CONDUCTING AUDITS AND INVESTIGATIONS WITH COUNSEL

1. CONDUCTING AUDITS AND INVESTIGATIONS WITH COUNSEL D. Bart Turner Jay Mather Manufacture Alabama 2017 Safety/Health/HR Conference April 28, 2017

2. Conducting Workplace Safety Audits (with Counsel) AGENDA • Why undertake a Workplace Safety Audit ? • Goals and Objectives of Audit ? • Role of Counsel (Inside vs. Outside Counsel) • Structuring the Work Place Audit • Audit Control Group and Team • Scope of the Audit • Audit Reports • Now that the Audit is complete, what should I do with it ?

3. Why undertake a Workplace Safety Audit ? • There are a variety of reasons facilities consider undertaking audits • Corporate directives to better understand compliance status at each facility; • Some of the applicable OSHA Standards (e.g., PSM) require routine audits; • Prior to facility start-up or a change in process to better understand implications; • A change in standard or potential new requirements (e.g., Silica Rule); • Implementation of corporate compliance program. • Post-Incident Investigations • Concerns over potential agency or other enforcement action • Incident or investigation at one facility of a corporation and concern over compliance status at other related facilities

4. Goals and Objectives of Audit ? • Defining intent and purpose of the Audit and goals to be achieve are paramount. • Develop a clear vision with and support of management. • This requires buy in of corporate resources and time--- not only for conducting the audit but being prepared to address recommendations. • Internal Audit or involvement of outside consulting services. • Components to consider--- recordkeeping; policies and procedures; work place practices; industrial hygiene and noise dosimetry testing • “Mock-Agency Conference”--- If this is the goal, go through the paces.

5. Role of Counsel (Inside vs. Outside Counsel) • Role of counsel depends on the purpose of the Workplace Audit • Early Engagement---Take measures to protect against potential disclosure of the Audit Findings or Report to government agencies or private party litigants (subpoena or discovery) before the audit work Attorney-Client Communications: • There must be an attorney-client relationship; • the communication must be for purposes of obtaining legal advice; • there must be an expectation that the communication be kept confidential • Third-Party Consultants--- this privilege can extent to third party consultants where the client provides information to the party retained by the attorney for purposes of obtaining legal advise. See, U.S. v. Bornstein, 977 F.2d 112, 117 (4th Cir. 1992).

6. Role of Counsel (Inside vs. Outside Counsel) Attorney Work Product: • Rule 23(b)(3) of the Federal Rules of Evidence recognizes that materials prepared by or at the direction of a party’s representative in anticipation of litigation are generally protected from discovery. • FRE 23(b)(3) may also extend to materials prepared at the direction of the attorney so long as they are prepared in anticipation of litigation. • OSHA Review Commission has also held that these protections extend to investigative reports after an incident even when no litigation has been filed. In-House Counsel Concerns: • Extending privilege to in-house counsel in connections with Audits is not as clear-cut • Often times, In-House counsel are involved in business as well as legal decisions which can complicate the analysis of privilege.

7. Structuring the Work Place Audit Timing • Ensure the Audit Goals and Objectives are clearly defined before initiating • Scoping Component--- Involvement of outside consulting services and counsel • Scheduling--- If multi-facilities, where to start • Coordination with Management--- This should involve both corporate and facility management and safety directors (and in-house counsel) • Implementation at the Facility level--- During shut-down ? During Production ? Which Shift ?

8. Audit Control Group and Team • Clearly define at the outset the Audit Control Team • Engagement Letter--- should be used to establish the Control Group • Range of Possibilities • Outside Counsel • In-House Counsel • Safety Director (corporate and/or at the facility • Outside Safety Consultant • Plant Manager • Audit Control Group will define document control parameters and recipients • “ATTORNEY-CLIENT PRIVILEGE/PREPARED AT REQUEST OF COUNSEL”

9. Scope of the Audit • Engagement letter--- In the event outside counsel and consulting services are to be involved, implement engagement at the outset. • Opening Conference • Define the Audit Process: • Overview of the Facility Operations • Overview of the Safety Program and Staff • Applicable safety and industry standards • Recordkeeping/Retention and Policies and Procedures • Document Control and Control Group • Data Collection and sampling--- industrial hygiene testing and noise dosimetry; parameters to consider.

10. Scope of the Audit Facility Specifics • Programs: • Control of Hazardous Energy (LOTO) • Confined Space Entry • Emergency Action Plan • Powered Industrial Platform (aerial lifts/scissor lifts) • Flammable Liquid Storage • Hearing Conservation Program • PPE • Fire Extinguisher Program • Material Handling Program • Industrial Hygiene Program • Machine Guarding Program • Hazard Communication Program (SDS) • Welding, Cutting and Hot Work Program

11. Scope of the Audit (Cont’d) Training Records • New Employee Orientation Training Records • Supervisor Orientation and Training • Fork Lift Operator Training • PPE Training (Respiratory, hands, eyes, foot) • Hearing Conservation Program • Material Handling Training Program • Hazardous Communication Training Program • Electrical Safety Program • “Tool Box Talks” or Training”

12. Scope of the Audit (Cont’d) Written Work Practices/Job Descriptions/Employee Evaluations • Plant Managers, Department Managers, Supervisors • Fork Lift Operators • Maintenance Personnel • LOTO Machine Specific Procedures • Confined Space Entry (Permit-Required) Objective Data • Industrial Hygiene Objective Data • OSHA 300, 300A, and 301 Logs, Forms and Summaries

13. Completion of Audit--- But Before Issuance of Reports Close-Out Conference: • Upon Completion of the Audit, conduct a Close-Out Conference with the Audit Team and Control Group • Discuss Observations and Findings • Proposed Conclusions and Recommendations • Open Items identified and suggested corrective measures • Assignment of Responsibility and Projected Dates of Completion • Other Items that are identified beyond the Scope--- e.g., Environmental Compliance issues

14. Audit Reports • Audit Report should be customized to the facility at issue and be “user-friendly” • The goal is to create a document that provides an objective evaluation of safety and compliance conditions • Identify opportunities for improvements of processes, programs and oversight • Systematically track all findings to closure • These are often snap-shots and require continuous improvements to management systems and overall safety culture

15. Audit Reports (Cont’d.) Examples of Poor Audit Findings • “Poor Housekeeping” • “Management is not committed to safety” • “There is no budget to pay for the corrective measures” • “Employees have never been trained” • “This is a clear OSHA violation” • “Same LOTO finding at California and Alabama Facilities would result in a Repeat Violation” • “If Facility doesn’t address the guarding, someone it going to get a hand cut off”

16. Audit Report--- Pictures ??

17. Audit Reports CORRECTIVE ACTION AND PREVENTATIVE ACTION LIST Responsibility and Accountability Assigned To: ________________________________________________ Corrective Action Required By Date: ____________________________________________ Corrective Action Completed Date: ______________________________________________ Corrective Action Verified By: __________________________________________________ Corrective Action Verified Date: ________________________________________________ Additional Corrective or Preventive Action Required?: _________________________________________________ Corrective Action Completed?: ________________________________________________ Corrective Action Completed Date: _____________________________________________ Additional Comments:________________________________________

18. Questions? Bart Turner Jay Mather bturner@kmcllaw.comJay@emcbham.com 205-767-8870 205-951-3400