By Adam R. Young, Daniel R. Birnbaum, James L. Curtis, and Craig B. Simonsen

Seyfarth Synopsis: Highlighting the current administration’s focus on using press releases to assure workplace health and safety regulations are being followed, OSHA announced that a major retailer who has allegedly continued to expose workers to blocked exit routes is being cited for hundreds of thousands of dollars of fines, and over $15 million in fines since 2017.

In a national news release issued earlier this month, OSHA highlighted the OSHA history of a major retailer, including alleged deficiencies related to blocked exit routes.  OSHA announced that “since 2017, OSHA has issued more than $15 million in fines and cited Dollar General Corp. for numerous willful, repeat and serious workplace safety violations related to unsafe conditions in facilities nationwide.”

In its press release, OSHA Regional Administrator Kurt Petermeyer in Atlanta accused the Company of putting profits before people, noting that “these violations are preventable, and failing to prevent them shows a blatant disregard for the workers on whom they depend to keep their stores operating.”

OSHA’s recent actions indicate three significant takeaways for employers.  First, OSHA has revitalized its use of press releases to bring public awareness of significant citations issued to employers, impacting customer relations, employee relations, and painting a target for aggressive third-party litigators, union organizers, and others with a litigious interest in a Company’s record of workplace safety.  Second, OSHA will continue to target employers with wide operations who may become repeat offenders.  As the cases demonstrate, such employers can quickly accumulate significant OSHA fines in a short period if OSHA believes a Company’s safety culture is deficient.  Finally, with regard to retailers who generally are in a less hazardous industry than other employers subject to OSHA inspections, OSHA will aggressively investigate and cite safety hazards such as blocked exit routes. 

To develop a strategy that reduces the risk of harmful press releases, potential repeat liability, and significant OSHA fines, employers should consult experienced OSHA counsel.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Workplace Safety and Health (OSHA/MSHA) Team.

Image From OSHA

By A. Scott Hecker, Adam R. Young, James L. Curtis, and Craig B. Simonsen

Seyfarth Synopsis: OSHA is promoting grain safety and compliance with the Grain Handling Facilities Standard on it’s website and links to additional information about Stand Up for Grain Safety Week, which takes place March 27-31, 2023.

Each year, dozens of workers become entrapped in confined spaces at grain handling facility worksites.  Further, according to researchers from Purdue University, there have been more than 900 cases of reported grain engulfment in the last five decades, with a fatality rate of 62 percent. As we noted in our October 8, 2019 blog concerning OSHA’s Grain Handling Facilities Standard, 29 C.F.R. § 1910.272, OSHA maintains an aggressive enforcement focus on grain handling facilities.  OSHA regularly pings the regulated community on grain handling facility compliance.  OSHA maintains regional and local emphasis programs for Grain Handling Facilities in Region V (IL, OH, WI), Region VIII (CO, MT, ND, SD), and the state of Idaho.

OSHA’s Grain Handling Facilities Standard applies broadly to facilities that “may receive, handle, store, process and ship bulk raw agricultural commodities such as … corn, wheat, oats, barley, sunflower seeds, and soybeans.”  The facilities include grain elevators, feed mills, flour mills, rice mills, dust pelletizing plants, dry corn mills, soybean flaking operations, and dry grinding operations of soycake.

With its most recent press release, OSHA explains that it continues to place an enforcement emphasis on grain handling facilities because the “grain handling industry is a high hazard industry where workers can be exposed to numerous serious and life threatening hazards.” The hazards include: fires and explosions from grain dust accumulation, suffocation from engulfment and entrapment in grain bins, falls from heights and crushing injuries, and amputations from grain handling equipment.

Engulfment and confined spaces are a primary concern of the Agency. “Suffocation can occur when a worker becomes buried (engulfed) by grain as they walk on moving grain or attempt to clear grain build up on the inside of a bin. Moving grain acts like “quicksand” and can bury a worker in seconds.”  It is estimated that about 400 pounds of pulling force is required to extract a body out of waist deep grain.  Accordingly, it is typically impossible for one employee to pull out by hand another employee engulfed in grain.  The regulations provide for grain bin entry procedures, with attendants and rescue plans.

