Audit, Compliance and Risk Blog

On January 10, 2024, the U.S. Environmental Protection Agency (EPA), U.S. Department of Justice, and the California Air Resources Board (ARB) filed a settlement agreement with Cummins, Inc. covering nearly one million Ram vehicles for which Cummins supplied diesel engines with illegal software-based “defeat devices” that produced misleading emission certification results compared with significantly higher emissions while the vehicles are in actual use. Cummins will pay the largest CAA penalties ever ($1,675 million in federal and state penalties), will fund environmental mitigation projects to compensate for excess nitrogen oxides (NOx) emissions ($175 million), and will also recall 630,000 vehicles (model years 2013-2019) to remove the defeat devices (estimated costs $150 million, including warranty extensions). Cummins will also implement corporate governance, organizational, and technical process reforms to minimize the likelihood of future violations.

The Occupational Safety and Health Administration’s (OSHA’s) Standard for Process Safety Management of Highly Hazardous Chemicals (usually referred to as “PSM”) requires extensive risk assessments and reduction efforts by facilities where a significant incident involving these chemicals might have catastrophic consequences. OSHA adopted PSM in 1992, and has made only minor technical revisions in the ensuing three decades. OSHA has also issued enforcement guidance to its inspectors, which it had not revised since 2012. However, in December 2023 OSHA issued an extensive new PSM enforcement policy, most of which is formatted in a total of 192 Questions and Responses designed to guide enforcement – and compliance that can obviate enforcement. The remainder of this note provides a very brief summary of the 120 page Enforcement Policy document.

Many laws provide for civil – and sometimes even criminal – penalties for noncompliance. New legislation typically sets penalty levels (“XXX dollars per day of violation” for example), at levels intended to provide meaningful deterrence and punishment for noncompliance. But over time, the relative sting of these penalties declines with inflation. To counteract the possibility that less painful penalties reduce incentives for compliance, most U.S. federal agencies are required to make annual “cost of living” adjustments to maximum available civil penalty levels (criminal penalties are not affected).

Federal laws (commonly referred to as RCRA, after the Resource Conservation and Recovery Act of 1976) provide comprehensive management requirements for parties involved in hazardous waste management, from “cradle to grave” covering generators, transporters, and offsite management facilities. Among these many provisions are requirements that “large quantity generators (LQGs)” submit biennial reports to the Environmental Protection Agency (EPA) or delegated states in March of every even-numbered year. March 2024 is the next such deadline, so now is a good time to review biennial report requirements to ensure compliance at qualifying facilities.

On December 21`, 2023, the Occupational Safety and Health Administration (OSHA) announced a notice of proposed rulemaking (NPRM) to develop an Emergency Response Standard that will update, expand and supersede OSHA’s existing Fire Brigades Standard. The new standard will extend detailed OSHA protections to additional emergency responders, including not just firefighters but also emergency medical service providers and technical search and rescue workers. The rest of this note describes these proposed changes.

On November 22, the Occupational Safety and Health Administration (OSHA) issued a Safety and Health information Bulletin (SHIB) discussing “safety helmets” as evolved alternatives to traditional hard hats, and offering recommendations for situations where employers should switch. On December 11 the agency announced that it’s following its own advice and replacing its own employees/inspectors hard hats with safety helmets. The rest of this note discusses OSHA provisions for personal protective equipment (PPE) providing head protection, and the rationale and examples of the benefits of upgraded headgear.

The Occupational Safety and Health Administration (OSHA) Region 3 (covering Delaware, Pennsylvania, West Virginia, and the District of Columbia) has renewed a Regional Emphasis Program under which it focuses inspection resources on “High Level Noise.” This announcement provides a useful reminder to employers throughout the US to evaluate occupational noise and the risks of employees’ hearing loss. The remainder of this note summarizes OSHA’s Occupational Noise Standard for General industry (separate requirements cover construction).

The Occupational Safety and Health Administration (OSHA) provides a “Young Workers - You have rights!” webpage on its website, compiling regulatory and practical information for employers and workers. As we approach the annual spike in youth employment during the end-of-year Holidays, this provides a timely reminder to focus on the needs and rights of young people in workplaces. The webpage targets information as follows:

• Young Workers
• Employers
• Parents and Educators
• Real Stories
• Hazards
• Resources

The remainder of this note summarizes these materials, focusing on information useful to employers.

On September 30, 2023, California’s governor Gavin Newsom signed Senate Bill (SB) 553, which expands the state’s workplace violence prevention (WVP) requirements, adding duties and rights for most employers in the state. Most importantly, SB 553 requires all non-exempt employers in the state to create WVP plans. These expanded requirements will be administered by California’s Division of Occupational Safety and Health (DOSH, but generally referred to as “Cal/OSHA”), which already administers WVP planning requirements for healthcare employers (which I wrote about HERE), and has been working on a general rule (I wrote about the latest draft HERE). The remainder of this note discusses SB 553, which takes effect on January 1, 2024 but remains subject to further rulemakings.

On October 7, 2023, California’s governor Gavin Newsom signed two important bills expanding climate-related reporting requirements for targeted organizations doing business in the state – SB 253 (Wiener) (Climate Corporate Data Accountability Act) and SB 261 (Stern). These requirements will be administered by the California Air Resources Board (ARB), which already includes most state greenhouse gas (GHG) regulatory requirements within its extensive air quality and climate authority (centered on the Global Warming Solutions Act of 2006 (AB 32). The remainder of these note discusses these new requirements.