Increasing OSHA Penalties: How to Avoid Inspections and Fines. Sponsored by
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1 Increasing OSHA Penalties: How to Avoid Inspections and Fines Sponsored by
2 OSHA Penalties Increase How to Practice Compliance and Avoid Hefty Fines November 16, 2016 Presented by: Tracy L. Moon, Jr. Phone: (404)
3 THANK YOU FOR YOUR COMMITMENT TO SAFETY Winning is not a sometime thing, it is an all-time thing. ~ Vince Lombardi So Is Safety!
4 WHY BE CONCERNED? August, 2016 Penalty Increase Recordkeeping Changes in 2015 & 2016 Continued aggressive enforcement including more inspectors, higher penalties and unfriendly press releases, especially against restaurant companies More employers placed in the Severe Violators Enforcement Program Increased focus on whistleblowers with push to find more cause determinations On-line whistleblower complaint applications More emphasis on workers rights, including worker summits
5 WHY BE CONCERNED? Interpretative letter on third-party representation Local, state and national governments look at safety records bar on submitting bids Private sector companies also looking at contractors, vendors and system safety record may lose clients Poor safety results in more injuries and increased costs, which reduce company s profitability could lose jobs Increased reporting requirements - Injury and illness - Fair Pay and Safe Workplace Executive Order
6 WHY BE CONCERNED? Civil penalties should be a credible deterrent that influences behavior far and wide, said U.S. Secretary of Labor Thomas E. Perez. Adjusting our penalties to keep pace with the cost of living can lead to significant benefits for workers and can level the playing field responsible employers who should not have to compete with those who don t follow the law.
7 PENALTIES Effective August 1, 2016: Other than serious Up to $12,471 per violation - increased from $7,000 Serious Up to $12,471 per violation - increased from $7,000 Posting Requirements Up to $12,471 per violation - increased from $7,000
8 PENALTIES Effective August 1, 2016: Willful Up to $124,709 per violation - Increased from $70,000 Repeat Up to $124,709 per violation - Increased from $70,000 Failure to Abate Up to $12,471 per day beyond abatement date - Increased from $7,000 Retroactive employers inspected before the effective date, but who receive OSHA citations after that date, will be subject to the higher penalties.
9 PENALTIES CRIMINAL VIOLATIONS Willful violation & employee death $10,000 or 6 months or both Second conviction: $20,000 or 12 months or both Advance notice of inspection $1,000 or 6 months or both Falsification of required records, etc. $10,000 or 6 months or both Murder or attempted murder of CO Term of years to life
10 HOW MUCH WOULD THIS OSHA PRESS RELEASE HARM YOUR REPUTATION AND BIDDING? Contractor's serial disregard of fall dangers underscores the necessity for National Safety Stand-Down to Prevent Falls in Construction, May 2-6. XYZ Builders. has failed 21 of 27 federal safety inspections in 12 months by putting its employees at risk of potentially fatal fall hazards. The company faces proposed penalties totaling $789,536 for violations in 20 of those inspections.. XYZ Builders has an extensive OSHA history that reflects a callous disregard for its employees "A developer and contractor that hire this company are truly rolling the dice on worker safety this employer must make immediate changes before something worse happens.
