Red states are paying employees to remain unvaccinated by tweaking unemployment laws

December 11, 2021, 3:00 PM UTC

As the U.S. prepares to enter its third year in the clutch of a relentless virus that has already taken the lives of 800,000 people, a group of Republican governors is sending a clear message to COVID anti-vaxxers in their states: We’ll pay you to remain unvaccinated. 

At least four states, Florida, Iowa, Kansas and Tennessee, have recently passed laws to allow employees to sign up for unemployment insurance if they are fired for their refusal to comply with vaccine mandates. A number of state lawmakers in Arkansas, New York, Texas, West Virginia, and Wisconsin have introduced legislation to do the same, and legal scholars expect more to come in 2022. 

“Nobody should lose their job due to heavy-handed COVID mandates and we had a responsibility to protect the livelihoods of the people of Florida. I’m thankful to the Florida Legislature for joining me in standing up for freedom,” said Florida’s Republican governor Ron DeSantis, an outspoken opponent of COVID-based restrictions and likely 2024 presidential contender, as he signed a bill that extends unemployment insurance to those who refuse vaccination, and bans vaccine mandates. About 30% of his state’s population is fully unvaccinated, in line with the rest of the country. 

As of September, unvaccinated Americans were 580% more likely to contract COVID-19, and 1400% more likely to die from the virus compared to those who are fully vaccinated, according to CDC data. COVID-19 associated hospitalization rates in October were about 8 times higher in unvaccinated American adults. Unvaccinated individuals are significantly more likely to spread the virus than those who have been vaccinated. 

DeSantis’ decision to reach into state coffers to pay Floridians who opt out of work is perplexing given his actions earlier this year. In June of 2020, the governor announced he would cut off emergency COVID-19 federal unemployment benefits early. At the same time, he reinstated a requirement that people apply to five jobs per week to stay on unemployment, and shuttered call centers that fielded calls from claimants. “The reason is simple: we’ve got almost a half a million job openings in the state of Florida,” DeSantis said at a press conference in Miami. 

Iowa and Tennessee were also among the twenty-six states that opted to withdraw early from the enhanced federal aid program which offered an additional $300-per-week supplement to state jobless payments. 

The vast majority of people (7 in 8) who lost federal aid in June were not reemployed by early August and the loss led to a nearly $2 billion cut in household spending, found a paper by economists at Columbia University, Harvard University, the University of Massachusetts Amherst and the University of Toronto.

“The fact that Governor DeSantis barely lifted a finger to assist Floridians with their unemployment benefits—even killing our efforts to increase the benefits by $100 [per week] this past legislative session—and is now trying to reform UI for people who quit their jobs due to vaccine requirements is a joke,” Anna Eskamani, a Democratic House member from Orange County, Florida, told the Florida Phoenix

“There are STILL problems Floridians are facing with the Connect website and zero leadership from him. This is just another example of Governor DeSantis distracting the public and politicizing public health.”

“We’ve ended federal unemployment benefits due to labor shortages, and now [state legislatures are] adding unemployment benefits when there are still labor shortages,” said Brittany Falkowski, a partner with Husch Blackwell LLP who focuses on employment and labor law. “The law incentivizes individuals to potentially become unemployed and disincentivizes employers from mandating vaccines when the science suggests that vaccines could keep people healthier and safer at work. It’s really just putting the employers between a rock and a hard place.”

Business leaders, in the midst of a hiring crisis, encouraged the early end of federal unemployment. Falkowski, who consults with corporate clients on how to navigate new employment laws, says that’s not the case this time around. 

“I have had quite a few clients who have implemented either a vaccination mandate or a vaccination or test mandate, and have had employees quit rather than comply with those policies,” she said. 

About 57% of large businesses in the U.S. require or plan to require COVID-19 vaccinations for employees, according to a recent survey by Willis Towers Watson, a consulting firm. 

Those plans, however, largely hinge upon the Biden administration’s plans to implement a nation-wide requirement for companies that employ over 100 people to implement vaccination mandates. The measure, which would be enforced by the Occupational Safety and Health Administration, has been temporarily suspended by a federal court

Of the companies that have already implemented vaccine protocol measures, 13% said mandates led to at least some employees resigning. Another 31% of those planning mandates said they were very concerned that this could contribute to employees leaving their organizations. 

