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Publication

August 10, 2010Client Alert

Employers Beware: Broad OSHA Reform Hidden In Mine Safety and Health Bill

On July 21, 2010, the House Committee on Education and Labor, by a party-line vote of 30-17, approved the Robert C. Byrd Miner Safety and Health Act of 2010, HR5663, and sent it to the full House of Representatives for a vote. That vote has not yet been scheduled.

Following recent mine disasters, mine safety reformers are seeking an overhaul of old and cumbersome mine safety rules. However, supporters of occupational safety and health law reform have seized upon the mining changes as an opportunity to attempt passage of comprehensive changes to the Occupational Safety and Health Act (“OSHAct”) before the mid-term elections. While these changes to the OSHAct were introduced in the Senate by the late Ted Kennedy over a year ago and gained very little support, they have now been tagged onto the mine safety reform bill.

Ironically, the bill is entitled the Robert C. Byrd (after the late Senator from West Virginia) Miner Safety and Health Act, even though the mine industry has only about 350,000 employees. The OSHAct reform provisions come right at the end of the bill and they affect all work places in all other private industries and impact over 135 million employees. The Deputy Assistant Secretary of Labor for Occupational Safety and Health, Jordan Barab, however, has denied that the Occupational Safety and Health Administration (“OSHA”) is trying to hide anything.

Enhanced Penalties for Non-Mine Industries

The bill increases penalties for the most common classifications of citation under the OSHAct (Serious and Other than Serious) from a maximum of $7,000 to $12,000 per citation item. The bill also increases the penalty for a Willful or Repeat citation from $70,000 to $120,000. However, if the cited violation caused or contributed to the death or “serious bodily injury” of an employee, the penalty maximum can be increased to $50,000 for a Serious citation and to $250,000 for a Repeat or Willful citation. The penalties for Serious/Other than Serious and Willful/Repeat citations are capped at $10,000 and $25,000, respectively. The bill also provides for automatic adjustments to those penalty amounts during the next four years tied to the Consumer Price Index. And Repeat citations can be based on earlier citations for violations of state law, not just the OSHAct or Federal OSHA’s standards and rules.

Criminal Penalties

One of the most controversial parts of the bill provides criminal penalties, including jail sentences, not just for any employer, but also for “any” corporate “officer or director” (which are undefined terms), who “knowingly” violates a standard, rule or order. (A proposed amendment to substitute “willful” – a higher standard - for “knowing” was rejected by the Committee majority.) These criminal provisions allow for imprisonment for not more than 10 years for a first conviction and for not more than 20 years for a second conviction in the event of a fatality. For conviction for a violation that resulted in a “serious bodily injury”, as defined above, the prison term is five years for a first offense and 10 years for a second offense. If passed, this provision likely would deter corporate officers and directors from participating in any active way in a company’s safety program.

Contesting the Citation Does Not Suspend the Abatement Obligation

In many cases, employers contest OSHA citations because they do not agree with OSHA's interpretation or application of a standard or the facts alleged by OSHA as constituting a violation of a standard. In other cases, abatement of the cited hazard may create a yet greater hazard, be infeasible, or put the company out of business. Under the bill, an employer apparently would not be permitted to contest an abatement requirement. As a practical matter, an abatement period is usually very short, and the bill provides that contesting a citation would not delay the due date for abatement.

Employers appear to be required under the bill to correct the hazard as alleged by OSHA, even if they do not agree with the citation, interpretation or abatement requirement; even if abatement would create a greater hazard; or even if abatement would put the company out of business. In addition, failure to abate while a citation were under contest could result in ever increasing penalties, since the bill provides a penalty of up to $12,000 per day for each such failure. In order to be excused from the abatement obligation, the employer would have to file a motion for a stay with the Occupational Safety and Health Review Commission and show both a “substantial likelihood of success” in its contest of the citation and that the stay would not “adversely affect the health and safety of workers”. Making such proof would be difficult.

Whistleblower and “Victims’” Rights Are Expanded

The OSHAct already protects employees from retaliation by their employers for complaining to OSHA, participating in an OSHA inspection or exercising any other right under the OSHAct. The bill expands the time an employee has to file a complaint of retaliation from 60 to 180 days, after which OSHA must conclude its investigation. Relief may include reinstatement, back pay and consequential damages, and expungement of all “warnings, reprimands, or derogatory references” in the employee’s file. The employer can appeal an order by OSHA in the employee’s favor, but the appeal does not stay OSHA’s order, including any order of reinstatement. An employee similarly can appeal an order in the employer’s favor. And an employee may request a hearing before a U.S. administrative law judge if OSHA does not issue an order within 120 days or, if certain other timeframes provided by the bill are not met, even sue the employer in federal court directly, bypassing OSHA’s administrative process.

The bill also gives the “victim” of an employer’s violation of the OSHAct or an OSHA standard or rule rights not presently provided by the OSHAct. Such a victim has the right to make a statement at any hearing on a contested OSHA citation, the right to receive notice of the commencement of settlement negotiations to modify a citation and the right to make a statement to a judge of the Commission as a part of a settlement proceeding. In the event the “victim” were deceased or incapacitated, a representative of the victim would be entitled to exercise the victim’s rights.

Conclusion

While the vast majority of employers are conscientious about employee safety and health, this bill poses a major concern for all employers. It substantially increases maximum penalties for violations of the OSHAct or OSHA standards or rules, even when those violations were merely accidental. It denies employers due process by not allowing an effective mechanism to challenge OSHA's abatement orders. And it not only substantially increases criminal penalties for “knowing” violations, but also provides for the criminal prosecution of company officers and directors. As a result, either they are going to want to micro-manage their companies’ corporate safety programs so that they can insure an avoidance of liability, which is not realistic given the other demands of their jobs, or they are going to want to distance themselves as far as possible from those safety programs so that they can claim to have been without any knowledge.

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