Will OSHA Conduct an Inspection after an Employee Complaint?

OSHA will make inspections of a workplace for a variety of reasons, including following a worker injury and always after a worker’s death.

Inspections may also occur randomly or part of a program aimed at a particular industry that OSHA has decided to target.

The other way an inspection may occur – and the main focus of this article – is if an employee contacts the agency to complain about possible safety violations.

These complaints may or may not result in an inspection of your workplace based on certain conditions, including the timing of the complaint. Under OSHA regulations, a worker can only report an alleged violation.

After OSHA receives a complaint it will decide whether it is worthy of an on-site inspection.

The agency has a set of criteria, at least one of which must be met in order for it to conduct an on-site investigation or an investigation that includes sending the employer a questionnaire to determine if it is complying with its safety regulations.

A current employee or employee representative must submit a written, signed complaint:

  • That includes enough details to help OSHA assess whether the employer is violating its safety regulations or if there is an imminent danger of physical harm to employees.
  • That alleges the worker was injured or made ill by a hazard that is still present in the workplace.
  • That claims an imminent danger to workers exists in the workplace.
  • About a company in an industry that is part of an OSHA local or national emphasis program, or a high-hazard industry that is the focus of such a program.
  • Against an employer that has been cited in the past three years by OSHA for egregious, willful or failure-to-abate citations.
  • Against a facility that is scheduled for or already part of an OSHA inspection.


If any of these conditions are not met, OSHA will typically make a complaint inquiry by phone or e-mail.


How a complaint inquiry works

If, for example, one of your employees contacts OSHA to complain that you are not using proper lock out/tag out procedures when cleaning certain machinery, the agency would likely contact your company.

It would tell you about the alleged hazard and ask that you assist in determining whether a hazard or violation exists.

During that first point of contact, the agency would ask that:

  • You promptly investigate to see whether the violation does indeed exist and that if it does, you abate the hazard to ensure employee safety and regulatory compliance.
  • After investigating, you document your findings and detail what kind of corrective action you took or are undertaking.
  • You post a copy of the complaint letter from OSHA in a conspicuous area so that all of your employees can see it.


OSHA usually requires that you respond with the results of your internal investigation and provide the report of findings and action taken within five days of being contacted by the agency.

If you don’t respond to the initial contact, do not provide a report within five days or if OSHA deems your response inadequate, it may then decide to inspect your facility.

OSHA will also provide a copy of your response to the complaining employee. If the employee thinks you have not made the corrections or have not been honest with OSHA, they can ask the agency to conduct an on-site inspection.


Legislation Would Let Employees Trade O.T. for Vacation Time

A newly proposed bill would change the Fair Labor Standards Act’s overtime mandate to allow workers to trade overtime pay for compensatory time off.

Introduced by Martha Roby, a Republican from Alabama, the Working Families Flexibility Act of 2017 would:

  • Cap the amount of paid time off that workers can accrue each year at 160 hours.
  • Require employers to pay out annually any unused comp time.
  • Give employers 30 days to pay out any unused comp time beyond 80 hours.
  • Require employers to pay out any unused comp time accrued upon termination for any reason.


Under current FLSA rules, employers must pay nonexempt workers overtime at a rate of 1.5 times their wage for every hour worked beyond in a 40-hour week.

The bill, if passed, would allow nonexempt workers to earn compensatory time off at a rate of no less than 1.5 times every hour for which they would have otherwise earned overtime pay.

This bill is a novel approach that gives both employers and employees an option of more time off every year, which in turn can help staff better achieve a work-life balance that the standard arrangement of two weeks’ vacation every year may not provide.

Some workers may prefer more time off over additional funds and would be happy to take a longer vacation instead of more money.

The legislation would allow employees to choose which option they would prefer, and the employer must honor their choice.

By virtue of the fact that the legislation was floated by a Republican and that the Trump administration has expressed an interest in laws that would give employees time off, such as after the birth of a baby, there is a chance the bill can advance in the House.


When Safety Shortcuts Become a Criminal Act

As the economy grows and companies’ operations are busier, workplace injuries also increase. And as companies add employees, they may fail to keep up their safety regimens, which can result in an uptick in workplace injuries.

