Audit, Compliance and Risk Blog

On May 4, 2022, the US Environmental Protection Agency (EPA) published notice of a proposed consent decree in litigation brought by the environmental group Center for Biological Diversity (CBD). EPA proposes to issue a decision responding to a petition filed by CBD in 2014, about whether to list discarded polyvinyl chloride (PVC) as hazardous waste under the Resource Conservation and Recovery Act (RCRA). CBD filed the suit early in 2021, after EPA had taken no action on its petition for seven years, claiming that the agency’s inaction violated a duty to act. EPA is now ready to commit to issue a proposed decision no later than January 20, 2023, and a final decision by April 12, 2024.

On April 8, 2022, the US federal Occupational Safety and Health Administration (OSHA) established a National Emphasis Program (NEP) to focus enforcement resources on “Outdoor and Indoor Heat-Related Hazards.” The NEP is OSHA’s latest step to manage and reduce heat illness in workplaces. Earlier actions include “Inspection Guidance for Heat-Related Hazards” on September 1, 2021 (I wrote about it HERE), and an “advanced notice of proposed rulemaking (ANPRM)” on these topics issued on October 27, 2021 (which I wrote about HERE). The remainder of this note summarizes the NEP.

Employers in Ontario need to be aware of several new obligations as a result of Bill 88, the Working for Workers Act, 2022. They include a written policy on electronic monitoring for certain employers, new measures regarding “information technology consultants” and “business consultants,” a new legislative framework for digital platform workers and additional occupational health and safety legislation obligations. Steps can be taken now to proactively plan for the changes that are in force and that will come in force in the near future.

Bill 88 was passed by the Ontario legislature on April 7, 2022 and received royal assent on April 11, 2022. Employers should be up to date with Bill 88 in order to ensure compliance. Here is a summary of the key points from Bill 88.

The federal Council on Environmental Quality (CEQ) has revised its regulations administering the National Environmental Policy Act (NEPA) of 1969. NEPA requires federal agencies to assess the environmental effects of their proposed actions, and incorporate this information into their decisions. Government-wide guidance is provided by the White House’s CEQ, established by NEPA and appointed by the President. CEQ issues formal regulations that agencies must follow, and guidance documents that provide additional advice. CEQ also reviews agencies’ NEPA implementation programs, and publishes annual national Environmental Quality Reports.

The Environmental Protection Agency (EPA) has proposed to ban a number of longstanding uses of chrysotile asbestos, using expanded authority provided as part of amendments adopted to the Toxic Substances Control Act (TSCA) in 2016. This proposal is EPA’s latest step to apply its expanded authority to review and restrict uses of asbestos, renewing agency efforts from the 1980s that were blocked by litigation.

On March 28, the US Environmental Protection Agency (EPA) proposed regulations requiring “non-transportation-related onshore facilities” to prepare response plans covering possible releases of hazardous substances, and submit those plans to EPA. This proposal implements longstanding but unused EPA authority under the Clean Water Act (CWA). The remainder of this note discusses the proposal.

On March 28, the Biden Administration issued its budget proposal for federal Fiscal Year (FY) 2023 (October 1, 2022 through September 30, 2023). The administration proposes a $11.9 billion budget for the Environmental Protection Agency (EPA), a 29% ($2.6 billion) increase above EPA’s adopted 2022 budget of $9.6 billion – similar to the administration’s FY 2022 proposal of $11.2 billion (which I wrote about HERE), which Congress cut considerably.

The Occupational Safety and Health Administration (OSHA) requires most employers with 10 or more employees at an “establishment” to prepare and maintain records of occupational injuries and illnesses (I&I) as they occur (I&I Logs). OSHA also requires employers to post an annual I&I Summary in each workplace “establishment” by February 1, summarizing that workplace’s I&Is during the previous calendar year. In addition, beginning in 2017 OSHA requires some employers to submit some of this I&I information electronically to the agency. (I wrote about the initial electronic reporting requirements HERE). On March 30 OSHA proposed to update and revise these electronic reporting requirements, which the remainder of this note summarizes.

When must organizations evaluate and disclose how climate change will affect their operations?

The US Securities and Exchange Commission (SEC) administers reporting requirements for companies listed on national securities exchanges (“listed companies” or “public companies”), under federal securities laws including the Securities Act of 1933 and the Securities Exchange Act of 1934. Some of the SEC’s requirements provide detailed specifications, such as financial reporting consistent with Generally Accepted Accounting Practices (GAAP). Others are less quantified, requiring reporting of information that might be “material” to investors’ evaluation of a public company. Over time, SEC has added topics subject to reporting of material information, and some of these generalized requirements have evolved into more specific ones. In the latest example of this evolution, in March 2022 SEC is proposing regulatory requirements for disclosures about “climate-related risks and metrics” by public companies, enhancing and standardizing existing agency guidance (I’ve written about these several times over the years, most recently HERE). The remainder of this note summarizes SEC’s proposal.

In December, the Ontario Court of Appeal reviewed a case involving two disputing factions in a 5-member partnership (Extreme Venture Partners Fund I LP v. Varma).¹  The two partners who managed the activities decided that their efforts were being undervalued by the other 3, and responded by starting competing businesses, diverting resources from the original entity, and hiding these activities. The other 3 partners eventually found out and sued them for breaches of their fiduciary duties. The trial court found against the wrongdoers, and on appeal the Court of Appeal actually increased their punishment.