Georgia State University
Law Review

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Volume 18

Number 4

Summer 2002

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Working at Home at Your Own Risk: Employer Liability for Teleworkers Under the Occupational Safety and Health Act of 1970

Kelli Dutrow

“O, how full of briers is this working-day world!”

William Shakespeare, As You Like It, act 1, sc. 3

Introduction

    Teleworking is a recent phenomenon that portends fundamental change in the landscape of American business.[1] Teleworkers function within an entirely new occupational paradigm; instead of going to work, the work comes to them.[2] The number of teleworking Americans increased by seventeen percent in 2001.[3] Currently, one in five American employees regularly teleworks.[4] An entirely new vocabulary has simultaneously developed alongside this alternative approach to work. Telework, telecommute, and telecenter—all are examples of the new terms that have now become part of the American workplace vernacular.[5] The telework alternative is being hailed by many as a veritable panacea to a host of modern workplace problems.[6] The most cited advantages are that teleworking will solve environmental problems,[7] provide an effective compromise for working parents (particularly mothers),[8] increase employee productivity and retention,[9] and provide new opportunities for disabled Americans to enter the workforce.[10] Following the tragic events of September 11, 2001 (“9-11”), teleworking became a necessity for many workers displaced by terrorism.[11] Not surprisingly, interest in teleworking has increased exponentially following 9-11 as traumatized workers retreat to the safe haven of home.[12]

    At first blush, teleworking appears to be a winning combination for employees, employers and society as a whole—promising comfort for workers in times of crisis, a cleaner environment, reduced business costs, decreased absenteeism, improved productivity, retention, and job satisfaction.[13] Recently however, that rosy picture began to fade when the Occupational Safety and Health Administration (OSHA) suggested that employers could be liable for unsafe conditions within the home worksite.[14]

    OSHA rendered that suggestion through an advisory letter sent via the Internet to a Texas corporation seeking guidance regarding its work-at-home programs.[15] The suggestion triggered a storm of controversy culminating in OSHA’s decision to rescind the letter.[16] The debate continues, however, apparently fueled by a growing frustration with OSHA’s rulemaking procedures which was gathering force long before the November 1999 letter surfaced.[17]

    The focus of this Note is to explore whether employers are, or should be, liable to teleworkers under the Occupational Safety and Health Act of 1970[18] (OSH Act). Part I reviews the history and purpose of the OSH Act to ascertain how it is to be interpreted and who gets to decide whether its drafters intended for the Act’s protections to extend into the home environment. Part II outlines the social impact of teleworking. Part III addresses the various arguments as to whether the OSH Act should be interpreted as applicable to home offices. Additionally, Part III reviews several recent developments, including Congress’ first exercise of its power under the Congressional Review Act[19] to overturn OSHA’s sweeping ergonomics regulations, which suggest OSHA will not soon succeed in any effort to extend the OSH Act to home offices. Part IV explores OSHA’s rulemaking efforts and the growing sentiment that, through advisory letters like the one at issue, OSHA improperly and perhaps unconstitutionally engages in “rulemaking through the back door.”[20] Finally, Part V suggests a workable solution to the problem of OSHA in the home based upon a theory of bargaining, which, as illustrated by several model teleworking programs, may offer the type of quid pro quo arrangement necessary to satisfy advocates on both sides of the debate.

I. History and Purpose of the OSH Act

    The Occupational Safety and Health Act of 1970 (OSH Act)[21] is “the primary federal law regulating workplace safety and health.”[22] The Occupational Safety and Health Administration (OSHA) administers the OSH Act, which mandates that an employer must “keep its place of employment free from recognized hazards that are causing or likely to cause death or serious physical harm to its employees.”[23] To establish a violation of the OSH Act, OSHA must demonstrate: 1) the existence of a hazardous condition at the workplace, 2) the employer either knew or should have known about it, and 3) the employer failed to correct the hazardous condition according to the appropriate OSHA standards.[24] To facilitate these regulations, OSHA compliance officers are “empowered . . . to inspect any workplace covered by the Act.”[25]

    Throughout its thirty-year history, the OSH Act has been both praised and criticized.[26] At the eye of the storm of criticism swirling around the teleworking debate is the assertion that extending the OSH Act to home offices vitiates its original purpose, thereby tarnishing OSHA’s credibility and weakening the overall integrity of the OSH Act.[27]

A. Purpose of the OSH Act

    The OSH Act was designed to reduce work-related injuries by establishing and responding to national safety and health standards.[28] A review of the OSH Act’s legislative history reflects that the statute was primarily designed to prevent industrial accidents.[29] The types of hazards originally at issue were those which arose during the industrial revolution,[30] and continued to plague “workers in the dusty trades.”[31] Manufacturing and construction workers were specifically listed for consideration.[32] “Industrial plants” are mentioned throughout the language of the OSH Act.[33] Proponents of the Act relied upon compelling statistics which, at the time, illustrated a national industrial crisis in need of immediate resolution.[34] Agency authority under the OSH Act has been broadly interpreted as “coterminous with congressional power to regulate commerce.”[35] Congress deemed the Commerce Clause[36] was implicated in this context because of the impact work related injuries have on interstate commerce via lost wages, reduced productivity, and medical and disability expenses.[37] Whether a nexus exists between occupational safety, health, and commerce is beyond the scope of this Note. However, the fact that the OSH Act was founded on such an expansive premise, and functioned accordingly for almost thirty years, may help explain the reform movement which began in the mid-1990s.[38]