In addition, grain dust explosions can be severe.  According to OSHA, over the last 35 years, there have been over 500 explosions in grain handling facilities across the United States, which have killed more than 180 people and injured more than 675.  OSHA has used at least one national industry consensus standard in enforcement activities concerning grain handling facilities.  We previously blogged on Updated Combustible Dust NFPA Industry Consensus Standard Gives OSHA New Tool to Cite Employers: Does Your Facility Comply?  In the blog, we noted that compliance with the industry standard for combustible dust was set for September 2020.  But we suggested that industry not delay its compliance efforts, as OSHA was already citing employers using the not-yet-effective NFPA 652, Standard on the Fundamentals of Combustible Dust.

Since that time, federal OSHA has continued its enforcement emphasis on employers who operate grain handling facilities, and those employers should ensure they remain in full compliance.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Seyfarth Workplace Safety and Health (OSHA/MSHA) Team.

By Adam R. Young, Patrick D. Joyce, James L. Curtis, Daniel R. Birnbaum, Melissa A. Ortega and Craig B. Simonsen

Seyfarth Synopsis: The Biden Administration is seeking a 17% funding increase for OSHA under the Department of Labor’s fiscal year 2024 budget request.

The FY 2024 budget request for OSHA is approximately $738.7 million, an increase of more than $106.3 million from FY 2023. The upcoming fiscal year begins Oct. 1. Released on March 9, the proposal includes increases of 16.3% for federal enforcement (up roughly $40 million for FY 2023), 30% for federal compliance assistance (+$23.3 million), and 26.3% for safety and health standards (+$11.1 million).

During the Trump Administration, OSHA faced years of flat budgets and OSHA had a difficult time competing for safety professionals with private industry when trying to hire compliance officers. This created staffing challenges at OSHA’s area offices. With this new budget request, USDOL intends to add 432 full-time equivalent employees (“FTEs”), including 250 additional enforcement staff “to rebuild and strengthen OSHA’s enforcement program.” The 250 new enforcement FTEs would include 142 OSHA compliance safety and health officers.

A divided Congress, however, will have the final say. A hearing before the House Labor, Health and Human Services, Education, and Related Agencies Subcommittee was previously scheduled for March 9, 2023, but was postponed due to the departure of outgoing Labor Secretary Marty Walsh.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Workplace Safety and Health (OSHA/MSHA) Team.

By Jeryl L. Olson, Rebecca A. Davis, Patrick D. Joyce, Scott T. Fenton, Ilana R. Morady, and Craig B. Simonsen

Seyfarth Synopsis: The U.S. Environmental Protection Agency’s (EPA) has announced that it is proposing the first-ever national drinking water standard for six per- and polyfluoroalkyl substances (PFAS) in the latest action under President Biden’s plan to combat PFAS pollution and the EPA PFAS Strategic Roadmap. 

Through its proposed rule, EPA seeks to establish legally enforceable levels for six PFAS in drinking water.  The proposed rule follows EPA’s prior proposals to designate two PFAS as hazardous substances under CERCLA and to use the Clean Water Act permitting and regulatory programs to enforce cleanup of PFAS pollution in the drinking water.  The proposal however is fraught with issues.

While according to the Biden Administration, the proposal is intended to be another step in “EPA’s Strategic Roadmap”, and EPA Administrator Michael S. Regan is touting the proposal as a means to “…provide states with the guidance they need to make decisions that best protect their communities…”, some states have already introduced measures to limit PFAS (at more reasonable levels than proposed by EPA) and while EPA’s proposal ostensibly is intended to build on such existing state initiatives, it is more likely, in current form, to merely stall such initiatives as states struggle to determine how to conform their programs to meet EPA’s new limits.  

