OSHA DEVELOPMENTS

February 05, 2004

By Horace A. (Topper) Thompson III

OSHA FORM 300A SUMMARY MUST BE POSTED BEGINNING FEBRUARY 1.

Beginning this month, OSHA requires non-exempt employers of more than 10 employees to post for 60 days a summary of the total number of job-related injuries and illnesses that occurred last year. Post the summary form, not the complete annual log. Employers who unnecessarily post the entire OSHA Form 300 log, rather than the OSHA Form 300A summary, publish personal identification of employees suffering specific injuries or illnesses, and could face issues relating to breach of medical confidentiality. The 300A Summary should be displayed between February 1 and April 30 in an area wherever notices to employees are usually posted, or where workers may access and view it. Employers must make a copy of the summary available to employees who move from worksite to worksite, such as construction workers, and employees who do not report to any fixed establishment on a regular basis. The form must list the total number of job-related injuries and illnesses that occurred in the last year. Our experience is you may be cited and fined if you post the form without the signature/certification of a company executive, or if you fail to post zeros at the "total" line because you had no recordable injuries or illnesses. Copies of the OSHA Forms 300, 300A and 301 are available on the OSHA Recordkeeping Webpage in either Adobe PDF or Microsoft Excel Spreadsheet format.

EMPLOYERS EXEMPT FROM OSHA RECORDKEEPING

Employers with ten or fewer employees and employers in certain industry groups (including hospitality and maritime) are normally exempt from federal OSHA injury and illness recordkeeping and posting requirements. A complete list of exempt industry SIC codes in the retail, services, finance and real estate sectors is posted on OSHA's website. Beware, however, that employers exempt from recordkeeping are still required to comply with OSHA safety and health standards and the general duty clause. They must also report verbally within eight hours to the nearest OSHA office all accidents that result in one or more fatalities, or in the hospitalization of three or more employees.

CONCERNS ABOUT INFORMAL SETTLEMENT OF AN UNDUE OSHA CITATION

Some employers appear to treat OSHA citations - even undue citations -- like any other cost of doing business. They informally admit (before contestment) potentially defensible OSHA violations in exchange for a routine reduction of the proposed fine. Under the informal settlement approach, OSHA reduces the penalty by as much as 50%, the violation is affirmed, the employer commits to abate the alleged violative conditions, and the violation becomes a part of the "history of previous violations" maintained on OSHA's website. As a result of recent developments at OSHA, a policy of informal settlement of undue citations can lead to serious long-term problems. The justifications for this approach may no longer hold up.

Employers justify the informal settlement approach by the expectation that the cost of contestment of the citation will outweigh the penalty reduction achieved by a successful defense. OSHA's new enhanced enforcement policy, adopted this past year, complicates calculation of the ultimate cost of informal settlement of a defensible OSHA citation. Employers who build a history of previous violations may become prospective targets for OSHA's recently announced "Enhanced Enforcement Policy." Targets of enhanced enforcement are threatened with $70,000 per item fines for repeat violations at sister facilities, $10,000 per day for "failure to abate" violations, significant "egregious" fines multiplying per item penalties by the number of exposed employees and/or national negative publicity.

Employers justify the informal settlement approach also by the desire to "declassify" a willful or repeat classification of an OSHA citation. Declassification is a settlement option in which OSHA "declassifies" a willful or repeat violation in return for the following commitments by the employer:

1. Acknowledgement of the validity of the violation, but only for OSHA enforcement purposes,
2. Payment of substantially all (usually 80%) of the proposed fine, and
3. Commitment to obligations more extensive than necessary to abate the violation.
4. Corporate-wide settlement.

The declassification settlement agreement has become attractive primarily because of the mistaken belief that declassification standing alone will avert tort or criminal exposure in fatality cases. In regard to tort exposure, declassification of the citation but retaining willful level penalties is not now and probably never has been a substantial barrier to tort exposure for citations originally issued as willful violations. The tort lawyers know and can prove that an item with a penalty above 7,000 is classified as a willful or repeat, whether or not the classification is stated. In regard to criminal exposure, there are signs that declassification through informal settlement with OSHA may not prevent USDOJ from exercising its prosecutorial discretion to pursue a corporate criminal penalty. This may be true in the case of a fatality allegedly caused by a violation of a standard, or altered documentation required by OSHA, or mailed false documentation. Moreover, the potential that senior management and risk managers can be held criminally liable in connection with an OSHA investigation may be greater today than ever before. A series of articles in the New York Times has ratcheted up public pressure on OSHA to prosecute criminal cases against corporate executives in cases involving a workplace fatality or an altered OS&H report. This heightened exposure of corporate executives to the risk of criminal prosecution is aggravated by the potential for novel theories of executive accountability, increased corporate sentencing options and the probability of greater negative publicity.

Topper Thompson can be reached at either his New Orleans, LA office at (504) 522-8788 or at his Gulfport, MS office (228) 864-3094, if you have any questions about the subject of this article. The attorneys in the L & E Practice Group at Watkins Ludlam Winter & Stennis have developed innovative alternative billing strategies to provide cost-effective assistance to employers trying to cope with these difficult issues.