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Deadline for Electronic Submission of OSHA Form 300A Data Looming
OSHA's Improve Tracking of Workplace Injuries and Illnesses regulation, often commonly referred to as OSHA electronic recordkeeping regulation, requires construction employers subject to the rule to electronically submit their 2019 300A Annual Summary to OSHA no later than March 2, 2020. Only establishments in the construction industry with 20 or more employees are required to electronically submit the Form 300A. An "establishment" for the purposes of OSHA's electronic submittal of records rule, is defined as a "single physical location where business is conducted or where services or industrial operations are performed." Thus, an employer must make a location-by-location determination of whether it meets the threshold requirement for number of employees (based on peak employment at any time during the year, including temporary, seasonal and part-time workers) to trigger the data submission requirements.
You can access OSHA's online portal for the electronic submission of your 2019 300A Annual Summary by clicking here.
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Arizona Court of Appeals Issues Ruling in CGL Pollution Exclusion Case
In the unanimous decision issued by the three-judge panel on October 31, 2019, the Arizona Court of Appeals found that the pollution exclusion in a roofing contractor's CGL policy was intended to cover "traditional environmental pollution claims," and not the injuries caused by breathing in fumes emitted from roofing materials as a result of the alleged negligence of the roofing contractor. In the vigorously contested case,
Starr Surplus Lines Ins. Co. v. Star Roofing, Inc.
, No. 1 CA-CV 18-0641, 2019 WL 5617575 (Ariz. Ct. App. Oct. 31, 2019)
, the Arizona Court of Appeals ruled that the CGL carrier, Starr Surplus Lines Insurance Co., could not rely on the CGL policy's pollution exclusion to dodge coverage for a lawsuit brought by a woman who was allegedly injured due to fumes released from Star Roofing, Inc.'s roofing work on a commercial building in Tempe, Arizona.
The plaintiff in the underlying action fractured her forearm and sustained other injuries when she allegedly passed out and fell in the building's parking lot as she was leaving work due to the fumes emitted from Star Roofing Inc.'s roofing work. In the lower court's ruling, the Arizona Superior Court granted Star Roofing, Inc.'s motion for summary judgment and ruled that the pollution exclusion did not bar coverage for alleged fume claims as alleged in the underlying action. On appeal, Starr Surplus argued the lower court's decision should be revered because the pollution exclusion unambiguously bars coverage for any bodily injury claims arising from the "actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of 'pollutants' at any time." However, the appellate court sided with Star Roofing Inc. and Amicus Curiae National Roofing Contractors Association and Asphalt Roofing Manufacturers Association and found that the exclusion should not apply to the underlying fume claims.
Following past precedent in the case Keggi v. Northbrook Prop. & Cas. Ins. Co., 199 Ariz. 43, 13 P.3d 785 (Ct. App. 2000), the three-judge panel said standard pollution exclusions should be applied narrowly and preclude only traditional environmental pollution events, such as improper disposal or containment of hazardous waste.
The Court went on to state that
"[p]ollution exclusions are intended to cover traditional environmental pollution claims and not the bodily injuries allegedly suffered by [the underlying plaintiff] as a result of Star Roofing's alleged negligence in the installation" and that applying the exclusion more broadly would "otherwise eviscerate coverage reasonably expected by the insured under a
commercial general liability policy."
States across the country are divided on whether to apply the pollution exclusion narrowly or broadly. With this ruling, Arizona continues to remain with the states that view the pollution exclusion narrowly excluding only traditional environmental pollution events from CGL policy coverage.
Hendrick, Phillips, Salzman & Siegel successfully filed an Amicus Curiae Brief on behalf of National Roofing Contractors Association and Asphalt Roofing Manufacturers Association in the appeal. If you have any questions about the application of CGL pollution exclusions in your state, please contact Benjamin Lowenthal at at (404) 522-1410, or you can e-mail him by clicking here.
