October 17, 2018

OSHA Clarifies Its Position on Incentive Programs and Drug Testing

A memorandum issued by OSHA on Oct. 11 clarifies the agency’s position that its rule prohibiting employer retaliation against employees for reporting work-related injuries or illnesses does not prohibit workplace safety incentive programs or post-incident drug testing. According to the memo, OSHA believes that many employers who implement safety incentive programs or conduct post-incident drug testing do so to promote workplace safety and health. The agency states that action taken under a safety incentive program or post-incident drug testing policy would only violate the OSHA rule “if the employer took the action to penalize an employee for reporting a work-related injury or illness rather than for the legitimate purpose of promoting workplace safety and health.”

OSHA’s memo describes incentive programs as important tools to promote workplace safety and health. But other stakeholders have expressed concerns that incentive programs may discourage workers from reporting injuries and illnesses.

“No one avoids getting hurt simply to get a prize at the end of the week or a bonus at the year,” David Michaels, former assistant secretary of labor for OSHA, told Business Insurance. “Giving out prizes or bonuses doesn’t prevent injuries. They discourage injured workers from reporting their injuries. Workers don’t need bonuses to work safely. They need safe workplaces.”

A 2012 report published by the Government Accountability Office found that rate-based safety incentive programs, which reward workers for achieving low rates of reported injuries or illnesses, may discourage reporting of injuries and illnesses. GAO’s report further stated that policies such as post-incident drug and alcohol testing may also discourage reporting.

OSHA’s memo states that rate-based incentive programs are permissible “as long as they are not implemented in a manner that discourages reporting.” The agency says it will not cite an employer who takes a negative action against an employee under a rate-based incentive program—withholding a prize or a bonus due to a reported injury, for example—“as long as the employer has implemented adequate precautions to ensure that employees feel free to report an injury or illness.” According to OSHA, employers can do this by “taking positive steps to create a workplace culture that emphasizes safety” such as implementing an incentive program that rewards employees for identifying unsafe working conditions or establishing a training program for all employees to reinforce reporting rights and responsibilities.

The agency also lists several instances of workplace drug testing that are permissible under its regulations, including random drug testing, drug testing unrelated to the reporting of a work-related injury or illness, drug testing under a state workers’ compensation law, and drug testing to evaluate the root cause of a workplace incident that harmed or could have harmed employees.

OSHA states that its Oct. 11 memo supersedes any other interpretive documents that could be construed as inconsistent with its new interpretive position. The full memo is available on the agency’s website.