The Long-Standing Waiver for Manufactured Products from FHWA’s Buy America Requirements is Phasing Out
Amidst the flurry of tariff threats swirling around the world, the Federal Highway Administration (FHWA) is terminating the waiver known as the Manufactured Products General Waiver from the Buy America requirements found in 23 U.S.C.A § 313. The Buy America regulation requires all federal-aid projects to use only steel, iron, and manufactured products that are produced in the United States. Since 1983, these requirements have been waived for manufactured products that were permanently incorporated into federal-aid projects by not requiring such products to be produced domestically, apart from predominantly iron or steel components of manufactured products. This waiver is being phased out in 23 C.F.R. 635.410, an amendment to the Buy America regulation which establishes new standards that will apply to manufactured products on federal-aid projects. The final rule was published in the Federal Register on January 14, 2025 (Vol. 90, No. 8, pp. 2932-58).
The new rule, 23 C.F.R. 635.410, defines “manufactured products” as “articles, materials, or supplies that have been processed into a specific form and shape, or combined with other articles, materials, or supplies to create a product with different properties than the individual articles, materials, or supplies.” A manufactured product does not include an article, material, or supply if it is “classified as an iron or steel product, an excluded material, or another product category as specified by law or in 2 C.F.R. part 184” or “mixtures of excluded materials delivered to a work site without final form for incorporation into a project.” However, “an article, material, or supply classified as a manufactured product may include components that are iron or steel products, excluded materials, or other product categories as specified by law or in 2 C.F.R. part 184.”
Manufactured products must be manufactured in the United States effective for federal-aid projects obligated on or after October 1, 2025. The Manufactured Products General Waiver will remain in place until then. The additional requirement to have greater than 55% of the manufactured product’s components, by cost, be mined, produced, or manufactured in the United States becomes effective for federal-aid projects obligated on or after October 1, 2026. For all federal-aid projects obligated on or after October 1, 2026, all manufactured products permanently incorporated into the project must both be manufactured in the United States and have the cost of the components of the manufactured product that are mined, produced, or manufactured in the United States be greater than 55% of the total cost of all components of the manufactured product.
Under the new rule, an article, material, or supply is generally only subject to one set of requirements. The classification of an article, material, or supply is made based on its status at the time it is brought to the work site for incorporation into an infrastructure project. The work site is the location of the infrastructure project at which the iron or steel product or manufactured product will be incorporated. The new rule also provides additional clarifications for precast concrete products and enclosures of electronic hardware systems classified as manufactured products, as well as, how to determine whether the cost of components for manufactured products is greater than 55% of the total cost of all components.
Are You Really Covered as an Additional Insured?
For your next construction project in New York, securing commercial general liability coverage as an additional insured may not be as simple as it would appear. Recent court rulings have interpreted the terms of insurance policies, where additional insured parties are intended to be covered pursuant to a “blanket” endorsement (i.e., the additional insureds are not explicitly named in the body of the endorsement or the underlying insurance policy), to provide coverage only to those persons or entities that the named insured has agreed to add as additional insureds in writing.
As a result of the rulings described below, when drafting construction contracts, it is important to be unambiguously clear as to which parties are intended to be additional insureds under any insurance policies required to be obtained under such contracts. In order to protect against the risks of non-coverage highlighted below, any party entering into a construction contract or subcontract should take the following actions when additional insureds are added to an insurance policy pursuant to a “blanket” endorsement:
(i) require by direct written agreement between the applicable named insured and each proposed additional insured that such named insured must include such proposed additional insureds as additional insureds under its insurance policy, together with a contractual indemnity by the named insured in favor of such proposed additional insureds, or preferably (where feasible) (ii) require that any insurance policy required under such construction contract should expressly name each and every party that is intended to be included as an additional insured thereunder; and
review the underlying insurance policies (i.e., not just the applicable certificates of insurance, which are informational only and do not supersede or modify the actual policy terms) to confirm exactly what persons or entities are covered as additional insureds thereunder and to confirm whether coverage as an additional insured is primary or excess to other coverage available to such additional insured.
