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December 2004

OSHA Cites Terminix Commercial For Exposing Employees to Hazardous Chemicals

The U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) has cited Terminix Commercial, Pennsauken, N.J. for failing to protect workers from hazards involving methyl bromide exposure. Terminix Commercial provides exterminating and pest control services, employing 26 workers in Southern New Jersey.

OSHA initiated its investigation on May 14, in response to an incident reported by the company in which four employees were admitted to the hospital exhibiting symptoms consistent with methyl bromide exposure. The day before, the workers had removed tarps from stacks of cocoa bean pallets that were fumigated with methyl bromide.

OSHA has issued citations to Terminix Commercial for two alleged willful violations of health standards, with a penalty of $99,000; four alleged serious violations, with a penalty of $16,650 and three alleged other-than-serious violations, with a penalty of $3,600.

The willful citations address the employer's failure to provide appropriate respiratory protection; failure to evaluate workplace hazards; and failure to provide training on the hazards associated with methyl bromide. The serious citations include employees' exposure to fall hazards; use of forklifts to lift employees; lack of forklift training and lack of eye and face protection. Other-than-serious citations were issued for recordkeeping and hazard communication deficiencies.

Source: Occupational Safety and Health Administration

State: California

Kern County Husband and Wife Team Sentenced To Prison for Workers Compensation Fraud Ordered to Pay more than $100,000 in Restitution and Fines

Investigators found that the husband held one job while illegally receiving disability payments from another. His wife helped hide the income through a payroll scheme.

An Inyokern couple who bilked the workers’ compensation system out of more than $76,000 in an elaborate disability scheme was sentenced to prison Tuesday on the charges and ordered to pay $102,706 in restitution and fines, according to authorities.

After an investigation by the California Department of Insurance and the Kern County District Attorney’s office, Robert Fred Herbert, 37, and Debra Lynn Herbert, 42, pled no contest to the charges on August 10. Robert Herbert was sentenced to four years in prison and ordered to pay $48,208.03 in restitution, plus $4,200 in fines. His wife was sentenced to 60 days county jail and ordered to pay $48,208.03 in restitution and $2,100 in fines. She was also placed on three years probation.

The Herberts began the scam in 2000 at Robert’s former employer, Desert Garage Door in Ridgecrest. On April 5 of that year, he claimed an injury and filed a workers’ compensation claim with Golden Eagle Insurance. Several weeks later, he returned to full work status. However, in September 2000, the owner of the firm learned that Herbert was receiving paid total temporary disability while still working and receiving his regular paycheck.

Herbert argued with the employer and subsequently left employment there. He hired an attorney to help him continue his workers’ compensation claim and was referred to a new doctor who placed him on total temporary disability once again.

Shortly after Herbert left his job at Desert Garage Door, Golden Eagle Insurance Company began receiving tips that he was working at Valley Fence Company in Ridgecrest, where his wife was the office manager and bookkeeper. She helped execute a scheme in which Herbert was paid through his wife’s paycheck in order to hide the income.

Source: State of California

Labor Department Orders American Standard - Trane Corporation To Rehire Whistleblower

The U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) has ordered the American Standard Companies and Trane Corporation, an American Standard subsidiary based in Piscataway, N.J., to pay more than $105,000 in back wages and reinstate a former controller who was fired for protected "whistleblowing" under the Sarbanes-Oxley Act of 2002.

David Windhauser, a controller for Trane Corporation, complained to OSHA's New York regional office that he was terminated after he raised questions about company accounting practices to his supervisors. According to Patricia K. Clark, OSHA's regional administrator in New York, an investigation by her office determined that Windhauser had been discharged in violation of Sarbanes-Oxley.

On Nov. 15, 2004, Clark transmitted to American Standard a notice of "Secretary's Findings and Preliminary Order" ordering the company to:

1. Remove any disciplinary letters from Windhauser's personnel file;
2. Reinstate Windhauser to his former position as controller for Trane Corporation in good standing; and
3. Reimburse Windhauser back pay and compensatory remedies in the amount of $105,489.55.

Under Sarbanes-Oxley (the Corporate and Criminal Fraud Accountability Act), an employee may file a complaint with OSHA if the employee has been retaliated against by his or her employer for reporting suspected corporate fraud or other activities related to fraud against shareholders. If OSHA determines after an investigation that an employee's complaint has merit, it can order remedies such as reinstatement and back pay.

Companies are covered under Sarbanes-Oxley if they have a class of securities registered under section 12 of the Securities Exchange Act of 1934 or if they are required to file reports under section 15(d) of the Securities Exchange Act.

Source: Occupational Safety and Health Administration

State: Illinois

Area of Interest: Chicago Tortilla Maker Penalized $163,350 for
Willful and Serious Workplace Safety and Health Violations

The U.S. Labor Department's Occupational Safety and Health Administration (OSHA) has cited Tortilleria Atofonilco, Inc., Chicago, following its investigation into a formal complaint about a worker who suffered an amputation injury on May 1, 2004.

OSHA issued citations for alleged willful and serious violations of workplace health and safety standards. A willful health citation was issued for exposing workers to noise levels in excess of federal standards and failure to provide hearing protection, training and baseline audiograms to test for possible hearing loss. Willful safety violations include the failure of Tortilleria Atotonilco to ensure that maintenance workers were protected against accidental energizing of machines, a problem that has resulted in amputations on several occasions at the plant.

Alleged serious safety violations included die cutter and dough machines that were unguarded to protect against amputations, failing to use flexible cords without splice or tap and using compressed air for cleaning at more than 30 pounds per square inch of pressure.