The proposed new rule creates significant concerns for public water supplies (at present it does not apply to private water supplies or residential wells) as it would mean that if a public water system determines that PFAS exist in drinking water at or above the proposed levels, the existing drinking water system would need to be retrofitted, or alternatively a new drinking water system will need to be installed.  Some communities would need to consider switching to a different water source.  All options are costly and create challenges for communities already struggling to meet federal drinking water limits. (Note,  there are limited funds and grants available to communities under the Infrastructure Law for disadvantaged communities and small communities of less than 25,000 people, but it is unclear how and when those funds may be allocated.) For these reasons, the levels set by EPA will be critically challenged, and are unlikely to survive public notice and comment in their current form because of the cost.

If finalized, the proposal, as detailed in EPA’s FAQs, would regulate PFOA and PFOS as individual contaminants, and will regulate four other PFAS – PFNA, PFHxS, PFBS, and GenX Chemicals – as a mixture. A hearing is to be held on the rulemaking at www.regulations.gov, identified by Docket ID Number: EPA-HQ-OW-2022-0114, on May 4, 2023, at which the public will be invited to provide EPA with verbal comments. For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Seyfarth Workplace Safety and Environmental Team.

By Brent I. Clark, Patrick D. Joyce, Adam R. Young, A. Scott Hecker, Daniel R. Birnbaum, and Melissa A. Ortega

Seyfarth Synopsis: This week we are attending the ABA Workplace and Occupational Safety and Health Law Committee Midwinter Meeting in San Diego, California. The meeting includes representatives from the U.S. Department of Labor, including the Occupational Safety and Health Review Commission, the Mine Safety and Health Review Commission, Administrative Law Judges, and the Solicitor’s Office, as well as management, labor, and safety attorneys and professionals.

The final day of the ABA Workplace and Occupational Safety and Health Law Committee Midwinter Meeting began with a panel of judges and Commissioners from the Occupational Safety and Health Review Commission: the Honorable Cynthia Attwood, the Honorable Amanda Wood Laihow, and the Honorable Covette Rooney. Chief Administrative Law Judge Rooney discussed the Review Commission’s ongoing Administrative Law Judge settlement rates, which continue to hover near 95% for federal OSHA cases. For settlement conferences, the data indicated a shift towards in person meetings. Trials appeared to maintain a 50/50 split between in-person and virtual. Of the hundreds of COVID citations OSHA has issued, Chief Judge Rooney only identified one that has proceeded to hearing. Chief Judge Rooney expressed a preference for in-person hearings as a Judge, but gratitude for the potential for remote hearings where necessary and also explained the changes to the procedural rules and preference for rule compliance.

At the Review Commission level, in Fiscal Year 2022, the Review Commission directed 14 of 24 petitions for discretionary review, and decided 12 cases. The oldest case on the docket has been limited to 21 months, meaning that there are far fewer pending cases that in past years. The Review Commission received its full budget request from Congress, and is seeking to bring in additional employees, including the appointment of a third Commissioner. The Review Commission offered an explanation of when it will permit oral argument, which they were open to in a future with three sitting Commissioners 

The second panel was a mock mandatory settlement mediation conference, mediated by the Honorable William Coleman, Administrative Law Judge with the Review Commission. The panel first discussed mandatory settlement proceedings under 29 CFR 2200.120, and Judge Coleman shared his preferences. Administrative Law Judges can exercise their discretion and conduct the proceedings as they prefer, but within the guidelines in the rules. For example, Judge Coleman prefers to hold the proceedings remotely and will regularly do so if the parties agree. Judge Coleman also prefers to have the company representative with final settlement authority in the room during the proceeding.

