What GAWDA members need to know to remain compliant.
By Tom Badstubner, Marilyn Dempsey, Michael Dodd, Rick Schweitzer, and Steve Guglielmo
The GAWDA Consultant Program is a GAWDA member benefit that is included as part of your member dues to the association. It is consistently rated as one of the most valuable member benefits that GAWDA provides. Between the four of them GAWDA’s consultants bring more than 150 years of industry-specific experience to the association.
In June, the GAWDA Consultants hosted a three-day compliance workshop in Minnesota that was also simulcast via webinar. In addition to that workshop, Summer is Regional Meeting season, and the Consultants are mainstays at GAWDA’s Regional Meetings, providing members with timely updates on all of the important regulatory and compliance topics in the industry.
Since the Q2 issue, there has also been a flurry of proposed regulatory rulemaking and some important legislation that could impact GAWDA members. As always, GAWDA’s consultants deftly explain what it will mean for GAWDA members.
Thank you to Tom Badstubner, GAWDA’s FDA and Medical Gases Consultant, Marilyn Dempsey, DHS, EPA and OSHA Consultant, Mike Dodd, DOT Consultant, and Rick Schweitzer, Government Affairs and Human Resources Consultant, for lending their time and expertise to discuss these important topics. The following is a lightly edited transcript of that conversation.
Welding & Gases Today: You hosted the Summer Compliance Seminar, which I want to discuss, but if we could start with some information that Rick recently sent over for the GAWDA Connection. Rick, there were two proposed rules that came out recently. The first was the DEA proposed rule to reschedule marijuana as a schedule 3 controlled substance, and the other was the PHMSA proposing an increase to HAZMAT registration fees. Can you explain what’s going on with those proposals and what they would mean if they were to come to pass?
Rick Schweitzer: The first item is a proposed reclassification of marijuana from schedule 1 to schedule 3 in the list of controlled substances. The Drug Enforcement Administration has proposed downgrading marijuana from schedule 1 to schedule 3. Schedule 1 means there is no currently accepted medical use for the substance. In recent years, it’s become clear that marijuana does have some recognized medical uses. And it’s also legalized now for medical purposes and/or recreational purposes in 33 states, as well as the District of Columbia. The DEA wants to recognize that by placing it in a more appropriate class. This would not decriminalize marijuana. Its use would still be illegal under federal law, although it would incur a much lower penalty.
The big question here is what effect it might have, if any, on truck drivers and DOT testing regulations that apply to commercial motor vehicle drivers. Initially, I thought there would be no impact on that, because the FMCSA has said that, regardless of what the states do, as long as marijuana is illegal under federal law, they are going to continue to have their drug and alcohol testing regulations apply to marijuana as well.
But, there’s a recent letter sent by the American Trucking Associations to the Attorney General and to the Secretary of DOT, as well as the Secretary of Health & Human Services, indicating that there might be a problem with this reclassification, because under current health and human services standards you’re only authorized to test for schedule 1 & schedule 2 substances. So, I’m not sure how this is going to play out legally. It might require some variation in DOT or health & human services rules to get this coordinated. My expectation is that there will still be testing for marijuana under DOT rules. I do not see this as a way of revising that or withdrawing that requirement.
WGT: No matter what the end result ends up being, we’re still a long way away from it, correct?
Rick: The proposed rule was published in the Federal Register on May 21, and comments are due by July 22. DEA will have to consider those comments and come up with a final rule, which probably won’t be issued until sometime next year, most likely.
On the HAZMAT fees, this is the DOT requirement for shippers and carriers of hazardous materials. Every July 1st, you have to renew your registration and pay your fees. The fees go to funding state and local emergency responders. So, it’s a good use of the money. Congress, a couple of years ago increased the amount of money that can be collected under this program from $28 million to $46 million. So, the fees are intended to go up to collect the additional revenue authorized. For small businesses they would go up from $250 to $375 a year. For large businesses they would go up from $2,575 to $3,000 per year. There is a statutory cap that keeps the fees at $3,000 for all registrants as a max.
GAWDA worked with a coalition of shippers and carriers of hazardous materials to keep the small business fees at a reasonable rate. We wanted to make sure they didn’t exceed $500. We succeeded, because the proposal has only gone up from $250 to $375. A small business, for purposes of this fee, is 175 employees or less. That’s for NAICS code 424690, which is what most distributors use. That’s the category for other chemicals and allied products merchant wholesalers. That’s the code that would go into the Small Business Administration’s Classification for a Small Business.
Mike Dodd: That’s a help because didn’t it used to be 100 employees?
Rick: I think so. I looked it up today and it said 175.
Mike: That’s great. That will knock a whole bunch of people out of the “big” fee.
Rick: That’s for NAICS 424690.
WGT:. So that’s two pieces of proposed regulatory changes. Rick, we had a good conversation a few weeks ago about some other regulatory things. The overtime exemption and the non-compete clause that we had already discussed. Are there any other regulatory or compliance things that have appreciably changed or that GAWDA members need to be aware of that have come across your desks or through your agencies since we spoke for the Q2 magazine?
Rick: The only other thing that I would bring up would be the OSHA Walk Around Rule, which is a final rule that allows non-employee representatives, including union organizers or union representatives or even plaintiff’s lawyers to accompany an OSHA inspector and company employees when the OSHA inspector is inspecting a business. It’s called the “Walk Around Rule.” This extends the worker representatives who are able to accompany the OSHA inspector. This has now been challenged in court by NAWD and the Chamber of Commerce and many other business groups claiming that there’s not sufficient Congressional authorization for this kind of expansion of the OSHA authority. As it is right now, it is a final rule and scheduled to go into effect, but it is being challenged in court.
