Monday, June 21, 2021

OSHA’s new workplace safety rule on Covid is limited to the health care industry.


Daily Business Briefing

June 10, 2021, 4:04 p.m. ET

June 10, 2021, 4:04 p.m. ET

Credit…Erin Schaff/The New York Times

The Occupational Safety and Health Administration announced a rule on Thursday outlining steps that employers must take to protect workers from the risk of Covid-19, but it will apply only to the health care industry, not to other high-risk workplaces, as the Biden administration initially indicated.

“The science tells us that health care workers, particularly those who come into regular contact with the virus, are most at risk at this point in the pandemic,” Labor Secretary Martin J. Walsh said on a call with reporters. “So following an extensive review of the science and data, OSHA determined that a health care specific safety requirement will make the biggest impact.”

The rule will require health care employers to provide protective equipment like masks, to screen and triage patients for the risk of Covid-19 and to ensure adequate ventilation and distancing, among other measures. It will also require those employers to provide adequate paid time off for workers to receive vaccinations and manage their side effects.

Fully vaccinated workers will not be required to wear masks and practice social distancing.

Mr. Walsh, whose department includes OSHA, said the administration was issuing optional guidance to employers outside health care that would focus on workplaces in the manufacturing, meat processing, grocery and retail industries.

Groups focused on workers’ issues criticized the decision to limit the rule, known as an emergency standard, to health care employers, arguing that the virus continues to pose serious risks to other workers.

“We know that workers in many industries outside of health care faced elevated risks of Covid,” Debbie Berkowitz, a senior OSHA official during the Obama administration who is now at the National Employment Law Project, wrote in an email. “Especially in low-wage industries like meat processing that is disproportionally Black and brown workers.”

She added: “We need to make sure these workers are still protected with mitigation measures.”

Some union leaders expressed frustration that the Biden administration abandoned its earlier plans.

“Today’s new Covid workplace safety standard from OSHA represents a broken promise to the millions of American workers in grocery stores and meatpacking plants who have gotten sick and died on the front lines of this pandemic,” Marc Perrone, the president of the United Food and Commercial Workers International Union, said in a statement.

Ms. Berkowitz and Mr. Perrone had expressed hope that Mr. Biden would chart a different course from his predecessor, under whom OSHA declined to issue a standard related to Covid-19.

During the Trump administration, OSHA adopted a policy of largely limiting Covid-related inspections to a small number of high-risk industries like health care and emergency response. It did not include meatpacking — which studies indicated was a major source of virus transmission — in this high-risk group.

Some worker groups gave OSHA credit under President Donald J. Trump for enforcing safety rules in the health care industry, including proposed penalties of over $1 million for violations at dozens of health care facilities and nursing homes. But critics accused the agency of largely failing to fine meat processors for lax safety standards, such as failure to adequately distance workers.

Mr. Walsh indicated that the risks to most workers outside health care had eased as cases had fallen and vaccination rates had risen. He also indicated that guidance by the Centers for Disease Control and Prevention last month advising those who have been vaccinated that they generally need not wear a mask indoors played a role in OSHA’s decision to forgo a broader Covid-19 standard.

“OSHA has tailored the rule that reflects the reality on the ground, the success of the vaccine efforts, plus the latest guidance from C.D.C. and the changing nature of pandemic,” Mr. Walsh said on the call.

David Michaels, a head of OSHA during the Obama administration, said the C.D.C. guidance had made a broader OSHA rule more difficult to enact. “To justify an emergency standard, OSHA has to show there’s a grave danger,” Dr. Michaels said. “For that to happen, the C.D.C. would have needed to clarify its recommendation and say that for many workers, there remains a grave danger.”

Without such clarification, said Dr. Michaels, now a professor at the George Washington University School of Public Health, employer groups would probably have challenged any new OSHA rule in court, arguing that the C.D.C. guidance indicated that a rule was unnecessary.

