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OSHA

The Canadian Perspective
The author's analysis is completely relevant to Canadian companies even if the terminology he uses isn't. As we noted last month, Canadian employers, like their American counterparts, have a right to contest Canadian Occupational Safety and Health (OSH) violations. The factors the author sets out in his series are the same ones Canadian employers should consider when deciding whether to exercise this right.

There are seven factors I counsel employers to consider when deciding whether to contest a U.S. Department of Labor Occupational Safety and Health Administration (OSHA) violation. In Part 1 of this series, I discussed two of these factors:

The strength of OSHA's case — that is, how good a chance OSHA has of proving that a violation occurred and/or that the proposed fine amount or abatement is appropriate; and

The size of the fine involved.

Let's now look at the next two factors.

3. Abatement Requirements and Associated Costs
Prompt abatement of hazardous work conditions should be the goal of everyone in the workplace — it is certainly OSHA's top priority. However, if an employer has a good faith basis to challenge the validity of a citation, that employer should also take into account the direct and indirect effects of any proposed abatement.

For example, a serious citation carrying a mere $500 civil penalty might not look like a big deal. But it could have a multimillion-dollar impact if abating the citation involves making significant changes to operations, processes or machinery, (e.g., performance of group lockout/tagout). In addition, employers with multiple sites need to understand that the abatement required at one facility typically has to be implemented at all facilities.

To be clear, I'm not suggesting that employers contest an OSHA citation for the sole purpose of avoiding legitimate abatement requirements. I'm merely suggesting that if they have a good faith belief that the alleged violation is not just, employers should seriously consider the effects of the abatement in deciding whether to contest the citation.

4. Adverse Effect on Competitive Position
The potential losses from OSHA citations often involve more than fine amounts. They may also have an adverse effect on your reputation and competitive position. For example, if you have a history of OSHA citations, you might have a harder time bidding for contracts, especially if the citation is characterized as willful or serious. That's because many companies look at safety and OSHA citations in evaluating bidding companies and are more apt to select bids from competitors who don't have citations.

Expensive abatement requirements might also harm your competitive position by forcing you to raise your fees or prices. You'll be at a particular disadvantage, vis-ÿ-vis your competition, if you have to implement work procedure modifications that are more burdensome than industry standards.

Next month, I'll take you through the final three factors. Until then, stay safe everyone



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