Introduction
Multi-employer worksite policy
Construction industry liability
General industry liability
Criminal liability
Recommendations
Comment


Introduction

From those operating large-scale construction sites to those operating office buildings, factories and healthcare facilities, many employers rely on one or more subcontractors to perform any number of specialised functions. In such an arrangement, the employer subcontracting work to another entity often assumes (and the contractual arrangement often establishes) that the subcontractor retains exclusive responsibility for the safety and health of its own employees while performing the subcontracted work. Often this assumption by the employer about the subcontractor's role and performance is wrong and can result in Occupational Safety and Health Administration (OSHA) liability under the multi-employer worksite policy.

Multi-employer worksite policy

Under Section 5(a) of the Occupational Safety and Health Act an employer must:

  • provide a worksite free from recognised hazards to each of its employees; and
  • comply with all occupational safety and health standards developed by OSHA.

Thus, the act creates two types of obligation:

  • a general duty obligation that extends only to the employer's own employees; and
  • an obligation to obey all OSHA standards with respect to all employees, regardless of their employer.

This second obligation formed the basis of OSHA's multi-employer worksite policy, under which it decided that it has the authority to issue citations to:

  • employers that expose their own employees to hazardous conditions; and
  • employers that create a hazardous condition that endangers employees – whether their own or those of another employer.

The policy enables OSHA to issue citations to multiple employers, even if the violations do not directly affect the employer's own employees. The policy has particular importance in the construction industry, with many different employers having employees at a site at any given time.

Since the early 1980s, OSHA has continuously expanded the scope of its multi-employer worksite policy. As of 1994, OSHA's policy has instructed its compliance officers to issue citations to any employer that:

  • exposes its own employees to a hazardous condition;
  • creates a hazardous condition that endangers any employer's employees;
  • is responsible for remedying a hazardous condition, even if its own employees are not exposed to the hazard; or
  • can control, prevent or abate a hazardous condition through the exercise of reasonable supervisory authority.

This fourth category has historically caused the most consternation among employers and the courts. In particular, construction industry employers have frequently challenged OSHA's ability to cite them for violations where their own employees are not exposed to any hazards relating to the violations in the citations. In these cases, the employers have attempted to rely primarily on the language in 29 Code of Federal Regulations, Section 1910.12(a) – an introduction to OSHA's construction industry standards – which appears to limit the scope of an employer's obligations under OSHA's construction industry standards to its own employees.

Construction industry liability

The doctrine has been applied with particular emphasis in the construction industry. For example, in Solis v Summit Contractors, Inc, the US Court of Appeals for the Eighth Circuit unequivocally held that an employer can no longer avoid OSHA liability simply by subcontracting work to another entity.(1)

Summit Contractors
In Summit Contractors, OSHA issued citations to Summit Contractors, Inc – the general contractor for the construction of a college dormitory in Little Rock, Arkansas – and All Phase Construction, Inc – a subcontractor that Summit had hired to perform exterior masonry work. OSHA's compliance officer had observed All Phase employees working on scaffolds more than 10 feet above the ground without fall-protection equipment. Summit had subcontracted the entire project and, consequently, had only a project superintendent and three assistant superintendents on site (and no tradesmen). Summit's project superintendent had observed All Phase employees working on scaffolds without fall-protection equipment on two or three separate occasions and advised All Phase to correct these problems. Based on these facts, OSHA cited Summit as the 'controlling' employer because it could prevent or abate a hazardous condition through the exercise of reasonable supervisory authority.

The Court of Appeals for the Eighth Circuit found that Summit was liable as the controlling employer because, in the court's view, Congress had intended the Occupational Safety and Health Act to require employers to adhere to OSHA's standards, regardless of whether the endangered employee was their own. The court acknowledged the heavy burden placed on controlling employers, stating that the "controlling employer citation policy places an enormous responsibility on a general contractor to monitor all employees and all aspects of a worksite". The court's decision validates OSHA's broad view of the circumstances under which an employer can correct or abate violations committed by another employer.

General industry liability

Summit Contractors has enhanced the enforcement of OSHA standards at construction sites, and there have been many citations issued to controlling employers – whether that be:

  • the general contractor;
  • the construction manager; or
  • any other employer with control over a subcontractor.

OSHA has also utilised its multi-employer worksite policy in its inspections beyond the construction industry, including of:

  • manufacturers that subcontract maintenance work which involves lockout-tagout (LOTO) and other hazards;
  • office property managers that subcontract window cleaning involving fall hazards and maintain a level of control over the means and methods by which the subcontractor performs the actual work;
  • healthcare facilities that hire janitors from temporary employee staffing companies and fail to provide blood-borne pathogen training; and,
  • manufacturers that hire temporary employees and fail to provide hazard communication, personal protective equipment, LOTO and other training.

OSHA applied the multi-employer worksite policy in factory settings, where it cited the factory operator when an employee of a subcontracted cleaning company was killed while working at the factory because of failure to comply with LOTO requirements. Ultimately, the citation against the host employer was dismissed based on the employer's lack of actual control over the subcontractor, but the application of the multi-employer worksite policy was validated.(2)

Secretary of Labor v Ryder Transportation Services
The decision in Secretary of Labor v Ryder Transportation Services(3) is concerning because it is a scenario that most employers with a fixed facility will face at some time if they engage an outside contractor to perform services such as, as was the case in Secretary of Labor, on the roof of a facility – either on the roof itself or on equipment (eg, heating, ventilation and air conditioning units) located there. This liability involves the hazard of the outside contractor employees being exposed to injury because of fall hazards – either from the leading edge of the roof or skylights or other openings.

