99-25956. Proposed Policy Statement Concerning the Occupational Safety and Health Administration's Use of Voluntary Employer Safety and Health Self-Audits  

  • [Federal Register Volume 64, Number 193 (Wednesday, October 6, 1999)]
    [Notices]
    [Pages 54358-54361]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 99-25956]
    
    
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    DEPARTMENT OF LABOR
    
    Occupational Safety and Health Administration
    [Docket No. W-100]
    
    
    Proposed Policy Statement Concerning the Occupational Safety and 
    Health Administration's Use of Voluntary Employer Safety and Health 
    Self-Audits
    
        Authority: Sec. 8(a) and 8(b), Pub. L. 91-596, 84 Stat. 1599 (29 
    U.S.C. 657).
    
    AGENCY: Occupational Safety and Health Administration, USDOL.
    
    ACTION: Notice of proposed policy statement; request for comment.
    
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    SUMMARY: The Occupational Safety and Health Administration (OSHA) is 
    issuing a proposed policy statement describing the agency's treatment 
    of voluntary employer self-audits that assess workplace safety and 
    health conditions, including compliance with the Occupational Safety 
    and Health Act. The proposed policy statement provides that the agency 
    will not routinely request self-audit reports at the initiation of an 
    inspection. Where a voluntary self-audit identifies a hazardous 
    condition and the employer promptly takes self-audit reports at the 
    initiation of an inspection. Where a voluntary self-audit identifies a 
    hazardous condition and the employer promptly takes appropriate 
    corrective measures, OSHA will treat the audit report as evidence of 
    good faith, and not as evidence of a willful violation. OSHA requests 
    public comment regarding it proposed policy statement.
    
    DATES: Written comments must be submitted on or before December 6, 
    1999.
    
    ADDRESSES: Send two copies of your comments to: OSHA Docket Office, 
    Docket W-100, Room N-2625, Occupational Safety and Health 
    Administration, U.S. Department of Labor, 200 Constitution Avenue NW, 
    Washington, D.C. 20210, Telephone: 202-693-2350. Comments limited to 10 
    pages or fewer may be faxed to the Docket Office at the following FAX 
    number: 202-693-1648. However, the original and one copy must be mailed 
    to the Docket Office within two days. Electronic comments may also be 
    submitted electronically through the OSHA Internet site at URL, http://
    www.osha-slc.gov/e-comments/e-comments-self-audit.html. Please be aware 
    that information such as studies, journal articles, and so forth cannot 
    be attached to the electronic response and must be submitted in 
    quadruplicate to
    
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    the above address. Such attachments must clearly identify the 
    respondent's electronic submission by name, date, and subject, so that 
    they can be attached to the correct response.
    
    FOR FURTHER INFORMATION CONTACT: Richard E. Fairfax, Occupational 
    Safety and Health Administration, Directorate of Compliance Programs, 
    Room N-3468, U.S. Department of Labor, 200 Constitution Avenue, NW, 
    Washington, D.C. 20210, Telephone: 202-693-2100. For electronic copies, 
    contact OSHA's web page on the Internet at http://www.osha.gov.
    
    SUPPLEMENTARY INFORMATION: 
    