B. 1995 Amendments: The “New OSHA”

    OSHA received a great deal of criticism during the 104th Congress.[39] Legislators proposed extensive changes to the OSH Act that were designed to limit its regulatory power and reduce its impact on the private sector.[40] In May 1995, President Clinton announced “the new OSHA”[41] along with a general Regulatory Reinvention Initiative[42] which included a fresh perspective on the OSH Act, and was designed to meet four primary goals: to “cut obsolete regulations,” within government agencies; to “reward results, not red tape”; to “create grassroots partnerships” between regulating agencies and the people being regulated; and to “negotiate” rather than “dictate.”[43] The President also directed government agencies to increase communication with the private sector, with an ultimate goal of changing their traditional adversarial relationship to one based upon compromise and negotiated rulemaking.[44]

    In particular, President Clinton directed agencies to consider how to achieve their goals less intrusively and to consider when “private sector alternatives . . . [might] better achieve the public good envisioned by the regulation.”[45] The President’s suggestions were well-received[46] and OSHA did make some attempts at reform.[47] However, not long after this directive to reduce bureaucracy and enhance negotiation with the private sector, OSHA took a decidedly controversial turn.[48]

C. From Common Sense to Chaos: Taking the Lid Off Pandora’s            Box[49]

    In an advisory letter to a Texas credit services company on November 15, 1999, OSHA declared that employers are responsible for the health and safety of home workers.[50] Considering the potential liability for an estimated twenty million Americans who were working out of their homes at that time,[51] the business community responded with an overwhelming attack on the OSHA position.[52] Shortly after OSHA published the letter on its Web site, then Labor Secretary Alexis Herman rescinded the letter, but maintained his position that “employers still must work to ensure ‘safe and healthful’ work conditions for [home-based] employees.”[53]

    In an attempt to quell the raging debate, OSHA Administrator Charles Jeffress announced that OSHA will not inspect home offices, nor are employers expected to do so, out of respect for the privacy of the home.[54] However, Jeffress also stated that the agency “will . . . follow-up on complaints involving potentially hazardous factory work being performed in the home.”[55] On the same day, OSHA issued a directive instructing compliance personnel on the scope of OSHA involvement in home-based worksites, and reiterating Jeffress’ position statement, but leaving many questions unanswered.[56] In particular, issues that went unaddressed included how to distinguish between a home office and work performed in the home; which whistle-blowers deserve a response by OSHA; and whether this compromise position would alleviate concerns prompted by the threat of liability.[57]

II. Social Impact of Teleworking

    Improving air quality and reducing traffic congestion are two of the most frequently cited reasons to telecommute.[58] The National Environmental Policy Institute (NEPI) estimates that allowing just ten percent of the nation’s workforce to telecommute a mere one day a week would eliminate 12,963 tons of air pollution and save more than 1.2 million gallons of fuel each week.[59] Other employer incentives include reducing overhead costs and retaining employees in a tight labor market.[60] There is also growing governmental support to increase the number of teleworkers;[61] simultaneously, the commercial popularity of teleworking is on the rise.[62] Environmental and other quality of life issues are of particular concern in the metropolitan Atlanta area,[63] where an estimated fifty-two percent of telecommuters live in the suburbs but travel into the city to go to work.[64] A survey in the Atlanta area showed that sixty-one percent of respondents believe their commute is going to get worse over the next four years, traffic is considered to be the “most urgently need[ed] improvement for metro Atlanta to have healthy, prosperous, growth,”[65] and seventy-five percent of respondents would be interested in working at home.[66]

    Statistics also reveal strategic business reasons for leaders to consider providing teleworking programs. In particular, offering telecommuting programs reduces the amount of expensive commercial real estate needed to support an employer’s workforce.[67] Additionally, lowered absenteeism and continued productivity during inclement weather reduce business costs.[68] Some business leaders, however, have been reluctant to embrace the growing trend of teleworking[69] for fear they will lose control of remote workers or that the costs of telecommuting would be prohibitive.[70]

    Not surprisingly, the idea of being liable for violating OSHA regulations in the home-office heightens employer concerns. In a poll of human resource professionals conducted shortly after OSHA announced the potential for liability, thirty-seven percent of respondents rejected the idea.[71] According to one executive, “[i]f an employee wants . . . to work at home, the employer should be absolved of any workplace liability if that workplace now becomes the employee’s home.”[72]

III. Should the OSH Act Apply to Home Offices?

    Opponents of employer liability for home workers suggest employers will be overburdened with questions such as whether floors are cluttered with children’s toys, whether a home is free of lead paint, and whether two-story homes have separate and approved fire escapes.[73] Senator “Kit” Bond, a Missouri Republican, called the OSHA proposal ridiculous, giving as an example the potential that “mothers working at home, who need to step over a child safety gate, will now be considered in a hazardous work environment.”[74] Another concern is the potential for privacy invasions associated with government-sponsored OSHA inspections of private residences.[75]

