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OSHA's Ability to Cite General Contractors for Subcontractors' Safety Violations Now in Doubt
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May 21, 2007
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| (A revised version of this article appears in the November 8, 2007, edition of BNA's OSHA Reporter.)
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By Elizabeth M. Walsh
Howrey LLP
The Occupational Safety and Health Administration's authority to issue citations to general contractors for subcontractors' violations under OSHA's "Multi-Employer Citation Policy" has been called into question by the decision of a divided Occupational Safety and Health Review Commission. Secretary of Labor v. Summit Contractors, Inc., OSHRC No. 03-1622 (April 27, 2007).
The Multi-Employer Citation Policy
The current Multi-Employer Citation Policy is described in OSHA's Field Inspection Reference Manual, CPL 2.103. The policy provides that although employers may not have employees of their own exposed to a safety hazard, they still may be cited for a safety or health violation if such employers create the hazard, if they control the work site or if they have the authority to correct the hazard to which another's employee is exposed.
The citation in question arose from scaffolding violations committed by a masonry subcontractor on a construction site in Little Rock, Arkansas. Besides citing the subcontractor for the violations, OSHA also cited Summit, the project's general contractor, on the basis that, as general contractor, Summit was the "controlling employer." No Summit employees were exposed to the hazard created by the violation.
The Summit Decision
In vacating the citation issued to Summit, OSHRC Chairman W. Scott Railton and Commissioner Horace A. Thompson, III agreed in separate opinions that OSHA's Multi-Employer Citation Policy is invalid in the construction context when applied against a "controlling employer" who neither creates nor has employees exposed to the cited safety hazard.
The two commissioners premised their decision on 29 CFR §1910.12 (a), a regulation promulgated by OSHA in 1971. Under the plain terms of §1910.12 (a), an employer engaged in what is defined as "construction work" may be cited only for a violation of construction standards that exposes "his employees" to the prohibited hazard.
Section 1910.12 (a) states that "[e]ach employer shall protect the employment and places of employment of each of his employees engaged in construction work by complying with the appropriate standards prescribed in this paragraph." Section 1910.12 (b) defines "construction work" as "work for construction, alteration, and/or repair, including painting and decorating."
In his lead opinion, Railton noted that OSHA's historically inconsistent application of the Multi-Employer Citation Policy was a factor in his decision. "It seems to me that the checkered history of the multi-employer doctrine as expressed in the Secretary's ever-changing compliance guidelines... taken in contrast with a regulation [§1910.12 (a)] which has not been amended since 1971, results in the latter trumping whatever reliance the Commission can place on the varying nature of the policy," Railton wrote. Coincidentally, the decision was issued on the last day of Railton's term as a commissioner.
Commissioner Thompson wrote separately that §1910.12 (a) clearly was intended to be a limit on OSHA's powers. "It was intended to limit the Secretary's discretion to impose under the OSH Act the duty under the [Construction Safety Act] of prime (general) contractors at construction sites," Thompson wrote.
In dissent, Commissioner Thomasina V. Rogers asserted that the majority had "reversed over thirty years of Commission precedent." She wrote that the policy reflects a "valid use of [OSHA's] enforcement authority" and accused the two other commissioners of "rewrit[ing] history more to their liking."
The Summit Decision's Application Only to Construction Work
It is important to understand that the Summit decision does not affect OSHA's authority to continue issuing citations under its Multi-Employer Citation Policy when employers are not engaged in what is defined as "Construction Work" under §1910.12 (b) but rather are engaged in "General Industry" work that is subject to the standards in 29 CFR Part 1910. Such work typically involves work for maintenance purposes, even if performed by construction contractors. The key is the nature of the work being performed, not the nature of the employer performing it.
For example, when a contractor is performing work at an existing facility, such as in an electric power plant outage, a chemical plant turnaround or as a resident contractor in an industrial facility, the Multi-Employer Citation Policy still may be applied if the contractor's work is not "construction work" but is considered "general industry" work.
The reason for this result is that the decision is premised exclusively on an interpretation of §1910.12 (a), which applies to "Construction Work," and not upon an examination of OSHA's basic authority under the Occupational Safety and Health Act to issue multi-employer citations. OSHA's authority to issue such citations has been upheld by several U.S. Courts of Appeals.
Questions Created by the Summit Decision
OSHA has appealed the Summit decision to the U.S. Court of Appeals for the 8th Circuit in St. Louis. All briefs have been submitted, including amicus curiae briefs by the Building and Construction Trades Department, AFL-CIO supporting OSHA, and a group of construction industry associations, supporting Summit.
While an appeal is pending, it is unclear what will happen with citation contest cases that are pending before OSHRC Administrative Law Judges when the citation involves "Construction Work" and is premised on the Multi-Employer Citation Policy. Many such cited employers can be expected to request that such citations now be vacated.
OSHA has announced that it would not change its enforcement policy and would continue to issue citations to non-exposing, "controlling" construction employers. Often, OSHA regards only decisions of a Court of Appeals, rather than OSHRC, as establishing binding precedent.
The decision is not binding on states, such as California, that have their own state plans for regulating occupational safety and health. Many state agencies that adjudicate state-issued citations follow the precedent of OSHRC, but such adherence generally is not required. Similarly, state OSHA enforcement agencies are not required to follow federal enforcement policies and frequently do not do so.
The decision also does not affect other legal principles that influence the relative obligations of contractors on a construction site as to safety and health issues, such as state tort law, building codes, voluntary consensus codes and standards, contract terms or insurance considerations. It is questionable, therefore, whether the decision, even if affirmed, will have a practical effect on the extent to which general contractors seek to direct, influence or control OSHA compliance and safety performance by subcontractors.
Nonetheless, if affirmed, the decision represents a significant change in OSHA's enforcement authority in construction and could have a significant impact in cases in which citations were issued after serious accidents. For example, OSHA citations often are used in state court damage actions or other collateral litigation as evidence of a contractor's failure to meet a recognized duty of care, and significant OSHA citations can affect the settlement value of collateral claims.
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For more information about the issues covered in this report, please contact Elizabeth Walsh in our Washington, D.C. office at 202-383-7392 or at walshe@howrey.com or contact your Howrey attorney. For more information about Howrey's Construction Practice Group, click here.
©2007 Howrey LLP
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