OSHA Issues Interim Regulations and Request for Comment on Certain Whistleblower Protections Added by Dodd-Frank Act

The Occupational Safety and Health Administration (OSHA) has issued interim final regulations (pdf) governing its procedures for processing retaliation/whistleblower complaints under the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley” or “SOX”). The SOX whistleblower provisions were amended by Sections 922 and 929A of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, enacted on July 21, 2010.

Notably, Section 922(a) of Dodd-Frank amended the Securities Exchange Act to establish a new securities whistleblower incentive and protection program. The SEC has already issued final regulations governing this program. Section 922(a) of Dodd-Frank added various protections for whistleblowers, including a prohibition on discharging, demoting, suspending, threatening, harassing (directly or indirectly) or otherwise discriminating against an employee for providing information to the SEC or assisting in an investigation or judicial or administrative action relating to the information provided. Section 922(c) of Dodd-Frank extended the statutory filing period for retaliation complaints under Sarbanes-Oxley from 90 to 180 days. If a final decision is not issued within that time period, and the delay is not due to the complainant’s bad faith, he or she is entitled to bring an action against his or her employer in federal court. The regulations have been changed to reflect the Dodd-Frank revisions affording parties the right to a jury trial. This section of Dodd-Frank also prohibits the waiver of such claims by pre-dispute arbitration agreements. Section 929A expressly states that the whistleblower protection provisions in Sarbanes-Oxley apply to employees of subsidiaries and affiliates of publicly-traded companies whose financial information is included in the consolidated financial statements of such companies.

According to OSHA – which is charged with enforcing the whistleblower provisions contained in 21 separate statutes – the new interim regulations “clarify and improve” the procedures for handling Sarbanes-Oxley whistleblower complaints, and make them consistent with the procedures in place for handing similar complaints under the other statutes over which OSHA has jurisdiction. In September, OSHA revised its Whistleblower Investigations Manual  to reflect these new case handling procedures.

Among other revisions, OSHA’s interim final rule does the following:

  • Changes certain terms for consistency (i.e., actions will be filed for “retaliation” instead of for “discrimination).
  • Describes the activities that are protected under Sarbanes-Oxley and the conduct that is prohibited in response to any protected activities.
  • Revises the statute of limitations for filing complaints from 90 to 180 days.
  • Eliminates the requirement that whistleblower complaints to OSHA under Sarbanes-Oxley be detailed and in writing. Under the new regulations, “consistent with OSHA’s procedural rules under other whistleblower statutes, complaints filed under Sarbanes-Oxley need not be in any particular form. They may be either oral or in writing.”
  • Describes the procedures that apply to the investigation of Sarbanes-Oxley complaints;
  • With respect to the burdens of proof necessary to sustain a claim, the regulations state that the complaint will be dismissed unless the complainant has made a prima facie showing that protected activity was a contributing factor in the alleged adverse action. The preamble to the regulations explains that it is the Secretary’s position that complainant must prove by a “preponderance of the evidence” that his or her protected activity contributed to the adverse action; otherwise the burden never shifts to the employer to establish its defense by “clear and convincing evidence.”
  • Explains that once the complainant establishes that the protected activity was a contributing factor in the adverse action, the employer can escape liability only by proving by clear and convincing evidence that it would have reached the same decision even in the absence of the prohibited rationale. The “clear and convincing evidence” standard is a higher burden of proof than a “preponderance of the evidence” standard.
  • Explains that among other remedies, “in appropriate circumstances, in lieu of preliminary reinstatement, OSHA may order that the complainant receive the same pay and benefits that he received prior to his termination, but not actually return to work. Such ‘economic reinstatement’ is akin to an order of front pay. According to OSHA, “economic reinstatement is designed to accommodate situations in which evidence establishes to OSHA’s satisfaction that reinstatement is inadvisable for some reason, notwithstanding the employer’s retaliatory discharge of the employee.” The agency notes, however, that “there is no statutory basis for allowing the employer to recover the costs of economically reinstating an employee should the employer ultimately prevail in the whistleblower adjudication.”
  • Outlines the various litigation steps, rules of and process for appealing decisions, and the roles of federal agencies involved.

The new interim procedures are effective as of November 3, 2011. Comments on these regulations are due within 60 days of the procedures’ publication in the Federal Register, which is scheduled for November 3. Comments may be submitted electronically through the federal eRulemaking portal; via fax to (202) 693-1648 (if comments do not exceed 10 pages); or by mail or hand-delivery to: OSHA Docket Office, Docket No. OSHA-2011-0126, U.S. Department of Labor, Room N-2625, 200 Constitution Avenue, N.W., Washington, D.C. 20210.

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OSHA Reopens Comment Period on Proposed Injury and Illness Recordkeeping and Reporting Rule

The Occupational Safety and Health Administration (OSHA) has agreed to reopen the comment period to allow for further input on its proposed changes to certain recordkeeping and reporting requirements. In June, the agency proposed to revise the current rule, which requires an employer to report to OSHA, within eight hours, all work-related fatalities and in-patient hospitalizations of three or more employees. The proposed rule would require an employer to report to OSHA, within eight hours, all work-related fatalities and all work related in-patient hospitalizations; and within 24 hours, all work-related amputations. The proposal would also amend Appendix A to Subpart B of the agency’s Injury and Illness Recording and Reporting regulation by updating the list of low-risk industries that are partially exempt from the rule’s requirements. Industries considered “low risk” are those with an average Days Away, Restricted, or Transferred (DART) rate at or below 75 percent of the national average DART rate. The proposed rule seeks to amend the list of low-risk industries listed in Appendix A by replacing the current list with one based on the updated North American Industry Classification System (NAICS) data, which relies on DART rates based on recent information compiled by the Bureau of Labor Statistics (BLS).

The initial comment period closed on September 20, 2011. In response to a request by the National Automobile Dealers Association, the agency will reopen this proposal for additional comment until October 20, 2011. All comments must include the docket number: OSHA-2010-0019 or the regulatory information number (RIN) 1218-AC50. Comments may be submitted electronically through the federal eRulemaking portal, or via fax if fewer than 10 pages to: (202) 693-1648. Alternatively, comments may be sent by mail or hand-delivery to: OSHA Docket Office, Docket Number OSHA-2010-0019, U.S. Department of Labor, Room N-2625, 200 Constitution Avenue, NW., Washington, DC 20210.

