Following the implementation of the California Division of Occupational Safety and Health’s (Cal/OSHA) COVID-19 Emergency Temporary Standards (ETS) on November 30, 2020, several employers and trade associations filed a lawsuit in San Francisco Superior Court for declaratory and injunctive relief against Cal/OSHA. The lawsuit, National Retail Federation, et al. v. California Department of Industrial Relations, et al. (Case No. CGC20588367), was the first filed seeking to prevent the agency from enforcing the ETS. Shortly thereafter, the Western Growers Association filed a related case in Los Angeles Superior Court. However, in an effort to avoid “duplicative and inconsistent rulings,” the Western Growers Association lawsuit was transferred to San Francisco and the cases are being heard together.

The lawsuits alleged that the ETS were improper for several reasons, including that Cal/OSHA “exceeded the scope of its authority to promote occupational safety and health by attempting to regulate wages and paid leave” and “arbitrarily and capriciously deprive[d] Plaintiffs of property without just compensation or due process, particularly with respect to the COVID-19 testing and mandatory periods of paid exclusion from work.”

On January 28, 2021, Judge Ethan P. Schulman heard oral argument on the motions for a preliminary injunction in both cases. Both sides articulated a number of arguments.

On behalf of the National Retail Federation (NRF), the plaintiffs argued the ETS were both duplicative of, and more expansive than, the already-existing regulation governing the Injury and Illness Prevention Program (IIPP)—an argument that Judge Schulman described as inconsistent. In particular, the plaintiffs stated that the ETS—like the IIPP prior to November 30, 2020—addressed COVID-19 issues in the workplace, while simultaneously imposing additional obligations on employers, including the payment of wages and benefits to excluded employees and testing. The plaintiffs further argued that the rulemaking process was suspect in that the staff of the Occupational Safety and Health Appeals Board said there was no need for an emergency regulation while Cal/OSHA enforcement officials claimed the opposite to be true.

Cal/OSHA responded that the ETS were not burdensome as an additional regulation imposed on employers. With respect to the issue of the requirement to pay benefits and wages, Cal/OSHA stated that the purpose of the ETS were to keep infectious employees out of the workplace. By maintaining their pay and benefits, Cal/OSHA hoped to incentivize employees to be forthcoming about being exposed. The agency also maintained that the Occupational Safety and Health Appeals Board was correct in finding the pandemic to be an emergency necessitating the implementation of emergency standards. According to Cal/OSHA, this finding was based on the claim that businesses have continued to operate during the pandemic and needed guidance on how to respond to the risk of exposure in the workplace and supported by a statistic stating that between February 2020 and September 2020, the agency received approximately 7,000 complaints of unsafe work practices.

On behalf of the Western Growers Association, the plaintiffs argued that the rulemaking process giving rise to the ETS were insufficient. The plaintiffs stated that Cal/OSHA did not provide the information required by Government Code Section 11346.1 to justify the passing of the ETS. The process for adopting an emergency regulation requires an opportunity for comments during the rulemaking process, which—the plaintiffs argued—there was no evidence of such an opportunity here. The plaintiffs warned against the “dangerous game” of giving agencies too much leeway in declaring what constitutes an emergency because doing so would allow agencies to escape the normal level of scrutiny that accompanies rulemaking. The plaintiffs thereafter requested that the court enjoin sections 3205(c)(10), 3205(c)(11), 3205.3(c), 3205.3(h), and 3205.4(c) of the ETS.

Cal/OSHA responded that the rulemaking process was appropriate because: (1) there was adequate notice of the November 19, 2020, meeting that allowed for public comment; and (2) pursuant to Government Code Section 11346.1, there was an emergency. The agency maintained that the ETS were necessary because the IIPP regulation was not effective in creating a safe workplace as evidenced by the rising positivity rates and widespread infections in the summer of 2020. Further, Cal/OSHA argued that the enumerated sections that the plaintiffs sought to enjoin went at the heart of the emergency regulations by failing to keep hazards out of the workplace. The agency concluded that if the court found any violation of the Administrative Procedures Act, the entire regulation could not survive.

Judge Schulman ordered the parties to file additional briefs by February 5, 2021, on relief, severability, and other issues deemed to be critical. Further, the court would consider the motion to be “under submission” on February 11, 2021, and would issue a final decision shortly thereafter.