In 2018, the New York Court of Appeals upended market norms in affirming a ruling limiting coverage for additional insureds to those in contractual privity. Gilbane Bldg. Co. v. St. Paul Fire & Marine Ins. Co., 31 N.Y.3d 131 (2018). In Gilbane, the court found that a project’s construction manager was not covered as an additional insured by the insurance purchased by the general contractor (GC Policy), because the GC Policy included a “blanket” additional insured endorsement and the construction manager did not have privity of contract with the general contractor, the named insured under the GC Policy. The court specifically and exclusively relied on the language of such “blanket” endorsement, which read “WHO IS AN INSURED (Section II) is amended to include as an insured any person or organization with whom you have agreed to add as an additional insured by written contract … ” (with emphasis added). The court specified that the language “with whom” clearly required a written agreement between the named insured and any proposed additional insured, in which the named insured agreed to add such person or entity as an additional insured in order to effectuate coverage for the proposed additional insured.
This approach was reinforced in a recent decision in the New York Supreme Court, Appellate Division, Second Department, New York City Hous. Auth. v. Harleysville Worcester Ins. Co., 226 A.D.3d 804 (2024). In that case, an owner contracted with a general contractor who subsequently contracted with a subcontractor for construction work. The subcontractor obtained insurance coverage for the project and was later sued by its own employee in a lawsuit that also named as defendants the owner, general contractor and other parties whom the subcontractor had agreed to include in its insurance policy as additional insureds. The court determined that, apart from the general contractor, none of the other parties were entitled to coverage, relying on the language of the subcontractor’s insurance policy: “Who Is An Insured is amended to include as an insured any person or organization for whom you are performing operations only as specified under a written contract … that requires that such person or organization be added as an additional insured on your policy” (with emphasis added). The court interpreted this language as limiting coverage to those with whom the named insured (the subcontractor) had contracted directly to do work, thereby finding that the general contractor qualified as an additional insured under the terms of the policy, but that no other parties seeking additional insured status were covered.
The court also held that language in the subcontract between the general contractor and the subcontractor, incorporating the terms of the prime contract between the owner and the general contractor that required the general contractor to add the owner as an additional insured under the general contractor’s policy, was “insufficient to confer additional insured status on [the owner] with respect to the subcontractor’s policy.” Finally, after comparing the terms of the respective policies issued to the general contractor and the subcontractor, the court determined that the subcontractor’s policy was excess to the general contractor’s policy, so coverage for the general contractor — the one party the court determined was entitled to coverage under the subcontractor’s policy as an additional insured — would be triggered only if and when the liability limits of the general contractor’s own policy were exhausted. As a result, the general contractor would first have to pursue any applicable claim under its own insurance policy, and only after policy limits under its own policy were exhausted could the general contractor seek coverage as an additional insured under the subcontractor’s policy.
Rising Construction Costs in 2025: Tariffs, GMP, and Fixed-Price Contracts
Tariffs are a top concern in 2025, with postponements on imports that have been looming on the U.S. construction industry for the past month. A planned 25% import tariff is positioned to affect construction materials from Canada, Mexico, China, and soon several other countries., Economists fear the financial impact of the tariffs, amid other executive orders, on increasing costs for Americans, including for major construction projects.
Luckily, debate about the impending tariffs goes back farther than just the beginning of the year, so the construction industry has been proactive in considering the effects of these added costs on their prices.
What does this mean for construction law?
Contractors and construction companies that bought up materials at the beginning of the year ahead of tariffs have at least some leeway with the price of goods and project timing. Those that did not now face an increased cost of 1.4% on input prices that do not include the tariffs that, as of March 10, 2025, have yet to be implemented. Contractors that are still negotiating contracts will need to consider the financial impact that tariffs will have on material prices and project timeline. For those that have existing contracts or are in the middle of a project, the outlook is more grave.
Two types of contracts may have a severe financial impact on the contractor:
Guaranteed Maximum Price (GMP): an agreed-upon amount that sets the highest possible reimbursement on material, labor, and fee costs by the client. This allows wiggle room to find cheaper materials.
Fixed-price contracts: an agreed-upon price that remains the same from negotiation to project completion.