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OSHA Issues Revised Whistleblower Investigations Manual

Continuing its efforts to strengthen the enforcement of the Occupational Safety and Health Administration’s Whistleblower Protection Program, OSHA has released an updated Whistleblower Investigations Manual (pdf) containing revised case handling procedures and information on new laws enacted since the last manual was issued. The agency is responsible for enforcing the whistleblower provisions contained in 21 separate statutes, including Section 11(c) of the Occupational Safety and Health Act (OSH Act). In August, OSHA announced its plans to improve its efforts to investigate and enforce whistleblower complaints under these statutes in response to a Government Accountability Office (GAO) assessment of the agency’s Whistleblower Protection Program, which the GAO found lacking.

To this end, the main changes to the Investigations Manual include the following:

  • New chapters are added to provide information on investigating and processing whistleblower complaints filed under the Federal Railroad Safety Act (FRSA), National Transit Systems Security Act (NTSSA), and the Consumer Product Safety Improvement Act (CPSIA). In addition, the manual includes significant updates to the Surface Transportation Assistance Act (STAA) and to the Sarbanes-Oxley chapters, which reflects amendments made in the Dodd-Frank Wall Street Reform and Consumer Protection Act.
  • The manual requires investigators to attempt to interview the complainant in all cases.
  • The manual contains an expanded discussion of causation, burdens of proof, and the elements of a violation. As part of the intake process, the supervisor must verify that applicable coverage requirements have been met and that the prima facie elements of the allegation have been properly identified.
  • The instruction specifies that whistleblower complaints under any statute may be filed orally or in writing, in any language, and that OSHA will be accepting electronically-filed complaints on its Whistleblower Protection Program website.
  • The manual clarifies certain aspects of the investigation process, including the method and recording of interviews, and the processing of dually-filed 11(c) complaints in state plan states.
  • The manual includes changes in procedures for handling Privacy Act files and Freedom of Information Act requests.
  • The manual explains that interest on back pay and other damages is to be computed by compounding daily the IRS interest rate for the underpayment of taxes.
  • Finally, the manual sets forth additional guidance addressing uncooperative respondents and the process of issuing administrative subpoenas during whistleblower investigations.

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OSHA's 2011 Site-Specific Targeting Program Will Affect More Employers

High-hazard, non-construction employers with 20 or more employees will be subject to inspections under the Occupational Safety and Health’s 2011 Site-Specific Targeting (SST) programmed inspection plan. (pdf)  Last year’s SST applied to employers with at least 40 employees. The purpose of the SST is to enable OSHA to focus its inspection resources on workplaces that experience the highest injury and illness rates, as identified by data compiled in the 2010 OSHA Data Initiative (ODI) survey of approximately 80,000 establishments in selected high-hazard industries. According to OSHA, the worksites are randomly selected for inspection from a primary list of 3,700 manufacturing, non-manufacturing, and nursing and personal care facilities. Another change from last year’s program is the incorporation of a study to measure the program's impact on injury and illness rates and future compliance with OSHA standards.

Generally, the SST “defines key terms, describes the three inspection lists, provides scheduling and inspection procedures, and gives information on OSHA coding.” In addition, the report includes three appendices that provide information on the industry groups included in the 2010 ODI, includes a checklist for compliance safety and health officers (CSHOs), and instructs Area Offices on how to use the Inspection Targeting website. The targeted employers are culled from various manufacturing, non-manufacturing, and nursing and personal care facilities.

As was the case under last year’s SST, if a CSHO discovers that an establishment slated for inspection is a Voluntary Protection Programs (VPP) site, he or she must exit the site without conducting an inspection, and the establishment must be deleted from the inspection list. Similarly, if the establishment takes part in OSHA’s Consultation Safety and Health Achievement Recognition Program (SHARP), then the inspection officer must leave the site without conducting an inspection. If the establishment’s application to either of these programs is pending, then the inspection will be deferred.

In addition to the SST program, OSHA operates a number of national and local emphasis inspection programs aimed at specific high-risk hazards and industries.

In a press release, OSHA’s Assistant Secretary of Labor David Michaels said: “By focusing our inspection resources on employers in high hazard industries who endanger their employees, we can prevent injuries and illnesses and save lives,” adding: “Through the SST program we examine all major aspects of these operations to determine the effectiveness of their safety and health efforts.”

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OSHA Web Chat Generates a Number of Questions on Potential Injury and Illness Prevention Program Standard, Among Others

Deputy Assistant Secretary for the Occupational Safety and Health Administration Jordan Barab was on hand Monday to answer questions online regarding the agency’s regulatory agenda. The Department of Labor recently released its semiannual regulatory agenda, which included a number of significant workplace safety and health initiatives. OSHA’s agenda is an ambitious one, with eight proposals in the preliminary stages, five at the proposed rule level, and 14 regulations at the final stage of development. The agency is in the initial process of developing standards to address such hazards as infectious diseases, combustible dust, bloodborne pathogens, occupational exposure to beryllium, and occupational exposure to food favoring containing diacetyl and diacetyl substitutes. OSHA is also proposing rules that would reinstate the musculoskeletal disorder (MSD) column to the injury and illness reporting log, revise the agency’s injury and illness reporting system, and protect against occupational exposure to crystalline silica, among other measures. Regulations at the final rule stage include those designed to address hazard communication, and procedures to handle whistleblowing and retaliation complaints under various statutes governed by OSHA.

During the web chat, Barab noted that last year OSHA added an Injury and Illness Prevention Program standard (I2P2) to the regulatory agenda. According to Barab the proposed standard “will require employers to develop a program that will help them address their health and safety hazards in a systematic proactive way.” While OSHA has not yet set a specific date for publishing the proposed standard, Barab claimed the agency plans to begin the Small Business Regulatory Fairness Act (SBREFA) review process shortly at which time it “will be providing a draft to the SBREFA Panel, and at that time, the draft will be available to the public.” Barab said the agency will consider developing a document that compares the 1989 Safety and Health Program Management (SHPM) guidelines with the proposed I2P2 standard.

