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Federal regulators overstepped their authority when they cited an oil and gas company for not having an employee wear flame-retardant clothing, a new ruling holds.
The case—a victory for oil and gas employers—was the first to test a March 2010 Occupational Safety and Health Administration directive that required oil and gas drilling workers to wear Flame Resistant/Retardant Clothing (FRC).
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Lutz Co. |
| OSHA had said that oil and gas employers’ use of flame-retardant clothing was inconsistent. |
OSHA had issued the decision in the form of a memo that cited a general industry standard, saying the agency wanted to resolve the “inconsistent use” of FRC by oil and gas companies.
Administrative Law Judge Patrick B. Augustine ruled June 6, however, that the memo amounted to “improper rule-making.”
The Occupational Health and Safety Review Commission judge dismissed the serious citation and $5,390 fine against Petro Hunt LLC.
Oil Well Workers
The case involved an OSHA inspection of a Petro Hunt well site in northwestern North Dakota after a fire Oct. 14, 2010.
According to court documents, Petro Hunt supervisor Wade Signalness and trainee Jay Garmin visited the site that day as part of their daily duties.
Under supervision, Garmin gauged the level of well fluid in one of the tanks, and the two men left. Five minutes later, they noticed black smoke coming from the site and returned to find the treater shed and its components in flames.
The fire was extinguished, and no one was injured.
When OSHA inspected the next day, however, inspectors learned that Signalness had not been wearing FRC (although the trainee was) and that the employer did not require FRC. They issued the citation and fine.
Broad Standard
The citation invoked 29 C.F.R. § 1910.132(a), a broadly worded performance standard that requires the use of protective equipment, including protective clothing, under numerous hazardous conditions or circumstances.
Because the standard is so broad, OSHA must show that “either the employer had actual notice of a need for protective equipment or that a reasonable person familiar with the circumstances surrounding the hazardous condition would recognize that such a hazard exists.”
In a memo, OSHA argued that a hydrocarbon flash fire is a common danger in the oil and gas industry and that flame-resistant clothing was thus clearly warranted.
The agency also cited an earlier ruling that gives it latitude in interpreting standards, so long as the interpretation is “reasonable.”
Hazard Assessment
The company disagreed, arguing that it had conducted a thorough hazard assessment that resulted in a comprehensive series of administrative and engineering controls—more than 15 separate measures in all—that made FRC unnecessary.
The company also argued that the fire had not been a flash fire and that the company had had no flash fires at any of its 200 facilities.
Furthermore, the company argued, OSHA’s interpretation of the standard was so broad that it had the effect of mandating FRC for all oil and gas operations—essentially creating a new rule that had not undergone the rule-making process.
The judge agreed.
‘Improper Rulemaking’
The memo “takes a performance standard and imbues it with a specific obligation that FRC must be worn during the enumerated oil and gas operations, regardless of the particular circumstances that may be present at any individual facility,” the judge ruled.
In so doing, OSHA “has changed the requirement of the underlying standard,” thereby “engaging in improper rulemaking under the aegis of an enforcement standard.”
By using the terms “concludes” and “requires,” OSHA “has gone beyond mere interpretation and stepped into the realm of rulemaking by converting a performance-based standard into a specific standard,” the judge wrote.
OSHA “cannot ‘require’ anything more than what is authorized by the regulations. If [OSHA] wishes to specifically require that FRC be worn in all instances at oil and gas operations, then [it] must resort to the required notice and comment rulemaking process.”
As a result, “the FRC memo does not have the force and effect of law.”
Coating Case Cited
The ruling also noted similarities with a 2007 case against a Missouri coating contractor who had been cited by OSHA in 1997 for lack of hand-washing facilities and medical surveillance on a project in which two workers were removing lead paint from a bridge.
The contractor had three hand-washing trailers, but none was available at that time, so the company provided an Igloo cooler of water and pre-moistened towelettes, although apparently no soap. The company said it also conducted daily air monitoring for lead exposure.
In the end, the judge dismissed three of four citations against Thomas Industrial Coatings (and reduced the hand-washing violation), finding that the Lead in Construction standard then in force “gives an employer discretion, within reason, to determine how to properly address a hazard.”
Performance standards “require an employer to identify the hazards peculiar to its own workplace and determine the steps necessary to abate them,” the Thomas decision said.
OSHA has not indicated whether it plans to appeal the Petro Hunt FRC decision, or to pursue the requirement through the formal rulemaking process.
The FRC requirement has been challenged before. Earlier this year, OSHA defended the FRC memo against a challenge by Rep. Jeffrey M. Landry (R-LA), who had asked the agency to rescind it.
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