVID-19 vaccination mandates?

Internal stakeholders should include risk management, health and safety, human resources, legal, marketing and communications, operations teams, and medical personnel, if available. If applicable, employers should also ensure they receive input from unions, external medical providers, employee assistance program administrators, outside counsel, and benefits advisors.

Can employers in the US require their employees to be vaccinated for COVID-19?

Generally speaking, an employer can mandate that employees and applicants receive the COVID-19 vaccine, subject to some very important exceptions.

Under Title VII of the Civil Rights Act of 1964, employers are required to provide reasonable accommodations to employees whose sincerely held religious beliefs prevent them from getting a vaccine. Similarly, the Americans with Disabilities Act (ADA) requires employers to provide reasonable accommodations to employees with underlying disabilities that prevent them from being vaccinated. In formulating vaccination medical screening questions, employers should also be mindful of Title II of the Genetic Information Nondiscrimination Act of 2008, which prohibits an employer or a doctor on behalf of an employer from asking questions about genetic information.

In July — prior to the FDA’s approval of the Pfizer-BioNTech vaccine — the Department of Justice Office of Legal Counsel published its opinion that the Food, Drug, and Cosmetic Act “does not prohibit public or private entities from imposing vaccination requirements for a vaccine that is subject to an emergency use authorization.”

Some employers have publicly stated their plans to require vaccines among all or some of their employees — and, in some cases, customers and others on company premises. Several states are also requiring government employees and/or health workers to be vaccinated, with some requiring those who opt out to undergo regular testing.

What considerations should inform employers’ decisions to mandate COVID-19 vaccinations for employees?

An employer’s decision as to whether it should mandate COVID-19 vaccination will necessarily be informed by myriad considerations and should be made in consultation with in-house and outside counsel. Employers should be mindful that any decisions to mandate vaccination may require consultation and bargaining with any unions that represent their employees.

Key considerations for employers include:

• Logistical constraints around supply.
• Distribution and administration challenges.
• Evolving public health policy.
• Potential employee concerns about vaccines.
• Local community considerations.

Employers should also be mindful of the positions other employers are taking. Nearly 30% of US employers surveyed in early August by Mercer currently require or are planning to require that their employees be vaccinated for COVID-19 before engaging in certain work-related activities. This includes 14% that require or are planning to require that all employees returning to their worksites be vaccinated.

The bottom line is that various legal and HR considerations will affect each workforce differently. There is no one-size-fits-all approach, and public perception and sentiment among employees and employers is changing on a daily basis.

Can employers encourage and incentivize their employees to be vaccinated?

Employers can both encourage and incentivize vaccinations. Employers may be considering hosting vaccination clinics in the workplace, but this is easier said than done. As such, employers should consider additional steps to encourage vaccination. For example:

• Establishing policies that allow employees to take paid leave to seek COVID-19 vaccination elsewhere in the community.
• Supporting transportation to offsite clinics.
• Sharing information with employees about the importance of the COVID-19 vaccination.
• Announcing community locations offering the vaccination.

Employers can also incentivize vaccination by providing paid time off for recovery from side effects and by offering cash or non-cash incentives to employees who get vaccinated. They must, however, be mindful of the appropriate tax treatment of these incentives, as well as ERISA compliance, reporting, HIPAA privacy, and ACA requirements, particularly if more than a de minimis incentive is being considered.

Some cash payments in exchange for vaccination may be problematic; if a proposed payment is so large that it could appear coercive, it may no longer be considered an “incentive.” It is also important to be mindful of potential discrimination claims that could arise — for example, if an employee is medically unable to be vaccinated due to a disability and is thus denied an employment advantage.

Are employers required to pay employees for their time while being vaccinated?

Generally speaking, the time spent receiving a vaccine should be paid if the vaccination is provided on premises and during work hours. Even if vaccination is provided offsite or outside of work hours, the time involved might still be compensable if vaccination is integral and indispensable to the employee’s principal activities with the organization.

