Court: OSHA can subpoena your insurance records
May 16, 2011 by Fred HosierPosted in: Fatality, In this week's e-newsletter, Injuries, Investigations, Latest News & Views, OSHA news, What do you think?, Who Got Fined and Why?, Workers' comp, inspections, new court decision
An attempt to prevent OSHA from obtaining records from a company’s workers’ comp insurance carrier has failed.
OSHA investigated Haasbach LLC in Mount Carroll, IL, after the deaths of two teenage workers in July 2010. A third worker, a 20-year-old man, was also seriously injured when all three became trapped in corn more than 30 feet deep in a grain elevator.
The workers were “walking down the corn” to make it flow while machinery used for evacuating the grain was running.
In the course of its investigation, OSHA subpoenaed Grinnell Mutual Reinsurance Co. to present documents concerning inspections it made at the Haasbach facility.
Grinnell argued that it would be irreparably harmed by turning over the requested documents to OSHA because they might find their way into the hands of plaintiffs filing lawsuits against the company.
The insurance company also predicted the subpoena would cause a “chilling effect” by discouraging businesses from allowing insurers to conduct safety inspections if the material could end up in OSHA’s hands.
Federal law says OSHA can “require the attendance and testimony of witnesses and the production of evidence under oath” when conducting inspections and investigations.
A federal court rejected Grinnell’s arguments. It said the insurance company’s claim that it would be irreparably harmed by releasing the information was “unconvincing.”
Regarding the chilling effect on businesses if their insurers would have to release inspection information to OSHA, the court said that problem is a policy decision to be made somewhere other than the federal courts.
The court ruled that OSHA could subpoena the inspection records. However, the insurance company could still claim that certain materials are subject to privilege under federal law. The insurer would have to submit a log of documents it wants to withhold to a federal magistrate who would review the privilege claims.
Despite the controversy over whether OSHA could subpoena the records, the agency fined Haasbach $555,000 for 24 citations.
What do you think of the court’s ruling? Let us know in the Comments Box below.
(Solis v. Grinnell Mutual Reinsurance Co., U.S. Dist. Crt. N.D. IL, No. 11 C 50014, 5/2/2011)
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Tags: deaths of two teenage workers, grain elevator, Haasbach LLC, OSHA subpoena, Workers' comp
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May 24th, 2011 at 8:19 am
I can see OSHA’s point on this. Insurance carriers typically conduct loss control inspections and the findings of those inspections could be a clue to why this tragedy occurred. On the other hand, if the insurance carrier discovered severe safety hazards, they should have the company correct the hazards as a condition of continued coverage. Maybe in this case the insurance company has something to hide. Nonetheless, I do believe that government already has its nose into business too much.
May 24th, 2011 at 10:12 am
Insurance companies routinely report a company’s insurance risk to a variety of reporting agency so that other businesses can assess whether or not they should do business with them. So, I do not see why it would be a problem for them to comply with OSHA in the case of employee deaths unless they felt complicent in some manner and like so many other companies that are suppose to regulate their industry’s behavior the have failed to do so by looking the other way. Large company, huge insurance premiums, don’t want to lose the account, so they give them lots of lattitude to basically mess up. Now they have to cover the company’s butt with their own. Typical. I believe the gov’t should do more to investigate company’s processes and procedures and should routinely review those who insurance them. I do not believe the families of the two workers who died and the one injured believe the gov’t has it’s nose into business too much. Given a choice, I’m sure they wish someone had taken a closer look at this company long before now. Once a person has died, you can’t fix this, no matter what happens after. So another ounce or two of prevention is worth several pounds of cure. I think more inspections and follow-up rather than less is in order and maybe these kids would still be here.
May 24th, 2011 at 2:08 pm
Notenoughregs
Thank you on your comments as it has been proven over and over again here and in the other safety monitoring publications that business will not look out for the employees unless it is made to. I also believe that life is to be protected and the environment cared for.
I realize that comment is broad and indeed there are some companies that make good faith attempts to protect the workers, environment and public by having effective safety programs. But the more you look into this stuff the more you become aware that safety is an expensive commodity. That resource will not be spent unless there is a penalty system in place to enforce the mandate of safety programs. Part of that is to have enforcement and the resources, resources in the manner of Safety Inspectors and severe penalties for Safety noncompliance. The only entity I can see that fits that bill is the Government.
Unfortunately the companies that try to comply with safety mandates seem to be a minority. I have had many disagreements with folk in this forum and others by saying the above.
May 25th, 2011 at 9:07 am
Akecfinn - I think there are many companies that make a sincere and honest effort to comply with safety regs because they realize that failure to do so is costly on so many levels. Those companies that choose to skirt the regs are, in my opinion, short-sighted. For example, they may reason that they can save a couple of thousand dollars if they don’t provide medical exams for their employees who wear respirators on the job. They fail to see the cost of (1) a fine if OSHA catches them or (2) the costs if one of those employees keels over because they were unfit to wear a respirator. Companies that possess good business and moral ethical standards will do the right thing and I happen to think there are more of them than the other. Nonetheless, no company is perfect and OSHA will always find some reason to fine even the most diligent of safety programs.