Last week Connelly denied a petition for a writ of mandamus sought by Overaa Construction against the California Occupational Safety and Health Appeals Board over its interpretation of California’s multi-employer work site (MEW) regulation. See Title 8, Code of California Regulations (CCR) section 336.10. Connelly found that the Board acted reasonably in determining that Cal/OSHA’s burden of proof to establish liability of "controlling" employers does not require evidence that the employer failed to exercise "due diligence" to discover safety problems on a work site. If that were all that was involved here, employers could live with the decision. However, the effects of the decision will be broader.

It is an irritating decision because Judge Connelly also found, erroneously we believe, that the other side of the coin, whether the Appeals Board must consider an employer's evidence of "due diligence" as a defense to the citation, was not before the Board and therefore remains an open question. Irritating, because the fact that this is a "writ denied" case means that it sets no precedent, cannot be cited in future cases, will be read by very few people, and does nothing to alert employers that the other side of the coin is still an issue. Indeed, employers’ counsel have read the Board’s decision as a declaration that the MEW regulation creates "strict liability", that is, liability without fault or defense, for California employers. This also is how Cal/OSHA’s attorneys view the decision...unless they are arguing to the Superior Court.

The unaddressed issues in the Board’s decision are now left to employers and their attorneys in future cases to, as one of the Division’s attorneys put it, "suss out." Interesting phrase, "suss out". You rarely run across it except in law schools and university English departments. It means "...to examine so as to determine accuracy, quality, or condition." In this context it means to analyze in detail, a very lawyerly (and expensive) exercise.

It is also a sad decision. By leaving the implications of the Board’s decision to future "sussing" sessions, the Legislature’s vision of the Appeals Board as an informal forum, where employers would not be at a disadvantage appearing without benefit of counsel, is officially dead.

As of this writing, we do not know if Overaa Construction will appeal this ruling to the Appellate Court. Of course, none of this will be necessary if the Board uses future cases as an opportunity to reconsider the questions posed by their Overaa decision and make it clear that the calculus of liability under Cal/OSHA’s MEW regulations requires, in one way or another, that an employer’s due diligence towards safety must be considered even if not honored. We do not think this is asking too much.

If "strict liability" for another’s conduct is the rule, we can make some reasonable predictions:

1. As a controlling employer’s Cal/OSHA history fills with these citations, the record will cease over time to be an accurate measure of its commitment to safety. As these citations pile up, general contractors will become vulnerable to repeat and willful classifications based on their sub's conduct. We are already defending one such case.

2. General contractors, deemed by their status alone to be "controlling" employers by Cal/OSHA, will fail more bidding "pre-quals".

3. As insurance carriers rely more heavily on an insured’s Cal/OSHA history in making underwriting decisions, California’s controlling employers will see their rates rise or their companies become uninsurable.

In the meantime, California employers liable to be found "controlling" employers can take some lessons from the decision and act to protect themselves:

1. Judge Connelly, the Board and the ALJ were unimpressed by the record of Overaa’s attempts to make its subcontractor toe the safety line. Efforts need to be redoubled in the bidding process and on the jobsite to avoid or "butt heads" with subcontractors with poor records of safety compliance.

2. They also were unimpressed by the fact that the trench in question violated the standard by six inches at a single point, stating that this condition could have been found with due diligence. We recommend that all job walks by foremen and superintendents, not just safety personnel, must have a safety component to them and be fully documented.

3. Every citation as a "controlling" employer – or any other category of employer for that matter – under section 336.10 should be carefully considered before being accepted without appeal. The Division takes the position that a controlling employer "buys" all of its subs’ misconduct, regardless. They will continue to do so until the Board rules differently.