Dr. Michaels said that the new standard was an overdue step but that it was disappointing that no Covid-specific standard was issued for industries like meatpacking, corrections and retail. “If exposure is not controlled in these workplaces, they will continue to be important drivers of infections,” he said.

Jim Frederick, the acting head of OSHA, said on the call that the agency had power even without issuing broader Covid rules, through its so-called general duty clause, to enforce protections for workers outside the health care industry and that it would continue to do so.

He said many meatpacking facilities, along with other workplaces, had been inspected under an OSHA program applying added scrutiny to high-risk industries.

OSHA submitted a draft of an emergency standard for review by a White House regulatory office in April, and the administration has spent weeks meeting with worker and industry groups about its likely impact.

“As far as the meetings that took place,” Mr. Frederick said, “we’re a participant in those meetings, we receive those comments and take those into account in the overall work that’s being done by the agency.”

Employers will have two weeks to comply with most of the rule’s provisions.

The S&P 500 climbed into record territory on Thursday despite new data showing consumer price inflation rising faster than expected.

Investors have been particularly attuned to inflation, as the potential for fast-rising prices could force the Federal Reserve to rein in its support for the economic recovery. In recent months, signs that prices are rising have led to an increase in government bond yields and turbulence in the stock market.

But many economists and lawmakers have argued that the price increases are likely to be temporary, a result of shortages connected with pandemic lockdowns that will sort themselves out over time. On Thursday, the government reported that airfares and used car prices surged by more than 20 percent in May from a year earlier. Both increases are illustrative of the short-term adjustments as the economy reopens.

More broadly, the Consumer Price Index showed that prices rose 5 percent in May from the year before, the strongest year-over-year reading since 2008 and faster than the 4.7 percent increase expected by economists.

After an early jump, yields on 10-year Treasury notes fell by Thursday afternoon to 1.45 percent. The S&P 500 gained 0.5 percent, crossing above its May 7 closing high.

Concerns about an overheating economy have somewhat eased lately as monthly reports on hiring and unemployment have come in below expectations, highlighting the Fed’s contention that the recovery is far from complete.

The big policy question facing the Fed is when, and how quickly, it will begin to slow its $120 billion in monthly government-backed bond purchases. That policy is meant to keep borrowing of all kinds cheap and stoke demand, and also bolsters stock prices.

The Fed chair, Jerome H. Powell, and his colleagues have repeatedly said that they need to see “substantial” further progress toward maximum employment and stable inflation that averages 2 percent over time before they pull back from that policy.

Stocks in Europe were mixed on Thursday after policymakers at the European Central Bank said they would hold interest rates at record low and negative levels while continuing to buy bonds in its pandemic response program at “a significantly higher pace” for the next quarter compared with the start of the year — currently, a rate of about 80 billion euros a month.

Outside the Goldman Sachs headquarters in Manhattan. The bank is requiring all of its employees in the United States to log their vaccination status in the bank’s system.
Credit…Brendan Mcdermid/Reuters

Goldman Sachs wants to know how many of its employees have gotten a Covid-19 shot. The bank sent a memo this week informing employees in the United States that they had until noon on Thursday to report their vaccination status.

“Registering your vaccination status allows us to plan for a safer return to the office for all of our people as we continue to abide by local public health measures,” said a section of the memo, which was sent to employees who had not yet reported their status and was obtained by the DealBook newsletter.

Disclosing vaccination status had been optional at the bank. In May, Goldman told employees that they could go maskless in the Manhattan office if they reported that they had been inoculated.

Now, all Goldman employees in the United States, regardless of whether they choose to wear a mask while in the office, will need to log their status in the bank’s internal app for employees. The app does not ask for proof of vaccination, but it does require employees to record the date they received their shots and the maker of the vaccine. Employees who falsify records will be subject to discipline, including termination of employment. Goldman has also informed employees through the app that their vaccination status may be shared with managers and used for planning.

The Equal Employment Opportunity Commission made clear this month that it is legal to ask employees for their vaccination status so long as firms kept medical records confidential.

