Methods of diagnosing and treating harmful exposur- 123docz.net

The request for the information must further provide a description of the procedures to be used to protect the confidentiality of the information. An agreement not to use the information for any purpose other than the health need asserted or to release it under any circumstances other than to OSHA must also be included, and signed by the health professional as well as the employer or contractor of the health professional's services.

The confidentiality agreement may restrict use of the information to the purposes indicated in the statement of need, prohibit disclosure to anyone other than OSHA who has not signed an agreement, and provide for appropriate legal remedies, including stipulation of a reasonable preestimate of likely damages.

Nothing in the standard is meant to preclude the parties from pursuing noncontractual remedies to the extent permitted by law.

If a request for trade secret information is denied, the denial must be in writing and must state why the request is being denied. The requestor may refer the matter to OSHA for consideration.

The petitioners in the hazard communication litigation disputed the definition of trade secret used in the standard and the requirements for gaining access to trade secret chemical identities. The Steelworkers argued that the standard should have given employees without ready access to health professionals the same right of access as was provided health professionals (pp. 37-43 of Steelworkers' brief). The Steelworkers argued that an employee with a "need to know" chemical identity who is unable to secure the services of a health professional is left by the standard with no means to obtain this information (p.

38 of Steelworkers' brief).

Public Citizen argued that the standard's limitation on access to trade secret information by employees is in direct conflict with the employees access to trade secrets provision under the Access to Medical and Exposure Records regulation (the "Access to Records regulation") (29 C.F.R. 1910.20). The Access to Records regulation requires employers to disclose exposure data and medical records to employees. Workers have a right under the Access to Records

regulation to be informed of the chemical identities of the hazards they face on the job, although employers may withhold trade secret information which reveals processes or the percentage composition of a chemical mixture [29 C.F.R.

1910.20(/) (1) and (/) (3)]. The only condition employers may impose on the release of chemical identity data is that the employee enter into a confidentiality agreement under which the requesting party agrees not to release the information to a competitor or to use the information for commercial gain [29 C.F.R.

1910.20(/) (3)].

In addition, Public Citizen alleged that the procedures governing the disclosure of trade secrets will thwart requesters:

1. A request for a trade secret must come from a health professional, who must sign a confidentiality agreement not to disclose the trade secret to anyone, including their patients.

2. The confidentiality agreement may provide for liquidated damages which.

Public Citizen contends, compels employees to waive their right to have the employer prove damages in order to recover.

OSHA contended that the standard reaches a reasonable accommodation between the two interests. Regarding the definition of trade secrets, OSHA chose the most commonly accepted definition of the term from the Restatement of Torts, %151{b) (1939). The Restatement definition has repeatedly been used by courts interpreting federal statutes affording protection to trade secrets in public law settings. For example, the Supreme Court approved the use of the Restatement definition in the 1984 case Ruckelshaus v. Monsanto, 52 L. W.

4886 (June 1984). Moreover, OSHA argued, all trade secret identities, which otherwise could generally be legally withheld, are subject to disclosure (p. 61 of OSHA's brief).

OSHA defended the procedures for obtaining disclosure by arguing that they are designed to assure that disclosure is necessary to meet an occupational health need and that the secrecy of the information will be preserved outside the scope of that need (p. 68 of OSHA's brief). The agency stated that the liquidated damages provision of a confidentiality agreement does not free the employer from the threshold burden of proving that the health professional has committed a breach by an unauthorized disclosure.

In response to the petitioners' allegation that employees, as well as health professionals, should have access to trade secrets, OSHA stated that employees already have access to trade secrets under the Access to Records regulation. It is only the trade secrets of employers other than their own (and the odd

"hazardous substance" not covered by the Access to Records rule) for which an employee would have to rely exclusively on a health professional (p. 75 of OSHA's brief). Secondly, the limitation on employee access relates only to chemical identities—all health data, such as health effects and methods of control, must be available to employees.

