Calculating the 100-employee threshold under the OSHA vaccination ETS

Businessman calculating numbers on paper and desk

The Occupational Safety and Health Administration (OSHA) Emergency Temporary Standard (ETS) regarding COVID-19 vaccination, testing and facial coverings applies to “all employers with a total of 100 or more employees” during the period the ETS is in effect. It its preamble to the ETS, OSHA noted the 100-employee threshold would result in application of the ETS to “two-thirds of the nation’s private sector workforce.”

The preamble provides further guidance to employers as to how to calculate the 100-employee threshold. As an initial matter, employers must determine whether they employ 100 or more employees as of November 5, 2021, the effective date of the ETS.* Once the 100-employee threshold is reached, the ETS continues to apply even if the number of persons subsequently employed drops below 100. If an employer reaches the 100-employee threshold any time during the period that the ETS is in effect, it becomes subject to the ETS and remains subject to the ETS while it is in effect, even if the size of the workforce later drops below 100 employees.

When calculating the threshold, employers must include:

  • “All employees across all of their U.S. locations, regardless of the employees’ vaccination status or where they perform their work.” In other words, when determining the applicability of the ETS, employers must focus on the “number of employees, rather than on the type or number of workplaces.”
  • Part-time employees

The preamble further provides that “two or more related entities may be regarded as a single employer for OSH Act purposes if they handle safety matters as one company, in which case the employees of all entities making up the integrated single employer must be counted.”

What does this mean? It may be helpful to consider other “integrated employer” standards that were not utilized in the ETS. The U.S. Department of Labor (DOL) – which administers the ETS – has a long history of utilizing “integrated employer” standards. For instance, the federal Family and Medical Leave Act utilizes an “integrated employer test.” See 29 C.F.R. § 825.104. This test considers the following factors to determine if separate entities should be treated as a single, integrated employer: common management, interrelation between operations, centralized control of labor relations, and degree of common ownership/financial control. No single factor is determinative.

A similar “integrated employer” test is utilized by the Occupational Safety Health and Review Commission. The Commission is not a part of the DOL, but hears appeals from OSHA citations and penalties. It applies an “integrated employer” standard to disregard the separateness of corporate entities in order to hold one entity responsible for the safety violations of another, including for purposes of assessing repeat or willful violations. The Commission will generally consider factors such as whether the companies share a common worksite where employees of both companies face the same hazards, interrelated and integrated operations of the companies, the existence common officers, management, supervision, or ownership. Again, no single factor is determinative. While the Commission has not been consistent in applying this standard, it has found that where separate entities share a common worksite, have “interrelated and integrated operations” and share common ownership and/or supervision, the purposes of the OSH Act” are best effectuated by the two being treated as one.”

Notably, the DOL did not employ this type of test or standard for counting employees for purposes of the 100-employee threshold in the ETS. Rather, if the entities “handle safety matters as one company,” employees of each entity must be counted together toward the 100-employee threshold.

Treatment of separate entities as a single, integrated employer

Employers should consider the following factors to determine whether two or more separate entities should be treated as a single, integrated employer, and all of their employees counted together, for purposes of meeting the 100-employee threshold:

  • Do the entities utilize substantially similar policies regarding workplace conduct and safety, reporting of workplace injuries, COVID-related protocols, etc., even if those policies are separately issued by each entity?
  • Are issues arising under these types of policies handled (directly or indirectly) by the same personnel authorized to act on behalf of multiple entities?

If the answers to these questions are “yes,” it seems likely that OSHA would consider the entities to be an integrated employer for purposes of the ETS, with the result that persons employed by both entities must be counted together when determining application of the 100-employee threshold.

Finally, there are two categories of persons that may be excluded when calculating the number of employees for purposes of the 100-employee threshold. Employers may exclude:

  • Independent contractors
  • Persons placed with the employer by a staffing agency. For purposes of the ETS, the staffing agency will exclusively count such persons toward the 100-employee threshold.

* The legality of the OSHA ETS has been challenged by several states and entities, and earlier this month the fifth Circuit ordered a stay. Further consideration of that particular challenge has been delegated to the U.S. Court of Appeals for the Sixth Circuit, and appeal to the U.S. Supreme Court seems eventual. We will continue to monitor these developments and their impact on the ETS.