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H-2B Cap Reached for First Half of Fiscal Year 2020
In today's tight labor market, many contractors are looking for new ways to recruit workers. One of the means available to contractors who are looking for short term help in high peak seasons is the H-2B visa. The H-2B visa grants someone who is otherwise not authorized to work in the United States temporary work authorization status. Importantly, the government limits the number of H-2B visas issued to 66,000 per fiscal year, with 33,000 visas reserved for the first half of the fiscal year and the balance reserved for the second half of the fiscal year.
Recently, U.S. Citizenship and Immigration Services announced that the congressionally mandated cap on H-2B visas for temporary non-agricultural workers was reached for the first half of fiscal year 2020, which runs from October 1, 1999 through March 31, 2020. USCIS will reject new cap-subject H-2B petitions received after November 15 that request an employment start date prior to April 1, 2020.
Contractors looking ahead would be wise to begin the H-2B visa application process early. For more information on the H-2B visa application process, click here. If you have any questions concerning H-2B visas or require assistance with the application process, please contact Philip Siegel, who can be reached directly at (404) 469-9197, or via e-mail by clicking here.
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OSHA Clarifies its Position on Certifications from Crane Institute Certification
OSHA requires crane operators engaged in construction activity to be certified by an entity accredited by a nationally recognized accrediting agency. Recent, Crane Institute Certification, a popular source for crane operator certifications, lost its accreditation. Consequently, certifications from this entity are not compliant with OSHA requirements. Yet, OSHA has published an enforcement policy as it concerns crane operators holding certifications from Crane Institute Certification.
On November 26, OSHA announced that although certifications issued by Crane Institute Certification are not compliance with OSHA's operator certificator requirement, OSHA does not intend to cite employers for operating equipment that violates that requirements if their operators, in good faith, obtained certifications issued by Crane Institute Certification prior to December 2, 2019, with the belief the certifications met the standard's requirements. OSHA's policy goes on to explain that, until further notice, OSHA will not accept certifications from Crane Institute Certification, including re-certifications, issued on or after December 2, 2019.
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Beware of the Wage and Hour Auditor
Two recent press releases from the federal Department of Labor highlight to common wage and hour mistakes made by construction contractors.
In a press release published on October 22, the DOL announced that Bayonet Plumbing, Heating & Air Conditioning, LLC paid $33,795.00 in back wages and liquidated damages to 57 employees for violating overtime and recordkeeping provisions of the Fair Labor Standards Act. Bayonet's first mistake was not including earned commissions and earned bonus payments in the calculation when computing the employees' overtime rates when they worked more than 40 hours in a workweek in which the commissions and/or bonus was earned. Earned bonuses and commissions must be included in employees' regular rate of pay when determining the overtime rate to be paid to non-exempt employees.
Bayonet's second mistake was in not calculating the total hours worked by its employees. While the employees' primary responsibilities included technician and installation duties, there were times the employees spent welding. The employee failed to add the time spent welding to the time spent performing technician and installation duties, and in doing so, failed to pay overtime in those weeks when the total hours worked exceed 40 hours.
In a press release published on November 14, the DOL highlighted the consequences for misclassifying employees as independent contractors. The press release announced that Morgan Roofing, LLC, based in Galveston, Texas, paid $101,832 in back wages to 28 employees for violating the FLSA overtime requirements. Morgan Roofing misclassified its employees as independent contractors and paid them flat rates per day, without regard to the number of hours worked. This resulted in unpaid overtime violations. In other instances, workers were paid a straight time hourly rate for all hours worked, which resulted in a failure to pay overtime for work weeks during which the workers worked more than 40 hours.
If you have any questions about your payroll practices, including properly classifying exempt and non-exempt employees and paying the appropriate overtime rate for non-exempt employees, please contact either Philip Siegel or Scott Calhoun. Philip can be reached directly at (404) 469-9197, or you can e-mail him by clicking here. Scott can be reached directly at (404) 469-9195, or you can e-mail him by clicking here.
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Changes to H-2B Visa Program Adopted
DOL and Homeland Security have issued revised rules that modify the employee recruitment requirements for employers seeking to hiring non-agricultural labor through the H-2B Visa process. The new rules are intended to modernize and improve recruitment of workers and reduce the regulatory burdens on employers. The new requirements go into effect December 16, 2019.