The court set aside the definition of trade secret insofar as it affords protection

to chemical identity information that is readily ascertainable through reverse engineering and insofar as it denies employees access to trade secret chemical identity. The court discussed what information OSHA is authorized to protect as a "trade secret." It held that OSHA is not authorized to protect trade secrets except to the extent that the OSH Act, state law, or the Constitution creates substantive trade secret protection. It concluded that neither Section 15 nor any other provision of the OSH Act authorizes trade secret protection in the context of a Section 6{b) (5) standard, thus leaving state law and the Constitution as the only bases for protection of trade secrets. While suggesting that even state law might not justify trade secret protection under a federal regulatory statute like the OSH Act, the court was prepared to accept state law as a basis for protection, since none of the petitioners had asked the court to limit protection to constitutional requirements. The court then went on to consider the particular issues raised under the standard.

Definition of Trade Secret—The court held that the definition of trade secret in the standard is too broad. The standard defines a trade secret as:

confidential formula, pattern, process, device, information or compilation of information (including chemical name or other unique chemical identifier) that is used in an employer's business, and that gives the employer an opportunity to obtain an advantage over competitors who do not know or use it.

The court read this definition to reach even chemical identity information that is determinable without great difficulty through reverse engineering. It found that state law generally does not protect such information. The court therefore remanded the standard to OSHA for reconsideration of the definition of trade secret, ordering that any new definition shall not include "chemical identity information that is readily discoverable through reverse engineering."

Written Request Requirement—The court, with little discussion, upheld OSHA's requirement that any request for trade secret information must be in writing with supporting documentation.

Employee Access—The court rejected OSHA's decision to exclude employees and their representatives from obtaining access to trade secret information and to limit access to health professionals. It found that employees and their representatives could make use of such information and concluded that there was no record evidence supporting OSHA's determination that employees who are not health professionals would be more likely to breach a confidentiality agreement than would health professionals.

Confidentiality Agreements—The court upheld the standard's provision that, except in a medical emergency, a manufacturer receiving a request for trade secret information may require that the requesting party sign a confidentiality agreement containing a liquidated damages clause.

In response to the court's finding, OSHA published revised trade secret provisions on 27 Nov. 1985 (50 Fed. Reg. 48750). OSHA adopted the Restatement definition of trade secret and the Restatement's criteria for deter- mining whether a valid trade secret exists (for example, the extent to which the information is known outside the business; the extent of measures taken to guard the secrecy of the information). The ability to reverse engineer the chemical identity of a substance is one of the six criteria to be evaluated.

In addition, OSHA complied with the court's directive to provide for access to trade secrets for employees. It did so by providing for access by employees under the same conditions and procedures by which health professionals have access (that is, demonstration of need, confidentiality agreements, etc.).

Preemption

The extensive delay in the promulgation of the federal Hazard Communication standard^ had one very significant impact—^the passage of worker right-to-know legislation by some 21 states. Frustrated by the delays at the federal level, organized labor shifted the focus of the issue from federal OSHA to state legislatures. As a result, the issue of the preemptive effect of the federal standard has taken on considerable importance, both to the states that have right-to-know laws and to employers who are covered by the federal standard and the state laws. The significance of the preemption issue is demonstrated by the fact that five states which have right-to-know laws (Massachusetts, New York, New Jersey, Illinois, and Connecticut) intervened in the hazard communication litigation to challenge OSHA's contention that the standard preempts their state laws.

Petitioners, Steelworkers, and Public Citizen did not address the preemption issue at all in their briefs; the five state petitioners did. The foundation of the states' argument that the standard does not preempt their state laws is that the standard is not a "standard" but a "regulation." The OSH Act creates two kinds of rules—standards and regulations. The distinction between the two is significant and in two respects: judicial review of a standard lies in the federal courts of appeals, while judicial review of regulations lies in district courts*;

and, standards, but not regulations, statutorily preempt state laws that address the same issue as a federal standard. The controversy over whether the rule is a standard or regulation arose in this case because of the significance of the preemption issue and also because this rule is a generic standard, not substance specific, as most OSHA standards are.