The panel then went through a mock mediation for a hypothetical where an employer was cited for a willful violation of the machine guarding standard and a serious violation of the powered industrial truck standard with a penalty totaling over $200,000. This qualified the case for mandatory settlement mediation. Judge Coleman prefers to first hold ex parte conversations with the parties before the settlement proceedings officially begin. Judge Coleman then holds a mandatory settlement opening conference and requests written statements from the parties. Judge Coleman then holds a private caucus session with the parties.

The third panel was a discussion on automation, artificial intelligence (“AI”), and privacy. For OSHA, Rachel Graeber, Counsel, Office of the Solicitor presented. The panel discussed ways in which automation may create jobs, assist workers with their tasks, or change performance of the same. The panel also discussed different ways to think about AI from a workplace safety perspective. For example, smart powered industrial trucks may be able to prevent collisions. The panel discussed interplay with the NLRA and automation and how it affects employee labor rights. Employer representatives raised concerns with expectations as to industry consensus standards and whether OSHA had a duty to notify the regulated community regarding the applicability of those consensus standards. Finally, there were issues raised with regard to protections on employee biometric information and protection from medical inquiries under the Americans with Disabilities Act, and how advanced smart technologies may infringe on those rights.

The final panel addressed ethical issues and ethics opinions from state courts, as well as issues relating to attorney discipline, civil liability, and malpractice liability. Model professional conduct rules include prohibitions on harassment and discrimination, which is being rolled out in most states. The panel addressed implicit bias, explicit bias, and ethical considerations in conducting OSHA practice and safety management. Speakers provided suggestions and tools to address implicit bias in management and the legal profession. These implicit biases could be important to understand and improve both internal safety investigations and OSHA inspections. For example, the panel suggested a potential inaccurate conclusion based on bias, on issues like whether Spanish-speaking employee had understood training, or whether a recovering addict was impaired at the time of the accident. The panel stressed neutral evaluations and a consciousness of potential biases in making the determinations.

We look forward to returning to next year’s Midwinter Meeting in early 2024.

By Brent I. Clark, Patrick D. Joyce, Adam R. Young, A. Scott Hecker, Daniel R. Birnbaum, and Melissa A. Ortega

Seyfarth Synopsis: This week we are attending the ABA Workplace and Occupational Safety and Health Law Committee Midwinter Meeting in San Diego, California. The meeting includes representatives from the U.S. Department of Labor, including the Occupational Safety and Health Review Commission, the Mine Safety and Health Review Commission, Administrative Law Judges, and the Solicitor’s Office, as well as management, labor, and safety attorneys and professionals.

Today’s session started with a panel discussing recent significant caselaw affecting workplace safety.  The panelists talked about whistleblower related litigation and a recent case that affirmed that unpalatable or unwelcome job changes are not necessarily considered adverse employment actions for retaliation purposes.  The case is currently pending at the United States Supreme Court, who could potentially issue a decision that significantly impacts whistleblower cases moving forward.  The panel also discussed a recent case involving HAZWOPER citations that were vacated by the Review Commission and appeals court when a release of ammonia was not “uncontrolled” and the standard did not apply.  A note was made that a similar argument could extend to the lockout / tagout standard when equipment is designed to not result in “unexpected energization.”  A case involving a general duty clause violation that is currently on appeal to an appeals court was also discussed.  The heart of the conversation focused on whether an employer’s reliance on a specialty contractor to perform work was an affirmative defense that must be proven by an employer or a part of the government’s case to prove employer knowledge.  A decision by the appeals court could impact how employers plead affirmative defenses and clarify who has the burden of proof in specialty contractor cases.  Finally, continuing on the theme of discussing heat illness issues from the previous day, the panel spoke on a recent heat illness case where the Review Commission reinstated numerous citations that were previously vacated.  The Review Commission acknowledged that heat was a recognized hazard and there are ways to protect employees from the hazard that includes work or rest cycles, reducing time outdoors, and acclimatizing employees.