Employers are allowed to share vaccination status “with certain individuals if it’s relevant to the individual’s responsibilities, but they can’t share for no reason,” said Jessica Kuester, who specializes in benefits at the law firm Ogletree Deakins

Goldman has roughly 20,000 employees based in the U.S. at its New York headquarters and in other cities such as San Francisco and Dallas.

Companies across the U.S. are trying to find out how many workers are vaccinated ahead of full office reopenings. They have conducted surveys, given out cash rewards upon proof of vaccination or made reporting compulsory, as with Goldman.

“It’s important to have data to make data-informed decisions,” said Johnny Taylor, chief executive of the Society for Human Resource Management. He acknowledged that some may “grimace” at the idea of employers pushing for information like vaccine status.

Understanding what portion of their work force is vaccinated can help companies decide whether to try new incentives for employees to be vaccinated or consider a mandate. Goldman, for its part, said in the memo it “strongly encourages” vaccination, though the choice “is a personal one.” The Wall Street firm, which is bringing the majority of its workers back to the office this month, has been offering employees paid time off to get the shots.

“The big focus right now is we’ve got to get people vaccinated — we’ve got to get to the other side,” David Solomon, Goldman Sachs’ chief executive, told Bloomberg in January. Mr. Solomon has called working from home an “aberration.”

Several of Mr. Solomon’s rivals across Wall Street, including Jamie Dimon, JPMorgan’s chief executive, have been critical of remote work given the industry’s focus on in-person training and client solicitation. Mr. Dimon said in May that remote work “doesn’t work for those who want to hustle.”

JPMorgan, which opened all of its U.S. offices last month, has encouraged employees in its U.S. corporate offices who want to go mask-free to report their vaccine status. Bank of America has told bankers and traders who want to come in to the office that they may self-report their vaccination status on the bank’s internal portal. Neither bank has mandated vaccines.

“We started to bring vaccinated employees back,” Brian Moynihan, Bank of America’s chief executive, said in a hearing before the House Financial Services Committee on May 27.

“We had about 50,000 teammates that put the information in and give us the ability to call them back and have them work. In New York City in particular, that’s starting take place,” he said.

The closed Cinerama Dome movie theater in Los Angeles. The Small Business Administration has overhauled a program meant to help music clubs, movie theaters and other venues.
Credit…Chris Pizzello/Associated Press

The Small Business Administration has essentially ousted the leaders of a deeply troubled $16 billion relief effort for live-events businesses, bringing in a new team to take over and fix the program.

More than six weeks after the long-delayed program started taking applications, 14,000 businesses have applied for a Shuttered Venue Operators Grant. Only 90 have been awarded one. Thousands of applicants are tangled in technical glitches and bureaucratic messes, including an error that led to many people being inaccurately declared dead.

The program, which was enacted into law in December to help music clubs, movie theaters and other venues that were forced to shut down because of the pandemic, had been managed by a team from the S.B.A.’s Office of Disaster Assistance, which also oversees the agency’s $200 billion disaster loan effort.

But on Wednesday, the agency told industry groups that it was shifting the program’s leadership to a group of employees from its Office of Capital Access, which coordinated the $800 billion Paycheck Protection Program and the $29 billion Restaurant Revitalization Fund.

On a Thursday morning call with industry groups, Patrick Kelley, associate director of the S.B.A.’s Capital Access office, said the agency would quickly resolve the mistaken death reports and speed up the review process, according to two participants on the call.

The Small Business Administration is supposed to review and approve applications in tiers, with those who suffered the deepest financial losses helped first, but its deadline for addressing the first tier of applications was Wednesday — and thousands of those applicants are still waiting. Carol Wilkerson, an agency spokeswoman, said those applicants “remain at the front of the line.”

The changes came after repeated pleas for help from lawmakers and industry advocates. “The agency’s rollout and execution of the grant program has been a disaster,” Representative Greg Stanton, an Arizona Democrat, wrote in a letter sent Wednesday to Isabella Casillas Guzman, the S.B.A. administrator.