The employer in Secretary of Labor, Ryder Transportation Services, owned a facility used to rebuild automotive equipment for its vehicles. Since 2006, no Ryder employee had been on the roof; the roof was classified as a restricted area and its employees were forbidden to access it. The roof had a number of unguarded skylights.

In 2009 Ryder requested MC Dean – an outside electrical contractor that it had used to perform work at the facility – to install exhaust fans near the ceiling inside the building. After the fans had been installed and failed to function, Dean employees accessed the roof to determine why the fans, which protruded through the roof, did not function. The employees used their own aerial lift to access the roof. A Dean journeyman electrician exited the lift and walked to one of the exhaust fans. As the electrician walked back across the roof to the lift using a different route, he fell through a skylight to his death.

OSHA cited Ryder for exposing the Dean employee to the unguarded skylight. Ryder could not be cited for the exposure of its own employees as they had not accessed the roof. Using its multi-employer worksite doctrine, OSHA cited Ryder as the controlling employer for failing to protect the Dean employee from the hazard.

The administrative law judge found that the multi-employer worksite doctrine applied, and that Ryder was the controlling employer. He vacated the citation on a finding that Ryder had "neither actual nor constructive knowledge that an employee would be exposed to unguarded skylights that were remote from his work area". OSHA has appealed the decision, claiming that Ryder had such knowledge.

The decision represents a further confirmation of the extent of a host or controlling employer's liability under the doctrine. Any employer that engages an outside contractor to perform work on its roof is potentially exposed to liability if it does not confirm that the outside contractor employees are protected from any fall hazards. This will require the host employer to insure that:

  • skylights are guarded, as well as the leading edge of the roof; or
  • the employees use some other form of fall protection while accessing the roof.

The second requirement is more troublesome because many host employers have no knowledge of the applicable regulations and rely on the outside contractor to have such awareness, as well as appropriate fall protection for their employees. This liability will eventually extend to outside contractors coming to the employer's worksite to perform all manner of services, including electrical, plumbing, excavation or structural repair work.

Criminal liability

OSHA can seek to impose criminal liability on controlling employers, including penalties and jail time for managers, where a subcontractor employee is killed and there was a wilful violation of its standards. OSHA has already demonstrated its willingness to use the multi-employer worksite policy in this way.(4)

Recommendations

In light of the above, it is recommended that all employers carefully evaluate the degree to which they control the means and methods of a subcontractor's work and implement immediate action to ensure the exercise of reasonable care in identifying and correcting violations, including the following:

  • While an employer cannot discharge its OSHA liability by contract, contractual language can be protective to the extent to which a particular employer limits its responsibility and ability to correct or abate dangerous conditions at a multi-employer site. Employers must carefully review contractual language to identify the degree of control that they exercise over other employers.
  • When working with a subcontractor, an employer should review the subcontractor's safety-related documentation – including personal protective equipment records and safety programmes and policies – to ensure that they are up to date and address the particular hazards (eg, fall, electrical or excavation hazards) to which the subcontractor's employees are expected to be exposed.
  • When working at a multi-employer worksite, the employer with supervisory responsibility must either inspect the worksite itself or ensure that inspections are being conducted by a subcontractor frequently enough to be able to identify and correct observed safety and health violations. This includes training on-site managers and supervisors to identify safety and health violations.
  • An employer must also confirm that there is an effective system either to correct safety and health violations that it observes during the above inspections or to ensure that the subcontractor corrects observed violations. This should include documenting the completion of corrective action recommended and employee discipline for violations.
  • An employer should develop a system for subcontractors to monitor their employees, correct violations and report to the general contractor or construction manager.
  • An employer should require a subcontractor to report injuries immediately to the proper regulatory authority (as applicable) and the employer. The employer should maintain documentation of any worksite injuries to subcontractors' employees, as well as any corrective action taken to address hazardous conditions that led to the injury.
  • An OSHA 300 log should be maintained at the work site to record work-related injuries and illnesses.

Comment

Under the existing administration, multi-employer worksites have come under increased scrutiny. OSHA will likely continue to enforce compliance with worksite safety and health laws and regulations more forcefully, and the newly invigorated multi-employer worksite policy will be another tool that OSHA employs in its mission. Employers that exert control over other employers must assess their potential liability as a controlling employer and develop appropriate administrative procedures and written documentation to demonstrate compliance with a controlling employer's duties.

For further information on this topic please contact Mark A Lies at Seyfarth Shaw LLP by telephone (+1 312 460 5000) or email ([email protected]). The Seyfarth Shaw website can be accessed at www.seyfarth.com.

Endnotes

(1) 538 F.3d 815 (8th Cir 2009).

(2) IBP, Inc v Herman, 144 F.3d 861 (DC Cir 1998).

(3) Occupational Safety & Health Review Commission Docket 10-0551 (administrative law judge, February 28 2011).

(4) See, for example, US v Pitt-Des Moines, Inc, 168 F.3d 976 (7th Cir 1999), which upholds the conviction of a general contractor for the death of a subcontractor's employee.