Barab clarified during the online session that the I2P2 will not involve any changes to the current review methodology and associated application of penalties for identified violations. He emphasized that “a citation for violating an existing OSHA standard or for violating the General Duty Clause does not mean that an employer will also be cited for violating the Injury and Illness Prevention Program standard.”

In response to a question about OSHA’s rulemaking regarding the electronic collection of occupational injury and illness data, Barab explained that the agency’s initiative “will not add to or change any employer’s obligation to complete and retain the injury and illness records or change the recording criteria or definitions for these records,” but rather that the proposal “will only modify employers’ obligations to transmit information from their records to OSHA.” This proposal is in draft form and has not yet been issued as a proposed rule.

While Barab answered a number of questions regarding specific rules, he also stated that the agency has “no plans” at this time to add an ergonomics standard to OSHA’s regulatory agenda, although he claimed that musculoskeletal disorders (MSDs) account for almost a third of all workplace injuries and illnesses requiring time away from work. “Rather than promulgating an ergonomic standard at this time,” Barab explained, “OSHA will continue addressing this issue through providing guidance as well as through enforcement using the general duty clause under 5 (a)(1).” Barab was also asked whether the Agency gleaned anything from small businesses from the recently re-opened docket and teleconferences that could affect the proposal to add a column specifically for MSDs that they are required to report. In response, Barab stated that: “OSHA is currently reviewing the information and input received to determine an appropriate course of action.”

In response to an inquiry as to why the proposed rule for crystalline silica has been delayed, Barab explained that the rule “is a scientifically complex effort that potentially affects a large number of workers and employers. It is among the largest health rulemakings undertaken by OSHA. Although publication of the proposed rule is taking longer than expected, OSHA continues to work diligently with OMB and is confident that the proposed rule will be published soon.”

As for a potential bloodborne pathogens standard, Barab claimed that this proposed regulation might apply to workplaces other than healthcare-related ones if there exists occupational exposure or potential exposure to blood and body fluids.

Finally, Barab mentioned that the agency has updated its publication target date for the final rule on the Hazard Communication Standard to occur in September 2011.

A transcript of the entire web chat can be found here.

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OSHA to Hold Stakeholder Meetings in Advance of Possible Rulemaking to Limit Occupational Exposure to Infectious Diseases

The Occupational Safety and Health Administration will hold a series of stakeholder meetings on July 29, 2011 to gather information on how best to limit occupational exposure to infectious diseases. According to a notice (pdf) to be published in the Federal Register, the agency is considering the development of a program standard to limit exposure to infectious agents for workers who provide direct patient care or perform tasks other than direct patient care, but are nonetheless exposed to infectious diseases. As discussed in the notice, the latter category might include such tasks as providing patient support services such as housekeeping, food delivery, or facility maintenance; handling, transporting, receiving or processing infectious items or waste; maintaining, servicing or repairing medical equipment that is contaminated with infectious agents; conducting autopsies; performing mortuary services; and performing tasks in laboratories that could result in occupational exposure to diseases.

The agency plans to use the information provided during two three-hour stakeholder meetings to develop a possible rule governing occupational disease exposure. The meetings will be limited to approximately 30 participants per session, although members of the general public may observe, but not participate in, the meetings if space allows. The topics slated for discussion include the following:

  • Whether and to what extent an OSHA standard on occupational exposure to infectious diseases should apply in settings where workers provide direct patient care, as well as, settings where workers have occupational exposure even though they don’t provide direct patient care. Whether and to what extent there are any other settings where an OSHA standard should apply.
  • The advantages and disadvantages of using a program standard to limit occupational exposure to infectious diseases, and the advantages and disadvantages of taking other approaches to organizing a prospective standard.
  • Whether and to what extent an OSHA standard should require each employer to develop a written worker infection control plan (WICP) that documents how the employer will implement the infection control measures it will use to protect the workers in its facility.
  • Whether and to what extent an OSHA standard should require each employer to implement its WICP through a section addressing methods of compliance.
  • Whether and to what extent an OSHA standard should require each employer to make available routine medical screening and surveillance, vaccinations to prevent infection, and post-exposure evaluation and follow-up to all workers who have been exposed to a suspected or confirmed source of an infectious agent(s) without the benefit of appropriate infection control measures.
  • Whether and to what extent an OSHA standard should require the employer to establish and maintain medical records, exposure incident records, and records of reviews of its worker infection control program, and whether and to what extent an OSHA standard should contain other recordkeeping requirements.

Interested participants in the meetings – to be held on July 29, 2011 from 9:00 a.m. - noon and from 1:30 p.m. - 4:30 p.m. in the Francis Perkins Building, Room N-4437 at 200 Constitution Avenue, NW., Washington, DC 20210 – must file a request by July 22, 2011. Requests to participate in one of the meetings may be made electronically, via facsimile to: (781) 674-7200 (include "Attention: OSHA Infectious Diseases Stakeholder Meeting Registration” in the subject line) or by regular mail, express delivery, hand (courier) delivery, and messenger service to: OSHA Infectious Diseases Stakeholder Meeting Registration, Attention: Thomas Nerad, OSHA, Room N-3718, 200 Constitution Avenue, NW., Washington, DC 20210. Participants are asked to specify which meeting they would like to attend, in addition to their name, address, phone, fax, e-mail, organization for which they work and/or represent, and stakeholder category: government, industry, union, trade association, insurance, manufacturers, consultants, or other. According to OSHA, formal presentations by stakeholders will not be permitted in order to facilitate discussion.

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OSHA Proposes Revisions to Recordkeeping and Reporting Requirement Exemptions

The Occupational Safety and Health Administration is proposing to amend certain recordkeeping and reporting requirements by updating the list of low-risk industries that are partially exempt from these requirements, and mandating that employers report all instances of work-related fatalities and in-patient hospitalizations to the agency within eight hours, and amputations within 24 hours.

