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Is OSHA Backtracking on the Anti-Retaliation Provisions in the Recordkeeping Regulation?
Tuesday, October 16, 2018

The Occupational Safety and Health Administration (OSHA) added an anti-retaliation provision to the recordkeeping regulation finalized in May 2016, and it seems as if the workplace safety and health community has not stopped talking about it since. The impact of the provision on safety incentive programs and post-accident drug testing has been a particular focus of this conversation.

On October 11, 2018, OSHA issued compliance guidance that reads as a possible attempt to reverse some of the agency’s previous statements on retaliation, but what is its practical impact? Perhaps more important, will OSHA engage in rulemaking to amend or eliminate the provision?

How the Anti-Retaliation Provisions Came to Be

Section 1904.35(b)(1)(iv) of Title 29 of the Code of Federal Regulations instructs employers as follows: “You must not discharge or in any manner discriminate against any employee for reporting a work-related injury or illness.” OSHA announced during the rulemaking process that the OSHA 300 logs and 301 forms submitted electronically under the revised regulation would be posted on OSHA’s website and available to the public. Employers were instructed to redact employee names and other personally identifiable information when electronically submitting OSHA 300 logs and 301 forms.

Section 1904.35(b)(1)(iv) was included in the May 2016 final rule because “many commenters expressed concern that the public availability of OSHA data would motivate some employers to under-record injuries and illnesses,” and because of OSHA’s conclusion that the provision was necessary to prevent the “under-recording that arises when workers are discouraged from reporting” work-related injuries and illnesses. OSHA also saw the need for a means other than the Occupational Safety and Health Act’s section 11(c) (the whistleblower provision) to “enforce the existing statutory prohibition on employer retaliation against employees.” OSHA freely acknowledged that section 11(c) already prohibited retaliation for reporting work-related injuries or illnesses and that section 1904.35(b)(1)(iv) created a second remedy for employees.

Safety Incentive Programs and Post-Accident Drug Testing

In the preamble to the final regulation, OSHA stated that safety incentive programs and post-accident drug testing were potentially violative of section 1904.35(b)(1)(iv). Months later, OSHA issued a memorandum to regional administrators clarifying its position regarding safety incentive programs: programs that denied benefits to employees who reported injuries could violate the anti-retaliation provision. To cite an example used by OSHA, a program that allowed employees who reported no injuries to participate in a raffle for cash but excluded employees who reported injuries was not compliant. OSHA also stated that mandating a post-accident drug test in a scenario in which drug use likely did not cause or contribute to an injury might violate section 1904.35(b)(1)(iv). For example, mandating a drug test for an employee with an allergic reaction to a bee sting or a muscle strain could be retaliation.

These statements caused significant hand-wringing and confusion in the employer community. Perhaps as result, OSHA issued additional guidance that seemed designed to blunt the impact of the statements in the preamble.

The New Guidance

OSHA has issued new guidance to “clarify the Department’s position that 29 C.F.R. § 1904.35(b)(1)(iv) does not prohibit workplace safety incentive programs or post-incident drug testing” (emphasis added). OSHA “believes that many employers who implement safety incentive programs and/or conduct post-incident drug testing do so to promote workplace safety and health.”

Most significantly, OSHA states, “To the extent any other OSHA interpretive documents could be construed as inconsistent with the interpretive position articulated here, this memorandum supersedes them” (emphasis added). In other words, the previous guidance—which included examples of multiple programs that were not compliant—is presumably null and void.

Safety Incentive Programs

One issue that caused employers significant heartburn involved rate-based safety incentive programs—perhaps because so many employers have them. In the guidance, OSHA states:

“Another type of incentive program is rate-based and focuses on reducing the number of reported injuries and illnesses. This type of program typically rewards employees with a prize or bonus at the end of an injury-free month or evaluates managers based on their work unit’s lack of injuries. Rate-based incentive programs are also permissible under § 1904.35(b)(1)(iv) as long as they are not implemented in a manner that discourages reporting. Thus, if an employer takes a negative action against an employee under a rate-based incentive program, such as withholding a prize or bonus because of a reported injury, OSHA would not cite the employer under § 1904.35(b)(1)(iv) as long as the employer has implemented adequate precautions to ensure that employees feel free to report an injury or illness.” (Emphasis added.)

“A statement that employees are encouraged to report and will not face retaliation for reporting may not, by itself, be adequate to ensure that employees actually feel free to report, particularly when the consequence for reporting will be a lost opportunity to receive a substantial reward.” “Adequate precautions” that will “avoid any inadvertent deterrent effects of a rate-based incentive program” require “taking positive steps to create a workplace culture that emphasizes safety, not just rates.” OSHA lists these examples:

  • an incentive program that rewards employees for identifying unsafe conditions in the workplace;

  • a training program for all employees to reinforce reporting rights and responsibilities and emphasizes the employer’s non-retaliation policy; or

  • a mechanism for accurately evaluating employees’ willingness to report injuries and illnesses.

