How President Joe Biden’s vaccine mandate could affect big and small businesses

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Johnny Taylor, Society for Human Resource Management CEO and Lawrence Gostin, and Lawrence Gostin, a Georgetown professor, join ‘Squawk on the Street’ to discuss Biden’s vaccine mandate as the U.S. edges closer to enforcement. For access to live and exclusive video from CNBC subscribe to CNBC PRO: https://cnb.cx/2NGeIvi

Led by Texas Gov. Greg Abbott, Republican-run states are already gearing up to challenge the legality of the Biden administration’s vaccine mandate for private companies before the Labor Department has even published the rules.

President Joe Biden last month directed the Occupational Safety and Health Administration, a tiny agency that polices workplace safety for Labor, to write rules requiring private companies with 100 or more employees to vaccinate their staff against Covid-19 or test those who aren’t at least once a week.

More than 130,000 businesses across the U.S. are bracing for the new rules, which will apply to roughly two-thirds of the private sector workforce. OSHA told CNBC it delivered its proposal to the Office of Management and Budget on Tuesday night.

“Every day, we see more businesses implementing vaccination requirements, and the mounting data shows that they work. Businesses and organizations that are implementing requirements are seeing their vaccination rates rise by an average of 20% or more to well over 90%,” Biden said in addressing the nation Thursday. “Let’s be clear, vaccination requirements should not be another issue that divides us.”

The rule is expected to take effect soon after OMB completes its review. Because it’s being written under emergency procedures, OSHA can shortcut some of the usual regulatory bureaucracy, like a public comment period that would normally delay it by several months. OSHA will likely give companies time to comply with the new mandate before broad enforcement begins, according to Debbie Berkowitz, who served as a chief of staff and senior policy advisor at OSHA during the Obama administration.

Texas

Abbott hopes to preempt the new rules, issuing an executive order Monday that bars any entity from mandating vaccines for people who object on the basis of personal conscience, religious belief or medical reasons, including past recovery from Covid.

Texas-based Southwest Airlines and American Airlines this week said they expect to be subject to federal vaccine mandates. As federal contractors, those carriers have said they are subject to Biden administration vaccine rules that are stricter than the forthcoming OSHA rules.

The sweeping national mandate will almost certainly face more legal challenges. Nearly every GOP state attorney general in the U.S. signed a letter to the president last month vowing to use “every available legal option” to halt the mandate, calling it “counterproductive and harmful.”

“The one-size-fits-almost-all approach you have decreed makes clear that you intend to use the OSH act as a pretext to impose an unprecedented, controversial public health measure on a nationwide basis that only incidentally concerns the workplace,” the Republican attorneys general wrote.

Florida Gov. Ron DeSantis said Tuesday the state legislature should pass legislation preventing companies from firing people who do not wish to get vaccinated.

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