A. Privacy Concerns: At What Cost Safety?

    Whether OSHA has become “compulsively intrusive,”[76] or with the February 25th directive, has properly delineated the parameters of its authority over the home work environment, remains to be seen. In that directive, OSHA indicated that, “home offices,”[77] will not be inspected, but inspections of “other home-based worksites” will be made if the agency receives notification of a potential violation.[78] OSHA defines “home office” as “[o]ffice work activities in a home-based worksite . . . [which]. . . may include the use of office equipment.”[79]

    Although OSHA mentions home manufacturing as the type of in-home activity that is subject to agency inspection, OSHA broadly defines home-based worksites as “[t]he areas of an employee’s personal residence where the employee performs work of the employer.”[80] Such an expansive definition seems to leave the door open to inspections of a much wider range of in-home activities.[81] Further, OSHA has not indicated who has authority to make a complaint or whether some complaints will be taken more seriously than others.[82] Although OSHA has asserted that the scope of any inspections would be “limited to the employee’s work activities . . . [and would] not apply to an employee’s house or furnishings,”[83] the distinctions between those areas and activities subject to OSHA inspection and those not subject to inspection are not readily apparent and may be difficult to ascertain in the field.[84] By blurring these lines, OSHA may have failed in its attempt to quell the fears of those who believe that implementing these standards would violate private citizens’ Fourth Amendment rights.[85]

 

B. Administrative Searches Under the Fourth Amendment

    Administrative inspections or “searches”[86] have often implicated Fourth Amendment concerns.[87] The Fourth Amendment to the United States Constitution[88] prohibits unreasonable searches and seizures.[89] Courts have interpreted the Fourth Amendment’s main purpose as “safeguard[ing] the privacy and security of individuals against arbitrary invasions by governmental officials.”[90] It is generally recognized that a warrant and probable cause are prerequisites to finding a search reasonable.[91]

    A warrantless search is considered per se unreasonable unless it falls within one of “a few . . . well-delineated exceptions.”[92] Whether or not a warrant issues depends upon the degree to which an individual had a reasonable expectation of privacy in the area searched.[93] It is well settled that an individual has a high expectation of privacy in his own home.[94] Some have suggested that an exception to the warrant requirement exists for administrative inspections.[95] However, the issue of OSHA inspections in private residences is relatively uncharted legal territory, as is the question of whether a warrant would be required to search a home worksite. “[A]s society increasingly values the right of individuals to be free from intrusive searches of their person and property,”[96] an in-home OSHA inspection may be deemed unconstitutional.[97] Reviewing how other in-home administrative inspections have fared when challenged as unconstitutional may provide insight into how the courts might respond to the privacy issues implicated in such inspections.

    In Camara v. Municipal Court of the City and County of San Francisco,[98] the Supreme Court held that administrative searches are not immune to the Fourth Amendment warrant requirement.[99] There, the Court reversed Frank v. Maryland,[100] a prior case which seemed to carve out a warrant exception for administrative searches.[101] In Frank, the appellant was convicted under Baltimore law for resisting a city health inspector’s warrantless inspection of his home.[102] The appellant challenged the conviction as a violation of the Fourteenth Amendment, arguing that a warrant was required to protect his constitutional rights.[103]

    The Court held that the warrantless search was not unconstitutional, because

[t]he attempted inspection of appellant’s home is merely to determine whether conditions exist which the Baltimore Health Code proscribes. . . . No evidence for criminal prosecution is sought to be seized . . . [therefore], [a]ppellant . . . cannot properly resist . . . [an] act . . . consistent  with  the maintenance  of minimum  community standards  of  health  and  well-being,  including his own.[104]

The Camara Court rejected the assertion in Frank that the constitutional privacy interests “at stake in . . . inspection cases are merely ‘peripheral’. . . [because] the individual and his private property are fully protected by the Fourth Amendment only when the individual is suspected of criminal behavior.”[105] In Camara, the appellant was charged with violating the San Francisco Housing Code by refusing to allow a warrantless inspection of his leased apartment.[106] The Court held that this type of administrative search falls within the purview of the Fourth Amendment, and thus is unconstitutional if conducted without a warrant.[107] However, the Court suggested that the threshold for cause might be lower in these cases[108] and proposed a balancing test to determine whether there is probable cause sufficient to justify issuing a warrant in such cases.[109]

    In outlining this balancing test, the Court reasoned that “the need for the inspection must be weighed in terms of these reasonable goals of code enforcement.”[110] Some have suggested that this test is “‘ill-defined’. . . [and] pushe[s] traditional probable cause off center stage and . . . [into] an uncertain supporting role.”[111] Others believe that the test “created injustice and unconstitutional results”[112] by placing too much discretion in government hands, and tipping the scales in favor of administrative agencies.[113] Despite that criticism, Camara continues to represent the prevailing view on administrative inspections.[114]

    The situation in Camara is not altogether different from the type of scenario that may arise should OSHA pursue home worksite inspections. In fact, it was increased government regulation and inspections that led the Court in Camara to reexamine its holding in Frank.[115] If city health inspectors can be likened to OSHA compliance officers, the Camara rationale suggests that an OSHA inspection of a home-office made contrary to a homeowner’s consent—but based on a sufficient public interest—would be constitutionally valid.[116] Consequently, whether the OSH Act should apply to home worksites may depend upon whether the public interest in limiting certain safety and health risks outweighs an individual’s expectation of privacy in his own home.

