OSHA Appeals Decision Invalidating Its Multi-Employer Citation Policy

Jackson Lewis P.C.

Although the Department of Labor under new Labor Secretary Alex Acosta has indicated that it will be scaling back on the broad interpretation of joint employer for purposes of determining enforcement liability, on November 6, 2017, OSHA filed an appeal to the U.S. Court of Appeals for the Fifth Circuit seeking to preserve the agency’s multi-employer citation policy which has been in place for decades. Under this policy, OSHA maintains that it has the authority under the OSH Act to issue citations not only to the employer whose employees are exposed to a hazardous condition (exposing employer) but also to employers who create, correct or control the worksite even if its own employees are not exposed to the hazard.  OSHA has extensively used this doctrine in multi-employer construction worksites to cite the general contractor as the “controlling employer” in addition to subcontractors.

However, this doctrine was recently challenged and invalidated by an administrative law judge in a case involving a citation issued against a general contractor in Texas. In Acosta v. Hensel Phelps Construction Co., OSHA issued a citation to the subcontractor whose employees were exposed to cave-in hazards in an excavation.  OSHA also issued the same citation to the general contractor as the “controlling employer” at the worksite.  On the contractor’s motion for summary decision, the administrative law judge held that the multi-employer doctrine was invalid in the 5th Circuit (which covers Texas) based on a prior decision which the judge found was controlling precedent in the circuit.  Consequently, the judge vacated the citation against the contractor since it did not have any employees exposed to the cited hazard.  The Review Commission declined the Secretary of Labor’s request to review the decision which made the judge’s decision a final agency order.

The Secretary has now filed an appeal with the 5th Circuit seeking to reverse the order and to obtain a decision affirming the multi-employer doctrine in the circuit.  Primarily, the Secretary argues that its interpretations and policies are entitled to deference and that the prior 5th Circuit decision relied upon by the administrative law judge is not controlling as it involved a negligence matter and not an OSHA case.

A decision in this case will have huge impact for construction employers in Texas, Louisiana and Mississippi which are covered by the 5th Circuit.  In addition, a decision by the 5th Circuit on OSHA’s multi-employer doctrine could present a split among federal circuit courts of appeal regarding the agency’s enforcement and citation authority under the OSH Act.  For now, employers should continue to expect OSHA to vigorously defend and enforce its multi-employer doctrine.

We will continue to update this blog with any new developments is this case.

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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