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The U.S. Occupational Safety and Health Administration has not pulled back from conducting inspections and imposing rising penalties against employers for workplace safety violations despite the Trump administration’s deregulatory agenda, according to legal experts.
But the Trump administration is likely to pursue criminal actions against employers who willfully violate workplace safety standards when such violations lead to fatalities, experts say.
OSHA inspections had been trending down during President Barack Obama’s second term, but experienced an uptick in fiscal year 2017, with 32,396 inspections conducted compared with 31,948 in fiscal year 2016, according to agency data.
“My view of it is, we haven’t really seen the impact of the Trump administration on OSHA yet,” Eric Conn, founding partner of Washington-based Conn Maciel Carey L.L.P., said during a webinar by the law firm Tuesday. “We don’t have their leaders in place. It’s really the career OSHA folks running the show with a little bit of direction from the administration, and with the career folks you wouldn’t expect to see a lot of major change from what things looked like during the Obama administration.”
In November, the president nominated Scott Mugno to head OSHA as assistant secretary of labor. Mr. Mugno is currently the vice president for safety, sustainability and vehicle maintenance at FedEx Ground, a unit of FedEx Corp. In December, Mr. Mugno faced tough questions during his confirmation hearing, but scheduling issues have prevented a vote by the full Senate and a potentially looming government shutdown might further delay action on his nomination, said Amanda Walker, an Atlanta-based partner in the firm’s OSHA workplace safety practice group.
Meanwhile, the average penalty per serious violation rose to $3,645 per violation in fiscal year 2017 compared with $3,415 during the previous fiscal year, amid a major revamp to OSHA’s penalty structure, Mr. Conn said. However, only six $1 million cases for workplace safety violations were reported for the 2017 fiscal year compared with an average of 8.4 cases during fiscal years 2010 through 2016.
“If we’re all expecting that things are going to change dramatically … that may not be the case,” he said. “This could be a reflection of the career folks more or less running the agency for the time being or it could be a sign that we’re still going to see significant enforcement regardless of which administration controls the White House.”
In addition, the Department of Labor has not issued any notice of proposed rulemaking to rescind existing OSHA regulations, said Micah Smith, a Washington-based attorney with Conn Maciel.
“We’ve seen a lot of delays in the first year of the Trump administration trying to slow things down,” he said. “Remember, we were promised deconstruction (of the regulatory state). Every rule that was pushed out during the Obama administration before 2016 and by every other administration is still in place and still being enforced.”
A few obstacles to deregulation at OSHA include the lack of political leadership and the language and requirements of the Occupational Safety and Health Act, which apparently does not contemplate revocation of workplace safety regulations for economic growth reasons, Mr. Smith said.
“If Trump’s OSHA tries to push this deregulatory agenda in this way, you might see some very fertile grounds for legal challenge,” he said. “Call me a cynic, but I’m not real optimistic about how easy it would be for the Trump administration to start pulling back rules.”
Two OSHA regulatory developments bear watching in 2018, including an advancing potential rule on lockout/tagout requirements and possible changes to OSHA’s current electronic record-keeping rule, Mr. Conn said.
Potential changes under the electronic record-keeping rule could include elimination of or revisions of the rule’s anti-retaliation provisions, said Daniel Deacon, associate in the law firm’s OSHA workplace safety group in Washington.
“There was a lot of backlash from employers about a lot of these provisions and there wasn’t a whole lot of guidance,” he said.
OSHA could also increase the compliance threshold for employers in high-hazard industries, which currently requires employers with 20 or more employees in certain designated sectors to comply with the rule to 50 or 100 employees, which would “significantly decrease the burden on a large number of employers,” he said.
While about 500,000 workplace fatalities have occurred since passage of the OSH Act, there have only been about 80 criminal referrals and about a dozen criminal convictions, said Kathryn McMahon, a partner in the OSHA workplace safety practice group for the law firm. Such criminal prosecutions only happen if there is both a fatality and a willful violation of workplace safety regulations, she said.
In December 2015, the Obama administration issued a directive commonly referred to as the Yates memo after Sally Quillian Yates, then-deputy attorney general for the Justice Department, that intended to ramp up efforts to prosecute companies and individuals who endanger the lives of their employees under environmental statutes that feature stiffer fines and penalties than workplace safety laws.
While the Trump administration could try to pull back on the Yates memo, Attorney General Jeff Sessions is “known to be a law-and-order type guy” and blue-collar workers are President Trump’s base – two factors that might work against deregulation in this area, she said. In addition, Mr. Mugno has publicly committed to pursue criminal penalties, including jail time, against employers.
“Pick a few bad actors and they’ll use the environment statutes, which have much greater teeth,” Ms. McMahon said. “We anticipate that we might see a heightened risk of criminal prosecutions, in part to insulate and provide cover if they’re trying to do deregulation on the civil side.”
Signs and actions taken to date are pointing to a major pullback in the U.S. Occupational Safety and Health Administration’s regulatory stance under the Trump administration, but there are still plenty of unknowns, according to legal experts.