Some businesses have so much to keep track of that they may be negligent in enforcing their safety standards and making sure that all of their safety devices are in proper operating order.

When an employee is injured due to an employer’s negligence in keeping up its safety practices, there is typically no right of action for the employee under the exclusive remedy bargain that’s implicit in all workers’ comp agreements.

In that bargain, the employee trades the ability to sue the employer for the right to receive benefits and medical care to treat the injury.

But there is a point where employer negligence spills over into a criminal issue and owners risk incarceration for flagrant violations that put employees at risk.

And during the last few years OSHA has been stepping up criminal prosecutions of employers whose actions were more than just negligent.

While criminal penalties under the federal Occupational Safety and Health Act are fairly limited, with imprisonment capped at six months and fines capped at $10,000, the fines are stiffer for willful violations that cause loss of human life, with maximum fines of $250,000 for an individual and $500,000 for an organization.

If an employer’s willful violation of an OSHA standard causes the death of an employee it is not a felony, but a “Class B” misdemeanor.

And although the act carries with it the possibility of a prison term, in practice, prison occurs only in the rare circumstances where a senior management official operates de facto as the company. Otherwise, practically, only criminal monetary fines are applied for criminal violations.

Historically, there have been few prosecutions. There have been fewer than 80 OSH Act criminal cases resulting from the more than 400,000 workplace deaths that took place since the law was enacted. That’s fewer than two a year, and only 14 have resulted in criminal convictions.

Also, it’s challenging to prove a criminal violation under the OSH Act.

But in 2016, the Department of Justice (DOJ) started encouraging all United States Attorneys to charge employers for other violations that occur in connection with OSH Act violations, such as obstruction of justice, making false statements, witness tampering and conspiracy.


U.S. Attorneys were also encouraged to consider environmental crimes, which often occur in concurrence with worker safety violations. These offenses carry more significant periods of incarceration and fines.


Conviction examples

Two noteworthy examples of this wider implementation of the law are:

  • The owner of a roofing company in Philadelphia lied to OSHA on four occasions that he’d provided fall protection to employees after one his workers fell to his death. He even went so far as to instruct other workers to tell OSHA that they had worn fall protection on the day of the incident.
    He was indicted for lying, obstruction of justice and willfully violating an OSHA standard. Facing 25 years in prison, he pleaded guilty and was sentenced to 10 months in jail.
  • A worker was killed in 2015 because of a trench collapse at a construction site in Manhattan’s Meatpacking District. The general contractor was convicted of manslaughter for improperly securing the work site.


To obtain a conviction under Section 17(e) of the act, a prosecutor must establish beyond a reasonable doubt (unlike the lower civil standard for ordinary OSHA enforcement actions) that:

  • An OSHA standard (not the General Duty Clause) was violated;
  • The violation was committed by the employer (in other words, not by a rogue employee);
  • The violation of the standard was the direct cause of an employee’s death (prosecutors must prove beyond a reasonable doubt that the conduct underlying the OSHA violation resulted in the death); and
  • The violation was committed willfully by the employer.


Other actions that may result in criminal action

According to a the DOJ, in addition to willful OSHA violations that caused an employee fatality, employers (and employees) can face criminal sanctions in the following circumstances:

  • Falsifying OSHA documents
  • Advance notice of an OSHA inspection
  • Perjury during OSHA proceedings
  • Violating state criminal laws – The OSH Act does not preempt prosecution under state criminal laws, such as manslaughter or negligent homicide for work-related deaths and injuries.
  • Violating environmental laws.

Ransom Often the Smallest Cost of Ransomware

One of the least understood cyber threats to businesses is ransomware, which hackers use to shut down an organization’s computer system until the victim pays a ransom to unlock it.

While most organizations focus on the cost of the ransom, which is typically less than $1,000, the costlier damage is to the company’s operations, which can be hampered or completely shut down after their systems are rendered unusable.

Ransomware is one of the fastest-growing cyber threats and attacks are expected to grow 300% in 2016 from the year prior, making it vital for your organization to have in place systems to reduce the chances of becoming victimized.