Seven trade groups also sent a letter on Wednesday asking the S.B.A. to “immediately fully fund” eligible applications. Entertainment venues are “experiencing a talent drain, cannot reopen, and are hanging on by a thread because this funding is not arriving quickly enough,” they wrote.

The problem is becoming especially dire for businesses trying to salvage their summer season. Without money from the grant program, many are unable to hire staff, book performers, stock up on supplies and pay overdue bills.

Tracey Tee, the chief executive of Band of Mothers Media, which puts on a women’s comedy tour, got an email from the S.B.A. last week with the same news that has bedeviled thousands of venue owners and producers around the country. “Your name,” the email said, “appears on the Do Not Pay list with the Match Source DMF.”

Translated from bureaucratic jargon, it told Ms. Tee that she was considered dead.

“We are in debt up the wazoo,” Ms. Tee said. “We can’t afford to put shows back on the road because there’s no cash.”

Like virtually all producers, Band of Mothers — which puts on a “moms’ night out” music and comedy event called “The Pump and Dump Show” — was grounded by the pandemic last year, and has had little opportunity for revenue since. At the beginning of 2020, the company employed 13 people — most of them mothers of young children — but has since reduced its staff to two.

After receiving the email, Ms. Tee began a Kafkaesque effort to prove that the government’s information was incorrect. She called the Social Security Administration, which she said was unhelpful. An operator at her local office was friendly but said: “I think you’re being spammed or scammed,” Ms. Tee recalled.

The Small Business Administration has said little about the problem publicly. But in correspondence among applicants, the agency has acknowledged that the problem seemed to be a result of conflicts between employee identification numbers, which apply to businesses and nonprofit groups, and Social Security Numbers, which apply to individuals. If a company has the same employee identification number as a dead person, the agency flagged that application as flawed.

Ms. Wilkerson, the S.B.A. spokeswoman, said the agency was working to clear up the problem and move applications forward. Mr. Kelley said on Thursday’s call that applicants should finally see the results of those efforts — and a wave of approvals — next week, according to participants on the call.

A woman in Munich passing a mural showing traditional Bavarian musicians. Europe’s economy has been reviving from the pandemic.
Credit…Matthias Schrader/Associated Press

Even as Europe’s economic outlook is rapidly improving, European Central Bank policymakers decided on Thursday to maintain their “very accommodative” monetary stance.

Governments are lifting lockdown restrictions and the vaccine rollout has sped up, which has led to a bounce in the services industry and “ongoing dynamism” in manufacturing, Christine Lagarde, president of the central bank, told reporters at a news conference in Frankfurt.

“We expect economic activity to accelerate in the second half of this year as further containment measures are lifted,” she said.

But Ms. Lagarde stressed thatlots of support was still needed and that policymakers were giving the economy a “steady hand.”

“Uncertainties remain, as the near-term economic outlook continues to depend on the course of the pandemic,” she added.

The bank said it would hold interest rates at record low and negative levels while continuing to buy bonds in its pandemic response program at “a significantly higher pace” for the next quarter compared with the start of the year — currently, a rate of about 80 billion euros a month.

“The ECB is currently choosing to err on the side of caution rather than withdraw monetary stimulus prematurely,” analysts at ING wrote in a note.

Staff members at the central bank also published new forecasts for economic growth and inflation in the region. The eurozone economy will grow 4.6 percent this year and 4.7 percent next year, they said, compared with forecasts from three months ago that predicted 4 percent and 4.1 percent growth.

In the United States, policymakers are watching rising inflation, which rose 5 percent in May, the fastest annual rate since 2008. Economists say a sustained increase in inflation would force the Federal Reserve to pull back its monetary stimulus. But Ms. Lagarde said the American and European recoveries were “a very, very different story.”

In the euro area, inflation is expected to rise over the next few years, including core inflation, which excludes volatile energy and food prices, but the increase is “largely” a result of temporary factors, the bank said. The central bank does not forecast price gains to rise above its 2 percent target.

Staff projections, which were revised higher since March, point to a 1.9 percent annual inflation rate in 2021 and 1.5 percent rate next year.

