Given the broad scope and application of the Occupational Safety and Health Act (OSH Act) and the seeming omnipresence of the agency charged with its oversight and enforcement, the Occupational Safety and Health Administration (OSHA), virtually all employers are familiar with the OSH Act’s basic premise that all workers are entitled to a reasonably safe and healthful workplace. Those employers subject to the OSH Act and related OSHA regulations are also likely familiar with their obligations to record and report certain workplace injuries and illnesses.
On May 11, 2016, OSHA published a set of revisions (the “Final Rule”) to the existing regulations, 29 CFR 1904.35, 1904.36 and 1904.41, concerning recordkeeping and reporting requirements for employers. The Final Rule will require, among other things, an evaluation of current safety incentive programs and for certain employers to submit electronic workplace injury and illness records to OSHA on an annual basis, which OSHA will publish on its publicly available website. This article provides a brief overview of the Final Rule and offers some suggestions to prepare employers for the revised recordkeeping and reporting requirements.
To illustrate the Final Rule’s application – and to highlight potential problem areas – consider this hypothetical scenario. Suppose manufacturer BigBiz has more than 250 employees in various positions throughout the company. BigBiz has traditionally complied with the standard recordkeeping and reporting requirements imposed by OSHA regulations, maintaining on file OSHA Forms 300 (Log of Work-Related Injuries and Illnesses), 300A (Annual Summary of Work-Related Injuries and Illnesses) and 301 (Injury and Illness Incident Report). BigBiz has also implemented various safe-work incentives to reward workplace safety and has dutifully refrained from retaliating against employees who report a workplace injury or illness.
Despite such efforts, under the Final Rule, BigBiz now faces the requirement to electronically submit its OSHA records every year, which will be publicly available on OSHA’s website, as well as the possible need to revise its safety incentive programs. With uncertainty to the Final Rule, what can BigBiz do to ensure compliance?
OSHA’s stated purpose in implementing the Final Rule is to improve worker safety. Importantly, however, OSHA admits the Final Rule is founded on cues taken from the field of behavioral economics, suggesting that making employers publicly accountable for workplace safety will “nudge” employers toward achieving safer workplaces. In essence, the idea is to shame employers with poor workplace safety records into compliance. While it is billed as a “simple change” to existing requirements, like many regulatory issues, the devil lies in the details.
TWO PRIMARY ELEMENTS OF THE FINAL RULE
First, the Final Rule generally requires electronic reporting of workplace safety information on an annual basis. For employers with more than 250 employees, the Final Rule requires electronic submission of information contained in the employer’s Log of Work-Related Injuries and Illnesses, Annual Summary, and Incident Reports. Employers who have between 20 and 249 employees are required to electronically submit the information contained in the employer’s Annual Summary. Further, OSHA may also demand submission of this information upon notification to the employer. These new electronic reporting requirements will become effective January 1, 2017 and phased-in over the course of three years.
Second, the Final Rule requires employers to expressly inform all employees of the process to report workplace injuries and illnesses and their right to do so without fear of retaliation. Similarly, the Final Rule also requires employers to ensure that workplace injury and illness reporting procedures are reasonable and that implemented policies do not unintentionally cause employees to underreport or fail to report workplace injuries or illnesses. Such anti-retaliation requirements were scheduled to become effective August 1, 2016. However, in response to significant public outcry, OSHA subsequently delayed enforcement of these provisions until November 1, 2016.
The publication of workplace injury and illness information may lead to the improper use of such information in litigation. For instance, if an employer is a non-subscriber to a workers’ compensation program and an employee suffers a workplace-related injury or illness, the employee may pursue claims against the employer in litigation. If the underlying injury or illness was recordable, and the employer dutifully submits information concerning the recordable or reportable incident to OSHA, who then makes the information publicly available, the employee’s attorneys may attempt to utilize that publicly available information in litigation against the employer.