The next panel discussed COVID-19, and its impact on both the structure of the workplace and OSHA regulatory efforts.  The panel discussed the legal and business challenges faced by the workplace during the pandemic and reminded the attendees that there remains a high potential for a future pandemic down the road.  To that end, the panelists discussed that employers need to be prepared to respond quickly through remote work practices, use of PPE and other recognized practices for handling infectious diseases.  The panel also acknowledged that the COVID-19 pandemic has led to a more informed workplace with regard to what safety and health standards exist in the workplace.  Further, employees have become more aware of OSHA’s retaliatory provisions and their 11(c) rights.  The panelists also tied in the COVID-19 pandemic to concerns about mental health issues in the workplace, and the increased potential for workplace violence cases that may result.

The conference then split into break-out sessions.  During a session on discrimination, a panel looked at how issues such as bullying could be addressed by workplace safety laws, including as a workplace violence incident under the general duty clause, or whistleblower statutes.  The panel also observed that a bullying issue that leads to employee mental health issues that are work related could result in a recordable incident on an OSHA 300 form.

We also attended a breakout session regarding updates on OSHA enforcement in the Construction industry.  OSHA Directorate of Construction Director Scott Ketcham addressed major concerns and emphases with regard to construction.  He noted data that showed a fatality rate three times higher in construction.  With less than 8% of workers in the construction industry, OSHA conducts more than 50% of its inspections against construction employers.  He discussed recent examples of bridge collapses and truss construction collapses, indicating major alleged safety shortcomings. He discussed falls and the risks posed by falls at great length, as one in ten worker deaths (in all industries) is due to fall.  He explained the agency’s focus on fall hazards for its inspections and citations, and a pending National Emphasis Program relating to fall hazards. 

OSHA CSHOs are already instructed to stop any time they see employees working at height (or in a trench) and ensure that appropriate safeguards are in place.  He also discussed current regulatory activity, including new design requirements for Powered Industrial Trucks (replacing the 1969 standards), pending revisions to the lead regulations, and a Worker Walk Around Representation Notice of Proposal Rule Making.  OSHA plans to clarify the definition of construction further, including a new definition of “heavy maintenance” as a type of construction.  The regulated community often continues to grapple with the issue and complying with detailed different regulations as to General Industry and Construction regulations.

USDOL Staff Attorney Juan Lopez discussed examples of aggressive enforcement actions.  He gave examples of willful-egregious citations, in which OSHA was highly motivated to issue citations based on prior fall fatalities at other worksites for the same employer.  He discussed how, in that case, the agency also coordinated with local authorities to have the employer’s license revoked.  He discussed violation by violation citations, including a recent citation where OSHA issued thirteen separate citations based on 13 employees not wearing fall protection.  Notably, he repeatedly referred to admissions supervisors made during management interviews as the key evidence in each case.  He also discussed USDOL’s efforts to pierce the corporate veil as to OSHA penalties, to create individual responsibility for OSHA violations for ownership. 

At a separate Cal/OSHA breakout discussion, panelists discussed some of the unique challenges, opportunities, and regulatory approaches to administering and operating under the country’s largest OSHA state plan.  The discussion focused on wildfires and air quality (including the importance of the Air Quality Index, or AQI), outdoor heat and its potential risks, and H-2A agricultural employees.

Finally, a panel discussed whistleblower laws, including both the statutes that protect employees from retaliation and those that provide rewards, such as the False Claims Act.  The panel focused on the best practices employers can take when responding to such claims to reduce liability.

More to come from the conference tomorrow.

By Brent I. Clark, Patrick D. Joyce, Adam R. Young, A. Scott Hecker, Daniel R. Birnbaum, and Melissa A. Ortega

Seyfarth Synopsis: This week we are attending the ABA Workplace and Occupational Safety and Health Law Committee Midwinter Meeting in San Diego, California. The meeting includes representatives from the U.S. Department of Labor, including the Occupational Safety and Health Review Commission, the Mine Safety and Health Review Commission, Administrative Law Judges, and the Solicitor’s Office, as well as management, labor, and safety attorneys and professionals.