    I. Explanation of the Proposed Policy
    
        The purpose of the Occupational Safety and Health Act is to assure, 
    so far as possible, safe and healthful working conditions for every 
    working man and woman in the Nation. In order to achieve that goal, the 
    Act requires employers to furnish their employees with employment which 
    is free from recognized hazards that are likely to cause death or 
    serious physical harm, and to comply with occupational safety and 
    health standards issued by the Secretary of Labor. Some courts have 
    inferred from these requirements that employers have an implicit duty 
    to scrutinize their workplaces to identify and correct hazardous 
    conditions. See Dunlop v. Rockwell International. 540 F.2d 1283, 1291-
    92 (6th Cir. 1976); Automatic Sprinkler Corp. of America, 7 BNA OSHC 
    1957, 1959 (OSH Review Commission 1979). OSHA also has included an 
    explicit requirement in many standards that employers self-inspect to 
    determine compliance. See, e.g., 29 CFR 1926.20(b) (requiring 
    ``frequent and regular'' inspections of construction sites); 29 CFR 
    1910.119 (mandating compliance audits and other inspections and 
    investigations for operations with hazardous chemicals); 29 CFR 
    1910.120 (requiring audits and other reviews for operations with 
    hazardous waste products); and 29 CFR 1910.1025(d), (e) (mandating 
    monitoring and planning to evaluate and to reduce employee exposure to 
    lead).
        In addition to required self-audits, many conscientious employers 
    undertake voluntary self-audits in order to foster safe and healthful 
    work environments and to assure compliance with the Occupational Safety 
    and Health Act. For a number of years, OSHA, employers, employee 
    representatives, and other interested parties have considered the role 
    that these voluntary employer self-audits play in meeting the goals of 
    the Act. The purpose of this proposed policy is to provide general 
    guidance regarding the circumstances in which OSHA intends to exercise 
    its authority to obtain voluntary self-audit reports during the course 
    of an inspection, and the manner in which the agency will use voluntary 
    self-audits when it classifies violations of the Occupational Safety 
    and Health Act and when it proposes penalties for such violations. The 
    agency indends that the policy will recognize the value of voluntary 
    self-audit programs under which employers or their agents identify and 
    promptly correct hazardous conditions and will acknowledge that, in 
    limited situations, records relating to voluntary self-audits play an 
    important role in the agency, ability to effectively carry out its 
    inspection and enforcement duties under the Occupational Safety and 
    Health Act.
        OSHA recognizes the vital part that voluntary safety and health 
    audits can play in workplace safety and health when employers use them 
    to identify workplace hazards and take the corrective actions needed to 
    control such hazards. OSHA also notes that safety and health audits--
    when they lead to appropriate corrective action--can provide 
    significant economic benefits for employers by reducing the myriad 
    direct and indirect costs that are associated with occupational 
    injuries and illnesses. These costs include workers' compensation, 
    indemnification and medical payments, sick leave, and lost 
    productivity. Further, voluntary safety and health audits produce 
    tangible benefits for employers who seek to avoid OSHA enforcement 
    actions by identifying conditions that constitute violations of the 
    Occupational Safety and Health Act and by providing employers with the 
    opportunity to rectify those conditions prior to the time that OSHA 
    inspects the work site. A good self-audit program should be especially 
    effective in detecting and preventing the ``high gravity'' and 
    ``repeated'' violations that carry the highest penalties.
        It is also the case the documentation derived from employers may be 
    of critical importance during an OSHA inspection, as the agency 
    attempts to ascertain whether an employer is in compliance with the 
    Occupational Safety and Health Act and the standards promulgated under 
    that Act. In addition, the legal burden to establish an employer's 
    actual or constructive knowledge of a violative condition rests with 
    the Secretary of Labor under current Occupational Safety and Health 
    Review Commission precedent and the Secretary is required consider the 
    classification of each violation and to consider the employer's good 
    faith in setting an appropriate monetary penalty. Therefore, OSHA 
    relies, in part, on evidence concerning the employer's safety and 
    health efforts and the employer's state of mind to discharge is duty to 
    enforce the Occupational Safety and Health Act fairly and effectively.
        OSHA has broad legal authority to request the production of 
    documentation concerning an employer's voluntarily conducted safety and 
    health audits. See 29 U.S.C. 657(b); Reich v. Hercules, Inc., 857 F. 
    Supp. 367 (D.N.J. 1994); Martin v. Hammermill Paper Division of Int'l. 
    Paper Co., 796 F. Supp. 1474 (S.D. Ala. 1992). Employers generally 
    recognizes that OSHA has legal authority to obtain self-audit reports, 
    but some have urged the agency to issue a policy statement clarifying 
    that it does not intend to exercise that authority routinely.
        While many employers conduct voluntary safety and health audits, 
    some employers have expressed concern that OSHA's enforcement powers, 
    and the absence of an explicit policy statement recognizing the value 
    of voluntary self-audits, could deter employers from undertaking 
    voluntary self-auditing activities. Specifically, employers have raised 
    concerns that, if OSHA routinely seeks to obtain employers' voluntary 
    safety and health audit reports for enforcement purposes, some 
    employers might choose not to conduct such audits. This policy 
    statement is designed to convey clearly OSHA's policy and practices 
    concerning voluntary self-audits.
    
