By Ed Orlet, NAED’s Senior Vice-President of Government Affairs
Vaccine Mandates:
There are now at least two federal vaccine mandates that NAED members are grappling with. There is the Executive Order 14042 on Ensuring Adequate Covid Safety Protocols for Federal Contractors (the “Contractor Order”) and the Occupational Health and Safety Administration’s COVID-19 Vaccination and Testing; Emergency Temporary Standard (the “OSHA ETS”).
The Contractor Order expressly directs that a new contract clause, be created by the Federal Acquisition Regulatory Council, which will be inserted into federal contracts requiring contractors and subcontractors, for the duration of the contract, to comply with all guidance for contractor or subcontractor workplace locations published by the Safer Federal Workforce Task Force.
The OSHA ETS basically mandates that all employers with 100 or more employees to require employees to either become vaccinated or to provide a weekly negative test result prior to entering the workplace.
Currently, both federal mandates require that employees falling under either of the rules will need to have their final vaccination dose – either their second dose of Pfizer or Moderna, or single dose of Johnson & Johnson – by January 4, 2022. However, there are challenges in court to both and additional guidance is expected.
- The Department of Labor will continue to provide briefings on how the Emergency Temporary Standard. You can stay ahead of all updates by clicking here.
- For the Contractor Order, contractors may not accept recent antibody tests to prove vaccination status. Contractors are required to check CDC COVID trackers and take the appropriate actions. For a list of all Contractor guidelines, you can click here.
- Husch-Blackwell is also preparing a program to keep you informed on the Emergency Temporary Standard, including potential non-compliance penalties and how to handle religious or medical exemptions. You can click here to stay informed.
Election Results:
If you spend enough time reading news from Congressional reporters, you’ll notice two trends in headline writing: “Republicans pounce” and “Dems in disarray.” Very seldomly do both happen in a single week. On November 2, Republicans pounced on multiple statewide races with wins in the Virginia Governor, Attorney General, and House of Delegates elections and a better than expected second-place finish for New Jersey Governor. Immediately Democratic moderates and progressives laid the blame for the poor performances on each other and urged their colleagues to either expand or shrink their plans for the Build Back Better Act.
Infrastructure and Spending Bills:
Now that Congress has passed an infrastructure bill, Democrats have turned their attention to the Build Back Better proposal which asks Congress to spend nearly $6 trillion on physical infrastructure and social programs. After proposing these plans in late spring, House and Senate Democrats have shrunk the size of the bill to somewhere between $1.5 and $2 trillion depending on which chamber you look at. It is this difference that has brought back headlines of Democrats in disarray. On Friday, Democratic leadership held a vote open for more than five hours to give themselves time to solve intra-party problems with passing the Build Back Better Act. The massive scale of the division within the party is shown by the fact that whatever bill passes the House will be changed by the Senate, the House vote planned for last Friday is simply a show vote to prove momentum, not actual legislating. Even a vote on an infrastructure package that will go to President Biden’s desk as written was put off after a revolt by the House progressive caucus.
Once the dust settles in the House early in the week of November 8th, it will be on Senate Democrats to craft a final package that meets the demands of Senators Manchin (D-WV) and Sinema (D-AZ). These two senators have been vocal in urging their colleagues to draw back on their priorities due to rising inflation, high unemployment with high job openings, and poor favorability ratings. Many high-profile components of the Build Back Better plan are on the chopping block with programs like government-funded paid family leave and expansion of Medicare being removed from the plan while other components move in and out of the “final” package almost hourly. Even the tax side of the reconciliation bill has some fluidity left in it due to the need for the spending programs to be paid for to meet Senator Manchin’s demands. This means potential pay-fors through increasing the estate tax, cutting pass-through deductions, and additional force realization events for capital gains taxation are all possible sources of revenue that could be put into the bill at any time. It is thanks to the efforts of NAED members that attended the joint virtual fly-in with the American Supply Association that many of these tax increases are not in the package already. These well-timed meetings put the tax increases in the crosshairs of many influential legislators that ensured their removal, unfortunately, and any last-minute need for revenue could put them back in the bill. NAED will continue to push back against these potential tax increases in this bill or any other future bills.
The current House plan that leadership is trying to pass as quickly as possible has nearly $1.9 trillion in revenue provisions, some of them aimed directly at businesses:
- Changes to international tax rules to increase taxation of foreign income and reduce deductions for foreign-owned property
- Corporate minimum 15% tax on “book” income instead of standard adjusted-gross income
- Tax on stock buybacks
- Limiting of interest deductions
- Adding the 3.8% Net Investment Income Tax to pass-through business income
- Surtax 5% and 3% on income over $10 million and $25 million respectively
- Limitation of losses from active trades or businesses
- Limits on large IRAs and other retirement accounts
- Increasing tax compliance is likely to hit small businesses.