Inspected in Poughkeepsie, Enforced in Peoria? When Will OSHA Recommend a Corporatewide Settlement Agreement?

Generally, when the Occupational Safety and Health Administration (OSHA) inspects an employer’s facility in one location, it issues citations and abatement requirements that apply only to that location. OSHA does not habitually attempt to issue citations and require abatement at facilities in other locations that are affiliated with the same employer—even in cases where repeat violations are cited based on violations at other facilities. But OSHA can negotiate settlement agreements with employers that apply to all of an employer’s facilities—basically, inspecting a facility in Poughkeepsie and enforcing its findings in Peoria.

Today we’ll look at situations when OSHA area directors are instructed to attempt to put a corporatewide settlement agreement in place.

After the Inspection

Once OSHA has completed an inspection at one of your facilities, the area director will issue citations for any alleged violations, together with proposed penalties and abatement requirements. These documents are not, at this point, written in stone; employers can appeal them within 15 working days. Sometimes an appeal results in a hearing before an administrative law judge; other times, employers will negotiate settlement agreements with OSHA in which both parties agree on violations, abatement, and penalties.

Unlike the citations themselves, settlement agreements can cover just about anything that both parties agree to—and OSHA has been increasingly negotiating settlements that cover not just one facility but all of an employer’s workplaces.

When Does OSHA Seek a Corporatewide Settlement Agreement?

Corporatewide settlement agreements were originally created to address cases involving extensive recordkeeping violations; the employers involved agreed to implement compliant recordkeeping practices throughout their corporations. Since 2011, OSHA has expanded its emphasis to employers whom OSHA identifies as having “a significant pattern of noncompliance with the OSH Act across multiple site locations.”
OSHA has identified these specific enforcement situations as opportunities to craft corporatewide settlement agreements:

High profile enforcement cases. OSHA will suggest a corporatewide settlement agreement in some “high profile enforcement cases,” as defined in OSHA’s guidelines. These include:

• Egregious enforcement actions
• Significant penalty cases
• Fatality/Catastrophe cases
• Severe Violators Enforcement Program (SVEP) cases
• Process Safety Management (PSM) cases
• Cases where a complex, serious hazard not covered by a standard exists (in other words, some General Duty Clause citations)

Extensive recordkeeping deficiency cases. OSHA will probably suggest a corporatewide settlement agreement in cases where systemic recordkeeping deficiencies or extensive problems are evident. For example, when a corporate official is making the recordkeeping decisions and/or corporate instructions provide erroneous guidance.

Cases where high gravity serious citations were issued. OSHA will probably suggest a corporatewide settlement agreement when an employer’s inspection history reveals one or more of these features:

• A systemic pattern of violations associated with a particular OSHA standard(s) or subpart
• A significant history of OSHA violations
• An accident or fatality trend stemming from the same or similar conditions

Under the current guidelines, “corporatewide” enforcement agreements are not enforceable in state-plan states, although OSHA, of course, wants employers to undertake agreed-upon compliance and abatement measures at all of their facilities, not just at the ones in federally regulated states.

Tomorrow we’ll look at OSHA’s latest attempt to expand its ability to enforce inspection findings across an entire corporation, rather than at a single location—and what the courts have said so far about those efforts.