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March 12, 2018
Status of OSHA’s VPP: OIG report cites absence of contractor data

OSHA’s venerable Voluntary Protection Program (VPP) may be undergoing several significant changes in the near future. For years, industry and its supporters in Congress have been pushing to expand the VPP and even make it a regulatory program. This legislative session has seen bipartisan reintroduction of a bill that would codify the VPP and the major advantage it provides to participating employers—removal from OSHA’s programmed inspection list.

Codification of the VPP would likely increase corporate participation in the program, a goal that was endorsed by Scott Mugno, the Trump administration’s nominee to be Assistant Secretary of Labor for Occupational Safety and Health. In a December 5, 2017, hearing of the Senate Committee on Health, Education, Labor, and Pensions (HELP), Mugno said that if approved by the Senate, he would consider expanding the VPP while continuing to use other compliance tools, including enforcement. Mugno’s nomination was approved by all Republicans and voted against by all Democrats on the HELP committee; the full Senate has yet to vote on the nomination.

The other VPP development is a September 2017 audit report from the Department of Labor’s Office of Inspector General (OIG), which found deficiencies in how the VPP tracked fatalities affecting contract workers. A worker fatality at a VPP member’s site is, in effect, a sign that the employer may not be abiding by the requirements of the VPP and can be cause for termination of membership. All employers must report work-related fatalities and certain severe injuries to OSHA. But the OIG found that OSHA did not have assurance that VPP staff followed up on all VPP contract-worker fatalities and catastrophes because the program officials relied on participants, workers, and contract workers to disclose VPP affiliation when reporting these incidents to OSHA.

The OIG recommended that the assistant secretary establish a system for OSHA itself to collect and disseminate VPP contractor information and institute other procedures and controls to ensure that the information is complete and accurate. After receiving a draft of the audit report, OSHA’s deputy assistant secretary said the agency planned to enhance the data management system it uses to track and monitor information about VPP participants, including information about contractors. The OIG acknowledged the deputy assistant secretary’s commitment to improvement without stating that these commitments would adequately address all issues raised in the audit report.

The VPP

Established in 1982, the VPP introduced a framework for OSHA, industry management, and labor to build cooperative relationships at workplaces with comprehensive safety and health management systems. Acceptance into the VPP is OSHA’s official recognition of the outstanding efforts of employers and employees who have created exemplary worksite safety and health management systems

According to OSHA’s VPP Policies and Procedures Manual:
“VPP’s emphasis on trust and cooperation between OSHA, the employer, employees, and employees’ representatives complements the agency’s enforcement activity, but does not take its place. VPP staff and VPP participants work together to resolve any safety and health problems that may arise. This partnership enables the Agency to remove participants from programmed inspection lists, allowing OSHA to focus its inspection resources on establishments in greater need of agency oversight and intervention. However, OSHA continues to investigate valid employee safety and health complaints, fatalities, catastrophes, and other significant events at VPP participant sites. Compliance with the OSH Act [Occupational Safety and Health Act] and all applicable OSHA requirements is only the starting point for VPP participants. VPP participants develop and implement systems to effectively identify, evaluate, prevent, and control occupational hazards so that injuries and illnesses to employees are prevented.”

While in existence for over 35 years, the VPP currently has only about 1,400 members, with operations at about 2,000 sites. This compares with the 8 million worksites and approximately 130 million workers in the United States overall. At the current staffing levels of 2,100 OSHA compliance inspectors, the agency would need 150 years to inspect every site. Constraints such as this led to the formation of programs such as the VPP and EPA’s self-audit policy. The underlying principle is that good actors will voluntarily comply with standards and take quick actions to correct identified deficiencies without being forced to do so by the government.

VPP’s basic requirements are that members have effective, ongoing safety and health programs; ensure that corporate leadership is involved in the program; and provide OSHA with annual self-assessment reports. According to OSHA, the self-assessment report is a critical review of the effectiveness of all VPP elements and an analysis of participant and contractor injury and illness data and trends.

Few small businesses have the resources needed to participate in the VPP (e.g., a full-time safety and health officer). Acknowledging this challenge, OSHA developed its Safety & Health Achievement Recognition Program (SHARP), which recognizes small business employers that have used OSHA’s On-Site Consultation Program and operate an exemplary injury and illness prevention program. Under SHARP, employers with exemplary safety and health programs and performance may qualify for a 1-year exemption from routine OSHA inspections.

Proposed legislation

The Voluntary Protection Program Act would make certain provisions currently in the VPP mandatory for OSHA, including on-site evaluations by OSHA inspectors that “shall not result in enforcement citations”; periodic reevaluations by OSHA to ensure that participants meet the criteria for membership; specific policies to investigate fatalities and serious injuries at VPP sites; and establishment of a system for monitoring the performance of participants.