11 OSHA S TOP 10 MOST CITED VIOLATIONS FISCAL YEAR Fall protection, general requirements ( ) 2. Hazard communication ( ) 3. Scaffolding ( ) 4. Respiratory protection ( ) 5. Lockout/Tagout ( ) 6. Powered industrial trucks ( ) 7. Ladders ( ) 8. Electrical wiring method ( ) 9. Machine guarding ( ) 10. Electrical general requirements ( )
12 MOST FREQUENT GENERAL DUTY CLAUSE CITATION 1. Forklift Hazards % - Lack of seatbelts - Improper lifting of personnel 2. Crane Hazards % 3. Dust Explosions % 4. Struck-by Vehicle - 10% 5. Ladder Fall - 5.8% Source: Tracy Cekada and Christopher Janicak Indiana University of Pennsylvania 2016
13 MOST FREQUENT GENERAL DUTY CLAUSE CITATION 6. PVC Piping Rupture 5.4% 7. Fire and Explosions 5.4% 8. Fall Hazards 5% 9. Automobile Lifts and Jacks 4.6% 10. Storage Rack Hazards 3.6% Source: Tracy Cekada and Christopher Janicak Indiana University of Pennsylvania 2016
14 EXAMPLE: TEMPORARY EMPLOYEE ISSUES Imagine the possibilities if an employer doesn t even know the number of temps on site and has not focused on this issue. Temporary employees: Don't receive same training as full time employees performing same duties Aren t included in Hearing Conservation or Respiratory Protection Programs Are not included in safety meetings Have no documentation of on-the-job training Are not aware of emergency response plans Supervisory roles may be unclear
15 SEVERE VIOLATORS ENFORCEMENT PROGRAM The following circumstances will be reviewed as a possible SVEP case: Fatality or catastrophe situation with willful or repeat Industry operations or processes that expose employees to the most severe occupational hazards and those identified as High-Emphasis Hazards Exposing employees to hazards related to the potential release of a highly hazardous chemical All egregious enforcement actions.
16 SEVERE VIOLATORS ENFORCEMENT PROGRAM The SVEP also includes the following action elements for employers who meet the SVEP criteria: Enhanced follow-up inspections Nationwide referrals, which will include State Plan states Increased company awareness, which will include issuing news releases Enhanced settlement provisions Increased use of Federal court enforcement action (contempt of court) under Sec. 11(b) of the OSH Act Memorandum on how to get off SVEP list
17 REDUCING CITATIONS AND PENALTIES Can you provide examples of what you individually do to set an example? How does management ensure that safety doesn t lose out to scheduling and money concerns? Do you know your Company s Safety Culture or Identity? Why do experienced employees and supervisors make bad decisions or act unsafely?
18 REDUCING CITATIONS AND PENALTIES What are your specific goals for safety? - How are you going to get there? - What are the Milestones? - What capital and people are needed? - What are the challenges? Culture? Process? History? - Does management consider safety to be more than a cost item? - Can you prove that a safety-focused culture leads to success and profits?
19 OSHA HAS THE BURDEN TO PROVE CERTAIN ELEMENTS Existence of a Hazard Exposure Applicable Standard Employer knew of or should have known of the Hazard with the exercise of Due Diligence
20 WHAT MUST OSHA PROVE TO ISSUE 5(A)(1) GENERAL DUTY CITATION? Condition or activity in the workplace presented a hazard Employer or its industry recognized the hazard Hazard was likely to cause death or serious physical harm and a feasible means existed to eliminate or materially reduce the hazard
21 SUPERVISOR ROLE IN OSHA CITATIONS: LEARNING OF OSHA VIOLATIONS Because employers can only obtain knowledge through their agents, the actions and knowledge of supervisory personnel are generally imputed to their employers, and the Secretary can make a prima facie showing of knowledge by providing that a supervisory employee knew of or was responsible for the violation.
22 YOU HAVE THE BURDEN TO PROVE THE UNPREVENTABLE EMPLOYEE MISCONDUCT DEFENSE Establish work rules designed to ensure safe work and to avoid OSHA violations Communicate the work rules to employees Train the employees as needed Take appropriate steps to discover violations Effectively enforce the rules and practices when violations are discovered
23 EFFECTS OF OSHA S NEW ELECTRONIC RECORDKEEPING RULE The new reporting requirements will be phased in over two years. Establishments with 250 or more employees in industries covered by the recordkeeping regulation must submit information from their 2016 Form 300A by July 1, These same employers will be required to submit information from all 2017 forms (300A, 300, and 301) by July 1, Beginning in 2019 and every year thereafter, the information must be submitted by March 2.