Post-Incident Drug Testing

OSHA now states that “most instances of workplace drug testing are permissible under section 1904.35(b)(1)(iv).” Examples of permissible drug testing include

  • random drug testing;

  • drug testing unrelated to the reporting of a work-related injury or illness;

  • drug testing under a state workers’ compensation law;

  • drug testing under other federal law, such as a U.S. Department of Transportation rule; or

  • drug testing to evaluate the root cause of a workplace incident that harmed or could have harmed employees. 

OSHA adds, “If the employer chooses to use drug testing to investigate the incident, the employer should test all employees whose conduct could have contributed to the incident, not just employees who reported injuries.” 

This language does not necessarily break new ground because it is similar to OSHA’s previous guidance. The statement that permissible workplace drug testing includes “drug testing unrelated to the reporting of a work-related injury or illness” is potentially significant. An employer in an industry where drug use could lead to accidents, such as manufacturing, construction, power generation, or warehousing, may maintain a policy requiring blanket testing whenever an injury is reported because ferreting out employees working under the influence is important for the overall safety of the facility. There, the employer is not testing because of an injury report; the testing is performed to maintain a drug-free worksite.

Why Now? What Has Changed?

Two significant events have occurred since OSHA issued the amendments to the recordkeeping regulation. First, President Trump was elected. As expected during a Republican administration, the rulemaking pace has slowed significantly (although enforcement has been aggressive). To the extent the U.S. Department of Labor has engaged in rulemaking, the purpose has been to undo Obama-era regulations rather than impose new mandates on employers. Along those lines, OSHA stated on June 28, 2017, regarding the deadline for electronic submission that the agency “intends to issue a separate proposal to reconsider, revise or remove other provisions in the final rule.” Those “other provisions” must include section 1904.35(b)(1)(iv).

Second, two lawsuits—National Association of Homebuilders of the United States, et al. v. Acosta, 17-CV-00009 (filed January 4, 2017) and Texo ABC/AGC, Inc. v. Acosta, 16-CV-1998 (administratively closed, June 30, 2017)—were filed shortly after OSHA finalized the amendments to the recordkeeping regulation. Both lawsuits challenged OSHA’s authority to promulgate the anti-retaliation provision given that section 11(c) provides a remedy to employees. The National Association of Homebuilders lawsuit also challenged the electronic submission provision. Both lawsuits are on hold because OSHA represented to the courts that it would be changing the regulation, and the courts are giving OSHA time to do that.

On July 30, 2018, OSHA proposed eliminating the requirement that establishments with 250 or more employees submit OSHA 300 logs and 301 forms electronically. OSHA has concluded that the data is not valuable from an enforcement perspective and that it raises concerns about the possibility that the agency would have to disclose the information pursuant to a Freedom of Information Act request.

OSHA has not, however, proposed any changes to section 1904.35(b)(1)(iv). Will OSHA ultimately issue a proposal amending or eliminating the provision? Reading the tea leaves, the answer is probably yes. The plaintiffs in the pending Homebuilders lawsuit presumably will not withdraw their complaint based on compliance guidance—particularly guidance this ambiguous.

Also, there appears to be a method to OSHA’s madness here. The anti-retaliation provision was added to discourage employers from punishing employees who report injuries. Based on evidence submitted during the rulemaking, OSHA concluded that some employers might try to deter reporting because OSHA 300 logs and 301 forms would be publicly available on OSHA’s website. OSHA is now proposing eliminating the electronic submission requirement altogether. As such, the anti-retaliation provision is no longer necessary because the original reason for it—the public availability of the data—will no longer be at issue.

Employers may have preferred a rulemaking in which OSHA acknowledged it lacked authority to create an alternative remedy to section 11(c). OSHA’s plan appears to be to skirt that issue and instead propose amending or eliminating section 1904.35(b)(1)(iv) because it is no longer necessary.

Practical Impact

Employers should continue to avoid safety incentive programs that violate section 11(c). For example, a program that rewards an individual employee with cash if he or she reports no work-related injury in a quarter may not be compliant. Rate-based incentive programs, particularly those that follow OSHA’s latest compliance guidance, are permissible.

Employers should consider two aspects of blanket post-accident drug testing. First, even before the existing guidance, OSHA had provided exceptions that allowed blanket post-accident testing, including obtaining discounted workers’ compensation rates and engaging in root-cause analysis investigations. The revised guidance seems to go one step further, allowing testing as another means of flushing out workers under the influence of drugs at work. Second, the key will be consistency in applying the policy for post-accident drug testing across similarly-situated employees.

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