Appendix A to Subpart B of OSHA’s Injury and Illness Recording and Reporting regulation lists the industries that are partially exempt from maintaining records of occupational injuries and illnesses. Currently, these exempt industries are considered low-risk based on the Standard Industrial Classification (SIC) system. These lower hazard industries are those industries with an average Days Away, Restricted, or Transferred (DART) rate at or below 75 percent of the national average DART rate. As explained in the proposed rule, in 1997 the North American Industry Classification System (NAICS) was introduced to classify establishments by industry. OSHA began converting the SIC codes to NAICS codes in 2001. The proposed rule would update the list of low-risk industries in Appendix A by replacing the current list with one based on the updated NAICS data, which uses DART rates based on recent information compiled by the Bureau of Labor Statistics (BLS).

OSHA seeks comments on the proposal, including input on the following questions:

  1. Should any additional industries be exempt from any of the recordkeeping requirements in Part 1904?
  2. Should OSHA base partial exemptions on more detailed or more aggregated industry classifications, such as two-digit, three-digit, or six-digit NAICS codes?
  3. Which industry sectors, if any, should be ineligible for partial exemption?
  4. Instead of using an average DART rate of 75 percent of the most recent national DART rate, is there a better way to determine which industries should be included in Appendix A?
  5. Should OSHA consider numbers of workers injured or made ill in each industry in addition to industry injury/illness rates in determining eligibility for partial exemption?
  6. Are there any other data that should be applied as additional or alternative criteria for purposes of determining eligibility for partial exemption?
  7. Should OSHA regularly update the list of lower-hazard exempted industries? If so, how frequently should the list be updated?
  8. Are there any specific types of training, education, and compliance assistance OSHA could provide that would be particularly helpful in facilitating compliance with the recordkeeping requirements?

In addition, the proposed rule would require that employers report to OSHA all work-related fatalities and in-patient hospitalizations within eight hours. Currently, employers are required to do so for such incidents involving three or more employees. The proposal also would require employers to report all work-related amputations within 24 hours. With respect to this change, OSHA seeks responses to the following questions:

  1. What types of incidents and/or injuries and illnesses should be reported to OSHA and why?
  2. Are there any injuries, illnesses, or conditions that should be reported to OSHA and are not included among in-patient hospitalizations?
  3. Should amputations that do not result in in-patient hospitalizations be reported to OSHA?
  4. Should OSHA require the reporting of all amputations?
  5. Should OSHA require the reporting of enucleations?
  6. Are there additional data or estimates available regarding the number of work-related incidents involving in-patient hospitalizations? Is there information available on how many work-related hospitalizations occur more than 30 days after the report of an injury or illness?
  7. Should OSHA allow reports to be made by means other than a telephone, such as by email, fax, or a web-based system?
  8. Are the reporting times of eight hours for fatalities, eight hours for in-patient hospitalizations, and 24 hours for amputations generally appropriate time periods for requiring reporting? What advantages or disadvantages would be associated with these or any alternative time periods?

Comments on this proposal must contain the docket number: OSHA-2010-0019 or the regulatory identification number: RIN 1218-AC50 and be received on or before September 20, 2011. Comments may be submitted electronically through the federal eRulemaking portal or, if not exceeding 10 pages, via fax to: (202) 693-1648. Alternatively, comments may be sent in triplicate by mail, hand delivery, express mail, messenger, or courier service to the OSHA Docket Office, Docket Number OSHA-2010-0019, U.S. Department of Labor, Room N-2625, 200 Constitution Avenue, NW., Washington, DC 20210.

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OSHA Launches Online Tool to Educate Employers About Recordkeeping Requirements

The Occupational Safety and Health Administration has developed on online tool to help employers assess their obligations under the agency’s injury and illness recordkeeping regulations. The OSHA Recordkeeping Advisor is presented in question and answer format and directs users to the next appropriate inquiry and/or course of action based on their responses. The stated purpose of the online tool is to help employers determine:

  • Whether an injury or illness (or related event) is work-related
  • Whether an event or exposure at home or on travel is work-related
  • Whether an exception applies to the injury or illness
  • Whether a work-related injury or illness needs to be recorded
  • Which provisions of the regulations apply when recording a work-related case

The agency emphasizes that the tool is designed to help employers better understand their recordkeeping requirements, but should not be used as a substitute for OSHA’s more detailed regulations, handbooks, or letters of interpretation.

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Bill Would Make Voluntary Protection Program Permanent

A popular workplace safety initiative was shown support on Wednesday when lawmakers in both the House and Senate introduced bipartisan legislation to make it permanent. The Voluntary Protection Program (VPP) Act (H.R. 1511, S. 807) would codify the current program, authorize the grant of funds to enable it to continue, and extend its availability to small businesses.

To participate in the VPP, employers submit applications to the Occupational Safety and Health Administration (OSHA) and undergo a stringent safety assessment of their work site and safety and health management programs. If the facility meets the required safety and health standards and is approved to participate in this cooperative program, the employer is exempt from OSHA programmed inspections, investigations and certain paperwork requirements. This exemption does not apply to investigations or inspections resulting from employee complaints, fatalities, catastrophes, or significant toxic spills/releases. OSHA onsite evaluations would be conducted to ensure a high level of protection of employees, however, these onsite visits would not result in enforcement citations. Employers would also be subject to periodic reevaluations for continued participation in the program.

According to a press release issued by Senator Mike Enzi (R-WY), the lead sponsor of the bill in the Senate, since the VPP’s inception in 1982, it has grown to include more than 2,200 worksites and more than 921,000 employees. The release also cites a 2007 report noting that the program has saved the government more than $59 million by avoiding injuries, private sector VPP participants have saved more than $300 million over this period, and that on average, participating workplaces experience an illness and injury rate that is 50 percent below that maintained by other workplaces in their respective industries.

Many in the business community have expressed concern that OSHA is putting the VPP on the backburner by allegedly diverting the agency’s funds to enforcement instead of prevention efforts. The bill would authorize Congress to grant the agency “such sums as may be necessary” to maintain the program. In addition, the legislation would direct the Secretary of Labor to “establish and implement, by regulation, a program to increase participation by small businesses” in the VPP.