Ransomware typically enters a company’s systems after an employee clicks on a link in a rogue e-mail, which allows the malicious code to infect the company’s systems and eventually shut them down, locking out all users and making all or some of the data inaccessible. After it has frozen the systems, it will demand a ransom to unlock it.

According to a recent survey by Hiscox, the bulk of ransomware attacks lead to business interruption losses:

  • Corporate loss of business income or services: 36%
  • Corporate loss of digital assets: 16%
  • Corporate loss of financial assets: 3%
  • Breach of personally identifiable information: 25%
  • Breach of personal financial identity: 17%
  • Breach of personal health information: 3%


But, experts believe that a significant portion of ransomware attacks go unreported, making it difficult to get a grasp on the full effects.

And while most states have laws requiring organizations to report privacy breaches, that’s not true for ransomware attacks.


The full damage

According to the FBI, there were 2,400 ransomware complaints in 2015, resulting in total estimated losses of more than $24 million with the average ransom demand being $10,000. But when smaller companies are targeted, the ransom can sometimes be as low as $500 to $1,000.

The ransom is usually the smallest cost to a company, as most businesses also have to contend with:

  • The cost of lost productivity
  • Lost profits
  • Harm to business reputation
  • The cost of reconstructing data


Ransomware typically targets your most important data, but sometimes it just makes your entire system unusable. It may also lock down your marketing materials, payroll data, intellectual property, financial transactions and health records.

Some companies try to beat the hackers by hiring outside professionals to decrypt all of the information that the ransomware perpetrators have frozen.

But that’s a risky proposition because it often leads to incomplete data recovery. Full recovery is usually only possible with the decryption key.

Ransomware criminals who are not paid will often destroy the key, leaving affected companies in a more serious bind.

If you’re lucky, a ransomware attack may only be confined to one server or computer. But if it hits the right servers, it can spread throughout your organization to all users and, if you are connected with vendors or partners, it can even spread to their systems.

There are a number of tactics that ransomware criminals use, such as:

  • Holding the data hostage
  • Threatening to disclose confidential or proprietary information
  • Threatening to sell or auction confidential or proprietary information


Controlling risk

CFO magazine recommends that you do the following to reduce the risk of being hit by ransomware:

  • Train and educate personnel on an ongoing basis.
  • Specifically address and plan for ransomware in your disaster recovery and business continuity plans, including testing of those plans.
  • Ensure that all anti-virus and other security software is properly updated. This software will detect and eliminate many forms of ransomware.
  • Engage a third-party expert security vendor to assess your organization’s systems and procedures.



If you suffer a ransomware attack, you should:

  • Identify and isolate infected and potentially infected systems.
  • Disable shared network drives connected to the infected systems.
  • Consider suspending regular backups of those systems to prevent the virus from spreading further.
  • Engage an information security consulting firm that specializes in assessing and mitigating these sorts of attacks.
  • Send out a memo to all your staff warning them of the infiltration and to not open e-mail and attachments from suspicious sources.



Cyber insurance can help pay for the effects of a ransomware attack. Depending on the insurer, some policies will pay the ransom, while others expressly exclude it, citing the “moral hazard” of such coverage.

If you are concerned about the damage a ransomware attack could inflict on your organization, call us to discuss your cyber insurance options.


Identify Your Workers’ Needs, Consider Costs before Open Enrollment

It’s almost time for small group open enrollment and you need to drive engagement so that your employees can make informed decisions about their health insurance options. We want to help you help your employees understand all of their options so that they can purchase a plan that is appropriate for their situation. So here is our advice for the open enrollment:

Listen to your workforce
Before you make any decisions, you should listen to your employees and better understand their needs and preferences. With answers and feedback in hand you can create a benefits package that is more appealing to them, which in turn gives you a competitive edge when attracting and retaining workers. Engage employees and solicit feedback through quarterly employee-benefits round table meetings. Invite employees from different age groups and different departments to participate in these meetings, to ensure you have a good cross-section of your staff represented.

