On October 11, 2018, OSHA issued a Memorandum to Regional Administrators clarifying the agency’s position on workplace safety incentive programs as well as post-incident drug testing policies. By way of background, on May 12, 2016, OSHA published a final rule which amended 29 CFR 1904.35 prohibiting employers from retaliating against employees for reporting work-related injuries or illnesses. In the preamble to the final rule as well as post-promulgation interpretive documents, OSHA took the position that certain post-accident drug testing and safety incentive policies might very well deter employees from reporting work-related injuries and illnesses. Therefore, such policies and programs could violate the anti-retaliation provisions in 29 C.F.R. 1904.35. OSHA’s interpretation immediately became controversial. Employers struggled to understand OSHA’s application of the anti-retaliation provisions regarding safety incentive programs and post-accident drug testing policies.
The new Memorandum to Regional Administrators issued on October 11, 2018, states its purpose is to “clarify the Department’s position that 29 C.F.R. 1904.35 does not prohibit workplace safety incentive programs or post-incident drug testing.” The Memorandum thereafter appears to represent a change in tone rather than a substantive change in position, but it does suggest perhaps a softer approach to enforcement.
Safety Incentive Policies
OSHA’s May 12, 2016, preamble to the amendment emphasized that safety incentive policies based on OSHA recordable rates were suspect and strongly discouraged such programs. OSHA took the position in 2016 that such safety incentive policies discouraged or deterred employees from reporting work-related injuries or illnesses. Rather, OSHA suggested rewarding employees who participated in safety-related activities, such as near miss reporting or identifying hazards or participating in accident investigations.
In the recent October 11, 2018 Memorandum, OSHA stated that a safety incentive policy premised on OSHA recordables or injury rates does not by itself violate 29 C.F.R. 1904.35. Rather, such policies will be considered violations only if they penalize employees for reporting work-related injuries or illnesses, or are implemented in such a way that discourages reporting. Importantly, OSHA noted that safety incentive programs can be an important tool to promote workplace safety and health. The Memorandum indicates that programs which offer a prize or bonus at the end of an injury-free month are permittable as well as a program that evaluates managers based on their work department’s lack of injuries. However, to lawfully implement such a safety program, the employer must ensure that employees feel free to report an injury or illness. Merely stating in a policy that employees are encouraged to report and will not face retaliation is insufficient. Employers need to implement additional “adequate precautions”, such as an incentive program that rewards employees for identifying unsafe conditions and hazards in the workplace, and a training program for employees to reinforce reporting rights and responsibilities without retaliation.
Post-Incident Drug Testing Policies
Many employers mistakenly believed that OSHA intended to prohibit post-accident drug testing when 29 C.F.R. 1904.35 was amended in 2016. However, OSHA only intended to prohibit post-accident drug testing when it was used to retaliate or discriminate against employees for exercising the right of reporting work-related injuries and illnesses. Therefore, to clarify OSHA’s position, the October 2018 Memorandum lists the following permissible scenarios for drug testing:
- Random Drug Testing
- Drug testing unrelated to the actual reporting of a work-related injury or illness
- Drug testing performed under a state workers’ compensation law
- Drug testing under other federal law, such as the U.S. Department of Transportation rule
- Drug testing to evaluate the root cause of a workplace incident that harmed or could have harmed employees. If the employer chooses to use drug testing to investigate the incident, the employer should test all employees whose conduct could have contributed to the incident, not just employees who reported injuries.
The Take Away for Employers
The new Memorandum makes it clear that employers can implement safety incentive programs and policies based on injury rates and OSHA recordables. However, employers should balance those programs with incentives based on proactive employee participation in identifying hazards and unsafe work conditions, and training on reporting injuries free from retaliation. The new Memorandum also makes it clear that drug testing is permissible and provides a list of acceptable scenarios. Please contact a member of our Labor and Employment Section with questions or comments.