According to Senator Enzi, “the Voluntary Protection Programs have encouraged a culture of health and safety in the workplace that saved the government and private sector millions of dollars by avoiding injuries and illnesses.” Senator Mary Landrieu (D-LA), a co-sponsor of the bill, added that; “the VPP program is a great example of how the right public-private partnership can succeed in reducing accidents at work, but these partnerships are not a replacement for stricter mandatory workplace safety guidelines, especially in dangerous occupations. Rep. Tom Petri (R-WI), the lead sponsor of the bill in House, commented that “there are times when OSHA has to be heavy handed, but most employers want to run safe workplaces. There is a lot to be gained by having OSHA recognize employers who have demonstrated a commitment to workplace safety. When OSHA does that, it creates an incentive for other employers to follow suit - and that improves safety and saves money on enforcement costs at the same time.” Another sponsor of the bill, Rep. Gene Green (D-TX) stated that “the Voluntary Protection Program is one of the few programs that has achieved unified support from both union and non-unionized labor, small and large businesses, and government.”

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Subcommittee Holds Hearing on OSHA Rulemaking

On Tuesday, the House Subcommittee on Workforce Protections held a hearing –
Investigating OSHA's Regulatory Agenda and Its Impact on Job Creation – to examine recent regulatory actions taken by the agency and discuss ways to improve the rulemaking process. Subcommittee Chairman Tim Walberg (R-MI) stated that both employers and employees have a “shared goal” of creating a safe workplace, but argued that OSHA has “become an administration focused more on punishment than prevention.” 

Driving home that point, one witness claimed that OSHA’s planned changes to its On-Site Business Consultation program would detrimentally affect small businesses. Under this program, small and medium-sized businesses may obtain free and confidential advice from the agency regarding their safety programs. According to the attorney witness, the success of the On-Site Consultation program hinges upon the fact that problems are not shared with OSHA’s enforcement wing. He claimed that this process encourages small businesses to seek help and fix problems before a safety incident arises. The proposed changes to the criteria under which participants in the program could be subject to enforcement action by OSHA inspectors “would have an awful effect on the program” by discouraging participation. He emphasized that OSHA did not convene a Small Business Regulatory Enforcement Fairness Act (SBREFA) panel prior to proposing these changes “despite the On-site Consultation program’s focus on small business. OSHA, therefore, missed an opportunity to learn directly from small businesses about how changes would affect their participation in the program.”

Other witnesses focused on recent OSHA actions that have been withdrawn, at least temporarily, such as the proposed inclusion of a musculoskeletal disorder (MSD) column to the Form 300 Injury and Illness Log, and the proposed reinterpretation of the phrase “feasible administrative or engineering controls” as it is used in the agency’s General Industry and Construction Occupational Noise Exposure standards. As explained by Jacqueline M. Holmes, who testified on behalf of the U.S. Chamber of Commerce, the reason why the panelists focused on withdrawn rules is that it “reflects a troubling allocation of resources” on OSHA’s part. With respect to the noise exposure rule reinterpretation, which would have required employers to use administrative or engineering controls instead of personal protective equipment (PPE) to reduce noise exposure that is above the acceptable level when such controls are “capable of being done” or “achievable,” Holmes criticized that the agency for attempting to implement this change “by regulatory fiat” instead of through the normal rule-making channels. While she appreciated that the rule was withdrawn, she claimed that the plan to make the change was flawed in the first instance. According to Holmes, OSHA “made no effort to identify that there was a problem that needed solving.” She also noted that the “vast majority of employers want to do the right thing. It is good business to work safely.”

Similarly, Stuart Sessions, testifying on behalf of the Coalition for Workplace Safety, claimed that if OSHA had finalized the noise exposure reinterpretation, it would have impacted between 2 and 7 million workers, and cost employers between $2,000 and $10,000 dollars per worker, resulting in an overall cost of between $1-27 billion per year. Sessions also estimated that the rule would have resulted in a loss of 10-20,000 U.S. jobs. The witness also argued that in crafting the change as an administrative interpretation instead of as a rule, OSHA sidestepped certain Regulatory Flexibility Act requirements to address small business concerns.

Another witness emphasized the need for OSHA to work with small businesses during the initial stages of the rule-making process, as they are disproportionately affected by federal regulations. According to the panelist, OSHA should work with the Small Business Administration’s Office of Advocacy early in the rule-making process to avoid problems down the line.

The discussion of the economic burdens of regulatory action is notable in light of President Obama’s recent executive order and memoranda to federal agencies directing rulemakers to consider how regulations impact small businesses, economic growth and job creation.

Subcommittee member Rep. Dennis Ross (R-FL) raised concerns about potential new causes of action against employers that could result if the musculoskeletal disorders column is ever restored. He suggested that the onus could be put on employers to examine any causal relationship between repetitive injury and job requirements. He also noted other potential liability pitfalls, such as retaliatory discharge claims if an employee who suffers an MSD is fired.

Ranking Democratic member Rep. Lynn Woolsey (D-CA), however, expressed concern that the Republican continuing budget resolution (H.R. 1) would cripple the agency and its ability to function. On Monday, the DOL issued its 2012 budget request for $583 million and 2,387 full-time equivalent employees (FTE) for OSHA, an increase of $24,766,000 and 52 FTE over the FY 2010 enacted level. The request for OSHA includes increases of $6.4 million to improve regulatory standards; $7.7 million for Compliance Safety and Health Officers; and $6 million for additional whistleblower investigators. According to Woolsey, the continuing resolution Congress is currently examining instead calls for an 18% reduction of OSHA’s budget, which would eliminate 414 agency employees and result in 8,000 fewer workplace inspections. She also claimed that the continuing measure would cut OSHA standards by 16%. She concluded the hearing, however, by stating that “unless the goal is to under fund and undermine OSHA,” both parties would be able to work together to “bring OSHA into the 21st century.”

A list of the panelists and links to their written statements can be found here.