' The effort to issue a hazard communication standard began in 1974 and involved the issuance of two notices of proposed rule makings (the first proposed rule was withdrawn in the early days of the Reagan Administration; the final rule is based largely on the Reagan Administration's notice of proposed rule making) and numerous delays.

* It is paradoxical that the state petitioners filed their petitions for review in a court of appeals, and yet they contended that the Hazard Communication rule is a regulation and not a standard.

OSHA supported its characterization of the Hazard Communication rule as a standard by demonstrating to the court that it has the two essential attributes of a standard. First, standards must be based on a finding of significant risk of material health impairment. The record in the rule making supports OSHA's conclusion that inadequate communication about serious chemical hazards endangers workers and that the practices required by the standard are necessary or appropriate to the elimination or mitigation of these hazards (p. 24 of OSHA's brief). Second, standards are designed to correct identified hazards rather than

"mere inquiry into possible hazards" (as regulations do). The Hazard Com- munication rule is designed to decrease the incidence of illness or injury caused by harmful chemical exposure by providing employees with both the information regarding the chemicals and the training needed to help protect themselves.

OSHA distinguished the Hazard Communication rule from Access to Records rule, which was determined by a court to be a regulation and not a standard.^

The Access to Records rule was held to be merely a device to detect hazards via recordkeeping; the Access to Records rule did not require employers to make records, only to make those records which employers already keep, available to employees. In contrast, the Hazard Communication rule imposes affirmative requirements to develop MSDSs, labels, education, and training programs as well as to evaluate chemical hazards. Finally, the Hazard Com- munication rule is not hmited to mere inquiry into possible hazards but mandates certain practices that are aimed toward the correction of hazards identified by the rule.

If the court determined that the rule was a "standard," then there would be express preemption of state laws in accordance with the terms of OSH Act. If the Hazard Communication rule was determined to be a regulation, there would have been another possibility for preemption—^the doctrine of implied preemption. Implied preemption means that, even if there is no applicable express statutory preemption provision, there may still be preemption if there is conflict between a federal scheme of regulation and a state scheme or if Congress intended to occupy an entire field of regulation.

In their briefs to the court, the state petitioners contended further that if the hazard communication rule is a regulation, there is no implied preemption of their state right-to-know laws.

The states contended that their right-to-know laws were enacted to ensure public healtii and safety—a subject matter that is appropriate to state regulation.

They also alleged that their laws, because they are broader in scope (that is, they protect more employees than the federal standard and include worker and community right-to-know provisions), cannot be preempted by a narrower federal standard. They alleged that Congress did not intend OSHA to occupy an entire field in such a manner.

' The decision in Louisiana Chemical Association v. Bingham, 657 F. 2d 777 (5th Cir. 1981), which held that the Access to Medical and Exposure Records rule was a regulation, not a standard, is the leading case precedent for this issue.

The standard states:

This occupational safety and health standard is intended to address comprehensively the issue of evaluating and communicating chemical hazards to employees in the manufacturing sector, and to preempt any state law pertaining to this subject. Any state which desires to assume responsibility in this area may only do so under the provisions of §18 of the Occupational Safety and Health Act (29 U.S.C. 651 et seq.) which deals with state jurisdiction and state plans [29 C.F.R. 1910.1200(a) (2)].

The issue of the standard's preemptive effect was thus squarely presented on the face of the standard.*

It was OSHA's position that state activity is limited in light of the Hazard Communication standard under well-established constitutional doctrine. The Supreme Court only recently, in Capital Cities Cable, Inc. v. Crisp, 52 U.S.L.W. 4803 (U.S., 18 June 1984), reviewed the law:

Under the Supremacy Clause, U.S. Const., Art. VI, cl. 2, the enforcement of a state regulation may be pre-empted by federal law in several circumstances: first, when Congress, in enacting a federal statute, has expressed a clear intent to preempt state law. . . .

The limitations on state regulatory activity due to OSHA's promulgation of the Hazard Communication rule come within this "clear congressional intent"

category.

The preemption provision of the OSH Act (Section 18) works in the following manner. Until OSHA promulgates a standard, state activity is not restricted.