Give advance notice
You can start this month with simple reminders for them to start thinking about open enrollment and evaluate their current health plans. Send out memos and place posters in high traffic areas. If you start with this in September or October, they can have time to assess their options, particularly if anything has changed in their lives like marital status, new children or health issues.

Costs are paramount
You can work with us to settle on plan arrangements that will be within your and your employees’ budgets (in their case, the plans also have to be deemed affordable under the Affordable Care Act). Employees have a right to understand the costs, so let them know how to access the free transparency tools provided online by most medical carriers. Provide employees with a breakdown of medical and pharmaceutical cost increases to avoid sticker shock.

Get an early start
If your plan year starts Jan. 1, you should hold open enrollment meetings and dispense plan materials in November or early December. It’s a busy time of year, and you want to give employees times to consider their options and plan for changes.

Communicate effectively
Your task is to get employees out of cruise control and truly assess all of their options. This is especially true if you are making changes to cost-sharing, introducing new plans, introducing a wellness plan or health savings account or flexible spending account. You should use a variety of different media to communicate with them. Use video, virtual and live meetings, e-mail communications and print materials to get through to your employees. While the attentive ones may think it’s overkill, using different forms of communication ensures that you reach the widest number of staff.

Get spouses involved
If you also offer insurance to spouses, you should communicate through your employees that they are also invited to join your open enrollment meetings. You can also invite them to view any electronic material you may post online, like the aforementioned videos. If they cannot make a general meeting, you can invite them to come in to meet with your human resources manager if they have questions.

Remind staff of the ACA
You can use open enrollment as a way to remind your workforce of their responsibilities to secure coverage under the Affordable Care Act. Let them know that employees that refuse affordable coverage from their employer and opt to purchase it on a public exchange will usually not be eligible for government premium subsidies. Ask us about the most frequently asked questions about the ACA and we can help you prepare a list of online resources that they can access to get answers to those questions you may not be able to answer.

The meeting
Send out meeting notices early to give your employees time to prepare and set aside time. Try to make the meeting engaging. You may also want to consider video recording the session, and also providing remote access to employees that don’t work onsite. Provide enough time for the main presentation, as well as for questions from your employees.

Why Your Employees Need Voluntary Disability Coverage

No one plans on becoming disabled and missing work, but it can happen. An illness or an accident could cause one of your employees to be unable to work for months, or even years.
While their health insurance will cover their medical expenses, it won’t cover the cost of living while they recover.
Only 30% of American workers in private industry currently have access to employer-sponsored long-term disability insurance coverage, according to the U.S. Bureau of Labor Statistics. That means most workers – and their families – do not have adequate protection against one of the most significant financial risks that they face.
That’s why you should be offering your employees voluntary short-term and long-term disability insurance. These policies provide income replacement to enable employees who are disabled to pay bills, including mortgages and college expenses, and to maintain an accustomed standard of living.
Disability insurance replaces a percentage of pre-disability income if an employee is unable to work due to illness or injury.
Employers may offer short-term disability coverage, long-term disability coverage, or integrate both short- and long-term coverage.

Short-term disability policies: These policies have a waiting period of zero to 14 days, with a maximum benefit period of no longer than two years.
Long-term disability policies: These policies have a waiting period of several weeks to several months, with a maximum benefit period ranging from a few years to the rest of your life.

Disability policies have two different protection features that are important to understand:
Non-cancelable – This means the policy cannot be canceled by the insurance company, except for non-payment of premiums. This gives your employees the right to renew the policy every year without an increase in the premium or a reduction in benefits.
Guaranteed renewable – This gives your employees the right to renew the policy with the same benefits and not have the policy canceled by the company. However, the insurer has the right to increase the premiums as long as it does so for all other policyholders in the same rating class as your employee.

Policy Options
In addition to the traditional disability policies, there are several options that you can also offer as part of the voluntary benefit package:
Additional purchase options. The insurer gives your employees the right to buy additional insurance at a later time.
Coordination of benefits. The amount of benefits your employees receive from the insurance company is dependent on other benefits they may receive because of their disability. The policy specifies a target amount they will receive from all the policies combined, so this policy will make up the difference not paid by other policies.
Cost of living adjustment (COLA). The COLA increases disability benefits over time based on the increased cost of living measured by the Consumer Price Index. Your employees will pay a higher premium if they select the COLA.
Residual or partial disability rider. This provision allows your employees to return to work part-time, collect part of their salary and receive a partial disability payment if they are still partially disabled.
Return of premium. This provision requires the insurer to refund part of the premium if no claims are made for a specific period of time declared in the policy.
• Waiver of premium provision. This clause means that your employees do not have to pay premiums on the policy after they are disabled for 90 days.