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Congressional Hearing Focuses on Regulatory Impact on Employers

On Thursday, the House Committee on Oversight and Government Reform held a hearing to discuss how regulations impact employers and job creation. Several business owners, advocates, and academics provided input on the benefits and detriments of current and proposed regulations, taking particular aim at recent proposals developed by the Occupational Safety and Health Administration (OSHA). The hearing coincided with the release of a report – Assessing Regulatory Impediments to Job Creation (pdf) – issued by the Committee. Findings of this report include the following:

  • According to one study, small firms bear a regulatory cost of $10,585 per employee whereas large firms with more than 500 employees incur a cost of $7,755 per employee to comply with federal regulations.
  • The manufacturing industry is hit the hardest by regulatory costs, with per firm costs at $688,944 – half a million dollars greater than the national average cost for all industries.
  • Small manufacturers bear a proportionally larger regulatory burden with an estimated cost of $26,316 per employee – more than double the burden that is faced by larger manufacturers.
  • While the Department of Labor has pulled back on two of its most controversial proposals, OSHA noise standards and OSHA Form 300 Musculoskeletal Disorders (MSD) reporting requirements, job creators expressed significant concern for the OSHA Combustible Dust Management rule, proposed changes in OSHA Consultation Agreements, and OSHA’s Injury & Illness Prevention Program (“I2P2”).

During the hearing, Jay Timmons, president and CEO of the National Association of Manufacturers (NAM), urged (pdf) agencies to “scrutinize the past two years of regulations and those currently under consideration to determine if they are consistent with a national mission of jobs and economic growth.” Timmons took particular issue with OSHA’s plans to propose amendments to its on-site consultation program “that would remove the ‘wall of separation’ between the consultation program and the enforcement staff.” Timmons added that: “OSHA’s actions here will only serve to discourage small businesses from participating in this successful program by making it more likely that a confidential consultation will turn into a surprise enforcement referral for something that does not present an imminent danger.”

Timmons also criticized OSHA’s anticipated proposal that would mandate a standard for employers’ safety and health programs. Timmons expressed concern that a required injury and illness program:

may not take into account the efforts by employers who already have effective safety and health programs in place or how this new mandate would disrupt safety programs that have achieved measurable successes. Based on preliminary information from OSHA, this proposal may allow OSHA investigators to substitute their judgment of the employer’s plan on how to achieve compliance and whether some “injury” in the workplace should have been addressed in some way, even if these conditions were regulated under a specific standard or did not amount to a “significant risk” as required under the OSH Act.

Echoing Timmons’ concern, witness Michael J. Fredrich, President of MCM Composites, LLC, testified (pdf) that OSHA’s proposed Injury and Illness Prevention Program “is nothing more than a ‘prove yourself innocent’ plan and it is a waste of time and money.”

Speaking on behalf of the National Federation of Independent Business (NFIB), business owner Jack Buschur testified (pdf) about the burdens imposed by project labor agreements (PLAs) and prevailing wage rules. With respect to PLAs, Buschur clamed:

The use of Project Labor Agreements is a discriminatory tactic that prevents non-union construction companies from working on government construction projects. The U.S. Department of Labor’s Bureau of Labor Statistics found in their annual report on union membership that from 2009 to 2010 union membership fell from 14.5 percent to 13.1 percent of the U.S. private construction work force. By preventing 86.9 percent of construction companies from bidding, PLAs increase the cost of construction by unfairly reducing the number of companies which can competitively bid. When you consider the fact that the construction industry currently has an unemployment rate of over 20 percent, it makes no sense to impose PLAs or other regulations that serve as impediments to job creation.

As for the prevailing wage rules, Buschur claimed that the requirements imposed by these regulations create an undue administrative burden on his business.

Karen Kerrigan, President and CEO of the Small Business & Entrepreneurship Council, testified (pdf) that the DOL’s “Plan/Prevent/Protect” regulatory initiative “will require businesses and other regulated entities to develop extensive, time-consuming plans and internal processes with their employees that will serve as a check for DOL on how and whether businesses are complying with the law.” In particular, Kerrigan took issue with the Wage and Hour Division’s planned regulation under the program that would require employers to provide workers with information on how their pay is calculated, how job classifications are developed, and whether and why they are classified as independent contractors. In addition, Kerrigan explained that under this proposal, employers would have to conduct training sessions regarding the differences in job classifications. According to Kerrigan, “for small businesses, the totality of the agency-wide Plan/Protect/Prevent program would be a significant burden – if not a nightmare.”

On the other hand, Sidney Shapiro, Member Scholar and Vice President of the Center for Progressive Reform, argued (pdf) that the focus on regulatory costs is misguide. Among other things, Shapiro claimed that:

  • The cost of regulation in isolation “proves nothing because it ignores the benefits that regulation brings to the public and the economy. OMB recently estimated that over the last 10 years major federal regulations with quantified and monetized costs and benefits produced total of between $128 and $616 billion – a staggering return on the total $43-$55 billion costs of these investments.”
  • Retrospective studies show that industry estimates of regulatory costs, submitted to agencies for purposes of rulemaking, are often too high.
  • A recent study on regulatory costs issued by the SBA Office of Advocacy is unreliable.
  • The costs of regulation generate economy activity, because the money is spent on goods and services, thereby generating jobs.

James Gattuso, a researcher with the Heritage Foundation, however, advocated (pdf) that Congress take the following steps to reduce the regulatory burden on businesses:

  • Require congressional approval of major regulations that place new burdens on the private sector;
  • Require a cost analysis of all legislation imposing new regulatory burdens; and
  • Establish a sunset sate for new federal regulations.

Similarly, Jerry Ellig, an economist and research fellow at the Mercatus Center, made a number of recommendations in his testimony. (pdf)  Among other steps, Ellig suggested that:

Regulatory analysis needs to be encouraged, enforced, and required for all federal agencies. Agency economists should have the independence to conduct objective analysis. Agencies should publish regulatory analysis before writing proposed regulations and explain transparently how the analysis affected their decisions when they issue regulations.

A complete list of the panelists and links to their testimony can be found here.