24 EFFECTS OF OSHA S NEW ELECTRONIC RECORDKEEPING RULE Establishments with employees in certain high-risk industries (Including Construction) must submit information from their 2016 Form 300A by July 1, 2017, and their 2017 Form 300A by July 1, Beginning in 2019 and every year thereafter, the information must be submitted by March 2.
25 EFFECTS OF NEW ELECTRONIC RECORDKEEPING RULE What must I do to make sure that employees report work-related injuries and illnesses to me? You must establish a reasonable procedure for employees to report workrelated injuries and illnesses promptly and accurately. A procedure is not reasonable if it would deter or discourage a reasonable employee from accurately reporting a workplace injury or illness.
26 EFFECTS OF NEW ELECTRONIC RECORDKEEPING RULE Drug Testing: To strike the appropriate balance here, drug testing policies should limit post-incident testing to situations in which employee drug use is likely to have contributed to the incident, and for which the drug test can accurately identify impairment caused by drug use. Incentive Programs: It is a violation for an employer to use an incentive program to take adverse action, Including denying a benefit, because an employee reports a work-related injury or illness, such as disqualifying the employee for a monetary bonus or any other action that would discourage or deter a reasonable employee from reporting the work-related injury or illness.
27 HOW WOULD YOUR EMPLOYEES RESPOND IF ASKED THESE SAFETY QUESTIONS? (Agree/Disagree/Strongly Agree/Strongly Disagree) We practice at the jobsite what is in our Corporate Safety Policy. I always receive site/job-specific training. Supervisors hold us to safety rules. Our subs work safely. All of our people are trained. We cover the specific safety issues for the job that day. I hold coworkers accountable for safety.
28 EMPLOYEE SAFETY CLIMATE SURVEY EXAMPLES OF AGREE/DISAGREE QUESTIONS 1. Management or your site has an open door policy on safety issues. 2. Safety is the number one priority in my mind when working each day. 3. Co-workers often help each other to work safely. 4. Safety rules and procedures are carefully followed. 5. Management clearly considers the safety of employees of great importance. 6. I am sure that it is only a matter of time until I am involved in an accident. 7. Sometimes I am not given enough time to get the job done safely.
29 EMPLOYEE SAFETY CLIMATE SURVEY EXAMPLES OF QUESTIONS 8. I am involved with safety issues at work. 9. This is a safer place to work than other companies where I have worked. 10. I am strongly encouraged to report unsafe conditions/near misses/hazard recognition. 11. At my site, management turns a blind eye to safety issues at times. 12. Some safety rules and procedures do not need to be followed to get the job done safely. 13. Some safety rules and procedures are not really practical.
30 EMPLOYEE SAFETY CLIMATE SURVEY EXAMPLES OF QUESTIONS 14. It is necessary to let safety slide a little in real life. 15. Safety is one of the first three things upper management talks about when they come onsite. 16. Upper management seldom comes on the floor. 17. Upper management is involved in safety training. 18. Upper management is involved in new employee orientation. 19. Our safety record is one of the top two things to owners. 20. I received safety training specific to my current job site. 21. Contractors cooperate and coordinate about safety.
31 SURVEY OF EMPLOYEE ATTITUDES 93% of employees say that their Company is currently at risk of an injury or death caused by one of five avoidable workplace dangers: Get it Done Un-discussable Incompetence Just this Once This is overboard Are you a team player And nearly one-half are aware of injury or deaths caused by these factors
32 SURVEY EMPLOYEE ATTITUDES Despite being aware of these five threats and the past incidents, only one in four employees said that they speak up and try to correct unsafe conditions even to a coworker not tied off. Culture must change.
