Rely on Occupational Safety & Health ReporterSM for full news coverage and documentation of federal and state workplace safety and health programs, standards, legislation,...
May 6 — The U.S. Court of Appeals for the District of Columbia Circuit has granted the parties' request to proceed with the agricultural industry's challenge to the Department of Labor's 2015 memorandum on the process safety management (PSM) rule without holding oral arguments, according to a court order issued May 5.
Also on May 5, the Department of Labor alerted the D.C. Circuit that it is launching Small Business Regulatory Enforcement Fairness Act proceedings to update the process safety management standard and incorporate the new definition of who must comply with it.
Gary H. Baise, with the law firm of Olsson Frank Weeda Terman Matz PC in Washington, which is representing a major plaintiff, the Agricultural Retailers Association, told Bloomberg BNA May 6 that he hopes that by eliminating oral arguments, which had been set for May 16, the court would render its decision sooner.
“We think we've made a straightforward legal argument and we want a very quick decision. It's just that simple,” he said.
Sept. 30 is the date under which retailers who had formerly not been required to comply with the standard will have to do so.
“We have people spending money to comply with the rule,” Baise said. “Sept. 30 isn't that far away, so we do want the court to make a decision.”
The association, which represents numerous parties, argues that the document the Labor Department calls a memorandum is, in fact, a new standard, imposed on industry without the administrative review process to which new standards must be subjected. The document attempts to define which entities are covered by the standard.
The department, meanwhile, calls the memorandum “prototypically interpretive.”
“Agency interpretations do not lose their interpretive status simply because they have practical implications for the regulated community,” it said in its brief to the D.C. Circuit.
In its May 5 SBREFA notice, the department says that its potential changes to the standard, which it said could take five years, don't change its interpretation of its memorandum as an interpretive rule and doesn't affect the Sept. 30 compliance deadline.
It said, “by codifying its interpretation of ‘retail' in the standard, OSHA can ensure that it has the force and effect of law and cannot be challenged on reasonableness grounds in individual enforcement proceedings.”
The Occupational Safety and Health Administration promulgated the process safety management standard (29 C.F.R. 1910.119) in 1992, requiring employers that use a wide variety of chemicals to undertake a process safety analysis to determine safe ways to prevent or minimize harm from catastrophic releases of these chemicals.
The standard doesn't apply to “retail facilities,” but the term isn't defined in the standard. However, OSHA issued an interpretive letter, also in 1992, setting out a retail exemption in which it said that any business that sold more than 50 percent of its chemicals directly to users was a retail facility. The agency's 50 percent interpretation didn't address retailer size, but the preamble to the standard provided the example of a gas station for cars and trucks as the type of retailer excluded.
Then, in July 2015, prompted by the agricultural grade ammonium nitrate blast at a fertilizer distribution center in West, Texas, in 2013, OSHA released its Retail Memorandum. The OSHA memorandum attempted to clarify which businesses were covered by the standard and which weren't (45 OSHR 743, 7/23/15).
The memorandum said that only companies defined in the Retail Trade Sector of the North American Industry Classification System could benefit from the retail exemption. The definition says, in part, “The retailing process is the final step in the distribution of merchandise; retailers are, therefore, organized to sell merchandise in small quantities to the general public.”
The memorandum discarded the 50 percent retail test, meaning that retail facilities of all sizes, except those selling in “small quantities,” would be required to comply with the standard after Sept. 30.
The association argues that agricultural retailers that were explicitly unregulated by the retail exemption for 23 years “are now compelled to comply with the Process Safety Management Standard's complex safety rules and procedures.” The association said that the likely cost for formerly unregulated entities to comply with the memorandum is between $20,000 and $30,000 (46 OSHR 334, 4/7/16).
Baize said that between 25 and 30 percent of small retailers could go out of business because of the costs they would incur complying with the new interpretation.
The parties jointly requested that the appellate court decide the case without oral arguments March 11.
To contact the reporter on this story: David Schwartz in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Larry Pearl at email@example.com
The Department of Labor's letter to the D.C. Circuit announcing its SBREFA proceedings is available at http://www.bloomberglaw.com/public/document/Agricultural_Retailers_Assoc_et_al_v_LABR_et_al_Docket_No_1501326/5.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)