U.S. President Joe Biden presents an update on the Covid-19 vaccination and response program at the Roosevelt Hall at the White House in Washington, DC on October 14, 2021.
Nicholas Camm | AFP | Getty Images
Concerned that the introduction of the Covid vaccine by President Joe Biden to private companies could cause a massive exodus of employees, business groups are pleading with the White House to postpone the rule until the end of the holiday season.
White House officials in the Office of Management and Budget held dozens of meetings with trade unions, industry lobbyists and individuals last week as the administration is finalizing a mandate review that will require businesses with 100 or more employees to ensure they are vaccinated. against Covid or weekly virus testing. It is estimated to cover approximately two-thirds of the private sector workforce.
OMB officials are scheduled to hold several meetings with groups representing dentists, trucking companies, recruiting companies and realtors on Monday and Tuesday.
Retailers are particularly worried that the mandate could trigger a spike in resignations, exacerbating staffing problems at businesses that are already understaffed, said Evan Armstrong, a lobbyist for the Retail Industry Leaders Association.
“As you know, it has been a hectic vacation season with supply chain problems,” Armstrong told CNBC after meeting at the White House last Monday. “This policy is difficult to implement. It will be even more difficult during the holiday season. “
Thirty percent of workers said they would quit their jobs without following vaccine or testing guidelines. according to a KFF poll published last month… Goldman Sachs, in an analysis released in September, said the mandate could hurt an already tense job market. However, it says that poll responses are often exaggerated and not many people actually quit.
The Occupational Safety and Health Administration presented its final OMB rule on October 12, and this mandate is expected to take effect shortly after the agency completes its review.
Last week, the National Retail Federation and a group of retail leaders asked White House officials in meetings to give businesses 90 days to fulfill their mandate. – the transfer of the effective date no earlier than the end of January, lobbyists said.
The Business Roundtable told CNBC that it supports the White House’s vaccination efforts, but the administration “must provide the time it takes employers to meet requirements, including with regard to employee retention, supply chain issues and the upcoming holiday season.”
United States Chamber of Commerce, who met with OMB on October 15, also asked the administration to postpone the implementation of the rule until the end of the holiday season. OMB officials declined to comment.
However, former OSHA employees, which will enforce the mandate, told CNBC that businesses are likely to have some time to implement the rules.
Jordan Barab, OSHA’s deputy assistant secretary for the Obama administration, said the administration is likely to give businesses about 10 weeks, as it did with federal contractors, before fully vaccinating employees.
However, for weekly testing, the compliance date may come earlier, he said.
“OSHA has always had provisions where necessary equipment, for example, could be in short supply to suspend performance if the employer can prove that it made a good faith effort to acquire the equipment,” Barab said. “They can set a relatively early date for weekly testing, but they will also provide additional time in case supplies are insufficient.”
The National Manufacturers Association, in a letter to OMB and OSHA chief James Frederick last Monday, asked the administration to exempt businesses from requirements if they have already met corporate requirements or achieved a certain level of employee vaccination through voluntary programs. if certified by a local public health agency.
Robin Burstling, Producer Group Lead Lobbyist, called federal requirements “unnecessary and costly” for companies that already support vaccinations among their employees. Boerstling also expressed concern that companies with just over 100 employees could lose valuable people to competitors that are not mandated.
“A realistic implementation period can provide the workforce planning needed to address the acute shortage of skills and current supply chain challenges, while maintaining the need to keep production open and operational,” Burstling wrote in a letter to the administration last Monday.
Industry lobbyists have also raised concerns about the cost of testing and who will cover those costs. The Retail Leaders Association believes that employees who choose not to vaccinate should pay for their weekly testing.
“If people are allowed to refuse vaccinations and the employer is committed to testing in terms of costs, then these employees have no real motivation to get the vaccine,” Armstrong said. With an estimated 4 million unvaccinated retail workers, testing costs will rise rapidly, he said.
However, Barab said OSHA typically requires employers to cover the cost of equipment and procedures required by its regulations throughout the agency’s 50-year history.
Industry concerns about the impact of Biden’s vaccination mandate on employment came after a record 4.3 million workers quit their jobs in August, the highest turnover in 20 years. Retail trade was particularly hard hit, with 721,000 workers leaving their jobs.
Goldman Sachs says the mandate will actually boost employment by reducing Covid transmission and reducing health risks that have been a barrier to labor force participation, encouraging the return of many of the 5 million workers who left the labor market in the wake of the pandemic.
Global supply chains are also under strain amid rising demand for durable goods linked to the pandemic, factory closures in places like China and Vietnam, and a shortage of truck drivers and skilled movers on the West Coast.
The White House acknowledges that there is little it can do to address macroeconomic issues such as demand growth and overseas factories. But he recently took steps to help, such as cutting a deal to keep major West Coast ports open 24 hours a day, seven days a week.
“We already have supply chain problems; we already have talent shortages, ”Ed Egi, lead lobbyist for the National Retail Federation, told CNBC after the group met with OMB last Tuesday. “This mandate cannot be realized in 2021 without serious implications for the American economy.”
– CNBC’s Nate Rattner and Christina Wilkie contributed to this report.