A challenge for employers

Employers are having difficulty navigating various and quickly-changing state laws banning vaccine mandates with OSHA mandates, Centers for Medicare and Medicaid Services mandates, as well as state and city mandates, said Falkowski. “My clients, these employers, are just trying to understand the landscape and how to walk the tightrope in a way that keeps them in compliance.” She says this is the busiest she’s ever been in her career. 

“It can be really challenging and frustrating for employers,” said Falkowski. “Typically, those who operate nationwide want to be able to have a consistent policy for all their employees. They want to avoid implementing a patchwork policy, but laws like the ones that we’re seeing here create a situation where they might have to.” 

Unvaccinated workers also cost companies more money. JPMorgan has banned business travel for unvaccinated workers and will soon start deducting their pay to cover the cost of COVID testing. Delta raised insurance premiums for unvaccinated workers, United Airlines said paid leave for unvaccinated pilots costs the company $3 million a month. 

Early data shows that employer mandates are incredibly effective in getting a workforce vaccinated. Since New York State implemented a vaccine mandate for healthcare workers in September, the vaccination rate of hospital employees doubled compared to the rate of all adults in the state. One month after the plan was implemented the percentage of nursing home staff receiving at least one COVID-19 vaccine dose increased to 92%, up from 71% in August. At United 99.5% of employees have been vaccinated

“What we’ve heard from business leaders is, whatever you do, don’t let us go back to a shutdown, don’t let us go backward,” New York City mayor Bill de Blasio, who recently announced a mandate for all on-site employees at all private businesses. The mandate takes effect on December 27 and will apply to workers at about 184,000 businesses, making it the largest in the country. Business leaders, said De Blasio, have asked him behind closed doors to implement a blanket vaccination rule to level the playing field with a set standard for all businesses. 

Florida, Iowa, and Tennessee all rank in the bottom half of the country for unemployment benefits with Florida in dead last. The state, which renamed its unemployment insurance system to “reemployment assistance” in 2011, has the worst recipiency rate (the proportion of jobless workers who actually receive benefits), in the entire country. On average, businesses in Florida contribute the lowest tax amount per covered employee in the country. The average nationwide per-employee tax contribution is $277, Florida businesses pay an average of $50.

As a result, the state’s unemployment insurance trust fund is inadequately funded, causing breakdowns in the system and a potential lack of solvency as more people file. Florida’s unemployment trust is funded at just 26% of what the federal government says is the minimum adequate solvency. Wisconsin’s trust is funded at 54% of the minimum adequate solvency, while Kansas and Tennsesee both surpass the minimum requirements. 

So what, precisely, are these states up to?

It sends a clear political message to President Biden in Washington D.C, Falkowski said. “Three of the four states that currently have these laws have Republican governors. And, you know, there are additional states with Republican governors who have come out and said that they think that these are good ideas.”

The GOP sees vaccine mandates as an energizing issue in the upcoming 2022 midterm elections and the subsequent 2024 presidential election. The Senate voted narrowly on Wednesday to roll back President Biden’s vaccine and testing mandate for large employers, in a largely symbolic gesture full of soundbites to be used in campaign ads. 

Experts don’t think these rules will stand up when they’re challenged in courts. “It is clear that federal rules and regulations preempt or trump state law or regulation,” said Former OSHA head David Michaels on C-SPAN. “This the Supremacy Clause of the Constitution. If they went to court, the federal government would probably win. In an emergency situation, a public health situation, the governor can say everybody has to wear a mask or obligate workers to be vaccinated, but there is no anti-emergency situation where he can say you can’t require vaccinations.”

In Florida, meanwhile, DeSantis has already decided he’s accomplished his mission.

“The governor’s fight to protect Florida jobs and workers from unconstitutional COVID-19 vaccine mandates has succeeded,” Christina Pushaw, press secretary to governor DeSantis, told Fortune

Success, at least in this case, appears to be in the eye of the beholder.

Never miss a story: Follow your favorite topics and authors to get a personalized email with the journalism that matters most to you.

Read More

Biden AdministrationUkraine InvasionInflationEnergyCybersecurity