Using Contractors: A Not So Modern Dilemma

• Heritage Group Safety

OUTLINE

• Where did all this contractor liability come from?

• The importance of pre-qualifying contractors.

• What does OSHA think.

• The BIG liability question $$$$$$.

Where did it come from?

• Several incidents in the late 80’s and early 90’s led to the OSHA Process Safety Standard.

• Pasadena, TX- ‘89-23 dead, 132 injured-explosion.

• Cincinnati, OH-’90- 2 dead-explosion.

Where did it come from?

• Sterlington, LA-’91-8 dead, 128 injuries-chemical release.

• The OSHA Process Safety Standard specifically targeted contractors because contractors were the cause of all these catastrophes.

• PSM applied to Contractors performing maintenance, repair, turnaround, major renovation and specialty work.

Contractor Liability

OSHA, later, applied this contractor liability into the construction industry through Program Directives and Standard Interpretations on Multi-Employer work sites.There is no “standard” on contractor liability.

However, you can be cited and fined for Contractor Violations if you are an Owner (Controlling Employer),Creating Employer, Exposing Employer or CorrectingEmployer.

More importantly, as an owner or controlling contractoryou can be held financially liable for injuries to third parties.

Pre-Qualifying Contractors

• Owners-Controlling Contractors can be held financially liable for injuries and deaths to third parties, third parties can damage your site or injure your employees and you can be fined by OSHA for their violations.

• Pre-Qualifying Contractors is a MUST!

What does OSHA think?

• Under the OSHA Multi-Employer Citation Policy both construction and non-construction citations shall be issued to employers whose employees are exposed to hazards. (exposing employer)

• Additionally, the following employers shall be cited, whether or not their own employees are exposed:

The employer who actually creates the hazard (the creating employer).

The employer who is responsible, by contract or actualpractice, for safety and health conditions on the worksite.The employer who has the authority for ensuring that the hazardous conditions are corrected (the controlling employer).

The employer who has the responsibility for actually correcting the hazard (the correcting employer)

MULTI-EMPLOYER MULTI-EMPLOYER WORKSITESWORKSITES

• Who is responsible?• Who created the

hazard?• Who is exposed to the

hazard. • Who is ultimately

responsible?

The EXPOSING EmployerThe EXPOSING Employer

• On Multi-Employer worksites, citations normally will be issued to employer whose employees are exposed to the hazard.

• Examples.

Others Normally Cited(Whether or not employees are

exposed)

• The Creating Employer.

• The Controlling Employer.

• The Correcting Employer.

Prior To Citation Issue-Does Employer Have Prior To Citation Issue-Does Employer Have A Legitimate Defense?A Legitimate Defense?

• Employer did not create the hazard.

• Employer did not have responsibility or authority to correct the hazard.

• Can demonstrate that all employees are notified of the hazard.

The Employer has instructed The Employer has instructed employees to recognize hazard, employees to recognize hazard,

and,and,• Exposing Employer

has taken means to protect employees from hazard.

• Has removed employees from job to avoid citation. (In extreme circumstances)

If Exposing Employer Meets If Exposing Employer Meets These Defenses:These Defenses:

• Then That Employer Shall Not Be Cited.

• If All Employers With Exposed Employees Meets These Defenses, Then Only Creating And Controlling Employers Shall Be Cited.

In Such Circumstances, The In Such Circumstances, The Controlling Employer and the Controlling Employer and the Hazard Creating Employer:Hazard Creating Employer:

• Shall be cited even though none of their employees are exposed to the Hazard.

PENALTIES:PENALTIES:

• Penalties are appropriately calculated, using the exposed employees of all employers as the number of employees for probability assessment.

WORKSHOPWORKSHOP

Cawley’s Tater Flake Company hired Hightone Paints,to do repair and painting. During the repair work, Hightone removed a railing near a walkway, exposingHightone employees, Cawley’s Tater Flake employeesand customers to a 7 foot drop. Cawley’s Tater Flakeput up a sign, warning the customers of the hazard.

Who should be cited for the missing rail????

Both Hightone Paints and Cawley’s Tater Flake Co.

Receive Citations:

Cawley’s Tater Flakes is the exposing employer. Hightone also has employees exposed.

The warning sign is not sufficient to meet a legitimateDefense.

Ma/Pa Inc., contracted with Bumstead Plumbingto repair sewer pipes on their property. The contractstated that Bumstead Plumbing was responsible for all safety and health conditions related to the sewerjob. Bumstead Plumbing dug a trench and did not provide protection against cave-ins for three of theiremployees working in the trench.

Which Company(ies) receives the citation?

Bumstead receives the citation. Bumstead is the exposing employer. exposing employer.

Since Ma/Pa had no employees exposed, did not create the hazard, was not responsible for the safety and health conditions related to the trench and didnot have responsibility for correction, they wouldprobably not receive a citation.

Host operates a factory. It contracts with Walton’s Service Co. to service. Host failsto cover drums of a chemical after repeated requests to do so. This results in airborne concentrations of the chemical that exceed thePermissible Exposure Level (PEL).

Which company receive the citation(s)?

Host is the creating employer because it caused Walton’semployees to be exposed to the air contaminant above the PEL.

Host failed to implement measures to prevent the accumulative air contaminant.

Cornhusker Inc. hired Dingy Tank Co. to clean two of their storage tanks. In the contract, Cornhusker Inc. maintains responsibility for the safety and health conditions of the workplace. During the cleaning operations, three Dingy employees are in the tank. Cornhusker has no confined spaceprogram.

Which company(ies) receive the citation(s)???

Who is the exposing employer?

Who is the controlling employer?

Who has the responsibility for safety?

Dingy Tank is the exposing employer.

Cornhusker is the controlling employer.

Both Dingy Tank and Cornhusker has responsibility to maintain safety and correct deficiencies.

Therefore, both companies receive citations.