BILL ANALYSIS Senate Committee on Industrial Relations 1999-2000 Regular Session Hilda L. Solis, Chair Fiscal: Yes Urgency: No Bill No: AB 1127 Author: Steinberg Version: As Amended June 29, 1999 Subject: Occupational Safety and Health: standards and penalties Support: California Labor Federation, AFL-CIO (co-sponsor) Los Angeles District Attorney's Office (co-sponsor) California District Attorneys Association Attorney General Bill Lockyer Amalgamated Transit Union Members Local 192 American Federation of State, County, and Municipal Employees California Applicants' Attorneys Association California Conference Board of the Amalgamated Transit Union California Conference of Machinists California Professional Firefighters California Teamsters Public Affairs Council Consumer Attorneys of California Engineers and Scientists of California, Local 20 IFTPE Hotel Employees and Restaurant Employees International Union PRIO Corporation Region 8 States Council of the United Food and Commercial Workers Union WORKSAFE! Opposition: California Chamber of Commerce California Manufacturers Association City of Los Angeles City of Vernon California State Association of Counties Kern County Superintendent of Schools Fresno County Office of Education Accesio Products American Electronics Association American Energy Operations, Inc. American Fence Contractors Association, California Chapter Associated General Contractors of California Associated General Contractors of San Diego Associated Builders and Contractors Association of California School Administrators Brea Canon Oil Co., Inc. California Association of Health Facilities California Beer and Beverage Distributors California Business Properties Association California Cast Metals Association California Fence Contractors' Association California Healthcare Association California Independent Petroleum Association California League of Food Processors California Poultry Industry Federation California Railroad Industry California Restaurant Association California Retailers Association California School Boards Association California School Bus Contractors Association California Self-Insurers Association California Small Business Association California Trucking Association Californians for Compensation Reform Coalition for Common Sense Commercial Transfer, Inc. Construction Employers' Association Construction Preliens & Paperwork Custom Plastics Eastern Municipal Water District Ed Vance Company Engineering Contractors' Association Food Express, Inc. Frank C. Alegre Trucking, Inc. Gary Olson Trucking, Inc. Hearing Date: June 23, 1999 AB 1127 Consultant: Patrick Henning Page 2 Senate Committee on Industrial Relations Greater Bakersfield Chamber of Commerce Hoyt-McKittrick Oil Company Independent Oil Producers Agency Jay Dee Transport Latin Business Association Marin Builders' Exchange Mid Coast Transportation, Inc Meehleis Modular Buildings, Inc Mike Conrotto Trucking Motion Picture Association Mountain Cascade Inc. National Federation of Independent Business Pool California Energy Services, Inc. Printing Industries of California Sacramento Builders' Exchange Silicon Valley Manufacturing Group Small Manufacturers Association of California Stream Energy, Inc. Swanson Farms The Gate Guy The Industrial Company Western States Petroleum Association Wine Institute Woodwork Institute of California Purpose: To provide omnibus reform of the Cal-OSHA program relating to civil and criminal penalties and enforcement procedures. Analysis: Existing law provides a framework for a safe and healthy workplace through the California Occupational Safety and Health Act (Cal-OSHA) for the adoption and enforcement of standards. Among other things, there are 3 key branches of the Cal-OSHA program in the Department of Industrial Relations relating to standards: -the Cal-OSHA Standards Board adopts standards; -the Division of Occupational Safety and Health (DOSH) enforces standards; and, Hearing Date: June 23, 1999 AB 1127 Consultant: Patrick Henning Page 3 Senate Committee on Industrial Relations -the Cal-OSHA Appeals Board hears appeals of employers cited by DOSH. Also, under the following categories: Penalties Civil and criminal penalties are assessed for violation of Cal-OSHA standards or orders. Most penalty assessments can be adjusted to reflect the seriousness of the violation and the safety record of the employer. -for a serious violation of a standard, a maximum civil penalty of $7,000; -misdemeanor penalties (i.e., for knowledge and negligence) for a serious violation, up to 6 months in jail, and/or a maximum of $5,000; -for a willful or repeat violation, causing death or serious injury, a civil penalty of not less than $5,000 nor more than $70,000; -for a willful violation, causing death or permanent or prolonged impairment, a criminal misdemeanor penalty, up to six months in jail and/or a maximum of $70,000; for subsequent violations, not less than $35,000 and/or up to 1 year in jail. -for failure to abate a serious hazard, not more