Violations of the PSM Standard can be cited as “Continuing Violations” according to a Recent OSHA Case
Have you closed out all of the findings from previous Process Safety Management (PSM) Audits? Addressed all of the recommendations from your prior Process Hazard Analyses (PHA’s)? Have you ensured that any recently acquired assets are free from these types of gaps? If you have gaps related to these or other known PSM issues, then you should be aware of a recent case involving Delek Refining and their refinery in Tyler, Texas.
To give you some background, Delek purchased the La Gloria refinery in 2005 from Crown and inherited a number of open findings and recommendations from prior PHA’s dating back to 1994 and a PSM compliance audit that weren’t addressed by the previous owners.
In 2013, OSHA cited Delek for several violations of the PSM standard:
- Serious Citation 1, Item 4: 29 C.F.R. § 1910.119(e)(5) – Process Hazard Analyses of Highly Hazardous Chemicals
- Serious Citation 1, Item 8: 29 C.F.R. § 1910.119(j)(4)(i) – Inspection and Testing of Process Equipment
- Serious Citation 1, Item 12: 29 C.F.R. § 1910.119(o)(4) – Compliance Audits
OSHA alleged that Delek failed to address the open findings and recommendations from prior PHA’s dating back to 1994 and a PSM compliance audit performed when Crown owned the refinery and cited them accordingly. Delek appealed the issuance of these citations to the Occupational Safety and Health Review Commission (OSHRC) and while one of the PSM related citations was set aside, the three listed above were upheld as “continuing violations” of the PSM standard. In other words, OSHA can potentially treat hazards identified in PHA’s and audits as daily violations of the PSM standard and continuously extend the statute of limitations until the recommendations or findings are addressed by the employer.
Until this ruling by the OSHRC in 2015, employers have operated under the assumption that the plain language of Section 9(c) of the OSH Act “no citation may be issued under this section after the expiration of six months following the occurrence of any violation” means precisely that – a company can’t be cited for a violation of the OSH Act after the statute of limitations has elapsed. However, with the precedent set by this ruling, OSHA can search through the records of prior PHA’s and audits and potentially cite employers for any open findings or recommendations that have not been clearly closed and properly documented, especially if the issue that resulted in a finding or recommendation still exists. The other matter of concern with this precedent is the problem of inheriting open recommendations and findings from a prior facility owner. The OSHRC found that because Delek bought the refinery and hired a number of Crown’s employees they assumed “successor liability” for the PSM violations of Crown, despite the fact that Delek was not involved in the operation in any way during the period when the PHA’s and audit were originally performed.
In summary, there are several lessons to be learned from this case and points to keep in mind if you are responsible for PSM compliance.
- If a facility or asset is being acquired, perform a due diligence audit or review and identify all open recommendations and findings from prior PHA’s and audits.
- All facility PHA’s and PSM audit reports should be checked for open recommendations and findings. This isn’t just a great idea from a regulatory standpoint, it’s a great idea from a risk management standpoint that ensures there are no forgotten, but previously known hazards out there that haven’t been addressed.
- Close out all findings and recommendations from PHA’s and audits within a reasonable amount of time and clearly document how those were closed.
- Don’t assume that the statute of limitations for a violation of the OSH Act has elapsed.
To avoid this from happening to you and your company visit our page: Audits and Assessments.