By Eric J. Conn, Chair of Conn Maciel Carey’s national OSHA Practice Group

It has been five years since OSHA launched its Severe Violator Enforcement Program (“SVEP”), and two years since an agency White Paper trumpeted the program’s “strong start” and progress on “key goals.”  A closer examination of OSHA’s SVEP data, however, reveals that:

• SVEP disproportionately targets small employers;
• SVEP cases are contested more often than other OSHA citations;
• OSHA has trouble conducting follow-up inspections of small employers, especially those in the construction industry; and
• The program fails to reach the recalcitrant employers it was designed to target.

The fact is, SVEP (which succeeded OSHA’s controversial Enhanced Enforcement Program) has shown troubling trends from the start. Not only do the criteria weigh against smaller employers, but the consequences for employers thus labeled are dire, placing them in a precarious position, even before OSHA has proven that the employer violated the law at all, let alone in such an egregious manner as to warrant inclusion in SVEP.

Repeat Overkill

SVEP was instituted to target “enforcement efforts on recalcitrant employers who demonstrate indifference to the health and safety of their employees.” To that end, OSHA created four categories that would land an employer in SVEP. However, over the life of the program, one qualifying category has been invoked predominantly: an employer who has two or more willful, repeat, or failure-to-abate citations related to High Emphasis Hazards (NF-2WRF).

Willful violations are those committed by an employer who knows the applicable standard but intentionally disregards it. Repeat violations have a much lower standard and require no aggravated intent. The employer does not have to know the law or be indifferent to safety.

Through the first several years of SVEP, this NF-2WRF category accounted for nearly 70% of all SVEP cases. On the surface, this suggests that the program is reaching those bad actors, who deliberately flout the law; i.e., employers that have committed multiple willful violations. However, the reality is that only one in four qualifying cases involves any willful violations. More than 75% of this category is based on repeat violations, which, again, do not require any specific or aggravated intent.

Moreover, OSHA reports that nearly 60% of SVEP employers have fewer than 25 total employees, and 75% have fewer than 100. Often, these employers are not “recalcitrant” and have not acted with indifference toward safety or the law. Rather, they generally do not know what OSHA’s vast portfolio of regulations require and/or lack the resources to comply.

Bad Timing

An employer is entered into SVEP at the outset of an OSHA case, prior to an opportunity to defend itself and prove wrong OSHA’s alleged violations. Notwithstanding this end run around Constitutional Due Process, once in the program, SVEP employers are immediately subject to:

• Public shaming by OSHA through both an inflammatory, embarrassing, and one-sided press release detailing the alleged violations and by posting the employer’s name on a Severe Violator list on OSHA’s public website;
• Mandatory follow-up inspections at that cited facility and up to ten sister facilities within the organization; and
• More expansive settlement terms than ever before, including corporate-wide requirements.

SVEP status also has serious indirect consequences:

• Harm to the company’s reputation;
• Loss of customers and clients;
• Defection by current employees and obstruction of recruiting prospective employees;
• Denial of, or increased interest rates on, business loans and lines of credit;
• Higher insurance rates or loss of insurance coverage; and
• Use of the SVEP designation in talking points for organized labor and interests adverse to the employers.

And all of this happens before any adjudication process—in other words, before OSHA proves that a violation of the law even occurred.

Getting Out

More than half of SVEP citations have been contested, with 30% of those contests still in process. Some disputed citations have taken more than three years to resolve.

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