This week we are pleased to have a guest post from Edward Heath and Kevin Daly. Attorneys Heath and Daly are members of Robinson+Cole’s Manufacturing Industry Team and regularly counsel clients on trade compliance, anti-corruption compliance, and other corporate compliance issues.

Proposition 65 is the California law that requires warning labels on products sold to California customers that potentially expose users to certain chemicals which may cause a risk of cancer or reproductive harm. The state maintains  a list of approximately 900 chemicals that fall within Prop 65, and the statute provides detailed guidance on what the warning label must contain.  Because of the steep penalties that can be imposed under Prop 65 litigation, compliance with the warning requirements is vital for any company selling products into California. Recently, the California Office of Environmental Health Hazard Assessment (OEHHA) has proposed amendments to the format requirements for Proposition 65 warnings that will require companies to re-assess the sufficiency of their current warnings.

Prop 65 provides two forms of “safe harbor” warnings. If a warning label conforms to the statutory specifics, it is deemed to shield the company from liability. Continue Reading California Regulators Propose New Regulations to Limit Use of “Short Form” Proposition 65 Warnings

This post was authored by Linn Foster Freedman and is also being shared on our Data Privacy + Cybersecurity Insider blog. If you’re interested in getting updates on developments affecting data privacy and security, we invite you to subscribe to the blog.

Aerospace and energy equipment manufacturer Honeywell has reportedly been hit with a cyber-attack in the form of a malware intrusion that disrupted some of its information technology systems. Honeywell issued a statement on March 23, 2021, stating that it “took steps to address the incident, including partnering with Microsoft to assess and remediate the situation.”

Honeywell confirmed that it has returned to service and that it has not identified “any evidence that the attacker exfiltrated data from our primary systems that store customer information. If we discover that any customer information was exfiltrated, we will contact those customers directly.”

Manufacturing companies have been hit hard recently with cyber-attacks, which is a wake-up call to evaluate cyber-hygiene and data theft prevention protocols.

Below in an excerpt from an article authored by Robinson+Cole Labor and Employment Group lawyers Britt-Marie K. Cole-JohnsonRachel V. KushelAbby M. Warren and Kayla N. West that was published in Industry Week on March 12, 2021.

The changing social climate has companies reevaluating their approach to diversity, equity and inclusion.

Many businesses faced a call for action in 2020 to clearly state their positions on the social justice and civil rights issues of the day. This has left employers wondering how best to respond, particularly if they haven’t done so in the past. There are many best, or even good, practices for cultivating a workplace that promotes a culture of diversity, equity and inclusion (DEI) while also supporting manufacturers’ overall business objectives.

Ideally, getting DEI right this year is a priority for employers, including those that may be federal contractors subject to affirmative action laws and regulations seeking to strengthen their commitments and strategies.

For many manufacturers, considering the following questions may help: Read the full article.

As a part of its ongoing efforts to increase workplace attention on COVID-19, OSHA recently released a new COVID-19 National Emphasis Program (NEP), signaling a commitment to expand its inspection and enforcement efforts to protect workers at high risk for contracting the virus.

The NEP indicates that OSHA will target its inspections on high-risk industries with the goal of significantly reducing or eliminating worker exposure to COVID-19. To support this effort, OSHA developed lists of specific industries that will be targeted for inspection. The highest priority industry continues to be health care, but there are a number of manufacturing industries included in the NEP target lists, such as:

  • Meat Processing
  • Food and Beverage Manufacturing
  • Chemical Manufacturing
  • Plastics and Rubber Product Manufacturing
  • Primary Metal Manufacturing
  • Petroleum and Coal Products Manufacturing
  • Industrial Machinery Manufacturing
  • Transportation Equipment Manufacturing

OSHA will develop programmatic inspection priorities by focusing on the industries listed in the NEP. It will further identify specific establishments for targeted inspection by reviewing 2020 Form 300A injury and illness data.

In addition to programmatic inspections under the NEP, OSHA will continue to perform unprogrammed inspections, particularly at facilities that have experienced COVID-19 related fatalities, and then at facilities with alleged employee exposures to COVID-19 related hazards. The NEP also establishes procedures for follow-up inspections of facilities that have already been inspected as a result of a COVID-19 hazard.

While OSHA has not developed an emergency temporary standard with regard to COVID-19 (at least not yet), it has issued numerous guidance documents that we have covered on the blog. The most recent COVID-19 guidance was posted on January 29, 2021. OSHA continues to rely on this guidance and existing statutes and regulations to support the issuance of citations for COVID-19 workplace deficiencies. In fact, in referencing the potential for citations, the NEP makes specific reference to the OSH Act’s General Duty Clause, which requires employers to provide a workplace “free from recognized hazards that are causing or are likely to cause death or serious physical harm.” OSHA has used the General Duty Clause to cite employers for COVID-19 related hazards, and this reference in the NEP signals a continued willingness to do so.

The NEP became effective on March 12, 2021, with inspections under the NEP commencing immediately and industry targeting to begin within at least two weeks (or by March 26, 2021). Based on this, we can expect to see heightened inspection activity related to COVID-19, particularly in industries listed in the NEP.

This post was authored by Linn Foster Freedman and is also being shared on our Data Privacy + Cybersecurity Insider blog. If you’re interested in getting updates on developments affecting data privacy and security, we invite you to subscribe to the blog.