Source: Occupational Safety and Health Administration

Area of Interest: OSHA Announces New Partnership to Safeguard Workers on Rochester's Troup Howell Bridge Replacement Project

Workers involved in the Troup Howell Bridge Replacement project will be safer thanks to a new partnership formed between the U.S. Labor Department's Occupational Safety and Health Administration (OSHA), the project's general contractor Edward Kraemer & Sons, Inc., the Rochester Building and Construction Trades Council AFL-CIO, the New York State Department of Labor and the Construction Industry Association of Rochester, N.Y., Inc.

OSHA's Strategic Partnerships for Worker Safety and Health are part of U.S. Labor Secretary Elaine L. Chao's ongoing efforts to improve the health and safety of workers through cooperative relationships with groups including trade associations, labor organizations, and employers. Major partnership goals for the Troup Howell Bridge Replacement include zero fatal accidents and an annual reduction in injuries of at least four percent.

The project is a multi-year venture to replace the bridge that daily carries more than 100,000 vehicles on I-490 over the Genesee River, South Avenue and Exchange Boulevard. It will utilize approximately 12 subcontractors, employing upwards of 150 construction trades workers over the life of the project. Operations that will take place during bridge replacement include demolition, excavation, concrete formwork, structural steel work, heavy rigging, and painting.

Under the partnership, Kraemer and all participating subcontractors must meet stringent safety guidelines that address such safety issues as fall protection, electrical safety, crane operations, and use of personal protective equipment. They also will develop and use site-specific safety programs. The partnership will remain in effect for the life of the project.

Source: Occupational Safety and Health Administration

State: California

Area of Interest Insurance Commissioner John Garamendi Calls for 2.2% Reduction in Worker’s Compensation Pure Premium Rates

This represents the Commissioner’s third recommended reduction in a row and results in a 22.6% cumulative decrease in the pure premium rate since July 2003.

On July 1, 2003, I issued my first pure premium rate recommendation during this term in office. It was an increase of 7.2%. At that time medical costs within the system were out of control, employers faced double digit premium increases, and injured workers were struggling to get the care to which they were entitled. In short, the system was broken.

My immediate priority was to help repair this broken system and bring relief to injured workers and employers. I enlisted the aid of the legislature, and together we succeeded in crafting and passing significant reform that has stopped the incredible pace of medical cost inflation. The impact of those reforms has allowed me to recommend successive pure premium rate decreases amounting to more than 20 percent.

Today, I announce my latest Decision. In accordance with the law and on the advice of my staff, including two Department actuaries, I have reduced the Workers’ Compensation Insurance Rating Bureau’s proposed advisory pure premium rate from an increase of 3.5 percent to a decrease of 2.2 percent for policies incepting on or after January 1, 2005. This is the third decrease in a row that I have recommended, totaling 22.6 percent in reductions since July 2003. But our job is not yet done.

There is a growing concern that insurers have not passed along all of the potential savings to employers in the form of reduced premiums. The evidence shows that although I have recommended upwards of 22 percent in reductions since July 1, 2003, insurers filing rates with the Department have generally reduced their rates by a little over 10 percent.

Source: State of California

State: Florida

Area of Interest: Employer of Workers Killed at July Construction-Site Accident Charged with Fraud

The employer of two workers killed in a July construction accident on a Hobe Sound work site has been arrested and charged with workers’ compensation fraud, Florida’s Chief Financial Officer Tom Gallagher announced today.

According to investigators with the Department of Financial Services’ Division of Insurance Fraud, Richard Meccariello, Jr., 39, of 3934 Sherwood Blvd. in Delray Beach was accused of failing to provide workers’ compensation coverage, a third-degree felony.

The department’s Division of Workers’ Compensation previously ordered two companies owned by Meccariello, Mac’s Construction and Concrete, Inc., 848 Glouchester St. in Boca Raton, and Mac’s Custom Construction, Inc., to stop work and cease all business operations in Florida due to workers’ compensation violations. The companies were also fined a total of $2.4 million. Under Florida law, construction industry employers with one or more employees must provide workers’ compensation coverage for their employees. At the time of the accident in July, Meccariello employed at least seven workers without coverage.

Meccariello was booked into the Palm Beach County Jail with bond set at $25,000. If convicted, Meccariello faces up to five years in prison.

Source: State of Florida

Area of Interest: OSHA to Issue Final Rule on Federal Agency Recordkeeping and Reporting Requirements

The Occupational Safety and Health Administration will publish a final rule in Friday's Federal Register that will require federal government agencies to adopt worker safety and health recordkeeping and reporting requirements that are essentially identical to the private sector. The new requirements will go into effect beginning Jan. 1, 2005.

While the regulation will become effective Jan. 1, notices of violations will not be issued during the first year as long as agencies are making a reasonable effort to comply with the requirements. OSHA will launch a comprehensive outreach and compliance assistance effort early in the implementation period to educate and train federal agencies on the new recording requirements.

The new requirements will enhance the capacity of agency safety and health managers to focus the attention of their illness and injury prevention programs on the most significant hazards; identify types or patterns of injuries and illnesses whose investigation will lead to prevention efforts such as improved work practices or technology development; and provide useful priority-setting information for establishment inspections within an agency.

The new recordkeeping requirements will produce an information base that can assist federal agencies and their employees to maintain safe and healthy working conditions. The importance of accurate recordkeeping to lower injury and illness rates is indicated by experience with OSHA's Voluntary Protection Program (VPP), a program that recognizes federal agencies and private sector employers with exemplary safety and health programs. VPP worksites, which have comprehensive safety and health management programs that include effective injury, illness, and accident recordkeeping, generally have lost workday case rates ranging from one fifth to one-third the rates experienced by most worksites in the same industry.

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