Employers File Lawsuit Challenging Cal/OSHA’s Alleged Illegal Overreach in ETS Rulemaking

Seyfarth Synopsis: The National Retail Federation (NRF) and others brought an action against the California Department of Industrial Relations (DIR), Division of Occupational Safety and Health (Cal/OSHA), and the Occupational Safety & Health Standards Board (Board) claiming that the Agency did not legally establish its recent emergency COVID-19 workplace regulations, while adding undue financial burdens to employers.

The December 16, 2020, complaint for declaratory relief, in National Retail Federation, et al., v. CalOSHA, et al., (Superior Court of California, County of San Francisco), alleges that Cal/OSHA ignored legal procedures in establishing its COVID-19 emergency temporary standards (ETS), and warns of dire financial consequences for businesses in California if they are forced to comply.

The Complaint criticizes the Board for forcing through an Emergency Temporary Standard (“ETS”) that required almost immediate “clarification” through FAQs and guidance, which in part appear to directly contradict the language of the ETS itself. The complaint also challenges the COVID-19 testing requirements and notes that the requirements apply equally to employers with 5 or 5,000 employees at the same workplace, with no adjustment in threshold levels for employers of differing sizes.

In addition, the complaint argues that Cal/OSHA violated employers’ Due Process rights because the ETS “arbitrarily and capriciously requir[es] them to exclude employees from the workplace with potentially ruinous losses of productivity and revenue, while simultaneously requiring these employers to pay the full costs of the labor that they needed, but were denied, all without having engaged in reasoned decision-making.” The Complaint alleges that the ETS was issued in violation of the Administrative Procedures Act and that there is “a total lack of data as to workplace exposures to the coronavirus,” with the Board relying upon “speculative claims” concerning the effectiveness of employer’s existing COVID-19 safety programs. The complaint also takes aim at the provisions of the ETS which regulate wages and employee benefits, areas over which Cal/OSHA has not been granted statutory authority.

The ETS has been criticized because it fails to address employees who are immune from COVID-19 (recently infected and recovered) and appears to require that they be tested, removed from work, and quarantined even though they are not at risk form the virus. Further, as nationwide vaccination programs are under way the ETS fails to address the use of vaccines or account for employees who are immune from the virus due to vaccination.

The Division has promised additional FAQ’s and guidance, but as of the writing of this blog, has not released them.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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