WGT: Marilyn, when we spoke for Q2 you talked about the Walk Around Rule. From your perspective, what could it mean for GAWDA members?
Marilyn Dempsey: So, for those GAWDA members that are union shops, this means that your shop steward, who’s your employee can call up the union hall and have someone come do a walk around with the OSHA inspector. That person may not necessarily know your business, they may not necessarily have the best interest of your business at heart, and they might speak about things that are not applicable to the inspection.
When you do a walk around you see a lot of things. You, as the company, want to keep the inspector narrowly focused on the scope of their inspection. Someone from the outside may draw attention to something that is outside of the scope and expand the inspection. Or the complainant, whether a disgruntled ex-employee or an employee filing an anonymous complaint, may have contacted a lawyer and that lawyer can now come in as part of this Walk Around.
Rick: Even if you’re a non-union shop, my understanding is that the rule allows union organizers to accompany the OSHA inspector during the inspection as well.
WGT: You hosted the 2024 Summer GAWDA Professional Compliance Webinar and Seminar from June 4-6, 2024, at Chart Industries in New Prague, Minnesota. For those that missed the Summer Compliance Seminar, you’ll be hosting the next live Seminar in October. Can you discuss some of the things you’ll be covering during that meeting?
Mike: The DOT Day will be training on high pressure cylinders, carbon dioxide cylinders, and liquid containers filling. There will be special emphasis on the prefill inspections and there will be lots of great pictures.
Tom Badstubner: The FDA day (Tuesday, October 22, 2024) will be covering the new medical gas regulations. These new rules are mostly in 21 CFR Part 123 Current Good Manufacturing Practices, but there are significant changes to the labeling regulations (21 CFR 201) and the Postmarket Safety Reports (21 CFR 314).
Marilyn: I’ll be covering what is in a Compliance Program and required trainings. Along with that, on May 20th, there was a new rule on the Hazard Communication Standard, which has some things that are going to impact our industry. There are three things that are happening.
First, OSHA has changed some definitions and classifications, including adding another category into the flammable classification. According to this new alignment with GHS revision 7, two common products: acetylene and propane, will now require “extremely flammable” on the label and the SDS will require additional precautionary information.
Second, OSHA has redefined “Bulk shipment” as, “any hazardous chemical transported where the mode of transportation (vehicle) comprises the immediate container (i.e. contained in tanker truck, rail car, or intermodal container).”
They also state that, “labels for bulk shipments may be on the immediate container (e.g. bulk tanker) or they may be sent with the shipping papers or electronic means so that the information may be printed out and available to the receiving company. However, there must be a written agreement with the customer to receive labels electronically.”
The third thing was on labels as well. GAWDA and CGA wrote a letter of recommendation letter that the “release by date” be an option for the manufacturer and OSHA agreed. That’s a really good thing for us.
Tom: That would be a problem for us, because we reuse our labels. We would be required to change labels.
Rick: So that’s a win.
Marilyn: The other thing I’m going to touch on during the seminar, which has been part of the Lessons Learned from the GAWDA Safety Committee, is that there have been a couple of very significant fires at our members’ locations and how a company’s compliance program can mitigate the risk of fire.
WGT: Is there anything FDA or DOT wise in terms of time sensitive things that members need to be cognizant of?
Mike: From a DOT standpoint, the HAZMAT registration, depending on what yearly cycle they are on, the registration was due on June 30th. So, if they haven’t done the renewal, then this is just a reminder to do so.
Rick: The proposal that we talked about would not go into effect this year because it’s a proposal. That would be next year at the very earliest.
WGT: These proposals, when they call for comments, if GAWDA members want to get involved is that something that they should be funneling to you?
Rick: Yes. They can comment themselves, or they can submit comments to me, and I can incorporate them into GAWDA comments that we will submit to the record, which we do on a number of rulemakings. We will probably be making a comment on the HAZMAT rule through this coalition I mentioned, which is about 45 trade associations that represent companies that either ship or carry hazardous materials.
Tom: We’ve noticed a couple recent audits that were a little more rigorous than they have been in the last couple years. GAWDA members are best served by paying attention to the basics of medical gas CGMP. For example, be sure all your logs are being properly filled out, your calibrations are up to date, your trainings are up to date, etc. The small and simple things that we do are also easy to forget and can result in violations.
We had an inspection where the inspector asked the GAWDA member for a clearly unsafe practice to be done, and actually insisted on it. It had to do with putting Clorox on cylinder valves. They wanted every single valve to be wiped with Clorox. It was a food application. This inspector didn’t know anything about our industry but knew a lot about the food industry. They felt that those valves needed to be sanitized with every use. It took a few times going back and forth before they backed off on this unsafe position. If the inspector asks for something unusual or unsafe, please reach out and we’ll help you fight it.
Twice each year we’re required by FDA regulations to review our drug product listings, which is basically a list of all of the different cylinder styles that we have and all of the medical gases that we are filling. One of the times is June, the other is December. If a member has not yet done their Drug Product Listing review, they should do it. It’s not hard to do, you simply review the listing and make sure it is still accurate; if it is, no action is required. If it isn’t accurate, let whoever is taking care of your FDA submissions know and update the FDA record.
WGT: Marilyn, now that we’re getting into the hot part of the year, is OSHA still focusing on the heat standards?
Marilyn: OSHA has the national emphasis program for heat illness prevention. There are states that require companies to have a written heat illness prevention plan. GAWDA members should check their state requirements, particularly the western states: WA, OR, CA.
WGT: Has GAWDA put anything out that they can easily refer to?
Marilyn: I’ve written about Heat Illness Prevention in the GAWDA Safety Organizer. NOAA and NIOSH have information online and OSHA has some great training for this on their website.
