From our Capital Thinking blog, our public policy colleague Stacy Swanson shares the latest federal employment law developments in in the legislative and executive branches during the week of August 30, 2021.

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This is a weekly post spotlighting labor topics in focus by the US legislative and executive branches during the previous week.

In this issue, we cover:

August Jobs Report Released
COVID-19 Updates
Unemployment Benefits Updates
Modernizing States’ Unemployment Insurance Systems
Mexican Labor Compliance Grant Opportunity

Both chambers of the U.S. Congress were in recess this week.  House lawmakers are set to return the week of September 20; Senators are set to return to Washington the week of September 13.  Upon Congress’ return from their August recess, lawmakers will have to address raising the debt ceiling to avert the U.S. Government from defaulting and approve funding beyond September 30 to keep the U.S. Government from shutting down, among other legislative priorities, such as the bipartisan infrastructure bill, Democrats’ reconciliation spending package, and likely another voting rights bill attempt.

Meanwhile, Senator Joe Manchin (D-West Virginia) in a Wall Street Journal opinion piece published on Thursday urged Democrats to take a strategic pause in advancing their $3.5 trillion spending package, citing an overheated economy and costly “inflation tax” and Congress having already spent $5 trillion over 18 months related to the coronavirus pandemic.  He noted an “unprecedented array of challenges” facing the country, stating his disagreement with those in Congress that “have a strange belief there is an infinite supply of money to deal with any current or future crisis, and that spending trillions upon trillions will have no negative consequence for the future.”  Senator Manchin said he would not support the $3.5 trillion package “or anywhere near that level of additional spending.”  Senator Kyrsten Sinema (D-Arizona) has also said that she will not support a package that costs $3.5 trillion.

August Jobs Report Released.  On Friday, September 3, the U.S. Department of Labor released the August Jobs Report, reflecting the American economy added 235,000 jobs that month, while the unemployment rate fell from 5.4 percent to 5.2 percent.  Notably, economists had expected 725,000 jobs to be added in August.  This is the first jobs report to reflect the impact of the Delta COVID-19 variant surge on the American economy, and it showed a clear slowdown.  The statistics demonstrate American workers are reluctant to return to the workplace amid the Delta surge; consequently, the U.S. economic recovery will not get back on track until the Delta surge subsides.

U.S. President Joe Biden blamed the impact of the Delta variant on the jobs report; he underscored the importance of continuing to vaccinate Americans, while also arguing for Congress to pass the bipartisan infrastructure bill and Democrat’s $3.5 trillion spending package.  This coming Monday, the United States celebrates the Labor Day holiday.

COVID-19 Updates.  While the Biden Administration indicated COVID-19 booster shots (“boosters”) would be available for all Americans starting September 20, the U.S. Food & Drug Administration (FDA) and Centers for Disease Control and Prevention (CDC) have been more reserved, pushing back against perceived political interference and indicating COVID-19 boosters should be for persons whose immune systems cannot defend against COVID-19 after just two doses.  The FDA announced a virtual meeting of its Vaccines and Related Biological Products Advisory Committee for September 17 to discuss the matter of additional doses of COVID-19 vaccines, specifically the Pfizer/BioNTech supplemental Biologics License Application for administration of a booster dose of Comirnaty in individuals 16 years of age and older.  This week, Moderna initiated its submission to the FDA for the evaluation of a booster dose of its COVID-19 vaccine, providing data to the FDA that the booster dose at the 50 ug dose level induced “robust antibody responses against the Delta variant.”  Pfizer/BioNTech submitted its initial data to the FDA last month.

Reuters reported on Wednesday that a national survey of 961 U.S. employers reflected nearly half of them are planning to impose COVID-19 vaccine mandates in the workplace by year-end and almost a quarter considering vaccination as a condition for employment.  Currently an estimated 21 percent of U.S. employers have one or more vaccine mandate requirements.  At least 12 U.S. states currently have laws restricting COVID-19 mandates:  Arizona, Arkansas, Georgia, Florida, Indiana, Montana, New Hampshire, North Dakota, Oklahoma, Tennessee, Texas and Utah.  As of Tuesday, the CDC reported about 62 percent of the U.S. population has received at least one dose of a COVID-19 vaccine, and about 52 percent are inoculated against COVID-19.

