By Mark A. Lies, II, James L. Curtis, and Craig B. Simonsen

iStock_000009254156LargeIn a decision last week, the Occupational Safety and Health Review Commission (OSHRC) found that the six month statute of limitations for OSHA to cite an employer does not apply to Process Safety Management (PSM) violations that present a continuing hazard. Secretary of Labor v. Delek Refining, Ltd., OSHRC Docket No. 08-1386 (April 23, 2015).

In Delek, the Secretary alleged that the employer violated 29 CFR § 1910.119(o)(4), by failing to properly close out recommendations from a PHA conducted years before by a prior owner. The employer claimed that citation was time-barred by OSHA’s six month statute of limitations. The Review Commission disagreed, holding that the statute of limitations did not apply because the violations presented a “continuing hazard”.

In Delek, the employer argued that the citations were barred by the statute of limitations based on the D.C. Circuit’s decision in AKM, LLC v. OSHRC, 675 F.3d 752 (D.C. Cir. 2012). In AKM, the D.C. Circuit found that OSHA could not issue a citation for a recordkeeping violation that was older than six months. The basis for the Court’s ruling was that employers are required by the Act to record workplace injuries within seven days of the date the injury occurred. Accordingly, the failure to record becomes a violation after the seventh day and that starts the statute of limitations to run.

The OSHRC disagreed that AKM, LLC applied to the facts before it. Delek involved PSM citations for failure to close out recommendations resulting from a prior PHA that had been conducted years before by a prior owner. Unlike the recordkeeping violation in AKM, the Commission found that the alleged violations were not one time failures to perform a specific task, but presented an ongoing hazard to the employees because the employer failed to act on the recommendation in the PHA with corrective action. According to the Commission, the failure to act on the recommendations means that the dangers identified in the PHA still persisted. Thus, each day that passed without the recommendations being addressed was a continuing violation that could be cited by OSHA, even years after the initial recommendation appeared in the PHA.

There was a vigorous dissenting opinion by Commissioner MacDougall. According to Commissioner MacDougall, the reasoning behind the application of the six month statute of limitations that was applied in AKM applies equally to the PSM citation in Delek. MacDougall argued that the “continuing violation” theory cannot be applied to contravene the plain language of the operative statute of limitations in the Act and unreasonably extend the six month time period. According to Commissioner MacDougall, this would have the absurd consequence of extending the statute of limitations ad infinitum.

Absurd or not, Delek significantly limits the holding in AKM, LLC. As lessons to be learned, employers should review safety audits and ensure that any recommendations have been closed out. This is especially true of PSM facility operators who should review their prior PHA’s and ensure that all of the recommendations have been properly closed out, no matter how old the recommendation may be.

In addition, in a situation where there has been or will be an acquisition of a PSM facility, the employer who is acquiring the facility will want to consider a more comprehensive due diligence inquiry prior to the acquisition to ensure that the PSM program is compliant — since the acquiring employer will be assuming liability for PSM violations that preexisted the acquisition. Employers are encouraged to watch for further developments in this matter.