Once OSHA has promulgated a standard, states may regulate that issue only if they obtain OSHA approval of the regulation as part of a state plan:

Any State which, at any time, desires to assume responsibility for development and enforcement therein of occupational safety and health standards relating to any occupational safety or health issue with respect to which a Federal standard has been promulgated under section 655 of this title shall submit a State plan for the development of such standards and their enforcement. [Section 18(Z>), 29 U.S.C.

mim.

State plans must be approved by OSHA where the criteria of Section 18(c), 29 U.S.C. §667(c), are met. Among these criteria are that the state standards must be "at least as effective in providing safe and healthful employment" as the OSHA standard, and that state standards, when applicable to products distributed or used in interstate commerce, must be required by compelling local conditions and must not unduly burden interstate commerce [Section 18(c)

* The Court of Appeals was not asked to rule on the validity of any particular state statute. This case involves only a preenforcement challenge to the federal OSHA standard and requires only that the court make rulings as to the OSH Act and the federal standard. The case discussed later in this paper. State Chamber of Commerce et al v. Hughey, No. 84-3255 (D.N.J. 1985), involved a direct challenge of the validity of the New Jersey Worker and Community Right-to-Know Act on the ground of preemption.

(2) of the OSH Act, 29 U.S.C. §667(c) (2)]. Therefore, any state that wishes to regulate on the subject of hazard evaluation and communication in the manufacturing sector must submit to OSHA a state plan meeting the criteria set out in the act (that is, "at least as effective," etc.). It was OSHA's position in this litigation that, without an approved state plan, states are preempted from regulating hazard communication within the manufacturing sector.

Regarding the issue of whether the standard preempts state laws regulating hazard communication in the nonmanufacturing sector, OSHA told the court that this issue is not ripe for review (p. 84 of OSHA's brief). Neither the standard nor its preamble expresses on its face what the preemptive effect of the standard might be in the nonmanufacturing sector. There has been no formal action by OSHA that would have a concrete effect on the state petitioners that would make this question fit for judicial decision at this time. OSHA suggested that the state plan approval process and challenges to state statutes provide better avenues for review of this question (p. 86 of OSHA's brief). What OSHA suggested is that if a state wishes to regulate hazard communication outside the manufacturing sector, the state should submit its regulation to the agency for approval as a state plan (since it already has to submit its regulation of hazard communication in the manufacturing sector for state plan approval).

OSHA told the court that there is no controversy concerning the standard's preemptive effect on community right-to-know laws (p. 88 of OSHA's brief).

Pubhc health and safety are beyond the purview of OSHA. The preemptive effect of an OSHA standard can be no broader than the Secretary's mandate.

OSHA pointed out, however, that to the extent that there are several portions of a community right-to-know law that are workplace or employee specific,

"they are not immune from preemption by OSHA simply because they are enveloped in a law that at the same time manifests a broader purpose" (pp.

88-89 of OSHA's brief).

The court held that the rule is a "standard" that has preemptive effect under the OSH Act with respect to disclosure to employees in the manufacturing sector. The court agreed with the Fifth Circuit in Louisiana Chemical Ass'n v.

Bingham that the test of whether an OSHA rule is a "standard'' or a ' 'regulation'' turns on whether the rule purports to correct a particular significant risk or instead is merely an enforcement or detection procedure designed to further the goals of the OSH Act generally. Applying this test, it held that the Hazard Communication rale is a "standard" under Section 6 of the OSH Act.

In addition, the Court held that, under Section 18 of the OSH Act, the Hazard Communication standard preempts state hazard disclosure laws with respect to disclosure to employees in the manufacturing sector. (The Court added gratuitous language indicating that there would be no preemption absent the express provisions of the OSH Act.) The Court declined to consider the question, urged by several states, of whether state laws requiring' disclosure outside the manufacturing sector are preempted. Rather, it stated that such a declaration would be premature and noted that this question could turn on issues such as

Methods of diagnosing and treating harmful exposures to the chemical

Freifeld: I've got something I could add to that. There is an ANSI standard

NIOSH/OSHA's Pocket Guide to Chemicals