The first speaker was Douglas L. Parker, Assistant Secretary of Labor for Occupational Safety and Health from the U.S. Department of Labor. Mr. Parker spent time reflecting on his first full year in his role, focusing on vulnerable workers, new enforcement tools, and OSHA’s hiring efforts. After discussing the hazards that vulnerable workers, such as undocumented workers or persons of color, face in the workforce, Mr. Parker discussed OSHA’s enforcement efforts to combat such trends. Mr. Parker discussed OSHA’s expansion of the Severe Violator Enforcement Program, updating OSHA’s instance-by-instance policy, increasing work with law enforcement officials, growing OSHA’s emphasis programs, including with heat illness, and seeking enterprise-wide enforcement.

Mr. Parker also discussed OSHA’s recent hiring trends, which includes adding approximately 400 new hires, including over 200 new Compliance Officers. Mr. Parker recognized that one out of five Compliance Officers were hired in the last year, presenting potential issues for the Agency related to a lack of investigatory experience and unfamiliarity with the OSHA regulations for these new employees. Mr. Parker also noted that for the first time in years, all of OSHA’s senior executive staff positions have been filled.

Mr. Parker concluded by speaking about OSHA’s rulemaking efforts, that cover heat illness, infectious diseases, workplace violence, PPE, recordkeeping, LOTO, and emergency response.

Seema Nanda, Solicitor of Labor at the U.S. Department of Labor, followed up and noted that the Office of the Solicitor will prioritize addressing whistleblower claims proactively, including filing temporary restraining orders or preliminary injunctions to avert allegedly unlawful retaliation. Ms. Nanda talked about using the Agency’s power to seek court orders to enforce compliance with final orders of citations. Ms. Nanda also discussed “piercing the corporate veil” to hold an individual in charge of a company responsible when they had attempted to hide behind shell corporations to otherwise avoid liability.  Ms. Nanda spoke as well on her office’s efforts to address imminent dangers.

Following Ms. Nanda’s presentation, a question was posed in the context of the new rule regarding subpoenas under 8(d) of the Act and whether the subpoenas would be excessively burdensome on employers. Well known among OSHA practitioners and rooted in the language of the OSH Act, the Minimum Burden Doctrine restricts OSHA’s ability to obtain information by placing anything more than the minimum burden on the employer. Formal subpoenas may greatly increase the burdens placed on employers to produce documents, which risks a violation of the Minimum Burden Doctrine.

The conference also featured a panel discussing the increased trends of mental health issues in the workplace. The panel first spoke about employer obligations under the OSH Act regarding mental health under OSHA’s general duty clause and the seminal Integra decision.  The panel also talked about the status of OSHA’s anticipated workplace violence rule and provided an overview of numerous workplace violence caselaw.  There was further discussion regarding OSHA’s emergency response rule and OSHA’s suicide prevention initiative to promote workplace mental health and suicide prevention awareness.  The interplay between the ADA and mental health was also addressed by the panel.

Ending day one, Kimberly Stille, Director, Directorate of Enforcement of OSHA and Peter Vassalo, Counsel for Special Litigation, Office of the Solicitor spoke at length about key enforcement initiatives for 2023. Ms. Stille spoke at length about indoor and outdoor heat illness prevention which is aimed to address the leading weather-related killer in the workplace.  Ms. Stille discussed OSHA’s heat national emphasis program that is currently in place. Ms. Stille has noted that since the NEP was issued on April 8, 2022, there have been 1,685 federal inspections opened and 1,252 violations, most of which were not for heat but other issues such as fall protection or hazcom. Ms. Stille and Mr. Valasso then moved on to discussing OSHA’s new enforcement initiatives related to Instance-by-Instance, SVEP, and egregious policy. The panelists and the participants engaged in a spirited discussion regarding the benefits and drawbacks of such programs, such as the anticipated growth in employer contest rates due to the increase in penalties, the agency’s role in ensure employee safety and health through achieving abatement of alleged hazards, and the constitutionality of the SVEP policy. The panel ended with a presentation of inspection and citation metrics and a planned refresh of regional and national emphasis programs. More to come from the conference tomorrow

Seyfarth Synopsis: The National Retail Federation (NRF) is hosting a free webinar on workplace violence, taking place on Mar. 7, 2023, at 12:00 – 1:15 PM.