For contracts negotiated prior to the Trump Administration’s tariff announcement, the additional cost for materials may have a negative financial impact on the contractors. With GMP and fixed-priced contracts, contractors may lose money if they did not proactively negotiate for the impending tariffs on construction materials such as cement, lumber, steel, and aluminum. Addendums on these contracts may be referenced as “material price escalation” clauses rather than mentioning “tariffs.” Most construction contracts have such terminology built in following the COVID-19 pandemic supply chain demand.
As tariffs are uncertain, what is certain is that the contracts for construction projects must have clauses and amendments that consider the economic influences on material cost, whether it’s imposing tariffs, environmental causes, a pandemic, etc. We cannot plan for these events, but we can plan for what we do if they happen.
Under New York Law a Recourse Provision Bars Most Claims Except for Fraud
In Iberdrola Energy Projects v. Oaktree Capital Management L.P., 231 A.D.3d 33, 216 N.Y.S.3d 124, the Appellate Division for the First Department ruled that a nonrecourse provision in a contract barred a plaintiff’s causes of action for tortious interference with contract, unjust enrichment, and statutory violations of a trade practices statute, but not for fraud.
This case arose from a contract related to the construction of a power plant in Salem, Massachusetts. A choice-of-law provision dictated that the contract was governed by and construed in accordance with New York law. Defendants created a special-purpose entity (SPE) to serve as the company charged with constructing the new plant. Defendants owned, controlled, and managed the SPE and were the SPE’s majority and controlling equity holders. The majority of the SPE’s board of directors and officers were also defendants’ employees. The SPE retained plaintiff to be the project’s engineering, procurement, and construction contractor.
The contract permitted the SPE to terminate the contract for convenience or for a material breach by the contractor. In the event of termination for cause, the owner would incur substantial payment obligations; a termination for convenience would not. The contract required the contractor to post a standby letter of credit in the amount of approximately $140 million as security for the contractor’s performance. The owner was permitted to draw on the letter of credit only “upon any Contractor’s breach or failure to perform, when and as required, any of its material obligations under the Contract.” The contract contained a nonrecourse provision that provided that,
[Owner’s] obligations hereunder are intended to be the obligations of Owner and of the corporation which is the sole general partner of Owner only and no recourse for any obligation of Owner hereunder, or for any claim based thereon or otherwise in respect thereof, shall be had against any incorporator, shareholder, officer or director or Affiliate, as such, past, present or future of such corporate general partner or any other subsidiary or Affiliate of any such direct or indirect parent corporation or any incorporator, shareholder, officer or director, as such, past, present or future, of any such parent or other subsidiary or Affiliate.
The project was plagued with delays and cost overruns. When the project was 98% complete, the SPE terminated for cause. The SPE drew the $140 million afforded by the letter of credit, retained a replacement contractor, and completed the remaining work. The original contractor filed for arbitration against the SPE, claiming that the SPE breached the contract, engaged in tortious conduct, violated the Massachusetts Unfair Trade Practice Act, and sought $700 million in damages. The SPE appeared in the arbitration proceeding and asserted counterclaims.
The arbitration panel determined, among other things, that the SPE lacked cause to terminate the contract and that it terminated the contract as a pretense to draw on the letter of credit and issued a final award in the contractor’s favor for $236,404,377. That award was confirmed in New York, and the SPE filed for bankruptcy. The original contractor filed a civil action in New York, bringing the same claims against the defendants, but all counts except for fraud were dismissed based on the nonrecourse provision.
The New York lower court enforced the plain meaning of the nonrecourse provision, which sophisticated commercial parties negotiated. The nonrecourse provision is a contractual limitation on liability, which, like other exculpatory clauses, is generally enforceable provided it does not violate a statute or run afoul of public policy. The court determined the provision to be “as broad as it is clear: no liability could be imposed upon various individuals and entities for “any claim based on the contract or otherwise in respect thereof.” Plaintiff’s causes of action for tortious interference with contract, unjust enrichment, and violations of Massachusetts’s deceptive trade practices statute were all hinged or predicated on conduct taken under or in contravention of the contract. Since these causes of action were all related to or connected with the contract, they were all barred by the nonrecourse provision. The court showed no sympathy for the plaintiff contractor and its likely inability to recover any part of the judgment it was holding. The plaintiff knew it was entering a very large contract with an SPE and should have known of the breadth of the nonrecourse provision. The takeaway appears to be: Beware of nonrecourse provisions with SPEs.