C. Prevalence of Teleworker Injuries

    Unlike the compelling need apparent in the “dusty trades” where the OSH Act was born,[117] “there are [currently] no known claims of fatalities or serious injuries occurring at telecommuters’ homes arising from the activities of their employment.”[118] Further, “the types of jobs most telecommuters perform in their homes do not lend themselves to substantial risks for fatalities or serious injuries.”[119] Without evidence of a quantifiable health and safety risk it is unclear why the public is (or should be) interested in agency regulation of the home worksite.

    Many teleworkers use computers, telephones, fax machines and other typical office equipment when working at home. Theoretically then, in the absence of specific telecommuter injury data, the prevalence of injuries associated with working with office equipment might shed some light on whether reducing those risks should be part of our social agenda. OSHA and others suggest that a plethora of repetitive motion-related musculoskeletal disorders is associated with these tasks; yet the methods used to establish evidence of such injuries has been criticized as unreliable and inconclusive junk science.[120] In fact, Congress was recently compelled to exercise its authority under the Congressional Review Act of 1996[121] (CRA) in overturning OSHA’s epic ergonomics standard[122] due to a lack of proof that any real safety problem existed.[123] On March 22, 2001, President Bush signed a congressional resolution disapproving the rule, calling it “unduly burdensome” due to a combination of excessive employer costs and “uncertain” public benefits.[124] Randel Johnson, Vice President for Labor Policy at the United States Chamber of Commerce, seconded the sentiment calling the ergonomics rule “overbroad and unreasonable” and saying the rule “exemplif[ied] irresponsible government at [its] worst.”[125] Eugene Scalia, a known critic of OSHA’s policies and President Bush’s nominee for Labor Solicitor, said of the rule: “[N]o agency should be permitted to impose on the entire American economy a costly rule premised on a ‘science’ so mysterious that the agency itself cannot fathom it.”[126] The President’s signature, executing Congress’ decision to overturn the rule, actually “marks the first time a federal agency rule has been overturned under the [CRA], which provides a mechanism for Congress to consider and then vote up or down on controversial federal rules.”[127]

D. Congressional Response to “The Letter”

    With similar passion, Congress quickly responded to the question of whether employers should be liable for the health and safety of their home workers. The existence of compelling interests on both sides of the debate was evident in the legislation proposed during the 106th Congress.

    The Home Workplace Preservation Act of 2000[128] would amend the OSH Act, expressly relieving employers of liability for “federal health and safety violations that occur in their employee’s home offices.”[129] According to Representative E. Clay Shaw, Jr., who introduced the bill on January 24, 2000, “[t]elework is a necessary component of the structure of modern work patterns essential for helping employees better balance work and home life. . . . [It is] a means to improve public health, productivity, economic growth and quality of life and is a solution to air quality and decreasing traffic congestion.”[130] Representative Shaw also stated that “[t]elework . . . has special benefits for the poor, who spend a disproportionate percentage of their income on transportation.”[131] His primary concern is that employers will terminate their telecommuting programs if they are required to comply with traditional OSHA regulations.[132]

    The Home Office Protection Enhancement Act (HOPE)[133] introduced by Representative John D. Hayworth on January 27, 2000, would also amend the OSH Act to render it inapplicable “to employment performed in a workplace located in the employee’s residence.”[134] Speaking in support of the bill, Congressman Ron Paul stated that extending OSHA regulations into the home would cause employers to eliminate the option of teleworking, thus having a negative impact on the environment as well as people in need of alternative worksites.[135]

    Representative Gregory Walden introduced the American Telecommuter Protection Act[136] on February 10, 2000, to amend the OSH Act to expressly provide that it does not apply to the home worksite.[137] Findings in this bill included:

(1) [Telecommuting] is the best option for many as they raise families or deal with illness to perform their work at home.

(2) OSHA and other Government entities should not interfere with the home lives of law-abiding Americans.

(3) The Federal Government should not put employers in a situation where they are required to interfere with the home life of an employee.