33 PRE-INSPECTION ACTION PLAN OSHA Poster Assignment of responsibilities Training/recordkeeping Equipment needed during inspection Review of previous citations Review of insurance and third-party audits Periodic audits and reviews
34 INSPECTION PRIORITIES Imminent danger Fatalities/catastrophic accidents Employee complaints/referrals High-hazard industries & Special emphasis programs NOTE: With new OSHA recordkeeping reporting requirements, many new self-referral inspections
35 THROUGHOUT THE ENTIRE INSPECTION ALWAYS REMEMBER It is your facility You have rights... Inspection conducted in a reasonable manner Inspection conducted during a reasonable time Completion of inspection within 6 months Be cooperative and responsive but maintain control of the inspection
36 SHOULD YOU DEMAND A WARRANT? A policy call Few employers routinely require warrants May be necessary to gain time, such as when a manager or counsel needs to be present An ex parte procedure
37 OPENING CONFERENCE Ascertain purpose of the inspection Establish scope of the Inspection get copy of complaint if applicable Set ground rules for inspection Don t volunteer information Treat the Inspector in a professional fashion Notification of corporate officials and counsel Coordination with on-site contractors and vendors
38 THE WALKAROUND Employer right to accompany Compliance Officer ( CO ) Require CO to comply with all company safety and health rules, including training, where applicable Take accurate notes on areas reviewed and all discussions and comments from CO Do everything the CO does (photos, video, air monitoring, etc.) Maintain control - limit the area seen by the CO Side-by-side monitoring No exception or sampling No staging of event or accident No destruction of evidence or misrepresentations even if inadvertently
39 THE INSPECTION Interviews Schedule away from production floor or work area Normally in company conference room Tape-recording Signed statement Deposition
40 THE INSPECTION Hourly employee interviews OSHA takes position no management present Up to employee can have Employee Representative Advise employee of his/her rights, appreciation of cooperation, and to tell the truth Warning: Employees have whistleblower rights
41 THE INSPECTION Management and Supervisor interviews Always another management/counsel present agent of Company Definition of Manager? Fatality investigation attorney always present No tape-recording Signed statement
42 CLOSING CONFERENCE Employer s opportunity for free discovery Advise of observed unsafe conditions Usually, brief description as to possible violations no discussion of penalties, classification and abatement dates Note any abatement made during the inspection Suggest possible corrections Request photos and monitoring results Discuss appeal rights Not a time for debate All document requests from OSHA need to be reviewed and approved by Risk Management prior to being provided to OSHA
43 CITATIONS In writing Violation described with particularity Timely citation must issue within 6 months of the violation Proposed penalty specified Served by certified mail Post for 3 days or until abatement, whichever is longer
44 CITATION OPTIONS Agree to citations, pay full penalty Informal conference/informal settlement Notice of Contest 15 working days (Federal); some state plan states different time period Formal settlement Hearing
45 HEARINGS Occupational Safety and Health Review Commission Formal complaint and answer Discovery similar to Federal Court Hearing before Administrative Law Judge ALJ issues written opinion Appeal to three-member Review Commission Other options expedited proceedings
46 FINAL QUESTIONS Judge a man by his questions, rather than his answers. ~ Voltaire
47 Fisher & Phillips LLP is dedicated exclusively to representing employers in the practice of employment, labor, benefits, OSHA, and immigration law and related litigation. THESE MATERIALS AND THE INFORMATION PROVIDED DURING THE PROGRAM SHOULD NOT BE CONSTRUED AS LEGAL ADVICE OR AS CRITICAL OF THE CURRENT OR PAST ADMINISTRATIONS.
48 BE SAFE! REMEMBER: Bad decisions make good stories and usually the evening news.
49 Thank You
50 Disclaimers *This webinar is designed to provide accurate and authoritative information about the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional services. *This webinar provides general information only and does not constitute legal advice. No attorney client relationship has been created. If legal advice or other expert assistance is required, the services of a competent professional should be sought. We recommend that you consult with qualified local counsel familiar with your specific situation before taking any action.
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