Health, Safety and Environmental Standards ("HSE")
(Second of a series on Compliance)
BY J. ALDEN LINCOLN
A growing number of rules and policies affecting Health, Safety and Environmental ("HSE") compliance are being issued by such diverse groups as the United States Sentencing Commission, the Occupational Standards and Health Administration, ("OSHA"), and the International Standards Organization ("ISO"), thus giving companies more reasons to consider adopting voluntary HSE programs.
Here are some of the more significant of these rules and policies:
- Federal Court Requirements. The Federal Sentencing Guidelines already encourage companies to adopt reporting and compliance programs (See my article in the previous issue.) Furthermore, a set of similar guidelines specifically targeted at environmental crimes may be enacted by the Sentencing Commission soon.
- Governmental Standards for Legal Action. The enforcement policies of the Department of Justice, EPA and state environmental protection agencies now provide a basis for dropping charges under environmental laws in the accused company voluntarily discloses the violation, cooperates with governmental investigations, implements preventive measures, and enforces an internal compliance program.
- Occupational Health and Safety Standards. The Occupational Safety and Health Administration's ("OSHA"'s) Voluntary Compliance Program allows companies to reduce the number of government inspections by adopting an OSHA voluntary compliance program.
- International Standards. The proposed ISO 14000 standards will, when adopted, provide incentives to companies to meet self auditing and environmental management standards that are similar to incentives under the ISO 9000 quality standards.
- Confidentiality of Audits. A growing number of states (Oregon, Indiana, Kentucky, Colorado) provide that corporations performing environmental audits may protect their audit and related documents from disclosure (the "Self Evaluative Privilege").
Moreover, criminal enforcement of HSE laws and increased policing by state and federal agencies evidence greater legal risks to companies that fail to adopt and maintain HSE compliance programs.
The following actions are recommended for a company to implement a cost effective HSE compliance program:
- Make managers responsible for continuous monitoring of HSE compliance. HINT: For every documented problem, also document all steps taken to correct the problem.
- Adopt an HSE compliance policy and communicate that policy to employees. HINT: Consolidate various HSE programs into one comprehensive program, thus maximizing communication.
- Establish procedures for internal audits, internal reporting of violations and documenting the resolution of problems. HINT: Conduct audit programs with counsel to take advantage of the attorney-client privilege; since the privilege is subject to exceptions, document all corrective and preventive measures taken.
- Train employees at all levels; maintain regulatory expertise; and evaluate employees' performance of HSE duties. HINT: Impress upon upper level management the importance of HSE compliance and their responsibility for the program.
- Offer incentives for compliance. HINT: Provide the largest incentives for total environmental quality, e.g., waste minimization, toxic use reduction, etc. and integrate these incentives with corporate goals such as increased productivity and efficiency.
- Establish disciplinary procedures. HINT: Ensure the discipline of employees who either fail to report violations, interfere with the reporting of violations, or fail to cooperate with auditing.
- Continuously evaluate and improve your company's HSE compliance program. HINT: Periodically, obtain an outside assessment of your compliance program.
Comment: Since in the long run, total environmental quality is the goal, don't just stop at compliance. Consider pollution prevention programs, risk reduction programs, and methods to bring your employees and the surrounding community into the process to decide upon and implement HSE Standards.
© ASSOCIATION OF INDEPENDENT GENERAL COUNSEL 1994; (all rights reserved). This article is not intended as legal advice. Consult a qualified attorney for assistance concerning a specific issue or problem.