Manufacturers of products often are not prepared for, or aware that cybersecurity incidents can disrupt production and distribution of product. A recent filing by Molson-Coors Beverage Company illustrates that manufacturers face similar cybersecurity risks as other industries.

On March 11, 2020, Molson-Coors filed a Form 8-K with the Securities and Exchange Commission stating that:

Molson  Coors  Beverage  Company  (the  “Company”)  announced  that  it  experienced  a  systems  outage  that  was  caused  by  a  cybersecurity incident. The Company has engaged leading forensic information technology firms and legal counsel to assist the Company’s investigation into the incident and the Company is working around the clock to get its systems back up as quickly as possible.

Although the Company is actively managing this cybersecurity incident, it has caused and may continue to cause a delay or disruption to parts of the Company’s business, including its brewery operations, production, and shipments. In addition to the other information set forth in this report, one should carefully consider the discussion  on  the  risks  and  uncertainties  that  cybersecurity  incidents  and  operational  disruptions  to  key  facilities  may  have  on  the  Company,  its  business  and financial results contained in Part I, “Item 1A. Risk Factors” in its 2020 Annual Report on Form 10-K, filed with the SEC on February 11, 2021.

Manufacturing businesses may wish to consider prioritizing cybersecurity readiness in their processes, including backup plans, contingent operations plans, and disaster recovery plans.

Below in an excerpt from an article authored by Robinson+Cole Labor and Employment Group lawyers Natale V. DiNatale and Kayla N. West that was published in Industry Week on March 5, 2021.

Within hours of his inauguration, President Biden fired the National Labor Relations Board’s (NLRB’s) general counsel, Peter Robb, whose term was set to expire in November 2021. The Biden Plan for Strengthening Worker Organizing, Collective Bargaining, and Unions emphasizes President Biden’s goals for promoting workers’ rights to organize. After less than a month in office, he had already begun to take action, signaling that these issues are a priority for the administration. The following highlights current and potential developments within labor law under the new administration that may impact manufacturers in 2021. Read the full article.

This week’s post was co-authored by Robinson+Cole Labor and Employment Group lawyer Emily A. Zaklukiewicz.

Over the past year, employees have faced a number of challenges in light of the current pandemic, both personal and professional. Employees who are engaged in “frontline” work have been particularly impacted including those working in manufacturing facilities that have not closed and have been operating consistently over the last year. Many companies are recognizing the signs of exhaustion, burn-out and stress in their workforces and are actively searching for ways to engage, and re-engage, their frontline workers.

Continue Reading Incentivizing and Engaging “Frontline” Workers

The Wall Street Journal published a story a few days ago that described some of the challenges that exist in the manufacturing supply chain.

“U.S. manufacturers aced the shutdown of their factories and warehouses last spring in response to Covid-19. They’re botching the recovery.

“After carrying out an orderly retreat from assembly lines as the pandemic arrived in the U.S., many manufacturers pulled out the playbook they followed in past recessions, cutting costs and preserving cash. That left them unprepared for the sharp rebound in consumer demand that began just weeks later and never let up.”

Anyone who has tried to order an appliance or other consumer products can attest to the long delays in receiving products.  The authors describe it as a “bullwhip effect.”

As we have discussed in previous blog posts, the supply chain was certainly stressed in 2020 as the demand for some manufacturing clients skyrocketed and, frankly, their supply chains could not keep up. Manufacturers are looking closely at weaknesses in their supply chain all around the world in an effort to find the right balance between supply and demand.

However, I think the stories about manufacturers “cutting costs” and “preserving cash” are a bit overdone. In March/April of 2020, manufacturers were not even sure if they could operate and many were projecting significant losses in revenue. The demand put stress on manufacturers and their supply chains, and I think the more significant lesson learned is that manufacturers need to revisit their supply chain relationships and contracts moving forward.

Below in an excerpt from an article authored by Robinson+Cole Environmental, Energy + Telecommunications Group lawyers Megan E. Baroni, Christopher Y. Eddy, Peter R. Knight, and Jonathan H. Schaefer that was published in ISHN (Industrial Safety & Hygiene News).

The Occupational Safety and Health Act provides for increased penalties for employers who fail to rectify conditions following an Occupational Safety and Health Administration (OSHA) citation resulting in a similar incident. Such “repeat citations” are an essential element of the Occupational Safety and Health Act (OSH Act) enforcement scheme. As OSHA practitioners and environmental, health and safety professionals know, avoiding repeat citations is often a central issue when resolving an OSHA enforcement matter. OSHA policy instructs the agency to consider several factors when determining whether to characterize a citation as “repeat.” One of those factors involves a situation in which there has been a change in corporate structure or ownership between the initial and subsequent violations. In such instances, OSHA will evaluate whether there is “substantial continuity” between entities that warrants characterization of a citation as “repeat.” If, however, there is enough change in the corporate structure between the initial and subsequent violation, the citation will not be classified as “repeat.”  Read the full article.

 

While the presidential election may be in the past, conversations on political and social issues are not. As the new Presidential Administration takes the helm, the pandemic continues, and significant political division persists, conversations on political and social issues are commonplace in many workplaces across the country. Manufacturers are still grappling with the issue of whether and to what extent they can restrict employee speech and expression in the  workplace. Can employees discuss political or social issues at work?  What happens if it causes tension and distraction at work?  Does it matter if it occurs on working time? Continue Reading Free Speech and Expression in the 2021 Workplace