NFIB Sues California’s Division of Occupational Safety and Health

Date: December 18, 2020

On December 16, 2020, NFIB joined the National Retail Federation and three independent California businesses in suing the California Division of Occupational Safety and Health (better known as Cal/OSHA) over recently enacted COVID-19 workplace rules. These new rules require small businesses in California to “exclude employees with COVID-19 exposure from the workplace for 14 days” and “continue and maintain an employee’s earnings . . . and all other employee rights and benefits” while excluded from the workplace. Beyond these exclusion and paid leave requirements, the new regulations require employers to “[o]ffer COVID-19 testing at no cost to employees . . . who had potential COVID-19 exposure in the workplace.”

NFIB and its co-plaintiffs assert that the 14-day exclusion far exceeds the recommended CDC guidelines of ending quarantine due to exposure 7 days after testing negative. Under the new OSHA rules, an employee would be excluded from the workplace for two full weeks even if they test negative for COVID-19. This exclusion period would render many small businesses with few employees unable to operate simply based on one COVID case, regardless of how the employee contracted the virus or other employees were exposed. The testing and paid leave requirements impose a significant financial burden on the small business community.

Karen Harned, executive director of the NFIB Small Business Legal Center, had the following comment on the lawsuit: “Since March, California employers have worked hard to ensure their workplaces are safe. Despite this fact, Cal/OSHA failed to follow the proper legal procedures that would benefit from the real-world experiences of business owners across the state, and, instead, rushed forward with this rule that imposes another significant financial burden on small businesses at a time when they can least afford it.”

The suit alleges the following:

  1. Cal/OSHA violated the Administrative Procedure Act by enacting the regulations without notice and comment review.
  2. Cal/OSHA violated the Occupational Safety and Health Act and overstepped its jurisdiction by enacting regulations covering paid leave, medical care, disability payments, wages, and hours, each of which are the exclusive jurisdiction of a different California agency.
  3. Cal/OSHA violated the Due Process Clause of the Fourteenth Amendment by imposing such onerous restrictions that deprive Plaintiffs and other businesses of their property rights without adequate process or just compensation.
  4. Cal/OSHA violated the California Constitution by denying Plaintiffs and other businesses of their financial property without due process or just compensation.

The complaint filed in the case can be found here.

The NFIB Small Business Legal Center has prepared a summary of the new regulations, including provisions not challenged in the lawsuit. The rules took effect on November 30, 2020.

Members with additional questions about the new Cal/OSHA rules can contact the NFIB Small Business Legal Center at 800-NFIB-NOW.

Updated December 17, 2020

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