Earlier this year, employers focused on efforts to make it easy for employees to get vaccinated. They offered flexible schedules, paid time off to be vaccinated, modest financial incentives, and onsite vaccination. Despite these initiatives, over a third of U.S. adults remain unvaccinated. Consequently, employers are considering other ways to encourage workers to get vaccinated. Two widely-discussed options — imposing premium surcharges for health care coverage on unvaccinated employees and offering employees financial incentives — can be administratively burdensome, costly, and are unlikely to move the dial substantially.
So an increasing number of organizations have been mandating that their workers get vaccinated, and many others are trying to decide whether to follow suit. (Of the 961 U.S. employers that responded to a recent survey that our firm conducted, 21% already had a mandate in place and another 31% were planning to impose or were considering imposing mandates by the end of the year. The organizations collectively employ 9.7 million workers.)
Those still deliberating their options should realize that their decision could have a significant impact on their short-term productivity and profits as well on their long-term ability to attract and retain needed talent. With that in mind, we recommend that they take the following actions:
1. Evaluate the risk of workplace spread.
Outbreaks of Covid-19 were initially more likely to be associated with social venues such as restaurants, fitness centers, cafes, and religious organizations than workplaces. But some other kinds of workplaces had deadly outbreaks, including health care facilities, food processing plants, prisons, and nursing homes. That said, all employers are responsible for providing a safe working environment for employees and must protect the lives and health of customers and those they serve. Employees are most likely to accept vaccination mandates when there is strong evidence that they will protect the most vulnerable or have other clear business or public health benefits.
Even for those companies with a lower risk of onsite transmission, mandates can increase employees’ and customers’ perceptions of safety. Employers may implement vaccination mandates for higher-risk employees, such as for those who travel frequently for business, to avoid quarantines or illness away from home. In addition, some companies could require employees to be vaccinated so that they will be allowed onsite at the facilities of customers who have implemented a vaccination mandate.
Conversely, the case for mandating vaccination is much less compelling for employers that have only remote workers who do not have in-person contact with customers. The same is true for employers with workforces whose vaccination rate is already high.
2. Assess the likely impact of a vaccination mandate on talent.
Some companies have expressed concern that employees who object to a mandate will take advantage of the tight labor market and move to competitors. At the risk of stating the obvious, employers should consider the specific conditions in their particular industry. In some industries such as nursing homes, mandates are likely to be widespread. Therefore, a mandate is unlikely to cause workers to jump ship. And some people worried about being exposed to Covid-19 might be more willing to return to work or take a new job if they are assured that vaccination rates for the site’s workforce are very high due to a mandate. Indeed, a recent poll showed that a majority of employees favor vaccination mandates to improve workplace safety.
Companies with unionized employees will need to discuss any plans for a vaccination mandate with labor representatives. Although the AFL-CIO and a number of unions have expressed support for vaccination mandates, some unions have stated that they will want to negotiate the terms.
3. Calculate the economic impact of a mandate.
Companies with higher rates of employee vaccination will have fewer cases of severe Covid-19 and incur lower medical costs. One recent estimate suggests that the United States spent $2.5 billion on Covid-19 hospitalizations preventable through vaccination in June and July 2021.
Employers implementing a vaccination mandate will have to pay the administrative costs of tracking vaccination status, including safeguarding the privacy of employees’ personal health information. Some companies will track vaccination status through occupational health services, while many will rely on human resources outsourcing companies or other vendors.
4. Develop straightforward policies and procedures to make the mandate easy to implement.
Employers that mandate Covid-19 vaccination should have clear and simple implementation policies about who is subject to the mandate; which vaccines are acceptable; what proof of vaccination is required; whether to require booster shots when different cohorts become eligible for them; criteria for granting exemptions, including whether to require employees to reapply for exemptions periodically; and standards for those granted vaccination exemptions. (Most companies (62%) participating in our firm’s recent survey said they would require employees to provide proof of vaccination such as the Centers for Disease Control and Prevention vaccination card.)
The Equal Opportunity Employment Commission requires U.S. employers to offer exemptions to vaccination mandates for religious or medical reasons. But it allows employers to reassign or terminate employees if their unvaccinated status would make the workplace unsafe and any accommodation would lead to “undue hardship” for the business.
Employers that mandate vaccination can require those who are not vaccinated to have frequent tests to decrease the chance of Covid-19 entering the workplace. They can require weekly or twice-a-week antigen testing at home so that employees who might have Covid-19 do not come to the workplace. Those with positive tests should not come to work and should have a PCR test for confirmation. Companies with compulsory testing programs should bear the costs of testing and should budget accordingly. (Federal laws don’t require employers pay for tests they mandate, but most state employment laws do.)
Reviewing the vaccination mandate policy regularly will help ensure that the employer keeps up with new information as it becomes available.
5. Implement a comprehensive communication plan.
Since it takes five to six weeks from the first injection for people who receive an mRNA vaccine requiring two injections to be considered fully vaccinated, employers must fully communicate plans to issue a vaccination mandate months before the implementation date. The best communication will include a clear statement about why the mandate is being put in place and its benefits for employees, family, the community, and the company. To reach as many employees as possible, organizations should communicate the plan via multiple media (e.g., emails, brochures, videos, postcards, office posters). The communications should include images of a diverse range of employees or models to maximize their effectiveness with different groups.
6. Proactively address liability concerns.
Some companies might be concerned that a vaccination mandate could lead to lawsuits seeking damages if an employee has a rare but severe complication from the vaccination. They can be reassured that those harmed by any of the authorized Covid-19 vaccinations in the United States would be eligible for compensation through workers compensation or one of two government programs: the Countermeasures Injury Compensation Program or the National Vaccine Injury Compensation Program.
Employers that are considering offering onsite vaccination delivered by their own staff should check with their legal counsel to be sure that they would not incur additional liability.
An effective mandatory vaccine policy could also diminish potential company liability by reducing the risk of Covid-19 transmission in the workplace.
7. Measure the effectiveness of the mandate.
Employers that decide to require employees be vaccinated against Covid-19 can ensure that their program is beneficial to both public health and their business interests by evaluating the effectiveness of the mandate in real time. They can measure the changes in the rates of vaccinations, exemptions, employee turnover, and the administrative resources expended. They can also analyze the impact on employee morale and satisfaction. A timely evaluation system can help employers change policies, procedures, and communications in ways that improve vaccination rates and employee satisfaction.
Since a high level of vaccinated employees decreases the risk of workplace exposure to Covid-19, many companies are understandably seeking to push their unvaccinated workers to get vaccinated. While 100% employee vaccinations may be impossible to achieve, thoughtfully implemented mandates are likely to lead to higher levels of vaccination than other employer approaches. They can help reduce workplace disruptions and coronavirus illness associated with employment and increase employees’ and customers’ confidence that the company’s sites are safe. But mandates are not right for all employers. In deciding whether to implement one, they should carefully consider whether this is the best approach to protect employees, customers, and their communities.
by Jeff Levin-Scherz and Mike Orszag