    II. Description of Proposed Policy
    
        The draft policy applies to audits (1) that are systematic, 
    documented, and objective reviews conducted by, or for, employers to 
    review their operations and practices to ascertain compliance with the 
    Act, and (2) that are not mandated by the Act, rules or orders issued 
    pursuant to the Act, or settlement agreements. A systematic audit is 
    planned, and it is designed to be appropriate to the scope of the 
    hazards that it addresses and to provide a basis for corrective action. 
    Ad hoc observations made by an employer or a supervisor and ad hoc 
    communications concerning a hazardous condition made during the 
    ordinary course of business are not included within the definition of a 
    ``self-audit'' or ``voluntary self-audit report.'' The findings 
    resulting from the systematic self-audit must be documented 
    contemporaneously (at the time the condition is discovered or 
    immediately after completion of the audit) so as to assure that they 
    receive prompt attention. The self-audit also must be conducted by or 
    supervised by
    
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    a competent professional, who is capable of identifying the relevant 
    workplace hazards. However, a self-audit need not be comprehensive in 
    order to qualify for inclusion under the policy; for example, a 
    voluntary self-audit designed to identify hazards associated with a 
    particular process or hazard will qualify for consideration under the 
    policy.
        The policy provides that OSHA will not routinely request voluntary 
    self-audit reports when initiating an inspection, and that the agency 
    will not use self-audit reports as a means of identifying hazards upon 
    which to focus during an inspection. Rather, OSHA intends to seek 
    access to such reports only in limited situations in which the agency 
    has an independent basis to believe that a specific safety or health 
    hazard warrants investigation, and has determined that such records may 
    be relevant to identify or determine the circumstances of the hazardous 
    condition.
        An example of such a situation is when a fatal or catastrophic 
    accident has occurred, and OSHA is investigating the circumstances of 
    the accident to assess compliance and to assure that hazardous 
    conditions are abated. Another example is when the agency has reason to 
    believe a hazardous non-complying condition exists and the agency is 
    seeking to evaluate the extent of the hazard.
        OSHA emphasizes that it is not seeking through this policy 
    statement to expand the situations in which it requests production of 
    self-audit reports beyond its present practice. In addition, OSHA 
    intends to seek access only to those audit reports, or portions of 
    those reports, that are relevant to the particular matters that it is 
    investigating.
        OSHA has defined ``voluntary self-audit report'' to include 
    information obtained in the audit, as well as analyses and 
    recommendations. The effect is to include audit information in the 
    documents that OSHA will not routinely request at the initiation of the 
    inspection. OSHA has defined the term this way because the agency 
    believes that the definition responds to the concerns raised by 
    employers about the effect of routine OSHA requests for voluntary self-
    audit findings. OSHA notes that the U.S. Environmental Protection 
    Agency's self-audit policy statement applies to analyses, conclusions, 
    and recommendations resulting from a self-audit, but excludes data 
    obtained in the audit from the definition of an ``environmental audit 
    report.'' 60 FR 66706, 66711. OSHA requests comment on its proposed 
    definitions.
        The proposed policy also contains provisions designed to assure 
    that employers who respond with prompt corrective actions will receive 
    corresponding benefits in an OSHA inspection. These provisions would 
    come into play when OSHA obtains a voluntary self-audit report, whether 
    because the employer has voluntarily provided it to OSHA, as commonly 
    occurs, or because OSHA has required production of the report.
        The proposed policy statement explains that OSHA will treat the 
    self-audit report as evidence of good faith, not as evidence of a 
    willful violation, provided that the employer has responded promptly 
    with appropriate corrective action to the violative conditions 
    identified in the audit. Accordingly, if the employer is responding in 
    good faith and in a timely manner to correct a violative condition 
    discovered in a voluntary self-audit, and OSHA detects the condition in 
    an inspection, OSHA will not use the report as evidence of willfulness. 
    A timely good faith response includes promptly taking diligent steps to 
    correct the violative condition, while providing effective interim 
    employee protection, as necessary.
        In addition, OSHA will treat a voluntary self-audit that results in 
    prompt corrective action of the nature described above and appropriate 
    steps to prevent similar violations, as strong evidence of the 
    employer's good faith with respect to the matters addressed. Good faith 
    is one of the statutory factors that OSHA is directed to take into 
    account in assessing penalties. 29 U.S.C. 666(j). Where OSHA finds good 
    faith, OSHA's Field Inspection Reference Manual (the ``FIRM'') 
    authorizes up to a 25 percent reduction in the penalty that otherwise 
    would be assessed. The FIRM treats the presence of a comprehensive 
    safety and health program as a primary indicator of good faith. A 
    comprehensive safety and health program includes voluntary self-audits, 
    but is broader in concept, covering additional elements. OSHA has 
    concluded preliminarily that a voluntary self-audit/correction program 
    of the type described in this statement should be considered evidence 
    of good faith. If the agency does not request an employer's voluntary 
    self-audit reports during the course of an inspection, the employer 
    subsequently may provide such reports to the agency as evidence of its 
    good faith. OSHA requests comment on this issue.
        OSHA believes that the policy proposed here would provide 
    appropriate positive recognition of the value of voluntary self-audits 
    while simultaneously enabling the agency to enforce the provision of 
    the Occupational Safety and Health Act effectively. In order to assure 
    that the policy meets these dual goals most effectively, the agency 
    seeks comments from employers, employee representatives, and other 
    interested parties concerning, inter alia, the effect that the proposed 
    policy would have upon employers' willingness to conduct voluntary 
    self-audits, the effect that the policy would have upon the agency's 
    ability to enforce the Occupational Safety and Health Act, and the 
    manner in which the policy might be modified to meet these goals 
    better. OSHA invites individuals and organizations to submit comments 
    regarding the propriety of the self-audit policy in general, or 
    regarding any specific issues concerning voluntary employer self-audits 
    that are relevant to the effective and fair enforcement of the 
    Occupational Safety and Health Act.
    
