California hit employers with huge COVID fines but settled for far less. Here’s why
The 33-page citation looked like an open-and-shut case of an employer skirting workplace safety rules and putting people in danger.
San Quentin prison employees who worked in the gun towers and administrative buildings had been allowed to “circumvent” COVID-19 screening stations. Infected workers were expected to finish their shifts, potentially spreading the coronavirus. When people got sick to the point of hospitalization, prison brass failed to immediately report to California’s workplace safety agency, Cal-OSHA.
And perhaps the most notable claim spelled out in the damning July 2020 report: The prison failed to quarantine newly transferred inmates, seeding an outbreak among the most medically vulnerable incarcerated people. By August, more than 2,200 inmates and staff were infected. Twenty-eight incarcerated people and an employee were dead.
It was a disastrous series of failures deserving of a major fine, Cal-OSHA determined.
The agency slapped a $396,000 citation on the state-run prison, making it one of the largest fines levied during the now two-year pandemic. Aside from penalizing the prison, the fines were ostensibly meant to send a message that COVID-19 rules existed for a reason and must be followed.
A different message is becoming clearer, however.
Nearly two years after that botched transfer and series of violations, the California Department of Corrections and Rehabilitation has paid none of its huge fine at San Quentin, according to state records. Moreover, records show serious violations remain unabated at San Quentin prison and more than a dozen other facilities across California.
The drawn-out appeals are part of a widespread public and private-sector pushback against Cal-OSHA’s COVID-19 penalties. The increase in appeals has sent the state’s workplace safety group on a hiring spree to try to keep up and has left critics fearing the state is going soft on companies that ran afoul of pandemic rules and simply factor legal fights into their bottom line.
The Bee analyzed the cases of 110 employers fined at least $10,000 in the first 12 months of the pandemic. Of those, only 41 have paid anything, and their payments amount to just $469,468. That’s less than half of the combined $1,144,565 they were fined.
Some citations totaling tens of thousands of dollars have been settled for just a few hundred.
Stephen Knight, executive director of Worksafe, an Oakland-based employee-rights advocacy group, called The Bee’s findings “stark and disappointing.”
“Many employers have the costs of ignoring and violating Cal-OSHA baked into their business models and just don’t care,” Knight said. “This is just incentivizing and facilitating that willful negative behavior that’s bad for worker safety and, therefore, bad for California.”
Dan Lucido, Cal-OSHA’s chief counsel, said she has hired 18 attorneys in the past 10 months who can help handle appeals. Her message for an employer spoiling for a fight over the “solid citations” her team has levied?
“We’re lawyering up, too.”
Cal-OSHA inspectors cited a Kaiser Permanente facility in San Leandro after emergency room staffers were expected to use “defective face shields, cracked helmets and parts that were being held together by tape.” At another facility in San Jose, employees were intubating COVID-19 patients with improper masks. And in Oakland, the hospital failed to notify employees who unwittingly came into contact with infected patients.
Each of those three Kaiser systems faced a penalty of about $80,000, among the steepest of the COVID-19 fines leveled on individual employers. Records show each appealed and shaved off most of their ticket — they paid $29,500 on average.
Kerry Leedy, a Kaiser spokeswoman, said in an email that the citations didn’t “align with applicable public health guidelines in place at the time or improperly failed to recognize severe supply chain shortages and other issues associated with the pandemic.” Records show Kaiser’s violations have been abated. The settlements, Leedy said, showed the citations were “not indications of any ongoing or significant safety issues.”
Sutter Hospital in Oakland, meanwhile, was hit with a $10,000 citation when Cal-OSHA said hospital officials failed to follow contact tracing protocols early in the pandemic. The hospital appealed. Liz Madison, a spokeswoman, said Sutter “demonstrated during the prehearing discovery that it properly conducted contact tracing and notifications.”
All but one of Cal-OSHA’s citations were withdrawn. The final amount Sutter paid: $425.
The prospect of fines becoming a symbolic gesture is troubling, said Jeff Ruch, Pacific director for Public Employees for Environmental Responsibility, a Washington, D.C., group that ripped Cal-OSHA in July 2020 for its lackluster enforcement program.
“If they know you’re a paper tiger, the quality and the amounts of the settlements will diminish,” Ruch told The Bee. “The settlements tend to be dimes on the dollar.”
There will never be enough inspectors to check on every employer in the state. Instead, Cal-OSHA relies on hefty fines to send a message, the goal being to signal that scofflaws face consequences, said Laura Stock, director of UC Berkeley’s Labor Occupational Health Program.
Letting employers off the hook for just a fraction of their fine “is certainly undermining that goal,” Stock said.
Advocates and department officials said settlement amounts don’t tell the whole story — or even the right one. The more important metric, they said, is making sure employers fix the most serious problems that inspectors noted and make a workplace safer for workers.
For COVID-19 violations, that’s happened about 88% of the time, according to state data.
“We are doing an excellent job of getting abatement, which is how you make the workplace safer,” Lucido said, defending Cal-OSHA’s enforcement. “Put aside the dollars.”
Even so, 16 of California’s prisons have serious violations that remain unabated more than a year since the initial appeal process began.
