Your Safety Audits May End Up in OSHA’s Hands

By Gregory N. Dale Sep 8, 2014
Some employers make efforts to improve workplace safety and health through audits initiated or conducted by the employer, agents of its insurance carrier, and/or outside third-party consultants. Audits can be a useful and proactive method of identifying and acting upon workplace safety and health hazards. However, if secured in litigation-related or inspection-related discovery, such audits may also serve as “roadmaps” for outside entities, such as the Occupational Safety and Health Administration (OSHA), to determine: 1) whether (and when) an employer was aware of a safety, health, and/or environmental hazard; and 2) if the employer failed to take timely or effective steps to remedy any such hazard.

OSHA Policy

In late 1999, OSHA proposed a policy concerning its use of voluntary employer safety and health audit information. Shortly thereafter, OSHA finalized the policy and essentially observed that employers have an implicit duty to review their workplaces to identify and act upon hazardous conditions. Further, OSHA noted that many OSHA standards require employers to engage in a self-inspection process to determine compliance. OSHA also observed that many conscientious employers undertake voluntary safety audits in order to promote safe working conditions and to assist in the employer’s compliance with safety laws, standards and regulations.

The OSHA policy applied to certain voluntary audits and it expressed the general view that OSHA would not “routinely” request voluntary safety audit reports when initiating an inspection and would not use such audit reports as a means of identifying hazards upon which to focus during an inspection. Instead, OSHA advised that it intended to seek access to such reports only in “limited situations” where OSHA has an independent basis to believe that a specific safety or health hazard warrants investigation and has determined that safety audit records may be relevant to identify or determine the circumstances of the hazardous condition.

OSHA’s Efforts to Seek Audit Reports

Nonetheless, over the past few years, some employers have had just such audits requested by OSHA in the course of OSHA investigations. Despite the policy, OSHA has sought, and succeeded, in securing such audit information. But, in one recent case, the employer prevailed in at least preventing OSHA from seeking such audit information as a means to identify areas of inspection examination. The court did indicate that OSHA could secure relevant audit information, but only after OSHA independently secured evidence of a safety hazard. Thus, the protections afforded employers over such audit results is not particularly strong.

What about attempting to secure attorney/client privilege protection over a safety/health audit commissioned by an employer’s lawyers? Case law has demonstrated that the retention of legal counsel to retain a consultant to perform such an audit may not provide as much protection as might be expected.

In 2011, the Occupational Safety and Health Review Commission (OSHRC), which adjudicates disputes between employers and OSHA, issued a decision in a case in which OSHA attempted to secure a report issued to an employer’s legal counsel by a safety consulting firm retained by that counsel. In summary, the OSHRC held that:

  • The attorney/client privilege will not apply where the attorney consults with the consultant to obtain information the client did not have or employs the third party to gather data through studies and observations of the physical conditions at a client’s site.
  • Information supplied by the employer to the consultant (hired by the lawyer) may be protected, but two other requirements must be satisfied: a) the employer must have sought legal advice from counsel as opposed to some other form of advice (e.g., business or accounting advice); and b) in order to provide legal advice, the attorney needed the services of the consultant to translate technical, complex information or improve comprehension.

In view of this background and OSHRC decision, here are several recommendations:

  • Attorneys and safety/health consultants must, at the outset, have a clear understanding of whether the employer and its lawyer expect to protect the consultant’s report under the attorney/client privilege or the work product rule (important note: the OSHRC case at issue only dealt with the attorney/client privilege—the case did not address work product rule issues/protections).
  • The safety and health consultant must have an initial discussion with legal counsel as to how the parties will structure the survey/study and report to best protect it, if that is what is intended.
  • The employer, consultant and attorney must consider the potential that the report may, despite best efforts, end up in the hands of a party other than the host employer and/or its lawyer.
  • The parties will need to consider the potential for any claimed attorney/client privilege to be waived, if the consultant’s report is turned over to third parties, such as OSHA.

What to Do with Existing Audit Reports

What if an employer has existing audit reports in its files, such as those issued by insurance companies or insurance company-retained consultants? Here are a few thoughts for consideration.

Examine the reports to see if there is/are recommendation(s) from the consultant that have not been acted upon by the employer. If so, determine whether the recommendation accurately describes a condition that is not in compliance with OSHA and/or other legal requirements. If so, promptly take action to correct the condition. Leaving such a noncompliant condition in an uncorrected state may furnish evidence of an alleged “Willful” OSHA violation. Moreover, if the uncorrected condition caused or contributed to an occupational fatality, there could be criminal consequences to the employer and even to individual responsible officials.

If the original recommendation or violation alleged by the consultant is not actually a violation (due to a mistake by the consultant, new information, etc.), then it is important to secure the auditor’s confirmation (preferably, in writing) that the original recommendation/allegation is not valid and the condition is now considered to be in compliance.

If the original recommendation/alleged violation was, in fact, corrected by the employer, see if the consultant will review the corrective actions and confirm, in writing (if possible), that the condition(s) have been appropriately addressed and/or that the condition is no longer a safety/health issue.

These are important considerations because, if the report is discovered by OSHA, OSHA may treat the safety audit report and subsequent corrective actions as evidence of good faith, and not as evidence of an alleged willful violation, especially if the employer has responded promptly with appropriate corrective action to the violative conditions identified in the audit. Good faith is also a statutory factor that OSHA takes into consideration in assessing penalties.

Employers should consider these developments in planning and carrying out safety and health audits. The developing case law in this area demonstrates that, even where legal counsel is involved, careful planning and documentation regarding the audit process and reports are essential.

Gregory N. Dale is a partner in the Indianapolis office of Faegre Baker Daniels LLP.​


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