    III. Statement of Proposed Policy on Voluntary Self-Audits
    
    A. Purpose
    
        1. This policy statement describes how OSHA will treat voluntary 
    self-audits in carrying out agency civil enforcement activities. 
    Voluntary self-audits, properly conducted, may discover conditions that 
    violate the Occupational Safety and Health Act so that those conditions 
    can be corrected promptly and similar violations prevented from 
    occurring in the future. This policy statement is intended to provide 
    appropriate, positive treatment that is in accord with the value 
    voluntary self-audits have for employers' safety and health compliance 
    efforts, while also recognizing that access to relevant information is 
    important to the Secretary's inspection and enforcement duties under 
    the Occupational Safety and Health Act.
        2. This policy statement sets forth factors that guide OSHA in 
    exercising its informed discretion to request and use the information 
    contained in employers' voluntary self-audit reports. The policy 
    statement is not final agency action. It is intended only as general, 
    internal OSHA guidance, and is to be applied flexibly, in light of all 
    appropriate circumstances. It does not create any legal rights, duties, 
    obligations, or defenses, implied or otherwise, in any party, or bind 
    the agency.
        3. This policy statement has three main components:
        (a.) It explains that OSHA will refrain from routinely requesting 
    reports of
    
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    voluntary self-audits at the initiation of an enforcement inspection:;
        (b.) It contains a safe-harbor provision under which, if an 
    employer is responding in good faith to a violative condition 
    identified in a voluntary self-audits report, and OSHA discovers the 
    violation during an enforcement inspection, OSHA will not treat that 
    portion of the report as evidence of willfulness;
        (c.) It describes how an employer's response to a voluntary self-
    audits may be considered evidence of good faith, qualifying the 
    employer for a substantial civil penalty reduction, when OSHA 
    determines a proposed penalty. See 29 U.S.C. 666(j). Under this section 
    of the Act, a proposed penalty for an alleged violation is calculated 
    giving due consideration to the good faith of the employer.
    