We are looking forward to the National Retail Federation’s Retail Law Summit, where Adam Young will be presenting a March 7, 2023 webinar on Workplace Violence in Retail with his colleagues Melissa Ortega and Timothy Hoppe. Any retailers or others who are interested in this topic, please tune in! Our event description is below:

Employers face growing concerns with retail theft, threats, assaults, sexual violence, and mass shootings, particularly in West Coast markets. The session will discuss legal liabilities relating to workplace violence, as well as applicable and draft laws. We will provide practical tips on developing and updating workplace violence policies to best protect employees, customers and visitors. We will guide attendees through common challenges such as responding to customer/visitor threats, safety concerns from employees, and individuals using retail locations for shelter.

By Rebecca A. Davis and Jeryl L. Olson

Seyfarth Synopsis: ASTM 1527-21 is now in effect.  The ASTM Standard for Phase I Environmental Site Assessments is evaluated every eight years.  The most recent update, ASTM E1527 – 21, approved by the United States Environmental Protection Agency (EPA) on December 15, 2022, is now in effect.

On December 15, 2022, the United States Environmental Protection Agency (EPA) published its final rule, 87 Fed. Reg. 76578, which formally updates the standard to satisfy “all appropriate inquiries” under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).  The result is the effective adoption of ASTM E1527-21 as the new Phase I Environmental Site Assessment standard.  ASTM E1527-21, went into effect on February 13, 2023, and significantly revises a number of the prior provisions under ASTM E1527-13, and also clarifies a number of key terms and requirements.

The new ASTM Standard is intended to provide additional information (and the basis for defenses to certain CERCLA-type liabilities) for prospective purchasers by revealing additional conditions not previously considered relevant to due diligence or the CERCLA defenses.  However, there are significant additional consequences we anticipate will stem from key definitional changes to “Recognized Environmental Condition” (REC), “Controlled Recognized Environmental Condition” (CREC), and “Historical Recognized Environmental Condition” (HREC), which are updated to reduce misclassifications of known or likely hazardous material and petroleum product releases affecting subject properties.  Overall, these definitional changes should create consistency amongst consultants, including as to how environmental conditions are recognized; however, they will also bring added expense to stakeholders.  For example, the updated standard also adds new definitions for the terms “likely,” which is intended to clarify the likely presence or likely release of a hazardous substance.  Although this change is expected to result in greater consistency, the changes to the definitions of REC and Business Environmental Risks (BERs) are also expected to result in consultants identifying more RECs and BERS than would have been identified under the old standard.

Other significant changes include:

  • A requirement for enhanced research into the history of the subject property and adjoining properties, as well as enhanced site reconnaissance requirements;
  • Clarification as to the meaning of the terms “Property Use Limitation” and “Significant Data Gap”; and
  • Clarification that the 180-day shelf life of the Phase I does not commence as of the date of the report, but rather when the various components of the Phase I report are completed, including (i) interviews with owners, operators and occupants, (ii) searches for lines, (iii) searches for government records, (iv) visual inspections by the consultant, and (v) consultant’s certifications; and
  • Guidance regarding how to address emerging contaminants, such as per- and polyfluoroalkyl substances (PFAS), as a non-scope consideration.  This addition may ultimately provide an important driver for parties seeking to determine whether to evaluate PFAS.

In addition to the forgoing, and notwithstanding the definitional changes, the new standard clarifies that a requirement for Phase II testing is not mandated as a result of findings.  Nonetheless, many market participants (including lenders, institutional purchasers/investors and others) will often still require such testing be performed in a variety of circumstances, increasing the likelihood that such additional testing will not only add to the costs of environmental due diligence, but also to the ultimate consequences thereof.