Under the current rules, after an employer has filed its H-2B application and received its Notice of Acceptance, the employer is required to take several steps to attempt to recruit U.S. workers for the positions before it may receive a final determination granting the H-2B application. Those recruitment standards currently require the employer to place two advertisements in a newspaper of general circulation in the area of the intended employment.
The changes to the rules eliminate this requirement. In fact, although the proposed regulations would have required the employers to place an electronic advertisement on the internet instead, the final rule does away with this requirement altogether. Instead, the DOL will automatically advertise all H-2B job opportunities by posting them on SeasonalJobs.dol.gov, which is an expanded and improved version of DOL's existing electronic job registry. The website can be accessed by clicking
here. DOL and Homeland have reserved the right to require individual employers to take further steps to recruit workers, depending on circumstances.
The fundamental standards for approval and the application process for H-2B visas has not been changed, but the elimination of the advertisement publication requirement will ease the burden for construction companies looking to hire seasonal workers through the H-2B visa program. The changes should help streamline the approval process and hopefully lead to a more productive hiring process. If you have any questions about these changes or the H-2B visa process generally, please contact Philip Siegel at 404-469-9197 or Scott Calhoun at 404-469-9195.
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OHA Finds that a Non-Architect Service-Disabled Veteran can "Control" a SDVOSB Architectural Firm
Under 13 CFR Part 125, for a business to be verified as a Service-Disabled Veteran-Owned Small Business (SDVOSB) by the Department of Veterans Affairs (VA) Center for Verification and Eligibility (CVE), the Service-Disabled Veteran owner must control the SDVOSB's long term decision making and day-to-day management and administration of the business operations. Ordinarily, the Service-Disable Veteran needs to hold the critical licensing on behalf of the business to demonstrate requisite control. However, if Service-Disabled Veteran can demonstrate ultimate managerial and supervisory control over the license holder, he or she is not required to hold the licenses.
Over the past year, two matters have come to this firm's attention that indicated the CVE was shifting its policies to more strictly apply the presumption that a critical license holder controls a business and narrow the circumstances where a non-license holding Service-Disabled Veteran could be found in control under 13 CFR Part 125. Indeed, over the course of just a few weeks, two of this firm's SDVOSB clients were denied reverification based upon the Service-Disabled Veteran not holding the business's critical licensing. The first SDVOSB had been previously verified and operating for four years and the second had been previously reverified six times over twelve years. In both cases, nothing had substantially changed about the management, key personnel, structure, or activities of the business that would have impacted the CVE's verification evaluation.
Both SDVOSBs filed appeals with the Small Business Administration's Office of Hearing and Appeals (OHA). Notably, the OHA had just recently been transferred jurisdiction to hear SDVOSB CVE appeals, as of October 1, 2018, and had not issued any decisions analyzing "control" in relation to critical licenses. Upon receiving the appeals, the CVE rescinded its denial of reverification for one of the two SDVOSBs stating in its rescission letter that it was reversing the denial because the denial was inconsistent with its current interpretation of the licensing issue, but, the CVE also noted that another case was pending with OHA regarding a non-veteran license holder that may cause it to reexamine its current policy. That case was the CVE Appeal of Veterans 1st Architecture, LLC.
Veterans 1st was initially verified as a SDVOSB architectural firm by the CVE on September 30, 2015. After three years as a verified SDVOSB and without any change to the management, key personnel, or structure of the business, the CVE denied Veterans 1st's reverification application. The CVE decided that the Service-Disabled Veteran could not control the SDVOSB because he was not a registered architect in Georgia. Notably, the Service-Disabled Veteran was not a registered architect when Veterans 1st was initially verified; and, Veterans 1st's registered architect was same person throughout the company's existence. Further, every other factor indicated that the Service-Disabled Veteran controlled Veterans 1st. The Service-Disabled Veteran was the managing member, its majority owner, had exclusive control over all operations except the provision of architectural services, and had extensive experience in the construction industry. After four years of managing a SDVOSB architectural firm, the facts demonstrating the Service-Disabled Veteran's control over Veterans 1st were stronger at reverification than at initial verification. Yet, the CVE relied exclusively on one and only one fact to determine the Service-Disabled Veteran lacked "control" - the Service-Disabled Veteran was not a Georgia registered architect.
