A Word of Caution

2. A Word of Caution These materials are presented with the understanding that the information provided is not legal advice.  Due to the rapidly changing nature of the law, information contained in this presentation may become outdated.  Anyone using information contained in this presentation should always research original sources of authority and update this information to ensure accuracy when dealing with a specific matter.  No person should act or rely upon the information contained in this presentation without seeking the advice of an attorney.

3. Current Trends in OSHA Inspection and Enforcement Policy Presented By: Gene W. Bailey, II, Esquire

4. OSHA Enforcement Crackdown OSHA leadership personnel are: • Highly motivated, vocal proponents of protecting workers • Familiar with making industry a target

5. Penalty Increases and“Regulation by Shaming” • “For many employers, investing in job safety happens only when they have adequate incentives to comply with OSHA’s requirements . . .. Higher penalties and more aggressive, targeted enforcement will provide a greater deterrent . . ..” • “Fear of public disclosure (and the associated scorn and anger) encourages employers to eliminate hazards.” - Assistant Secretary Michaels

6. “Regulation By Shaming” • Branding employers as “bad actors” in press releases causes other employers to comply • In the past, press releases were only issued for violations totaling $100,000 or more - the threshold is now $45,000 or more • Enforcement strategy seems to be: • Issue press release and big citation • Do not settle easily: Let the lawyers sort it out • Press releases can be more problematicthan the citations and penalties

7. Higher Penalties • Since legislative amendments to the OSH Act seem very unlikely, OSHA is using the power it has under the OSH Act to increase penalties • OSHA to CHSO’S: • “Issue as many citations as you can” • “Find” serious, repeat, or willful violations

8. Penalty Increases • Size • A 10-40% reduction for employers with fewer than 250 employees • No reduction for employers with 251 or more employees • Good Faith • 15% “Quick Fix Incentive” to encourage employers to abate immediately • Eliminated 10% reduction for strategic partnership to agreements • Repeat • Increased the timeframe for a repeat from three to five years • Minimum Penalties • Increased the minimum penalty for a serious violation to $500; any posting violations are now increased to $250 • Egregious Penalties

9. Recordkeeping • If injuries and illnesses are not recorded, OSHA will look to see if an employer has an incentive program that provides benefits to employees and managers for not recording or reporting injuries • If an employer has this type of system set up, unrecorded injury and illnesses violations may be characterized as “willful” violations

10. Enforcement - Severe Violator Enforcement Program (SVEP) • Program became effective June 18, 2010 • Replaced Enhanced Enforcement Program • Key part of agency’s “heightened focus on indifferent employers” • Severe violators “qualify” for program • Willful, repeat or failure-to-abate violators • Enhanced enforcement actions under SVEP

11. Enforcement - Severe Violator Enforcement Program (SVEP) • Fatality/Catastrophe: One or more willful or repeat violations or failure-to-abate (FTA) notices based on a serious violation related to death or three or more hospitalizations • Non-Fatality/Catastrophe: Two or more willful or repeat violations, or FTA notices based on high gravity serious violations related to high-emphasis hazard (e.g., fall, NEP hazard, excavating/trenching) • Three or more willful or repeat violations, or FTA notices based on high gravity serious violations due to potential release of a highly hazardous chemical under the PSM • All egregious (i.e., per-instance citations) enforcement actions

12. Enforcement - Severe Violator Enforcement Program (SVEP) • Indications of “broader patterns of non-compliance at related employer worksites” • Regional and nationwide inspections of related workplaces • Directorate of Enforcement as central coordinator for nationwide referrals

13. Enforcement - Severe Violator Enforcement Program (SVEP) • Follow-up inspections mandated • Enhanced settlement provisions • Hire S&H consultant • Apply settlements company-wide • Report injuries and illnesses to OSHA quarterly • Report any serious injury or illness requiring medical attention andconsent to an inspection