Court Ruling Lets EEOC Inspect Workplaces without Consent, Warrant

A federal court has ruled that the U.S. Equal Employment Opportunity Commission has the right to conduct on-site inspections of businesses without a warrant or consent from the owner.
This new development could put employers in the crosshairs of the EEOC anytime the agency deems a complaint worthy enough to visit a company’s premises over an allegation of discrimination. And legal experts predict that the agency will cite this case whenever an employer tries to refuse an EEOC request for an on-site inspection.
“This decision arms the EEOC with precedent that it may conduct on-site investigations regardless of whether an employer consents, something employers should consider when contemplating whether to deny the EEOC access to its business during an investigation,” the law firm Seyfarth Shaw LLP wrote in a blog.
In the case in question, a man sued Nucor Steel Gallatin Inc. for discrimination, alleging that the company rescinded a job offer after it had learned of his disability history. He later filed a complaint with the EEOC, which subsequently informed the company that it would conduct an on-site visit to interview other personnel who were involved in the hiring process.
Gallatin refused, telling the EEOC “We simply do not feel that coming on-site is necessary or relevant to your investigation.” After that, the commission issued a subpoena to visit the premises and in turn Gallatin said it could not enter the worksite without a court warrant.
At that point, the EEOC asked the U.S. District Court in Frankfort, Kentucky, to intervene in the case. In its decision rendered on April 28, 2016, but published in July, the court ordered Gallatin to let the investigator perform the inspection, but ruled that the investigator limit the inspection to evidence directly related to the Hot Rolling Department Shift Manager position and its associated responsibilities.
It also said that requiring a warrant would essentially duplicate the same procedures for enforcing a subpoena.
The court noted that the EEOC regulations contained comprehensive safeguards for a company that refuses a subpoena. It also stated that the EEOC cannot enforce a subpoena without obtaining approval from a federal district court and that the court will approve the subpoena after determining if the inspection is in the agency’s “authority, procedurally sound, relevant to the specific charges filed, and not unduly burdensome.”
Seyfarth Shaw wrote in its blog that “if the EEOC ever did have any hesitance about conducting an on-site investigation without an employer’s consent, this ruling likely alleviates any such concern.”
The law firm recommends that employers tread carefully if they are considering challenging an EEOC subpoena.

