Court rejects OSHA's bid to issue recordkeeping citations more than six months after violations occurred

A three-judge appeals court panel has shot down OSHA's stance that it has authority to issue recordkeeping citations up to five years after a violation occurred if employer logs remain inaccurate -- handing a major victory to industry and, according to sources closely watching the issue, forcing the agency to issue future recordkeeping citations within six months of when the actual violation occurred, in line with industry's position. One attorney also suggests the long-awaited decision could bolster the agency's efforts to modernize its recordkeeping system to mandate electronic recording of workplace injuries and illnesses.

The Court of Appeals for the District of Columbia Circuit decided in favor of Volks Constructors, which challenged OSHA's recordkeeping citations but lost an earlier appeal to the Occupational Safety and Health Review Commission (OSHRC). The commission last year issued a split decision siding with the Labor Department's legal position (see related story). Labor Department attorneys had argued that recordkeeping violations continue as long as employer logs remain inaccurate under an OSHA rule to retain injury and illness records for five years. But the industry side argued that the six-month statute of limitations period is triggered once the "occurrence" of a recordkeeping violation takes place -- that is, the employer failed to record the incident within seven days.

OSHA cited and fined Volks for failing to properly maintain its injury log between January 2002 and April 2006, and the agency issued the citations in November 2006, at least six months after the last unrecorded injury occurred. The court, however, agreed with Volks "that the citations are untimely and should be vacated."

"For all practical purposes, it means that OSHA can't issue citations in which a failure to record a recordable injury occurred more than six months before the citation is issued," says Art Sapper, partner in McDermott Will & Emery's OSHA Practice Group, who argued the case for Volks. "Going back five years is no longer an option for OSHA."

The attorney also suggests the case could affect OSHA's ongoing effort to modernize recordkeeping requirements, saying, "Although [OSHA chief David] Michaels has been pushing OSHA's now-ongoing effort to require electronic reporting of injury logs about as hard as it can be pushed, this decision might add a bit more steam to the effort." OSHA is currently awaiting approval from the White House Office of Management and Budget to unveil a proposed rule on updated recordkeeping systems.

Sapper, in a statement issued just after the April 6 ruling, said his law firm was "gratified by the total vindication" of its client. "We believed all along that the statute of limitations was controlling and needed to be given greater respect than OSHA and the Review Commission had given to it. We appreciate the thoroughness of the court's unanimous decision and the consideration reflected in the lead and concurring opinions."

The three Appeals Court judges stated in their opinion that "[w]e think the statute is clear; the citations are untimely. The statute of limitations provides that 'no citation may be issued ... after the expiration of six months following the occurrence of any violation.' ... Like the Supreme Court, we think the word 'occurrence' clearly refers to a discrete antecedent event -- something that 'happened' or 'came to pass' 'in the past.'"

The panel states that "[i]n this case, every single violation for which Volks was cited -- failures to make and review records -- and every workplace injury which gave rise to those unmet recording obligations were 'incidents' and 'events' which 'occurred' more than six months before the issuance of the citations. … The [Labor] Secretary does not offer any other definition of 'occurrence' but instead heroically attempts, as the dissenting Commissioner put it, to 'tie this straightforward issue into a Gordian knot.'"

Since DOL argues that such violations continue every day that an unmet recordkeeping obligation remains unsatisfied, and its regulations require keeping such records for five years, "the Secretary concludes the real statute of limitations for record-making violations is the length of the agency's record retention period plus the limitations period Congress proposed -- here, five years beyond the six months stated in Section 658(c)," the judges state. "Despite the cloud of dust the Secretary kicks up in an effort to lead us to her interpretation, the text and structure of the Act reveal a quite different and quite clear congressional intent that requires none of the strained inferences she urges upon us." It remains unclear whether DOL intends to press the issue further. An OSHA official could not be reached for comment on the ruling.

The Appeals Court decision wipes out an earlier OSHRC precedent on the issue, an industry attorney with knowledge of the case says. The commission earlier ruled in DOL's favor in Johnson Controls -- a decision the body cited in the split decision in Volks that led to the D.C. Circuit appeal. The commission has said that if a case is appeal-able to a Court of Appeals that has an inconsistent precedent, it will follow the inconsistent precedent of the court, the attorney tells Inside OSHA Online. 

"OSHRC says, ordinarily we would follow our own precedent, unless the employer can appeal to a court of appeals with a contrary precedent. Since every employer can appeal to the D.C. Circuit, then that exception would always apply, and the exception would swallow up the rule of Johnson Controls."

The Labor Department has several options if it wishes to pursue the Volks case further, the attorney points out:

Seek panel reconsideration. DOL could ask the three judges on the panel to reconsider their decisions. "They have to show some misapprehension of law or fact by the judges," the source says. "If you read the opinion, that's pretty much impossible."

Ask for an en banc rehearing of the case by the full Appeals Court. "Regarding en banc, you have to show an inconsistency with a previous decision of the D.C. Circuit or with a decision of the Supreme Court; or a legal question of 'exceptional importance,' such as a question involving a conflicting opinion with another Court of Appeals," the attorney says. "All those things are impossible to show here. They're not going to get en banc rehearing."

Go to the Supreme Court. The high court would have to agree to take the case.