With reports reflecting the mRNA COVID-19 vaccines face waning vaccine efficacy and consequent calls for booster shots, some experts are examining Novavax’s COVID-19 vaccine candidate NVX-CoV2373, especially since its late-stage clinical data has been overwhelmingly positive and has matched the safety and efficacy rates achieved by the approved FDA vaccines.  Notably, NVX-CoV2373 has an adjuvanted subunit protein platform that allows for rapid generation of multi-valent vaccines, which experts believe may be useful in the fight against emerging COVID-19 variants.  Novavax’s Emergency Use Authorization (EUA) filing has been pushed back repeatedly and is now anticipated in the fourth quarter of 2021.  The previous Administration secured a contract with Novavax to purchase 110 million doses of its vaccine candidate; Novavax has confirmed it is on track to begin delivering these doses by the end of the year/early 2022.

Meanwhile, the World Health Organization (WHO) is tracking a new coronavirus variant known as “Mu,” or B.1.621.  First identified in January 2021 in Colombia, the WHO officially flagged it as a variant of interest on Monday.  The Mu variant appears to be more vaccine-resistant and is circulating predominantly in the Western Hemisphere, including the United States (2,065 cases), and in Europe.

Dr. Anthony Fauci, White House Chief Medical Advisor, said on Sunday, August 29, “I believe that mandating vaccines for children to appear in school is a good idea.”  And after increased reports of overdoses, the CDC issued a health advisory on August 26 warning Americans against taking Ivermectin – an FDA-approved prescription to treat infections caused by parasites – to treat and prevent COVID-19.

Unemployment Benefits Updates.  After 26 states cut off some or all of the pandemic-era unemployment assistance before the Federal expiration to address concerns over labor shortages, workers from 15 states legally challenged these decisions.  Lawsuits, thus far, have been rejected by courts in five states – Florida, Louisiana, West Virginia, Ohio and Indiana.  Seven states currently have ongoing lawsuits – Idaho, Texas, Iowa, Missouri, Tennessee, Alabama and New Hampshire.  Only three states saw a reinstatement of unemployment benefits for workers, in some cases temporarily – Arkansas, Oklahoma and Maryland.  There were no lawsuits filed in the remaining 11 states – Alaska, Arizona, Utah, Wyoming, Montana, North Dakota, South Dakota, Nebraska, Mississippi, Georgia and South Carolina.  Meanwhile, Federal pandemic unemployment programs are set to expire on September 6.

Modernizing States’ Unemployment Insurance Systems.  On Tuesday, August 31, the U.S. Department of Labor (“DOL”) announced the establishment of the Office of Unemployment Insurance Modernization to provide strategic leadership as the department works with state agencies and federal partners to modernize and reform the unemployment insurance systems (UI).  According to the Labor Department, the new unit will “implement UI modernization plans announced August 11, including unemployment insurance reform, and provide oversight and management of $2 billion in funds in the American Rescue Plan Act to prevent and detect fraud, promote equitable access, ensure timely benefits payments and reduce backlogs.”

On August 31, Ranking Member of the Senate Finance Committee Mike Crapo (R-Idaho), Ranking Member of the House Ways & Means Committee Kevin Brady (R-Texas), and Jackie Walorski (R-Indiana) – Ranking Member on the House Ways & Means Subcommittee for Worker and Family Support – sent a letter requesting the Government Accountability Office (GAO) investigate “the largest amount of unemployment fraud in history.”  The lawmakers also cited:

DOL has no affirmative requirement under current law to report a national amount or estimate of improper payments, including fraud, in COVID UI programs.  Unfortunately, DOL has not been adequately responsive to inquiries our offices have made, including lack of response to a written inquiry we made to the Secretary of the Department of Labor.”

Mexican Labor Compliance Grant Opportunity.  On Thursday, September 2, the Labor Department announced the availability of up to $10 million in grant funding to advance labor compliance in the Mexican states of Nuevo Leon, Sonora and Baja California, consistent with the obligations of the United States-Mexico-Canada Agreement (USMCA).  Funding is to enhance labor inspector engagement with supply chain actors regarding legal requirements in target states and USMCA priority sectors, such as sectors that manufacture goods, supply services or involve mining.

Employment Law Worldview