Dana Simas, a CDCR spokeswoman, said in an email that the department is appealing because it “addressed many of the issues raised.” CDCR, she said, has tried to slow the spread of COVID-19 “with the best information available.”
Cal-OSHA brings in AG’s Office
Last summer, The Bee reported that about four-in-five of the employers with fines more than $10,000 were appealing. More have followed suit — 95% of those businesses have challenged their fines. So has almost every employer hit with that kind of penalty in the months since.
Some claim their employees did not contract COVID-19 on the job. Others argued they weren’t liable for the fine because it was difficult, if not impossible, to score masks early in the pandemic and California’s fast-changing rules were difficult to decipher, let alone keep up with.
While some employers have settled up, many are still deep in their appeals.
Foster Poultry Farms was hit with five separate citations in May 2021 related to devastating outbreaks and problems at plants in Livingston, Fresno and Porterville. The citations totaled some $451,000 and involved at least seven fatalities at the Livingston plant.
Cal-OSHA said Foster Farms failed to immediately notify the state about fatalities and hospitalizations. The company failed to communicate to its own workers and did not enforce social distancing protocols and proper mask wearing, according to records.
When Lucido joined Cal-OSHA, she worked to get the California Attorney General’s Office involved in the department’s most high-profile workplace safety cases. Six deputies are now handling the Foster Farms case, Lucido said.
“We had to staff up,” Lucido said.
Ira Brill, a Foster Farms spokesman, defended the company. He said it was in compliance with local and state rules and touted its COVID-19 testing and vaccine programs.
“Cal/OSHA fines are subject to an administrative review process. Consequently we cannot comment,” Brill wrote in an email. “...We continue to offer testing and COVID-19 boosters to all employees that wish to participate.”
Cal-OSHA worker shortages contributed to the department “not meeting its enforcement activities and goals,” according to a 2020 federal report. Cal-OSHA’s goal for the year was 7,125 on-site inspections; they conducted 6,3556.
Still, Cal-OSHA has carried a big stick with the fines that it does initially levy, according to the report. The average penalty the state issues is $7,427, more than double the US average of $2,946. The fines were “the highest in the nation,” the report says.
Cal-OSHA had an 18% vacancy rate by the end of January, something Lucido said was far from a staffing crisis and more a result of pandemic-era challenges everywhere.
The Department of Industrial Relations, which houses Cal-OSHA, in January requested $267,000 to hire additional staff for the team that handles employers’ challenges to the Occupational Safety and Health Appeals Board. The board has faced a crushing amount of pushback from employers and a workload that “has exploded with appeals.”
That’s on top of a doubling in the number of challenges filed in superior court over the legality of conducting virtual hearings — time-intensive challenges the team must also respond to.
“Current staffing levels are not adequate to meet these new workload demands,” officials wrote in the budget request.
Knight, with WorkSafe, placed some of the blame on Gov. Gavin Newsom, who he said should be more actively using his megaphone to draw attention to Cal-OSHA’s woes. Notably, Knight said, Newsom’s Jan. 28 appointment of Jeffrey T. Killip as the new Cal-OSHA director was buried in a Friday night news release rather than announced at a public event that could have spotlighted worker safety and Cal-OSHA’s efforts.
Knight called it a “missed opportunity.”
At renegade bistro, ‘no mask allowed’
In September 2020, seven months into the pandemic, El Dorado County awarded Apple Bistro restaurant $22,736 in relief aid under the federal CARES Act.
That hasn’t prevented its owner from raging against government regulation of her business.
A month after the county delivered COVID relief money, Cal-OSHA hit the restaurant with a $108,000 fine for failing to protect workers. Months later, Cal-OSHA tossed in a pair of $675,000 penalties for failing to abate the problems. The total fine of nearly $1.46 million is the agency’s largest COVID citation against any employer.
Meanwhile, El Dorado County pulled the restaurant’s permit for failing to require employees to wear masks, among other violations. Then, when the restaurant continued operating, the county issued a cease-and-desist notice. The owners didn’t respond, so the county and the state sued the restaurant in November.
Last month, a Superior Court judge ordered the restaurant closed until it gets a new permit. The restaurant didn’t close but applied for a new permit. Last week it was turned down — not because of COVID violations, but because it didn’t have a permit for the well it had been using for water.
That sealed the restaurant’s fate, at least for the time being. Acting on a complaint from the landlord, sheriff’s deputies evicted Apple Bistro on Thursday.
Until then, the restaurant and its owner, Jennette Waldow, had been taking a defiant, anti-government tone about COVID restrictions.
Months ago the restaurant strung a banner, visible from Highway 50, declaring, “No Mask Allowed FOR EVERYONE’S HEALTH AND SAFETY.” On the door to the restaurant, a bumper sticker from the far-right website InfoWars said: “The media is the virus.”
Waldow couldn’t be reached for comment. But she has accused Cal-OSHA of “trespassing on our rights” in a video she created for the restaurant’s website. The video is under a link that’s labeled “Say no to tyranny.”
And say no Waldow did — until November.
Cal-OSHA records show the bistro paid about $13,000 of its fines.
Still, Cal-OSHA says, the restaurant owes the state more than $1.3 million.
This story was originally published March 17, 2022 at 5:00 AM.