Finding Ways to Reduce Human Errors that Cause Workplace Accidents

An Indiana University of Pennsylvania professor is hoping that a study he is embarking on will yield new methods for reducing workplace injuries by identifying tools to motivate and engage workers in the safety process. The study will focus on human error and the role it plays in accidents, and accident prevention.
Safety sciences professor Jan Wachter believes that human error in the workplace, while not completely preventable, can be managed by better tools to motivate and engage workers in the safety process.
If his study yields new ways to manage safety in the workplace successfully, he hopes the results can reduce lost workdays due to accidents by up to 20%. This, of course, would be a boon for employers as one of the costliest results of a workplace injury or illness is the time away from work, requiring other employees to pick up the slack and the loss in productivity, not to mention the personal costs to the person who was injured.
“While human error has been associated with the majority of incidents in the workplace, it can be managed through a variety of mechanisms. But motivation and worker engagement may be the keys to human-error reduction,” he said.
Wachter will test this theory in a research project that recently received $90,000 in funding from the Alcoa Foundation.
The professor says that the key difference in his study, as opposed to other research on safety in the workplace, is that he will investigate how well — or how poorly — workers are engaged, or buying into, a shared accountability for identifying at-risk situations and responding to them.
For example, a worker may forget to wear safety glasses and get glass or metal shards in an eye. Wachter suggests that this type of accident could be prevented through methods of worker engagement. That is, before each work shift, employees may get together and remind each other of the specific personal protective equipment needed for that day’s task. It would be akin to an airline pilot going through the preflight checklist to make sure that all systems in the aircraft are functioning properly before take-off.
The theory of getting employees to buy into a company’s safety policies has shown merit in the past. Safety specialists say that engaged employees demonstrate a greater sense of personal ownership and compliance with safe work methods, adjust more quickly to needed changes in safety practices, and act proactively to ensure that work is being done in the safest way possible.
Studies have already shown that one of the key elements of getting employees to buy into a culture of safety is that the management does so first. But it is rank-and-file employees that really make it happen. Earlier studies have found that employees need the following if they are to truly buy into efforts at keeping the workplace safe:
Trust – Workers must believe in management’s emphasis on safety, and that the safety program is primarily for their own good.
Knowledge – Employees must be given all appropriate information about the program. Generally, the more they know, the more they will be supportive and involved.
Commitment – Like owners and managers, employees must be committed to the concept of safety if they are to practice it.
Communication – Lines of communication must be open between workers and workers, and workers and management. Strategies for opening and maintaining lines of communication must be employed.
Attitude – Employees themselves may well be the best examples for each other in maintaining standards of a safety program. Attitude is catching, and often the attitude of commitment must be caught from management and ownership.
Involvement – The bottom line of a safety program is in practicing the safe behavior that is called for. Sometimes this may mean maintaining what already has been established; sometimes it involves major changes. In any case, the employee must be willing to make the effort to actually “live out” safety practices.
Recognition – Not only management, but front-line workers must be involved in recognizing safe behavior. Peer support is crucial for maintaining program enthusiasm and involvement.

It is hoped that the new study will expand on these factors. Once the results are made public, we will publish an update in this newsletter.

Bill Would Nearly Double Permitted HSA Contributions

As employers shift more of the cost burden to employees, legislation in Congress would nearly double the amount workers can put into health savings accounts.
Under H.R. 5445, employees enrolled in high-deductible plans and opting for single coverage could in 2017 contribute up to $6,500 to their HSAs, while those with family coverage could contribute up to $13,100.
Under current law, the 2017 maximum HSA contributions are $3,400 for employees with single coverage and $6,750 for family coverage.
The idea behind the measure is to let employees fund all of their out-of-pocket costs through HSA contributions. Premium costs though would not be funneled through HSAs, but employee premium contributions could also be deducted on a pre-tax basis.
Additionally, H.R. 5445 would increase the amount that employees over 55 years old would be able to contribute to their HSAs.
Under current law, workers who are older than 55 can make an extra $1,000 a year “catch-up” contribution to an HSA, but over-55 spouses cannot. The bill would extend this same right to spouses who are older than 55.
The measure is strong enough that it could receive bipartisan support and it comes at a time when out-of-pocket spending is on the rise. The House Ways and Means Committee approved the measure on a 23-15 vote in the middle of June.
Out-of-pocket spending on inpatient hospitalizations has increased 37% in the years following passage of the health care reform law, according to the “Out-of-Pocket Spending for Hospitalizations among Nonelderly Adults” study, published by JAMA Internal Medicine.
From 2009 to 2013, among those receiving health coverage through the private sector, total out-of-pocket spending – also known as cost sharing – on hospitalizations grew from an average $738 to $1,013, according to the study.
At the same time, individual health plans and consumer-directed health plans (CDHPs) also experienced the slowest growth in cost sharing.

Here’s what the study found:
• Cost sharing for patients in individual health plans grew 17% from 2009 to $1,875 in 2013.
• In the group health insurance market, cost sharing for inpatient hospitalizations increased 38% to $997 in 2013.
• Cost sharing for patients with CDHPs rose 25% to $1,219 in 2013.
• Cost-sharing for non-CDHPs grew 34% to $957 during the same period.
• Out-of-pocket costs for hospitalizations among HMO enrollees swelled 34% to $1,075.
• Coinsurance related to hospitalizations increased from $518 in 2009 to $688 in 2013, and the amount applied to patients’ deductibles rose from $145 in 2009 to $270 during the four-year period.