Although the mere recording or reporting to OSHA of a workplace-related incident does not prove negligence or other fault of the employer, it may be difficult for jurors to not attach undue weight to such information. Similarly, such information may be improperly utilized in an attempt to cast the employer as a “bad actor.”
In addition, mandatory reporting of workplace-related incident information may place the employer in the unenviable position of disclosing employee protected healthcare information or similar confidential information, possibly leading to claims of violation of the Health Insurance Portability and Accountability Act (HIPAA) and similar privacy laws. While OSHA has stated it will not publish names or other confidential information for public consumption while also asserting that an employer’s disclosure of protected information would not violate law if disclosed due to the mandatory electronic reporting requirements, OSHA’s assurances would be of little comfort to an employer defending such claims by an upset employee or former employee.
It is also important to consider that previously established employer safety incentive programs may now be deemed improper under the Final Rule. While the section 11(c) of the OSH Act has long provided a mechanism for the Department of Labor to pursue retaliation charges against an employer, 11(c) is only available after an affected employee files a complaint.
The Final Rule, however, implements a new regulation empowering OSHA to cite an employer for conduct deemed to be retaliatory or for creating what are deemed to be unreasonable injury or illness procedures. As a result, OSHA may now issue a citation and notification of penalty to an employer for maintaining a safety incentive program that OSHA determines may create a disincentive to report a workplace injury or illness, even if OSHA has not yet received a complaint from an affected employee.
As an example, a safety incentive plan awarding bonuses for zero or low recordable or reportable incidents may be deemed to discourage or deter employees from reporting incidents. Similarly, a procedure that potentially subjects an employee to disciplinary action for not promptly reporting an injury or illness may be deemed unreasonable if not applied consistently or if no leniency applies in cases where immediate recognition of an injury or illness is not considered reasonable.
Likewise, mandatory post-incident drug or alcohol testing may be deemed retaliatory where there is no immediate suggestion that intoxication was a contributing factor in causing the recordable or reportable injury or illness, and a test designed to identify impairment caused by that drug would be appropriate.
Another concern for employers is that the publication of workplace injuries and illnesses may have a potential impact beyond workplace safety. As an example, potential investors, customers, contractors and suppliers may attempt to utilize publicly available information as leverage during negotiations or as an impetus to terminate existing business relationships.
SUGGESTIONS FOR COMPLIANCE
Currently, the only means for OSHA to determine if an employer has complied with the recordkeeping and reporting requirements is through an inspection of the employer’s records, typically as a part of an investigation following a reportable incident or site inspection. However, mandatory annual reporting will provide OSHA with theoretically real-time information on recordkeeping compliance. As a result, employers must exercise particular diligence in ensuring all recordkeeping and reporting requirements are met.
Employers should also consider whether existing safety incentive programs and mandatory post-incident drug and alcohol testing procedures could be deemed retaliatory in nature or unreasonable barriers to employees reporting workplace injuries and illnesses.
To avoid potential issues, programs should generally be forward-looking rather than backward-looking. As an example, bonus programs rewarding the absence of recordable or reportable incidents may be deemed a deterrent to reporting, whereas programs rewarding recommendations for future safety improvements would likely be acceptable.
Nevertheless, such forward-looking programs may create a source of potential liability if a safety recommendation is made but not followed or adopted by the employer.
With respect to the actual electronic reporting required, OSHA has yet to identify the required procedure employers must utilize to comply with the Final Rule. Although OSHA has previously established an electronic reporting mechanism for some targeted employers, it is unclear if the present system will be scalable to accommodate the dramatic increase in users going forward. As a result, employers are now left to imagine how smoothly the process, once determined, may work in light of the poor performance and related issues caused by other recent government-based online interfaces and practices.
Ken Bullock is a Shareholder in the Energy & Maritime section in the Houston office of Munsch Hardt. Ken has experience representing clients across a broad cross-section of industries in transactional and litigation matters, including representation of clients in connection with OSHA investigations and before the Occupational Safety and Health Review Commission. For more information, Ken can be reached at firstname.lastname@example.org.