    B. Definitions
    
        1. ``Self-Audit'' means a systematic, documented, and objective 
    review by an employer of its operations and practices related to 
    meeting the requirements of the Occupational Safety and Health Act.
        (a.) ``Systematic'' means that the self-audit is part of a planned 
    effort to prevent, identify, and correct workplace safety and health 
    hazards. A systematic self-audit is designed by the employer to be 
    appropriate to the scope of hazards it is aimed at discovering, and to 
    provide an adequate basis for corrective action;
        (b.) ``Documented'' means that the findings of the self-audit are 
    contemporaneously recorded and maintained by the employer;
        (c.) ``Objective'' means that the self-audit is conducted by or 
    under the direction of a safety and health professional who is 
    competent to identify workplace safety and health hazards, given the 
    scope and complexity of the processes under review.
        2. ``Voluntary'' means that the self-audit is not required by 
    statute, rule, order, or settlement agreement. Voluntary self-audits 
    may assess compliance with substantive legal requirements (e.g., an 
    audit to assess overall compliance with the general machine guarding 
    requirement in 29 CFR 1910.212).
        3. ``Voluntary self-audit report'' means the written information, 
    analyses, conclusions, and recommendations resulting from a voluntary 
    self-audit, but does not include matters required to be disclosed to 
    OSHA by the records access rule, 29 CFR 1910.1020, or other rules.
        4. ``Good faith'' response means an objectively reasonably, timely, 
    and diligent effort to comply with the requirements of the Act and OSHA 
    standards.
    
    C. OSHA Use of Voluntary Self-Audit Reports
    
    1. No Routine Initial Request for Voluntary Self-Audit Reports
        (a.) OSHA will not routinely request voluntary self-audit reports 
    at the initiation of an inspiration. OSHA will not use such reports as 
    a means of identifying hazards upon which to focus inspection activity.
        (b.) However, if the agency has an independent basis to believe 
    that a specific safety or health hazard warranting investigation 
    exists, OSHA may exercise its authority to obtain the relevant portions 
    of voluntary self-audit reports relating to a hazard.
    2. Safe Harbor--No Use of Voluntary Self-Audit Reports as Evidence of 
    Willfulness
        A violation is considered willful if the employer has intentionally 
    violated a requirement of the Act, shown reckless disregard for whether 
    it was in violation of the Act, or demonstrated plain indifference to 
    employee safety and health. Consistent with the prevailing law on 
    willfulness, if an employer is responding in good faith to a violative 
    condition discovered through a voluntary self-audit and OSHA detects 
    the condition during an inspection, OSHA will not use the voluntary 
    self-audit report as evidence that the violation is willful.
        This policy is intended to apply when, through a voluntary self-
    audit, the employer learns that violative conditions exist and promptly 
    takes diligent steps to correct the volative conditions and bring 
    itself into compliance, while providing effective interim employee 
    protection, as necessary.
    3. Good Faith Penalty Reduction
        Under the OSH Act, an employer's good faith normally reduces the 
    amount of penalty that otherwise would be assessed for a violation. 29 
    U.S.C. 666(j). OSHA's FIRM provides up to a 25% penalty reduction for 
    employers who have implemented a safety and health program, including 
    voluntary self-audits. OSHA will treat a voluntary self-audit that 
    results in prompt action to correct violations found, in accordance 
    with paragraph C.2. above, and appropriate steps to prevent similar 
    violations, as strong evidence of an employer's good faith with respect 
    to the matters covered by the voluntary self-audit. This policy does 
    not apply to repeat violations.
    
    D. Federal Program Change
    
        This policy statement describes a Federal OSHA Program change for 
    which State adoption is not required; however, in the interest of 
    national consistency, States are encouraged to adopt a similar policy 
    regarding voluntary self-audits.
        This document was prepared under the direction of Charles N. 
    Jeffress, Assistant Secretary for Occupational Safety and Health, U.S. 
    Department of Labor, 200 Constitution Avenue, NW., Washington, DC 
    20210.
    
        Signed at Washington, DC, this 30th day of September 1999.
    Charles N. Jeffress,
    Assistant Secretary of Labor.
    [FR Doc. 99-25956 Filed 10-5-99; 8:45 am]
    BILLING CODE 4510-26-M
    
    
    

Document Information

Published:
10/06/1999
Department:
Occupational Safety and Health Administration
Entry Type:
Notice
Action:
Notice of proposed policy statement; request for comment.
Document Number:
99-25956
Dates:
Written comments must be submitted on or before December 6, 1999.
Pages:
54358-54361 (4 pages)
Docket Numbers:
Docket No. W-100
PDF File:
99-25956.pdf