PAINTSQUARE BLOG

Assault on Pizza Parties, Drug Tests and Executive Compensation

Part 1: Overview and History

OSHA’s recent reform to its Recording and Reporting Occupational Injuries and Illnesses regulation has created quite a stir for employers. 

As reported earlier, the new recordkeeping rule requires employers to electronically submit to OSHA their injury and illness recordkeeping data. OSHA will, in turn, publish the data online for all the world to dissect. 

© iStock.com / powerofforever

OSHA's new injury reporting and recordkeeping rule requires employers to electronically submit their injury and illness recordkeeping data; the electronic submission element is likely to be the least of employers' concerns in adhering to the regulation.

It turns out, however, the electronic recordkeeping data submission elements of the new rule may not be the most problematic for employers.

Little Guidance

The new rule also increases employers’ obligations to implement “reasonable reporting” procedures for employees to report to their employers the work-related injuries they incur, and expands OSHA’s enforcement authority by introducing a vague new set of anti-retaliation provisions. 

To date, employers have seen little guidance about what OSHA means by reasonable reporting procedures or what types of policies may violate the new anti-retaliation provisions.

Particularly controversial is the impact of OSHA’s new rule on employers’ policies for post-injury drug testing, safety incentive programs, and executive compensation and bonuses. Although none of those words appear in the amended Recordkeeping regulation, OSHA addressed each in the Preamble to the Final Rule.

These topics have been on OSHA’s radar for nearly a decade, dating back to a 2008 report issued by the House of Representative Committee on Education and Labor titled “Hidden Tragedy: Underreporting of Workplace Injuries and Illnesses.” 

From that time, OSHA has been making efforts to address a perceived culture of underreporting injuries and retaliation against employees who do report workplace injuries and illnesses.

Perceived Reporting Deterrents

OSHA has used every tool at its disposal to chip away at employer policies and practices that purportedly discriminate against employees who report injuries, or that attempt to deter employees from reporting injuries in the first place.

© iStock.com / ZernLiew

Since 2008, OSHA has been attempting to address a perceived culture of underreporting injuries and retaliation against employees who do report workplace injuries and illnesses.

Even before this rulemaking, OSHA has taken action against policies that it believes discourage reporting or recording of work-related injuries.

For example, in 2012, OSHA issued a policy memorandum to all of its field offices (commonly referred to as the “Fairfax Memo”) in which OSHA delineated various categories of safety incentive policies and programs that OSHA considered impermissible—either per se, or because of their purported injury reporting deterrent under the circumstances of the employer’s workplace. 

The memo set forth for the first time OSHA’s distaste for programs that reward the absence of injuries—e.g., a pizza party for a crew going six months without a lost time injury or entry into safety bingo for employees who do not have a recordable injury.

Using this memorandum, OSHA has pursued 11(c) retaliation actions against employers who disciplined employees after incurring injuries.

OSHA first acted on this hostility to safety incentive programs in the context of the Voluntary Protection Programs (VPP) cooperative program. In a 2014 VPP Policy Memorandum (which also addressed issues surrounding executive, management and supervisory compensation and bonuses based on injury and illness rates), OSHA threatened to strip VPP status from any VPP employer who maintained these dangerous safety incentives—like hosting safety pizza parties or providing bonuses for managers who have particularly safe stretches of work. 

Both memoranda left many questions unanswered.

© iStock.com / Denisk999

An employer who hosts a pizza party to reward workers for going a period without inury could be viewed as offering a safety incentive that discourages injury reporting.

With employers still daring to host pizza parties for employees all around the country, OSHA was not about to rest; hence, the new Recordkeeping rule. However, the Recordkeeping rule does little to address the uncertainty about OSHA’s expectations. 

My firm has made several inquiries to OSHA regarding specific employer policies and programs, but no clarity has been forthcoming. OSHA has expressed thanks for the questions and has reiterated that it is considering specific scenarios and will be issuing further guidance at some point in the future.

Despite a recent industry legal challenge of the rule, the looming Nov. 1 enforcement deadline for the anti-retaliation provisions of the rule (postponed by OSHA from the initial Aug. 10 date) means employers must act quickly to evaluate their existing reporting policies, drug testing policies, safety incentive programs, and compensation schemes to ensure they are in compliance.

This is especially true given OSHA’s response to Industry’s legal challenge to the anti-retaliation provisions of the rule, in which OSHA argues that the anti-retaliation provisions stem from an OSH Act mandate to ensure accurate reporting of workplace injuries, and that such policy determinations are solely within OSHA’s discretion.

Editor’s Note

This is Part 1 of a multi-part series on the topic. Part 2 will address the rules new employer obligations, as well as a new enforcement mechanism under the rule.

Part 3 will look at the agency’s attitudes toward safety incentive programs, post-accident drug testing and executive compensation and how these policies can serve as the basis for a retaliation-based citation.

ABOUT THE THE BLOGGER Eric J. Conn Eric J. Conn is a founding partner of Conn Maciel Carey and Chair of the firm’s national OSHA • Workplace Safety Group. His practice focuses exclusively on issues involving occupational safety and health law. OSHA Watch offers general information but should not be construed as legal advice. Employers are always advised to seek appropriate counsel for individual issues. Contact Eric. SEE ALL CONTENT FROM THIS CONTRIBUTOR