than $7,000 each day until abatement achieved; -public employers are not subject to civil penalties for violating a safety standard. Subsequent Violations: Civil Penalty Enhancements -by Regulation, a subsequent violation may not be considered a repeat violation unless it occurred at the same fixed establishment as the previous violation, or in the same DOSH region for non-fixed site employers. Abatement of Hazard Hearing Date: June 23, 1999 AB 1127 Consultant: Patrick Henning Page 4 Senate Committee on Industrial Relations -by Regulation, an employer's duty after the issuance of a citation to abate an unsafe condition is stayed if the employer appeals the citation. Admissible Evidence -OSHA standards and orders may be used as evidence in criminal prosecution, but not as admissible evidence in negligence and wrongful death actions. Multi-Employer Responsibility -by Regulation, citations may be issued, not only against the employer which exposed an employee to a hazard, but also other responsible employers at a multiple employer worksite (e.g. construction). Employers responsible for creating, controlling (by contract or practice), or correcting the hazard may be cited regardless of whether their own employees were exposed. Anti-Retaliation -an employee complaint filed with the Labor Commissioner claiming retaliation for reporting unsafe conditions or for refusal to work under such conditions must be filed within 30 days of the occurrence. This Bill increases civil and criminal penalties for willful, serious, and repeat violations of Cal-OSHA standards and orders and revises civil penalty enforcement procedures. Under the following categories, it makes the following changes: Penalties -for a serious violation, increases from $7,000 to a maximum of $25,000; -misdemeanor penalties for a serious violation, from a maximum of $5,000 to a maximum of $25,000 for an individual and adds $250,000 for a corporation. -for a willful or repeat violation, the maximum of $70,000 is not changed, but for subsequent violations there shall be no adjustment in the penalty. Past violations occurring Hearing Date: June 23, 1999 AB 1127 Consultant: Patrick Henning Page 5 Senate Committee on Industrial Relations anywhere in state within the previous five years shall be used to establish whether a current violation is a repeat violation. -for willful violation criminal penalties, from $70,000 to a maximum of $100,000 and a jail term up to 1 year for an individual, or, upon discretion of the court, 16 months or 2 or 3 years in jail and a maximum fine of $250,000. If a corporation, not less than $250,000, or more than $2 million. For a repeat conviction, up to 4 years in jail for an individual and not less than $1 million or more than $4 million for a corporation. -for failure to abate a hazard, from $7,000 per day to a maximum of $25,000. If, after signing a statement attesting to compliance, and upon re-inspection, abatement has not been achieved, there will be no adjustment in the maximum. Also, the individual is subject to a new maximum penalty of $100,000 and a jail term up to 1 year; for a corporation, not less than $100,000 or more than $1 million. -repeals the provision that civil penalties shall not be assessed against public employers. Subsequent Violations: Civil Penalty Enhancements -repeals the Regulation that limits civil penalty enhancements for repeat violations at the same fixed location of the worksite. Abatement of Hazard -provides that an order to abate an unsafe condition is not automatically stayed on appeal if DOSH determines substantial risk exists. Establishes an expedited appeals hearing within 15 days. Admissible Evidence -repeals the prohibition of admitting OSHA standards and orders as evidence in negligence and wrongful death actions and permits the evidence in all civil matters. Hearing Date: June 23, 1999 AB 1127 Consultant: Patrick Henning Page 6 Senate Committee on Industrial Relations Multi-Employer Responsibility -enacts in statute the current Regulation establishing responsibility for violation of a safety standard in a multi-employer worksite. Anti-Retaliation -extends from 30 days to 1 year the time period within which to file a complaint alleging retaliation for reporting an unsafe condition or refusal to work under such conditions. Other Items -specifies that "employee's representative" for filing a complaint of unsafe conditions, to be, one's family member, union representative, lawyer, a health and safety professional, or a representative of a government agency. -mandates that the Standards Board carry out its duty to adopt standards for ergonomics in the workplace designed to minimize the instances of injury from repetitive motion. Repeals current requirement to adopt the existing standard. -clarifies that DOSH and prosecutors have the authority to issue civil citations for violations of not only the statute, but of promulgated regulations. -includes operational "process" of machinery and equipment as cause for DOSH to seek an injunction to restrain the use of unsafe use or operation if the condition constitutes a serious menace. Comments: 1. Supporters argue that the Cal-OSHA program has been weakened significantly during the past 16 years through a series of regulations, policies, and Appeals Board decisions. They further state that while the majority of employers voluntarily comply with safety requirements, the existing penalties are Hearing Date: June 23, 1999 AB 1127 Consultant: Patrick Henning Page 7 Senate Committee on Industrial Relations too low to effectively deter those employers who do not comply. 