This analysis has both federal and state law implications, and depends on a number of factors, including whether vaccination is required by the employer, the jurisdiction in which the employer operates and the employee resides, the employee’s role and job duties, and whether there are any employer requirements around timing and requirements of vaccination. As with most analyses bearing on wage and hour practices, employers should consult legal counsel to determine their obligations.

Are employers required to establish COVID-19 vaccination programs?

Not under federal law. But employers should verify whether they are subject to any relevant state or local requirements.

What side effects and adverse reactions have reportedly been associated with the COVID-19 vaccines?

Common reactions to COVID-19 vaccines reported to date include pain and swelling at the injection site — typically the upper arm — along with headaches, fatigue, and muscle aches. These symptoms are commonly associated with other vaccines, such as the flu vaccine, and typically represent an immune reaction to the vaccines rather than infection or illness.

Fever and nausea have also been reported, but in smaller numbers. Public health officials are monitoring for the occurrence of any serious adverse effects, including allergic reactions to mRNA vaccines, as vaccination efforts continue. More information can be found on the CDC website.

Can an employee’s adverse reaction to a COVID-19 vaccine be considered a compensable workers’ compensation claim?

If an employer mandates that employees be vaccinated, a workers’ compensation claim filed by an employee with an adverse reaction could potentially be found compensable, as vaccination might be seen as a requirement for work.

If an employer offers vaccination and potentially advertises its availability through company emails and signage, an employee that files a claim for an adverse reaction might potentially be granted workers’ compensation benefits even if vaccination is voluntary and not mandated by an employer.

Employees who decide to be vaccinated on their own — without any requirement, influence, or advertisement from their employers — might still be able to file workers’ compensation claims due to adverse reactions. To be deemed compensable, however, an employee would likely need to prove that an injury was related and/or connected to the course and scope of employment and meet compensability requirements within the relevant jurisdiction.

In all of the above cases — and as in all workers’ compensation claims — the compensability of a specific claim will be determined by the relevant facts and application of the governing law in the relevant jurisdiction.

Can employer-mandated or sponsored COVID-19 vaccination programs result in employment practices liability exposure for businesses?

Potentially, yes. Even voluntary vaccinations could give rise to claims of discrimination, retaliation, and disparate treatment. It is critical that employers not allow an individual to be stigmatized or harassed for not being vaccinated. Maintaining confidentiality of any information gathered from employees during the screening and vaccination process can help to minimize the risk.

Can an employer ask pre-screening questions before vaccinating employees?

If an employer (or a contractor on its behalf) administers COVID-19 vaccines, the employer will likely need to show that any pre-screening questions are job-related and consistent with business necessity. In order to do so, an employer must show that an employee who refuses to answer pre-screening questions — and therefore cannot receive a vaccine — will pose a direct threat to the health or safety of themselves or others. This requires the employer to conduct an individualized assessment of direct threat.

Importantly, even if an employer must exclude an employee from the worksite under this analysis, that does not necessarily mean that the employer can automatically terminate the employee.

Employers should work with in-house and/or outside employment counsel to carefully and critically examine any pre-screening questions before they are shared with employees.

Should contractors and temporary employees be included in a workplace COVID-19 vaccination plan?

If an employer plans to mandate vaccination or offer vaccination in the workplace, it should consider providing vaccination to all people working there, regardless of their employment status. Often, for workers employed by contract firms or temporary staffing agencies, the firm/agency and the host employer can be deemed joint employers and, therefore, both are responsible for providing and maintaining a safe work environment. To that end, it may be necessary for employers to work with such firms/agencies on any vaccination initiatives.

Ultimately, employers — in consultation with in-house and outside counsel — should take a consistent approach with respect to all onsite personnel, regardless of their individual work arrangement. If an employer is not planning to or is unable to offer onsite vaccinations, it should consider providing information to all individuals at the workplace about how to explore options for vaccination in the community. If not all personnel are vaccinated, failing to require vaccination or proof of vaccination may undermine an employer’s own workforce mandate/direct threat analysis.