In March, the central bank increased the pace of the assets purchases in its Pandemic Emergency Purchase Program, which is scheduled to buy 1.85 trillion euros worth of debt by the end of March. Bond-buying programs are intended to keep interest rates low and smooth access to credit for businesses and households.

Data published earlier this week showed that the eurozone’s economy did not fare as badly in the first quarter as initially expected. Gross domestic product declined 0.3 percent in the first three months of the year, the statistics agency said, not the 0.6 percent decline that was previously estimated.

Ms. Lagarde also said it was too soon for policymakers to even begin discussing when and how it might end its pandemic bond-buying program. “It’s too early, it’s premature, it’s unnecessary,” she said.

  • Initial claims for state jobless benefits declined last week, the Labor Department reported Thursday.

  • The weekly figure was about 367,000, a decrease of 58,000 from the previous week. New claims for Pandemic Unemployment Assistance, a federally funded program for jobless freelancers, gig workers and others who do not ordinarily qualify for state benefits, totaled 71,000, a decrease of 2,000 from the prior week. The figures are not seasonally adjusted. (On a seasonally adjusted basis, state claims totaled 376,000, a decline of 9,000.)

  • It was the first time the weekly figure for initial state claims had fallen below 400,000 since the outset of the pandemic.

  • New state claims remain high by historical standards but are one-third the level recorded in early January. The benefit filings, something of a proxy for layoffs, have receded as businesses return to fuller operations, particularly in hard-hit industries like leisure and hospitality.

China’s top leader, Xi Jinping, has called for his country to achieve a more “lovable” image, but the legislation on Thursday was the latest sign that this has not led to fundamental shifts in foreign policy.
Credit…Kevin Yao/Reuters

Lawmakers in Beijing approved legislation on Thursday strengthening the authority of ministries to bar companies and individuals from obeying foreign sanctions against China. The new law was the latest in a series of moves by the Chinese government to push back against international pressure on its conduct in Hong Kong and in its far western Xinjiang region.

Passage of the new law means that multinational corporations and their employees could increasingly find themselves in a bind. The United States and the European Union have prohibited any dealings with a lengthening list of businesses and people in China who are accused of human rights violations and other offenses.

Compliance with those American and European laws would now entail a growing risk of violating Chinese laws.

China’s Ministry of Commerce issued regulations on Jan. 9 that prohibited any compliance with foreign sanctions. But the ministry has lacked the authority under that order to impose fines of more than a few thousand dollars for violations, said Nick Turner, a lawyer specializing in economic sanctions in the Hong Kong office of the Steptoe & Johnson law firm.

China’s Ministry of Foreign Affairs then imposed a series of retaliatory measures on foreign companies and individuals in March after Britain, Canada, the European Union and the United States all imposed sanctions on China over its actions in Xinjiang. The foreign ministry’s penalties included seizure of any assets in China belonging to some of the targeted individuals and institutions, denial of visas and a ban on Chinese companies having any commercial relationships with some of them.

But Western lawyers questioned whether the foreign ministry had the legal powers to do this.

The legislature has now “gone back and put in place legal authority which clearly authorizes steps that have already been announced,” Mr. Turner said.

The Standing Committee of the National People’s Congress approved the new law on Thursday afternoon and the congress released the full text late Thursday night in Beijing.

The legislation comes less than two weeks after China’s top leader, Xi Jinping, called for his country to achieve a more “lovable” image. But the legislation on Thursday was the latest sign that this has not led to fundamental shifts in foreign policy.

Joerg Wuttke, the president of the European Union Chamber of Commerce, criticized the secrecy with which the law was suddenly sped through the approval process this week. The law could hurt foreign investment by making companies feel like they are, “sacrificial pawns in a game of political chess,” he said in a statement.

A billboard in Brazil for the meatpacking giant JBS. The chief executive said the decision to pay a ransom to hackers was “very difficult.”
Credit…Paulo Whitaker/Reuters

The world’s largest meat processor said on Wednesday that it paid an $11 million ransom in Bitcoin to the hackers behind an attack that forced the shutdown last week of all the company’s U.S. beef plants and disrupted operations at poultry and pork plants.