14. Recent Statistics on SVEP • During the first year of the SVEP program, 182 employers have been placed in the program and have been cited under the terms of the SVEP policy • According to OSHA, most of these employers were in the program because they were cited for “high-gravity violations” • Majority of the employers are construction employers • Region 5 ( Midwest) issued the most SVEP citations (1/3 of the total SVEP citations issued) • 14 enhanced settlement agreements requiring the employer to hire an outside safety consultant

15. What Does This Mean For Construction Contractors? • Must be pro-active about OSHA inspections • How do you minimize liability during an OSHA inspection? • Do you have a plan in place to deal with OSHA in the event of an accident? • Do you know what rights you have during an inspection? • How will you deal with employee interviews? • How and when do you communicate your position to OSHA?

16. What Does This Mean For Construction Employers? • Settlement strategy • What reputational and other damage will result from “willful” violations? • What impact will current OSHA citations have on future liability? • What impact will current OSHA citations have on civil liability? • Should you litigate? • How does OSHA prove a willful? • How do you position a case to settle?

17. Before OSHA’s Arrival • What is at stake? • Civil penalties • Abatement costs • Criminal penalties • Negative media • Employee relations • Get ready ahead of time

18. Managing The OSHA Inspection • The inspection process can be managed • The goal: Allow OSHA to perform its task while minimizing intrusion and preserving good relations with Area • OSH Act prohibits the issuance of a citation “after the expiration of six months following the occurrence of any violation” • This means that, as compared with most litigation, OSHA inspections proceed relatively quickly

19. Preparation, Preparation,Preparation • Once the Compliance Officer arrives, it’s too late to train your jobsite people • OSHA inspections can be managed if your company prepares and is informed of its rights • OSHA’s goal is simple after an accident • What did they know and when did they know it? • Especially now, OSHA is not there to “help you” • Balance professional, cordial approach with caution

20. The Opening Conference • Once a Compliance Officer enters the jobsite, he conducts an Opening Conference. • Typically attended by the Company and union representative, if any on the site. • At conference, the Compliance Officer should reveal reason for inspection, i.e. accident, employee complaint, referral from another agency, or general inspection • This is where the Company begins to manage the inspection.

21. OSHA Interviews of Employees • Whatever a member of “supervision” says is imputed to the company • This means any foreman, even temporary • Also means crew leaders, lead men, or similar employees, even if in bargaining unit • The employee “in charge” is considered a supervisor by OSHA • Company has right to be present when OSHA interviews someone whose knowledge it will impute to the employer • Bargaining unit or hourly employees may be interviewed privately (or with union steward)

22. The “Walkaround” • Never, ever allow a compliance officer to walk around your jobsite unattended • Company and union have right to accompany CHSO wherever he/she goes on the site • You take parallel video or photos, at the same time • This means - you need cameras and videocameras on the site, and they better be charged or have batteries • Don’t rely on OSHA to share • OSHA can take industrial hygiene samples • You take parallel samples

23. Requests for Documents • Insist that document requests submitted to a single source, in writing • Is the document responsive to OSHA’s written request? • Is the document privileged? • Is the request reasonable? • Maintain separate copy of all documents provided • If written, no question what was sought by OSHA • Do not allow Compliance Officer to rifle through documents

24. Employee Safety Complaints • OSHA becoming more aggressive about whistleblower issues • Management should encourage and respond to safety complaints • You don’t have to do what the worker says or wants, but you should consider and respond • If not, you’re inviting the employee to involve OSHA

25. Closing Conference • Goal - Learn as much as you can • What citations will CHSO “recommend?” • How will they be characterized? • What abatement does OSHA expect? • How is the abatement to be accomplished? • Have there been any misunderstandings of fact that can be corrected before citations are issued? • Do not argue • Avoid admissions

26. Thank You!

27. For more information, contact:Gene W. Bailey, II, EsquireBowles Rice McDavid Graff & Love LLPgwbailey@bowlesrice.com(304) 347-1154