2. Opponents argue, among other things, that existing laws are adequate and that this measure inappropriately increases civil and criminal penalties, and changes key provisions of current law at a time when safety violations are at an all time low. They further argue that this bill will make it difficult to hire managers and supervisors, and will have a chilling effect on business being willing to locate or expand their workforce in California. Generally, opponents state that the onerous provisions of the measure relate to due process, expansion of those who can file a complaint (e.g., a family member could file without an employee's knowledge), higher penalties, and longer time limits to file complaints. These elements make settlement more difficult and subject law-abiding businesses to harassment. Some opponents argue that it would require possible abatement of an alleged hazard before an employer has filed an appeal. And, when found innocent through the appellate process, an employer would have already spent significant time and money fixing what was never a violation. Proponents counter that a collapsed trench or a leaky gas pipe should be repaired regardless of whom is finally responsible for the unsafe condition; more workers could be injured. Public agencies argue that removing their exemption merely creates a costly accounting system, exchanging funds from one public agency to another. 3. Multi-Employer Responsibility . In a multi-employer setting, DOSH has followed past Appeals Board decisions narrowly interpreting the definition of an employer to be Hearing Date: June 23, 1999 AB 1127 Consultant: Patrick Henning Page 8 Senate Committee on Industrial Relations limited to the employer of the exposed employee. Following a complaint to the U.S. Department of Labor that California failed to meet minimum OSHA requirements, the Department of Industrial Relations adopted a regulation establishing multi-employer responsibility. Some employers have taken the position that the regulation is unenforceable on the grounds regulations are not binding on the Appeals Board. This measure incorporates into statute, the multi-employer responsibility regulations and makes them explicitly enforceable. 4. Ergonomics . After years of controversy, litigation, and a statutory deadline, the Standards Board adopted an ergonomics standard with, among other things, a small business exemption. In the case of Pulaski v. Occupational Safety and Health Standards Board , a Superior Court declared parts of the standard, including a controversial small-employer exemption, invalid. The court's order is on appeal. This measure would reaffirm the Legislature's concern over the prevalence of repetitive motion injuries in the workplace and Standards Board's continuing duty to adopt a complete standard. 5. Prior Legislation . This measure contains the subject matter of a series of past bills. Under the categories below, the following passed the Legislature and were vetoed: -Penalties: The enhanced criminal penalty provisions are drawn from AB 1015 (Knox) of 1997, which was sponsored by the Los Angeles District Attorneys office. It was vetoed by Governor Wilson. -Filing of Anti-Retaliation Claims: The extension of the Hearing Date: June 23, 1999 AB 1127 Consultant: Patrick Henning Page 9 Senate Committee on Industrial Relations time for a worker subjected to retaliation for complaining about unsafe working conditions was contained in AB 2156 (Keeley) of 1998, which was passed by the vetoed by Governor Wilson -Abatement: Governor Wilson twice vetoed bills which would have required cited employers to seek a stay of an abatement order under specified circumstances. The bills were SB 1464 (Marks) in 1994 and SB 1935 (B. Greene) in 1992. -Public Employer Penalty Exemption Repeal: Governor Wilson twice vetoed bills which would have repealed government immunity from OSHA civil penalties. These bills were AB 3831 (Horcher) in 1994 and SB 2277 (Burton) in 1992. 6. Double Referral . If this measure passes this committee, it will be double referred to the Senate Committee on Public Safety. 7. Legislative History . This measure passed the Assembly Labor and Employment Committee by a 6 to 2 vote, the Assembly Public Safety Committee by a 5 to 3 vote, and the Assembly Floor by a 45 to 32 vote. Hearing Date: June 23, 1999 AB 1127 Consultant: Patrick Henning Page 10 Senate Committee on Industrial Relations