An Eleventh Circuit order allowing President Joe Biden to enforce his Covid-19 vaccination mandate for federal contractors in some states is likely to sow further confusion among businesses with government pacts.

The US Court of Appeals for the Eleventh Circuit handed the administration a partial victory Aug. 26, narrowing a nationwide injunction from a federal court in Georgia last year blocking the mandate. The ruling, and a patchwork of previous injunctions blocking the mandate in more than two dozen states, have put contractors on edge as they await the government’s response to the Eleventh Circuit decision.

“Anybody who tells you what’s going to happen is really reading the tea leaves,” said Leigh Nason, a shareholder with Ogletree, Deakins, Nash, Smoak & Stewart, PC. “I think everybody is waiting to see what the reaction from the administration is. That is going to be the litmus test on where this goes.”

The appeals court agreed that Biden’s vaccine rule, which applied to roughly a quarter of the US workforce and affected companies that do business with the federal government, is too broad. It said the administration likely overreached its statutory authority in regulating contracts under federal procurement law.

The court also said the injunction a coalition of seven states and construction trade group Associated...

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