(4) The home work environment is sufficiently different from the work environment envisioned in the Occupational Safety and Health Act of 1970.[138]

    Representative Thomas J. Campbell introduced House Bill 3588 on February 8, 2000.[139] Like the proposed HOPE Act,[140] and the Home Workplace Preservation Act,[141] this proposed legislation would amend the OSH Act to expressly state that the Act does not apply to employment performed in the home.[142] However, this bill also added the caveat that OSHA regulations would apply in the home if such “employment involves hazardous materials or the workplace was created so that that Act would not apply to the workplace.”[143]

    Michigan Representative Peter Hoekstra continued the flurry of legislation by introducing the Home Office Worker Protection Act of 2000 in the House on March 23, 2000.[144] In it, he suggested that OSHA regulations should apply to “home office employment” in certain situations.[145] First, Representative Hoekstra recommended that employers be required to “report work-related injuries and illnesses sustained by an employee engaged in home office employment,”[146] subject to sanctions for failing to do so.[147] Second, home office inspections would be prohibited.[148] Finally, Representative Hoekstra encouraged “maxim[um] public participation”[149] in the form of enhanced notice of rule-making and increased opportunities for public comment on the regulations.[150]

    Senator Rick Santorum introduced the Telework Tax Incentive Act[151] on April 13, 2000 in an effort to offset the potential business costs associated with teleworking.[152] Senator Santorum’s plan was to create an income tax credit for teleworking expenses.[153] The maximum annual credit given to an employee or employer engaged in a “teleworking arrangement” would be $500.[154] In support of this legislation, Senator Santorum offered compelling statistics highlighting both the prevalence of teleworking, and potential cost savings associated with the practice.[155]

    The Rural Telework Act of 2000[156] would amend the Consolidated Farm and Rural Development Act to “authorize the Secretary of Agriculture to make competitive grants to establish National Centers for Distance Working to provide assistance to individuals in rural communities to support the use of teleworking in information technology fields.”[157] According to Senator Paul Wellstone, who introduced the bill on April 13, 2000, “teleworking allows rural employees to perform skill intensive information technology jobs from their communities for firms located outside rural communities.”[158] His goals in proposing the bill included reducing unemployment rates and increasing higher quality, modern work opportunities for rural workers, including those individuals located on Indian reservations.[159]

E. 2001: Three Strikes—OSHA’s Out?          

    While such immediate congressional and public opposition to the idea of OSHA in the home may have alone been sufficient to sound the idea’s death knell, three particular events in 2001 seem certain to do so.

1. The New Freedom Initiative

    In February 2001, President Bush announced his New Freedom Initiative (“the Initiative”).[160] The Initiative represents a series of proposals to Congress designed to, inter alia, facilitate disabled Americans entering the the workforce.[161] In the Initiative, President Bush specifically referred to OSHA’s November 1999 advisory letter and proposed amending the OSH Act to prohibit its application in worksites where employees use telephones, computers or other electronic devices to work from home.[162] The President asserted that applying the OSH Act to home offices would “have had a chilling effect on teleworking, as employers would seek to avoid potential liabilities.”[163] President Bush felt the need to take such action despite OSHA’s subsequent withdrawal of the advisory letter because “OSHA . . . has not yet foreclosed future action.”[164] Due to the events of 9-11, whether Congress will adopt the Initiative will likely remain unclear for some time as many labor and employment related issues will rightly take a back seat to international affairs.[165] However, the events of  9-11 have already begun to indirectly impact the issue as the business world seems to be seeking safe haven from future terrorist actions in the form of teleworking.[166]

2. 9-11

    The tragedy of 9-11 has further fueled support for telecommuting.[167] Workers are now more afraid to enter skyscrapers, travel, and be present in large crowds.[168] Business leaders have also been brutally reminded of the need to “‘decentralize intellectual property.’”[169] Psychologically, workers are placing a higher value on being close to friends and family.[170] As a result, employees and employers are turning to telecommuting for both emotional comfort and business preservation.[171] One commentator has even expressed America’s need for telecommuting by drawing an eerie comparison with terrorist “worksites,” stating:

I do not understand why business cannot be done successfully from a virtual workplace in virtual New York with full videoconferencing facilities, when Osama bin Laden and Al Qaida [sic] can carry on their worldwide activities so successfully from the caves of a primitive country like Afghanistan. It is time to learn from the terrorists.[172]

    The potential downside to a full scale worker retreat into the “caves” of their own homes is that association through a team type concept can also provide comfort in times of stress.[173] “[I]f everyone is home, ‘you lose the benefit of having other people around you.’”[174] Further, “[s]ome telecommuters report feelings of isolation, alienation and lack of support.”[175] Teleworking is clearly not a panacea for the multitude of challenges workers will face following 9-11. However, offering it as an option may elevate workers’ job satisfaction and emotional well-being. In light of these new pyschological and strategic demands for an alternative workplace paradigm, the future of any obstacle impeding the success of teleworking appears dim. The events of 9-11 brought life into razor-sharp perspective for many Americans. Consequently, the public’s interest in home office injuries may be diminished in the face of such unspeakable horrors lurking elsewhere.[176] Americans may in fact be more willing to work at home, at their own risk, in exchange for peace of mind.