Also, particularly in states which require disclosure of known contamination discovered during due diligence, the combination of the expanded ASTM Standard and these disclosure requirements will force properties into cleanups that otherwise would not have been required but for the real estate transaction.  This could be true even where the contamination was caused in the far-distant past by some unknown party or long-ago owner/operator, or where the contamination is from an unrelated nearby property.  This consequence of forcing more properties into cleanup affects not only purchasers, but also sellers, as the parties, due to necessity, will negotiate responsibility for due diligence costs, cleanup costs, and the administrative costs of negotiating “NFAs” and “NFRs” with state agencies.

The new ASTM 1527-21 standard brings with it both the possibility of consistency and the potential for increased due diligence costs.  Only time will tell how well the new objectives and guidance are received by practitioners and stakeholders alike. 

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Seyfarth Workplace Safety and Environmental Team.

By Benjamin D. Briggs, A. Scott Hecker, Adam R. Young, Daniel R. Birnbaum, Patrick D. Joyce, and Craig B. Simonsen

Seyfarth Synopsis: The Biden Administration’s Fall 2022 Regulatory Agenda for DOL indicates the Agency’s intent to revise and expand its use of administrative subpoenas through an “interim final rule.” OSHA claims the purpose of its planned interim final rule is “to provide helpful clarity to the agency and the regulated public on” what OSHA suggests are “recurrent issues which lead to time-consuming disputes between the agency and employers.” OSHA’s realignment of the role of subpoenas in its investigative process could foreshadow an uptick in OSHA’s subpoena usage and increased adversarial activity between employers and the agency.

According to Chapter 15 of OSHA’s Field Operations Manual (“FOM”), which provides guidance to OSHA enforcement personnel, OSHA issues subpoenas “whenever there is a need for records, documents, testimony, or other supporting evidence necessary for completing an inspection or an investigation of any matter falling within OSHA’s authority.”  Subpoenas duces tecum, or for the production of evidence,require employers to produce documents or other evidence at a specific time and location, such as injury and illness records, e-mails and other correspondence, training materials, or employee handbooks and safety manuals.  Subpoenas ad testificandum, or “to give testimony,”compel their targets to testify under oath.  Notably, OSHA subpoenas are not self-enforcing, so if an employer fails to comply with a subpoena, OSHA must seek court enforcement.  Employers have the right to contest a subpoena to show it is, e.g., overbroad, beyond the scope of OSHA’s investigation, or excessively burdensome.

Employers want to avoid these kinds of court conflicts, and “helpful clarity” from OSHA about its use of subpoenas would be…well…helpful.  But significant ink has already been spilled in the FOM about the subpoena process, so it is unclear whether this interim final rule will lead to greater uniformity and predictability for the regulated community.

Employers should be aware, as explained by the Federal Register, that OSHA uses an “interim final rule”

[w]hen [it] finds it has good cause to issue a final rule without first publishing a proposed rule . . . .  This type of rule becomes effective immediately upon publication.  In most cases the agency stipulates that it will alter the interim rule if warranted by public comments.  If the agency decides not to make changes to the interim rule, it generally will publish a brief final rule in the Federal Register confirming that decision.

Interim final rules tend to provide less visibility into an agency’s plans and allow for less input from the public before taking effect.

Employers must comply with subpoenas – unless successfully challenged – so they should not be taken lightly.  They formally memorialize OSHA’s document demands, and given the potential court involvement noncompliance can invite, we recommend consulting experienced counsel to develop strategies to respond to or contest an OSHA subpoena.

Seyfarth’s subject matter experts will continue to monitor this developing situation to identify changes to the administrative subpoena process and to evaluate the on-the-ground impacts those updates may have on employers.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Workplace Safety and Health (OSHA/MSHA) Team.