The company, JBS, said in a statement that the decision to pay the ransom was made to protect its data and hedge against risk for its customers. The company said most of its facilities were back up and running when the payment was made.

The F.B.I. said last week that it believed REvil, a Russian-based group that is one of the most prolific ransomware organizations, was responsible for the attack.

JBS, which is based in Brazil, processes roughly a fifth of the United States’ beef and pork. News last week of the cyberattack on a producer so central to the U.S. meat supply spurred worries that the shutdown could shock the market, creating shortages and accelerating the rise of already-high meat prices.

The worst of those fears were not realized, in large part because JBS was able to resume its operations quickly.

The Wall Street Journal was first to report news of JBS’s ransom payment.

The breach was the latest in a string of attacks targeting critical infrastructure that have raised concerns about vulnerabilities of American businesses. Last month, a ransomware attack on the Colonial Pipeline, a vital artery that transports gasoline to nearly half the East Coast, caused gas and jet-fuel shortages and set off panic buying of fuel in several states.

The pipeline’s operator had also paid a ransom in Bitcoin to the attackers, the Russian hacking group DarkSide, which started as an affiliate of REvil. This week, the Justice Department announced that its investigators had traced and recovered much of the ransom, or some $2.3 million of the $4.3 million worth of Bitcoin paid. The revelation highlighted that the cryptocurrency, sometimes perceived as untraceable, can be quickly tracked down by law enforcement authorities.

White House officials have said they are reviewing issues with cryptocurrencies like Bitcoin, which for years have helped enable cyberattacks.

JBS said it learned on May 30 that it had been targeted by an attack affecting some of its servers powering its IT systems in Australia and North America. It moved to suspend those systems, shutting down the production plants.

The company announced, four days after it first learned of the attack, that its global facilities were again fully operational. It said that it lost less than one day’s worth of food production during the attack and that it would be able to make it up by the end of this week.

JBS said on Wednesday it was confident that none of its data or that of its customers was breached during the attack.

Deputy U.S. Attorney General Lisa Monaco, center, announcing the recovery of part of the Colonial Pipeline ransom on Monday.
Credit…Pool photo by Jonathan Ernst

The revelation this week that federal officials had recovered most of the Bitcoin paid in the recent Colonial Pipeline ransomware attack exposed a fundamental misconception about cryptocurrencies: They are not as hard to track as cybercriminals think.

That’s because the same properties that make cryptocurrencies attractive to cybercriminals — the ability to transfer money instantaneously without a bank’s permission — can be leveraged by law enforcement to track and seize criminals’ funds at the speed of the internet, The New York Times’s Nicole Perlroth, Erin Griffith and Katie Benner report.

Bitcoin is also traceable:

  • The digital currency can be created, moved and stored outside the purview of any government or financial institution, but each payment is recorded in a permanent fixed ledger, called the blockchain.

  • That means all Bitcoin transactions are out in the open. The Bitcoin ledger can be viewed by anyone who is plugged into the blockchain.

On Monday, the Justice Department said it had traced 63.7 of the 75 Bitcoins — some $2.3 million of the $4.3 million — that Colonial Pipeline had paid to the hackers as the ransomware attack shut down the company’s computer systems, prompting fuel shortages and a jump in gasoline prices. Officials have since declined to provide more details about how exactly they recouped the Bitcoin.

“It is digital bread crumbs,” said Kathryn Haun, a former federal prosecutor and investor at venture capital firm Andreessen Horowitz. “There’s a trail law enforcement can follow rather nicely.”

Given the public nature of the ledger, cryptocurrency experts said, all law enforcement needed to do was figure out how to connect the criminals to a digital wallet, which stores the Bitcoin.

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Today in the On Tech newsletter, Shira Ovide writes that tech isn’t just for nerds anymore, but companies often act as if it is.



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