3. The Ergonomics Fiasco

    The ergonomics debacle further fueled the 2001 teleworking fire by drawing attention to OSHA’s rulemaking processes.[177] In particular, OSHA justified its authority to promulgate the ergonomics rule under the general duty clause in the OSH Act.[178] The general duty clause establishes that “[e]ach employer . . . shall furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.”[179] That method of justification, however, raises substantial constitutional issues—such as whether the authority and discretion inherent in such nonspecific statutory language represents an improper delegation of power to OSHA.[180]         

IV. Agency Rulemaking and Judicial Review

    The OSHA advisory letter and subsequent directive regarding the application of the OSH Act to the home worksite is an example of what some call “[r]ulemaking through the back door.”[181] The fact that there is strong congressional opposition to the idea of OSHA in the home,[182] and that the OSH Act by all accounts was intended to regulate industrial worksites[183] raise the issue of whether OSHA overreached its rulemaking authority in issuing the decision.[184]

    Administrative agencies typically perform legislative, judicial and enforcement functions.[185] When disputes pertaining to the enforcement of the OSH Act arise, the Occupational Safety and Health Review Commission (OSHRC) is empowered to adjudicate the dispute.[186] In essence, Congress created the OSHRC as a check on OSHA’s power to enforce its own rules.[187] However, the efficacy of that precaution has been questioned, given the Supreme Court’s traditionally deferential treatment of administrative rulemaking.[188] In fact, some commentators suggest that OSHA abuses the judicial deference it is afforded by circumventing the notice and comment requirements administrative agencies typically must follow pursuant to the Administrative Procedure Act.[189]

    The deferential standard afforded to administrative rulemaking is evidenced in the holdings of Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc.,[190] Bowles v. Seminole Rock & Sand Co.,[191] and Martin v. OSHRC.[192] In Chevron, the Supreme Court evaluated the Environmental Protection Agency=s interpretation of “stationary source” in the Clean Air Act Amendments of 1977.[193] In upholding the validity of the interpretation, the Court outlined a two-part inquiry to be used during judicial review of an administrative agency’s interpretation of the statute it administers.[194] The first question is “whether Congress has directly spoken to the precise question at issue. . .[and] if the statute is silent or ambiguous [on] the specific issue . . . [the second question is] whether the agency’s answer is based on a permissible construction of the statute.”[195]

    In Bowles, the Administrator of the Office of Price Administration brought suit against a manufacturer of crushed stone for violating the Emergency Price Control Act.[196] There, the Court asserted that although the Constitution and Congress’ intent “may be relevant . . . [but] the ultimate criterion [in interpreting an ambiguous administrative regulation] is the administrative [agency’s] interpretation . . . unless it is plainly erroneous or inconsistent with the regulation.”[197]

    Finally, in Martin (“CF&I”),[198] the Court specifically addressed OSHA’s rulemaking parameters.[199] There, the Court stated that the OSHA Secretary’s interpretations would be upheld against the OSHRC’s interpretations if found to be “reasonable.”[200] In other words, OSHA gets the benefit of the doubt when it engages in statutory interpretation.[201] Critics have suggested that with this decision, the Court “emasculate[d]”[202] the OSHRC, tilting the balance of power in favor of the executive branch.[203] Commentators have suggested that because administrative agencies “[know] that they can act almost with impunity,” they “create law without following statutorily prescribed procedures.”[204] In particular, some analysts suggest the CF&I decision provides a legal foundation that “encourages OSHA to resolve major policy issues in secretly-written interpretation letters and compliance directives”[205] like the very ones at issue in this Note.

    OSHA’s response to the teleworking controversy belies an awareness that the agency may have overstepped its bounds.[206] An internal audit of the Department of Labor’s Office of the Inspector General (OIG) recently revealed that OSHA is now “revising its internal policies and procedures to strengthen requirements for letters ‘which provide interpretations of the OSH Act or significantly expand on existing policies.’”[207] The OIG effectively slapped OSHA’s hand in the report by making five specific recommendations to guide OSHA in that internal inquiry.[208] Most relevant to this discussion are the first two recommendations: 1) “OSHA should develop written procedures that specifically govern the preparation and processing of interpretation letters,” and 2) “Language in OSHA directives that clouds the policy role of interpretation letters should be clarified.”[209]

    Coincidentally, in the same year that OSHA faced the ergonomics failure and the teleworking controversy, the OSH Act celebrated its thirtieth birthday. Although it was the landmark year that prompted the House Subcommittee on Workforce Protections to hold hearings on the topic of OSHA rulemaking,[210] the ergonomics and teleworking issues also encouraged the discussion.[211] While this age-old debate over OSHA’s authority continues, the need and desire for teleworking increases.[212] Until the issue is resolved, the business world must find a workable arrangement that adequately protects employee rights but limits employer liability. A reevaluation of basic employment and contract doctrines may provide some guidance toward that end.

V. Quid Pro Quo: Toward A Workable Private Solution

    One of the primary goals of our legal system is to provide relief for injured people.[213] When new legal issues arise, such as the question of employer liability in the home, it is often unclear which path will lead most directly to that end. Reviewing some basic employment law doctrines may help clarify whether alternative legal remedies adequately address teleworkers’ occupational safety and health needs or whether OSH Act compliance is the best way to protect those interests.[214]

A. The Employment Relationship

1. General Tenets

    The doctrine of master-servant liability is classic American jurisprudence.[215] Traditionally, the common law duties of an employer for the protection of his employees included, among others, “[t]he duty to provide a safe place to work,”[216] and “[t]he duty to promulgate and enforce rules for the conduct of employees which would make the work safe.”[217] Contrary to the time when employees expected broad “Big Brother”[218]-type protections from their employers, modern employees seem more concerned about protecting their own privacy rights.[219]