This hearing follows other executive and legislative efforts to ensure that regulations do not pose an undue burden on the business community. Last month, President Obama issued an executive order and memoranda to federal agencies directing rulemakers to consider how regulations impact small businesses and economic development. In the same vein, the House of Representatives has begun debate on a resolution (H. Res. 72) that would require certain committees to inventory and review existing, pending, and proposed regulations and orders, “particularly with respect to their effect on jobs and economic growth.” In addition, the recently-introduced Regulatory Flexibility Improvements Act of 2011 (H.R. 527) would amend the Regulatory Flexibility Act to, among other things, require a more thorough analysis of regulations for their potential impact on small businesses. Whether and to what extent these measures are implemented remains to be seen.

OSHA's National Advisory Committee Meeting to Address Injury and Illness Prevention Programs

OSHA's National Advisory Committee on Occupational Safety and Health (NACOSH) will conduct a two-day meeting next week to discuss, among other initiatives, the agency’s Injury and Illness Prevention Programs. Throughout the summer, the agency conducted a series of stakeholder meetings devoted exclusively to soliciting input to help OSHA formulate an Injury and Illness Prevention Program rule. These meetings were held on June 3, 10, 29; July 20; and August 3.  Next week’s meetings will be held from 8:30 a.m. to 4:30 p.m. EDT on September 14 and 15 at the U.S. Department of Labor, Room N-3437, 200 Constitution Ave., N.W., Washington, D.C. 20210. In addition to discussing OSHA’s injury and illness prevention programs, the meeting will focus on the recent Gulf of Mexico oil spill response efforts.

Individuals interested in speaking at the meetings must submit a request beforehand. Information on how to make such a request can be found here.  Interested parties may also submit comments to the NACOSH prior to the meeting. Comments may be delivered electronically through the federal eRulemaking portal: www.regulations.gov, or sent in triplicate to the OSHA Docket Office, Room N-2625, U.S. Department of Labor, 200 Constitution Ave., N.W., Washington, D.C. 20210. Submissions of 10 pages or less may be faxed to the OSHA Docket Office at 202-693-1648. Submissions should include Docket No. OSHA-2010-0012.

Photo credit:  MBPHOTO, INC.

OSHA Begins its National Emphasis Program to Check the Accuracy of Employer Injury and Illness Recordkeeping

The Occupational Safety and Health Administration (OSHA) announced that it has started its one-year national emphasis program (NEP) (pdf) on recordkeeping to assess the accuracy of injury and illness data recorded by employers. Under this program, OSHA inspectors will conduct audits of at most 50 employers with at least 40 employees. No more than five worksites will be targeted per OSHA region. Those selected will be employers in one of 21 named industries that have reported the highest rates of missed work, restricted work activity, or job transfers. Such industries include animal (except poultry) slaughtering, scheduled passenger air transportation, foundries, concrete pipe manufacturing, soft drink manufacturing, and couriers.

The audit will include a safety and health walkaround inspection of the workplace on the first day of the review. The compliance officers will examine the employees' records in order to identify occupational injuries and illnesses that may have occurred to those employees from 2007 to 2008. OSHA will then compare its findings to the records the employer provided to the agency to find any discrepancies. As part of the NEP, OSHA will review medical records, workers’ compensation records, insurance records, payroll/absentee records and, if available, company safety incident reports, company first-aid logs, alternate duty rosters, and disciplinary records pertaining to injuries and illnesses. The agency will also review records that are stored offsite. Additionally, the OSHA compliance officers will conduct interviews with employees, management, the record keepers, and medical staff. If recordkeeping violations are identified, the inspectors will propose citations and penalties.

Those employers that currently participate in OSHA’s Voluntary Protections Programs or Safety and Health Achievement Recognition Program (SHARP) will be exempt from the NEP.
 

OSHA Plans Comprehensive Safety Inspections for Nearly 4,000 High-Hazard Worksites

Last Friday the Occupational Safety and Health Administration (OSHA) announced that its Site-Specific Targeting 2009 (SST) program (pdf) will focus its enforcement efforts on approximately 4,000 high-hazard worksites, including nursing homes and manufacturing establishments. The SST inspection program is based on injury and illness data from OSHA’s 2008 Data Initiative survey of 80,000 employers with 40 or more workers in industries with historically high occupational injury and illness rates. The agency uses this data to determine which work sites will receive comprehensive safety inspections.

According to a press release, this year’s SST program will not use one rate for all types of establishments, but rather will set minimum injury and illness rates for three separate categories of employers: manufacturing, non-manufacturing, and nursing homes. Doing so, the agency claims, will enable OSHA to inspect more facilities that exceed the minimum rate. In addition, some employers that did not respond to an OSHA Data Initiative survey will be automatically added to the inspection list. In a statement, acting Assistant Secretary of Labor for OSHA Jordan Barab said: “[t]hese inspections examine all aspects of a workplace's operations and the effectiveness of its safety and health efforts.”

The push for increased safety inspections is part of a larger enforcement trend within the Department of Labor (DOL). In June, Secretary of Labor Hilda Solis told attendees at the American Society of Safety Engineers’ annual conference: “Make no mistake about it: The Department of Labor is back in the enforcement business.” Jordan Barab similarly emphasized this sentiment, stating: “[t]he law says that employers are responsible for workplace safety and health, and there's a new sheriff in town to enforce the law."

Obama Names David Michaels as His Pick to Head OSHA

On Tuesday President Obama announced his intent to nominate David Michaels as the assistant secretary of the Occupational Safety and Health Administration (OSHA). Michaels, an epidemiologist, is currently a research professor at the Department of Environmental and Occupational Health at the George Washington University School of Public Health and Health Services, where he also directs the Department’s doctoral program.

Prior to working at George Washington University, Michaels was nominated by former President Clinton to serve as Assistant Secretary of Energy for Environment, Safety and Health. His responsibilities included protecting the health and safety of workers, neighboring communities and the environment surrounding the nation’s nuclear weapons facilities. In that position, according to his biography posted on George Washington University’s website, Michaels “was the chief architect of the historic initiative to compensate workers in the nuclear weapons complex who developed cancer or lung disease as a result of exposure to radiation, beryllium and other hazards. Since its enactment in 2000, The Energy Employees Occupational Illness Compensation Program has provided more than $4.5 billion in benefits to sick workers and their families.” In addition, Michaels oversaw the promulgation of the Chronic Beryllium Disease Prevention and Nuclear Safety Management rules.