Should employees still wear masks and physically distance in workplaces even if a large number of employees are vaccinated?

Yes. New evidence indicates that the delta variant is more contagious than earlier forms of the SARS-CoV-2 virus — and can be spread to others even by fully vaccinated people. As employees return to offices and other workplaces, employers and employees should remain diligent in following best practices to prevent the spread of COVID-19.

Among other steps, employers should continue to:

• Encourage employees to work remotely where feasible.
• When remote work is not possible, employ physical distancing and contact reduction measures on-site. These include enforcing physical distancing requirements, splitting teams up and/or staggering shifts, and introducing automation and voice recognition for basic office functions.
• Screen employees and visitors for COVID-19 symptoms before allowing them to enter workplaces.
• Enforce protocols for employees who are sick at work.
• Require, with rare exceptions, that all people in the physical workplace wear masks.

Will insurance coverage apply if an employee alleges an unsafe workplace as a result of contact with an unvaccinated coworker?

Employers liability claims are typically brought by employees or their family members against employers outside of the workers’ compensation system, alleging intentional acts or gross negligence resulting in injuries. Like workers’ compensation, the relevant jurisdiction is critical: Which civil actions can be pursued against employers differs by state, but most require that an injured employee allege some form of intent to injure for an employers liability claim to move forward.

Any actions related to bodily injury brought by employees or family members outside of the workers’ compensation system should be considered for reporting to employers liability, general liability, and excess liability insurers.

Will insurance coverage respond if an unvaccinated employee is alleged to have infected a customer?

Businesses generally have a duty to act with reasonable care in their dealings with third parties, including customers and vendors. Under most states’ standards, a business may be liable for injury to a third party — including medical costs, lost wages or profits, emotional damage, pain and suffering, or wrongful death — if a damage and causation can be proven. Damages can be sought by injured parties as well as by family members.

In this context, an unvaccinated employee — particularly given the possibility of the virus being spread by asymptomatic individuals — can present some risks for businesses. Organizations should evaluate the direct exposure of any unvaccinated employees to the public, the risk that such employees may expose other employees who are in direct contact with the public, and the risk that the virus may be present on their premises.

It should be noted that to bring a claim against a business, a third party generally must show that the infection occurred on the business’s premises, which may be difficult. In defending such claims, it is important for businesses to show that they have implemented protections against exposure to employees who are not vaccinated, such as remote work, masks, and social distancing, and that the claimant could have been exposed elsewhere.

Some states have passed laws that grant immunity from civil liability for COVID-19-related claims; such legislation is pending in other states.

Will public health systems cover the cost of vaccination? Or will employers be expected to cover the cost directly or through employer-sponsored health plans?

The US federal government is currently overseeing distribution of COVID-19 vaccines and is planning to purchase enough vaccine supplies to cover most — if not all — Americans in 2021. Plan sponsors, however, will be responsible for the cost of vaccine administration (approximately $50 for the administration of two doses). Employers that distribute vaccines on their premises — after receiving it from public health officials at no cost — would similarly be responsible for its administration and any associated costs.

How Marsh Can Help

Marsh colleagues continue to assist businesses in managing a variety of risks related to the pandemic, including addressing vaccination concerns and questions. As vaccination efforts continue, we can support employers in a number of ways, including:

• Advising on their options in encouraging and/or administering employee vaccination and assessing the potential risks they may face in each choice.
• Helping develop vaccine response and communication plans, while also assisting in reducing the risk of COVID-19 exposure in the workplace.
• Helping review applicable insurance policies, including workers’ compensation, employment practices liability, and general liability coverage, to understand how they may respond to various vaccine-related risks.
• In the event of a claim by an employee or third party, assisting in the preparation of filings and management of other critical claim processes.

For more information, contact your Marsh representative.