    Understanding the nature of the employment relationship will help clarify whether and how employers may be held responsible for their employees. Ultimately, the employment relationship is a contractual one.[220] Contract language alone, however, is not always determinative of the relationship between the parties.[221] In most cases, a variety of factors must be weighed to determine a worker’s precise status and thus the hiring party’s concomitant liability.[222]

    If a worker is classified as an independent contractor rather than an employee, the employer may be relieved of a certain amount of liability.[223] For example, employees, but not contractors, are generally protected from discrimination under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act,[224] and the Americans with Disabilities Act.[225] In addition, certain wage, hour, unemployment, and workers’ compensation laws apply to employees but not independent contractors.[226]

2. Defining “Employee”

    Several traditional tests are used to determine whether an individual is classified as an employee under state or federal laws.[227]

        a. Right to Control Test

    The Restatement (Second) of Agency defines a “servant” as “a person employed to perform services in the affairs of another and who with respect to the physical conduct in the performance of the services is subject to the other’s control or right to control.”[228] One of the factors often considered in determining the degree of control over the worker is the extent to which the employer supplies the work tools or the actual work place.[229] The right to control test, originally developed to define the parameters of an employer’s tort liability, is currently the test used by the Internal Revenue Service (IRS) to determine whether employers have obligations for certain workers.[230]

        b. Economic Reality Test

    The economic reality test is a broader test that “looks to all the circumstances involved to determine the economic reality of the workplace situation. . . . The rationale of this test is that it is important to compensate or provide protection to those who look to their employer for financial security and well-being.”[231]

    The economic reality test is used to determine whether a worker is an employee for purposes of evaluating liability under the Fair Labor Standards Act (FLSA) due, in part, to the broader definitions of employer and employee in that legislation.[232] This is also the test most often used to evaluate liability under the OSH Act.[233]

        c. Hybrid Test

    The hybrid test combines elements of both the right to control and the economic reality tests and is often utilized to evaluate liability under anti-discrimination statutes.[234] Despite the more intriguing aspects of the teleworking issue, determining whether an individual is an “employee” is the first step in ascertaining what rights, responsibilities, and legal remedies exist for both master and servant.[235]

B. Alternative Legal Remedies to Ensure Worker Safety

1. Workers’ Compensation

    Depending upon their status as defined under one of the preceding definitions, teleworkers may be protected under workers’ compensation laws.[236] Workers’ compensation statutes were enacted nationwide in an effort to provide “adequate, predictable, and efficient remedies” for employees who had suffered work-related injuries or disease.[237] Such statutes differ from the OSH Act in several ways. First, these are state laws.[238] Second, the OSH Act is designed to prevent injuries and illness while workers’ compensation is designed to compensate an injury or illness that has already occurred; in other words, the distinction is between prevention and rehabilitation.[239] Third, workers’ compensation provides a no-fault, or strict liability, remedy[240] while OSHA imposes a duty upon employers to provide a safe worksite.[241] Finally, while workers’ compensation is delivered directly to the worker,[242] relief for an OSHA violation less tangibly benefits the employee in the form of employer fines or enhanced company compliance.[243] Employers also benefit from workers’ compensation laws by virtue of limited liability and tort immunity.[244]

    Workers’ compensation statutes seem to focus more on the nature of the work rather than the work place,[245] and employees may even be compensated if they are injured while traveling for business or attending employer-sponsored social events.[246] Analysts speculate that “[o]ne of the next major battles in the workers’ compensation arena will be ‘whether an injury (or illness) that occurs during home-based employment [will be considered to be] an injury arising out of and in the course of employment.’”[247] No state currently has workers’ compensation legislation regarding the application of workers’ compensation laws to telecommuters.[248] However, considering the amount of attention the issue has received in Congress in the context of the OSH Act, workers’ compensation legislators might be wise to begin drafting their own legal framework.

2. Traditional Tort Claims and Defenses

    Traditional tort claims for negligence based on an employers’ general duty of care may augment any workers’ compensation provisions for teleworkers injured at home.[249] Products liability claims are also available if equipment used by teleworkers malfunctions.[250] Additionally, the privacy issues previously discussed might be remedied by the tort of intrusion upon another’s seclusion.[251] If the regulation of the home worksite is left to traditional common law remedies, employers may be able to raise traditional defenses such as contributory negligence or that the worker assumed certain risks by choosing to work at home.[252]

C. Benefit of the Bargain

    “Regardless of the selection criteria or method used to create it, the employer-employee relationship is a contractual relationship”[253] and contractual relationships are based upon a theory of bargaining.[254] In companies where teleworking thrives today, employers and employees have reached a mutually beneficial agreement that seems to equally satisfy the interests of both parties.[255] Perhaps foregoing OSHA protection in the home could be viewed as a type of consideration extended in exchange for an employer’s loss of physical control over the employee.[256] Most of these companies handle the potential problem of at-home injuries via workers’ compensation[257] and waivers of liability.[258] Effective screening of candidates, training, and education of the individuals on both sides of the equation, seem to be the basic building blocks of successful private programs.[259] As Secretary of Labor Elaine Chao stated