Michaels has written a book and a number of articles on workplace safety standards and contaminants, including Doubt is Their Product: How Industry's Assault on Science Threatens Your HealthSelected Science: An Industry Campaign To Undermine An OSHA Hexavalent Chromium StandardScientific Evidence and the Regulatory System: Manufacturing Uncertainty and the Demise of the Formal Regulatory System (pdf), Beryllium's Public Relations Problem: Protecting Workers When There Is No Safe Exposure Level (pdf), and Manufacturing Uncertainty: Contested Science And The Protection Of The Public's Health And Environment (pdf).

Michaels earned his undergraduate degree in History at the City College of New York, and his Master of Public Health degree in Epidemiology and doctoral degree in Sociomedical Sciences at Columbia University.

Department of Labor Outlines Regulatory Agenda for the Next 12 Months

The Department of Labor (DOL) has published in today’s Federal Register its semiannual regulatory agenda. (pdf)  The agenda lists all regulations the agency expects will be under review or development until April 2010, as well as those completed within the past six months. Specifically, the document lists 13 items in the pre-rule, proposed rule, final rule, and long-term action stages, along with a brief description, review timetable, comment period, and agency contact information for each regulation. 

Of the 13 regulations, four are listed as being under section 610 review. Section 610 of the Regulatory Flexibility Act (RFA) requires each federal agency to develop a plan for the periodic review of its rules that have or will have a significant economic impact on a substantial number of small entities. Those regulations currently under such review by the Occupational Safety and Health Administration (OSHA) include the bloodborne pathogens and methylene chloride standards. Also included in this review category are the explosives and blasting standard in the pre-rule stage at the Mine Safety and Health Administration (MSHA) and the plan assets – participant contributions regulation under review by the Employee Benefits Security Administration (EBSA). 
 

Legislative and Regulatory News for the Week of April 5, 2009

The following is a summary of the legislative and regulatory news for the week of April 5, 2009:

Agency Changes

President Obama has named Jane Oates as his nominee for assistant secretary of the Department of Labor’s Employment and Training Administration (ETA).

Jordan Barab has been appointed as both deputy assistant secretary and acting assistant secretary of labor for the Occupational Safety and Health Administration (OSHA).

Employee Benefits

The Internal Revenue Service has released guidance on the COBRA premium subsidy provided for in the stimulus package.  The Department of Labor (DOL) has likewise issued expanded guidance on the COBRA subsidy notice requirements.

Immigration

The U.S. Citizenship and Immigration Services (USCIS) announced that it will continue to accept applications for initial H-1B status more than a week after the filing season opened.

Workplace Safety

OSHA has released a guidance document on assigned protection factors for respirators.  The agency has also released a revised Field Operations Manual.
 

Jordan Barab Named As Acting Head of OSHA

U.S. Labor Secretary Hilda Solis has appointed Jordan Barab as deputy assistant secretary for the Occupational Safety and Health Administration (OSHA). Barab will also serve as acting assistant secretary for OSHA as of April 13.

Until his appointment, Barab had been serving as a senior policy advisor to the House Education and Labor Committee, specializing in worker health and safety issues. Prior to working on this committee, Barab spent four years at the U.S. Chemical Safety and Hazard Investigation Board. From 1998 to 2001, Barab was appointed as a special assistant to the Assistant Secretary for OSHA. In this position he served, among other things, as national labor liaison and ergonomics coordinator. Before that, he spent 16 years directing the safety and health program for the American Federation of State, County and Municipal Employees (AFSCME).

Additionally, from March 2003 until January 2007, Barab ran Confined Space, a blog devoted to “news and commentary on workplace health & safety, labor and politics.” Barab ceased writing for this blog when he began working for the House Education and Labor Committee.

In response to Barab’s appointment, Rep. George Miller (D-Calif.), Chairman of the House Education and Labor Committee, said in a statement:

I congratulate Jordan for being named as the acting head of OSHA. Jordan will bring a tremendous amount of valuable health and safety experience to an agency that has been neglected for far too long. Throughout his career, Jordan has demonstrated the specialized knowledge of health and safety issues needed to revamp the agency and strengthen its efforts to protect Americans while on the job. I look forward to working with Jordan and Secretary Solis to ensure that the agency works to protect the health and safety of our nation’s workers.

Bill to Regulate Combustible Dust Exposure at Industrial Sites is Reintroduced

As predicted, Rep. George Miller (D-CA), chairman of the House Education and Labor committee, Rep. John Barrow (D-GA), and Rep. Lynn Woolsey (D-CA), chair of the Workforce Protections Subcommittee, have reintroduced a bill that would regulate combustible dust exposure at industrial sites. The Worker Protection Against Combustible Dust Explosions and Fires Act (CDEFA) (H.R. 849), introduced on Wednesday, would require the Occupational Safety and Health Administration (OSHA) to issue interim rules on combustible dust within 90 days, followed by final rules within 18 months. CDEFA also would direct OSHA to revise the Hazard Communication Standard to include combustible dusts.

The rules would outline measures to minimize hazards associated with combustible dust through improved housekeeping, engineering controls, worker training and a written combustible dust safety program. These rules would be based on effective voluntary standards devised by the National Fire Protection Association. The rules would further provide requirements for building design and explosion protection.

A similar bill introduced last year (H.R. 5522) cleared the House by a vote of 247-165, but never made it out of the Senate Committee on Health, Education, Labor, and Pensions. The bill was introduced in response to the February 7, 2008 Imperial Sugar Refinery explosion in Port Wentworth, Georgia, that was caused by combustible sugar dust. The Congressional Budget Office had estimated that CDEFA would have increased OSHA’s enforcement workload by about five percent per year at a cost of approximately $10 million a year. If the current bill passes, it would likely have an impact on a broad spectrum of industries, the costs of which are unknown because there is likely a great variance from employer to employer how compliant they are with pre-existing standards and how up-to-date they are in the procedures and controls that are already in place.

Given the current makeup of the Senate and President Obama’s pledge to improve worker safety and strengthen OSHA enforcement, there is a greater chance this session that this bill could become law. At the moment, CDEFA has been referred to the House Committee on Education and Labor.