On appeal, the Small Business Administration's Office of Hearing and Appeals (OHA) reversed the CVE's denial of Veterans 1st's reverification finding that the CVE had erroneously construed Georgia law and had not properly considered the totality of circumstances when deciding whether the Service-Disabled Veteran controlled Veterans 1st. This decision was notable because it was one of the first CVE Appeal decisions made by the OHA. Had the OHA denied Veterans 1st's appeal, the precedent would have been set for the CVE to narrow the exception in the regulation that allows a Service-Disabled Veteran to show overall "control" by demonstrating ultimate managerial and supervisory control over the license holder to the point where there exception could have been rendered essentially meaningless. Under such an interpretation, Service-Disabled Veterans would have been denied the ability to partner with non-veteran license holders to start businesses and obtain the benefits associated with SDVOSB status, no matter the Service-Disabled Veteran's qualifications and experience in the field, simply because the Service-Disabled Veteran does not hold the business's licenses.
If you have questions regarding this article or other government contracting appeal or protest matters, contact J.T. Gallagher at (404) 469-9175 or you can e-mail him by clicking here.
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Employee Spotlight: Scott Calhoun
With each of our e-blasts going forward, we will be introducing you to a member of the HPSS Team! This month, meet Scott Calhoun.
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What is your role/position at HPSS?
I handle corporate and business transactions, corporate planning, and estate planning and asset protection matters for our clients. I am also a member of the Contract Review team.
How long have you practiced law?
35 years.
How does your occupation now line up with what you wanted to be when you were a child?
When I was a young child, I thought I wanted to be a preacher. That may have been the influence of my grandmother. By early teen years, I wanted to be a lawyer.
Who is your all-time favorite musician/songwriter/entertainer?
This is a very difficult question. I loved Karen Carpenter's voice and the harmonies she sang. Early music by Chicago, with its use of brass combined with rock instruments, created a wonderful sound. Bob Dylan is probably the best songwriter ever.
Outside of work documents, what's the last thing you read?
I have always been a big fan of the Tom Clancy novels about Jack Ryan. I am currently reading one of the latest of the Jack Ryan novels.
Is your favorite leisure time spent indoors or outdoors?
Outdoors. Golf, fishing, and walking in the woods.
Tell me about your family.
My wife and I have been married for thirty-two years. We have one son who is now 28 years old and is working on a tech start-up business. I have six brothers and a sister. My mother's third husband was Chi Chi Rodriguez's caddie on the PGA tour.
Name the top 2 items on your bucket list.
Play the Old Course at St. Andrews and go fly-fishing for bonefish in the Florida keys or Bahamas.
What is your proudest moment at HPSS?
Not one moment. I am probably proudest of my ability to learn so much about the construction industry and become a trusted advisor for many of our clients.
How do you relieve yourself of the stress?
I enjoy leisure reading. I work out regularly. I sing in my church choir. And I take two weeks each year and completely unplug.
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HPSS News!
Hendrick, Phillips, Salzman & Siegel was included in the U.S. News and World Report 2020 Best Law Firms list!
Leanne Prybylski and Benjamin Lowenthal recently joined the Firm. Both bring a wealth of construction law experience, and construction industry experience, to the Firm. You can learn more about Leanne by clicking here, and you can learn more about Ben by clicking here.
Philip Siegel recently appeared on The Roofer Show podcast with Dave Sullivan. Philip spoke on killer contract clauses and how to respond to the same. You can access the podcast by clicking here.
Philip was also recently selected by his peers as one of Georgia Trend's 2019 Legal Elite. Georgia Trend magazine invited participation by all Georgia lawyers, asking them to nominate the attorneys they consider best in 16 different practice categories. When the ballots were counted, Philip was recognized as one of the state's top construction lawyers.
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