OSHA [had] a finite budget of $425.4 million in FY 2001. It is impossible to inspect every workplace with this limited budget. This money is more effectively spent, and protects more workers, if it is focused on prevention efforts. Prevention, education and training are the most effective methods for providing the maximum amount of protection to the greatest number of workers.[260]

The following pioneering methods may prove effective in establishing a satisfying quid pro quo for employers and employees by improving the environment, reducing employer costs and keeping OSHA out of the home. In addition, these model arrangements support the type of grassroots effort Congress encouraged in the mid-1990s,[261] and the type of limited government sought by the Bush administration.[262] President Bush has described his vision in this way: “Government has a role, and an important role. Yet, too much government crowds out initiative and hard work, private charity and the private economy. Our new governing vision says government should be active, but limited; engaged, but not overbearing.”[263]

D. Work Smart Process[264]

    The goal of the Work Smart model is to empower teleworkers “with the means and responsibility for ensuring the work can be performed safely . . . [because then] they are in the best position to create their own safe work environment and to identify changes in that environment that require a change in work habits.”[265] This plan, which has been implemented for teleworkers at the U.S. Department of Energy in Washington State,[266] includes five basic steps to be implemented by the worker and approved by the employer:

1. Identify and document the work activities to be performed;

2. Identify and document the hazards associated with those activities;

3. Identify (or create) standards for safe performance of work to ensure that the hazards identified in step 2 are mitigated;

4. Perform the work; and

5. Periodically evaluate the work, hazards, and standards to ensure a safe environment.[267]

One of Work Smart’s added benefits is that it protects teleworkers’ privacy interests by eliminating the need for in-home inspections conducted by either employers or regulatory agencies like OSHA.[268] The architect of the Work Smart process would prefer that “teleworkers be completely responsible for their own in-home safety.”[269] As he put it, “employers [are] already giving us a big safety and health benefit, just by providing the telecommuting work option.”[270]

E. The Oregon Model 

    Funded by a 1993 grant from the Oregon Department of Transportation, the Oregon Department of Energy recently completed a four year initiative to “set up telecommuting programs and resolve telecommuting issues.”[271] The program included the development and distribution of educational materials introducing the telecommuting work option.[272] Pilot programs were established with a variety of employers across the state, and then the program was evaluated to measure its success.[273] As part of the pilot program, a “telework office checklist” was designed to help employees set up their own work space at home, and a teleworker self-assessment form was used for potential candidates to determine whether or not teleworking would be right for them.[274]

    The study’s findings revealed that Oregon telecommuters have reduced their weekday auto travel; that formal telecommuting programs will most likely succeed; that potential telecommuters make up almost half of Oregon’s work force; and that telecommuting is fast becoming a popular employment alternative mutually benefitting employers and employees.[275] Both the Work Smart and the Oregon programs illustrate the types of successful grassroots models of telework arrangements that are cropping up all over the country and benefit the employer, the employee and the environment.[276] But, telecommuting is not for everyone.[277] Prior to establishing this type of program, employers should carefully screen candidates to ensure that the situation is a well negotiated and mutually agreeable bargain.[278]

Conclusion

    “The final word is trust.”[279] If employees want to enjoy the flexibility of working at home, along with better air and less traffic congestion, they may have to sacrifice the “Big Brother” protections of OSHA and be more accountable for their own health and safety.[280] Employers who hope to lower absenteeism and increase employee retention in a tight labor market may have to provide some protection in the form of more training or education relating to safety in the home.[281] Ultimately, OSHA in the home is unmanageable and does not provide enough advantages to the employee to make it worth the intrusion into their privacy.[282] Other legal remedies are available to both prevent and rehabilitate employee injuries and illnesses.[283] No consensus has yet emerged as to whether working at home poses a health and safety risk for teleworkers, but statistical data clearly demonstrates traffic congestion causes environmental problems.[284] Compelling evidence also proves that working at home enhances employee productivity and quality of life.[285] The OSH Act’s drafters did not anticipate this alternative work arrangement.[286] Encouraging creative, empowering contract solutions arrived at through private, equal bargaining between employers and employees is a more palatable alternative than applying a thirty-year-old statute to the modern day workplace.[287]

    Finally, an awareness of and empathy for the American worker was unavoidably thrust into our social consciousness by the events of September 11, 2001 (“9-11”).[288] The tragedy of 9-11 may necessitate teleworking as a way to embrace traumatized workers, ensure continuity of business in times of crisis, and reduce the effectiveness of any future terrorist acts by decentralizing human resources.[289] As Americans search for meaning in the wake of such crisis, forging more satisfying and empowering employment relationships may well contribute to our nation’s healing.[290] Overly intrusive government regulations should not be allowed to chill a growing trend that could revolutionize American business.[291] Teleworking arrangements objectively reward employers for their enhanced compassion and sensitivity to quality of life issues, arguably bringing out the best in business by bringing out the best in people.[292] As George Orwell predicted: “The high sentiments always win in the end, the leaders who offer blood, toil, tears and sweat always get more out of their followers than those who offer safety and a good time. When it comes to the pinch, human beings are heroic.”[293]

 

 

Kelli L. Dutrow[294]

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