Under the bill, a site approved for the VPP would be exempt from inspections and investigations and certain paperwork requirements. These exemptions would not apply to inspections or investigations arising from employee complaints, fatalities, catastrophes, or significant toxic chemical releases.

OIG investigation

Between July 1, 2013, and September 30, 2016, OSHA received reports that 23 VPP participants experienced a worker or contract-worker fatality or catastrophe. The OIG conducted a performance audit of the VPP to determine if OSHA appropriately followed up on fatalities and catastrophes experienced by VPP participants. The OIG concluded that OSHA did not meet this responsibility because its inadequate information systems prevented it from obtaining assurance that it received reports of all VPP contract-worker fatalities and catastrophes.

While regulations require all employers to report work-related fatalities and certain severe injuries to OSHA, the OIG found that contractors that report may not reveal their affiliation with a VPP participant. In such cases, OSHA did not have adequate information systems to enable staff to identify VPP contract-worker fatalities and catastrophes.

According to the OIG, OSHA’s VPP staff lacked complete information on contractors used by VPP participants for the following three reasons:

1. Data not entered. Most VPP participants provided OSHA’s VPP officials with basic contractor information as part of their annual self-assessment reports, but OSHA did not enter this information into a monitoring system or otherwise share it with area office staff. Without this information, staff could not monitor lists of OSHA inspections and employer fatality and severe injury reports for potential VPP contract-worker fatalities and catastrophes

Lack of information sharing as well as communication issues reflected significant internal control weaknesses, leaving OSHA almost completely reliant on participants, workers, and contract workers to identify and report contractor fatalities and catastrophes as VPP-related incidents. As a result, OSHA did not have assurance that it received reports of all VPP contract-worker fatalities and catastrophes so that it could follow up with VPP participants.

As an example, the OIG reported that its interviews with VPP personnel in OSHA’s Region 3 (Philadelphia) office and review of a comprehensive self-audit performed by the Region 6 office found that the VPP data system maintained searchable information on every participant, including the street address, city, state, associated company, corporation, union, and contact persons. However, for VPP contractors, the data system did not even include the basic information (name and industry) OSHA collects from VPP participants via their annual self-assessment reports.

2. Data not reliable. For 11 of the 75 sampled participants in the Philadelphia office, OSHA collected incomplete or unreliable information on contractors from the participants’ annual self-assessment reports. VPP policy requires that participants submit information for each contractor whose employees worked for the participant 1,000 hours or more during any calendar quarter. The information provided by the sampled participants was neither complete nor reliable. OSHA was unaware of this because its policy for reviewing the annual self-assessments did not include steps to validate contractor information. As a result, OSHA lacked sufficient information to identify contract-worker fatalities or catastrophes that may have occurred at the sampled participants’ sites.

The OIG noted that eight participants did not submit complete contractor information, six did not provide the name of the contractor, and two did not provide the industry code. In addition, three participants’ annual self-assessment reports contained information on the number of contract workers that varied significantly from the number of contract workers observed by OSHA staff during certification site visits.

3. Data not required. The OIG found that approximately 12 percent of participants did not provide any contractor information because OSHA’s VPP policy did not require them to include it in their annual self-assessment reports.

Depending on the type of VPP participant, OSHA has two different requirements for submission of contractor information in the participants’ annual self-assessment. Site-based nonconstruction employers, which comprised approximately 88 percent of VPP participants nationwide, must submit limited information for contract workers (i.e., contractor name and industry code).

The remaining 12 percent of participants were in two other groups: site-based construction and mobile workforce. OSHA did not require participants in these groups to submit any contractor information. Site-based construction and mobile workforce participants included companies that support oil and gas operations, building construction, heavy and civil engineering construction, specialty trade contractors, remediation services, automotive repair and maintenance, and commercial machinery repair and maintenance.

Recommendations

The OIG recommended that OSHA establish a system to collect and disseminate VPP information on contractor fatalities and severe injuries to OSHA staff; establish controls to ensure that VPP participants submit complete and reliable contractor information in annual assessment reports; and collect contractor information from site-based construction and mobile workforce VPP participants.

The deputy assistant administrator basically agreed to undertake the recommendations, including enhancing the capability of the VPP Automated Data System (VADS) to track and monitor program information related to VPP participants. But the deputy assistant administrator added that creating and implementing a system that strives for real-time data regarding contractors at VPP sites would require time, resources, and technology at a cost that would exceed the benefits to overall work safety and health at VPP sites.

William C. Schillaci
BSchillaci@blr.com

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