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Amazon Covid-19 Lawsuit Spotlights State Regulatory Power

Feb. 17, 2021, 7:24 PM

The legal battle between Amazon.com Inc. and the New York Attorney General Letitia James over Covid-19 workplace safety and health shines a legal spotlight on whether and just how far states can go to regulate workplace conditions.

The retailer is challenging the attorney general’s attempts to force it to adopt worker safety measures that go beyond what the company had implemented, in a lawsuit filed Feb. 12 in the U.S. District Court for the Eastern District of New York. Amazon argues that federal law preempts her from doing so.

James blasted the filing in a statement issued later that day, accusing Amazon of using the litigation to distract from a poor worker-safety record during the pandemic.

The attorney general on Tuesday filed her own lawsuit against the company in the Supreme Court of the State of New York for the County of New York in Manhattan, claiming the company had violated several state labor laws and failed to protect its employees.

Now, in parallel legal actions, the AG and the online giant will fight over who has dominion over worker safety at Amazon’s Staten Island fulfillment center.

Michael Duff, a professor of law at University of Wyoming College of Law in Laramie, said Amazon may have a hard time convincing a judge that OSHA Covid-19 requirements adequately protected workers. “Hasn’t everyone been screaming for the past year that there isn’t a standard?” he asked.

A court victory for the attorney general would show there was room for state regulation of Covid-19 worker safety, even if it hadn’t been specifically authorized by the federal government, said Adam Pulver, an attorney with the advocacy group Public Citizen who tracks worker safety litigation.

Prime Responsibility

In general, the federal Occupational Safety and Health Administration has the prime responsibility for worker safety and health, according to the 1970 law that created the agency, the Occupational Safety and Health Act.

The law allows for state regulation of private-sector workers if the state has a worker protection agency that has been approved by federal OSHA—such as the California Division of Occupational Safety Health—or if the state is regulating a hazard not covered by an OSHA rule.

Several states with those federally approved programs—including California, Michigan, Nevada, Oregon, Virginia, and Washington—use a mix of regulations and executive orders to protect workers from Covid-19 infections.

Most of the 28 states without such a federally approved program also haven’t issued Covid-specific workplace rules. In attempting to impose its will upon Amazon, New York is unique.

New York can create regulations and laws protecting workers from Covid-19, even without a U.S.-approved OSHA-like program, because there isn’t a federal OSHA rule for the disease, Public Citizen’s Pulver said.

New York State of Mind

It’s not unusual for states or cities to enact narrowly focused regulations affecting worker safety that cross into OSHA’s jurisdiction, said Kenneth Kleinman, senior counsel with Stevens and Lee in Philadelphia.

In New York, state requirements brought on by the pandemic for personal protection equipment in health-care facilities weren’t challenged, he explained. And construction contractors follow New York rules for cranes.

The lack of a federal Covid-19 rule makes it likely a judge could decide New York could enforce its own requirements, Kleinman said. But that debate also could become moot if federal OSHA enacts an emergency temporary Covid-19 standard and the judge decides OSHA’s rule takes precedence, he added.

Amazon’s complaint against James comes as the Biden administration considers issuing a coronavirus-specific emergency temporary standard. President Joe Biden on Jan. 21 instructed OSHA to decide if a rule was needed and if a regulation was warranted to issue the standard by March 15.

Duff said that before the judge dismissed the worker safety aspects of the lawsuit, he may first have to decide whether OSHA or New York had the most protective requirements. A decision that the OSHA standard didn’t preempt stricter New York mandates could allow the worker safety parts of the lawsuit to continue.

Nellie Brown, a certified industrial hygienist and director of the workplace health and safety program for Cornell University’s The Worker Institute in Buffalo, N.Y., recalled the state enacted protections for nail salon workers to prevent them from inhaling toxic fumes, filling a gap in federal protections. The state rule wasn’t challenged.

The problem for states without their own safety agencies to protect workers from Covid-19 has been federal OSHA’s slow reaction to the pandemic—issuing guidance instead of regulations, said Susan Schurman, a distinguished professor with Rutgers University’s School of Management and Labor Relations in New Brunswick, N.J.

“I don’t find it surprising that states want to step in,” Schurman said. “Clearly, an emergency temporary standard from OSHA is badly needed.”

In the Amazon situation, New York was responding to worker complaints prompted by the lack of a standard and other labor concerns. “Clearly, they weren’t getting satisfaction and New York stepped in,” she said.

Company Contentions

Amazon, in its Feb. 12 filing, contends federal laws and rules already create a de facto federal Covid-19 regulation.

“OSHA has made clear that existing federal standards for personal protective equipment, general environmental controls, and toxic and hazardous substances, as well as employers’ obligations under the OSH Act’s general duty clause, govern employers’ operations in response to Covid-19,” the company’s lawyers contend.

Amazon’s case is assigned to U.S. District Judge Brian Cogan who, last year, threw out a lawsuit filed against the company by Staten Island Amazon warehouse workers claiming Amazon’s failure to protect them during the pandemic had created a public nuisance.

Cogan ruled that OSHA, not the court system, was better suited to address the issue. The workers have appealed the ruling. Pulver is among several lawyers who signed off on a friend-of-the-court brief since submitted to the U.S. Court of Appeals for the Second Circuit on the workers’ behalf. The case hasn’t yet been scheduled for argument.

New York hasn’t yet filed a legal response to Amazon’s claims. In a Feb. 12 statement, the attorney general said, “We remain undeterred in our efforts to protect workers from exploitation and will continue to review all of our legal options.”

Brown rejected Amazon’s contention that OSHA’s existing rules equate to a Covid-19 standard. OSHA’s bloodborne pathogen rule is intended to prevent infections spread by blood, not through the air—the primary path for the coronavirus, she said.

If New York had a state version of OSHA to cover private-sector workers, there wouldn’t be a question that the state could set mandates beyond federal OSHA requirements, Brown and Schurman said. But with states already facing financial problems, it isn’t likely they’ll rush to allocate the millions of dollar needed to set up state agencies for private-sector workers, the educators said.

To contact the reporter on this story: Bruce Rolfsen in Washington at BRolfsen@bloomberglaw.com

To contact the editors responsible for this story: Martha Mueller Neff at mmuellerneff@bloomberglaw.com; Andrew Harris at aharris@bloomberglaw.com

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