A Costly Oversight: Federal Court Emphasizes Strict Adherence to Mechanic’s Lien
A federal judge in New York served up a good reminder last week about the importance of dotting your i’s and crossing your t’s when it comes to perfecting a mechanic’s lien. The case involves a payment dispute between a subcontractor and general contractor on a police station renovation project in the Bronx.
The subcontractor liened the job and brought suit to foreclose its lien (among other claims). The New York lien law at issue for public improvement works provides that a lien “shall not continue for a longer period than one year from the time of filing the notice of such lien, unless an action is commenced to foreclose such lien within that time, and a notice of the pendency of such action is filed with the comptroller of the state or the financial officer of the public corporation with whom the notice of such lien was filed.” N.Y. Lien Law Section 18 (emphasis added). The subcontractor had filed its lien and a lawsuit to enforce it within one year but had failed to file the notice of pendency. The subcontractor’s lien had therefore automatically expired after one year. The subcontractor argued that the notice of pendency was unnecessary because the contractor had bonded off the lien. The court rejected that argument and dismissed the subcontractor’s lien claim. The case is J&A Concrete Corp. v. Dobco Inc., 2025 WL 605252 (S.D.N.Y. Feb. 24, 2025). A copy of the court’s opinion is located here.
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Captive Power Projects: A Summary of the Western Africa Regulatory Environment
Recent increases in construction and financing costs are directly affecting the development of energy projects across Africa. Captive power projects (CPPs) offer the possibility of mitigating this challenging landscape for both the developers themselves and those funding them. For those unfamiliar with the concept, CPPs are a type of power plant which provide a localised source of power to the end consumer. They are typically used in power-intensive industries for which a continual and consistent energy supply is paramount. In West Africa, CPPs are of particular interest to mining companies looking for reliable sources of energy. However, the successful development of CPPs in the region will be largely determined by the level of liberalisation in the country’s energy sector, and the right of non-state entities to develop, construct, operate and maintain these projects.
The energy sector across Western Africa has traditionally been restricted to a public monopoly closely associated with the sovereignty of a country, designed to protect the national utility company. When this type of regulatory framework prohibits or inhibits the production, transport and supply of electricity, two structures are usually considered:
where the development, construction, operation, and maintenance of a CPP serves the company’s own needs and this is permitted by the state’s regulation, the project falls under the self-production model (SPM) and the company can, as is often the case, subcontract with energy companies to ensure the supply of energy; or
where the relevant regulation permits development, construction, operation, and maintenance of a CPP for the purpose of supplying electricity to a separate private company, the project falls under the independent producer model (IPM) and can supply energy via off-grid infrastructure.
Bracewell has prepared a report summarising the applicable regulations for the two models outlined above which covers the following 11 countries: Benin, Burkina Faso, Cameroon, Chad, Côte d’Ivoire, Democratic Republic of Congo, Guinea (Conakry), Mali, Mauritania, Sénégal and Togo.
This report provides a high-level overview of existing and proposed regulation based on available sources. It is not a substitute for bespoke legal advice from lawyers in the jurisdictions concerned. Due to the nature of the region, the relatively recent development of the CPP landscape, and the inherent uncertainty in the interpretation of these regulations, we recommend a thorough technical and legal analysis of projects which should consider specific location and bankability issues prior to committing to a CPP project.
As the report illustrates, the energy sector of several countries — such as Burkina Faso, Mali and Togo — remains largely monopolised by the national electricity company, even where the company’s monopoly has been officially terminated by new legislation. In other counties — such as the Republic of Guinea — the legislation remains under development, so while the current framework gives limited guidance, there are no prohibitions laid down either. In contrast, many regions in West Africa have renovated the structure and essence of their energy legislation, demonstrating an intentional and welcome movement away from state-governed monopolies. Countries including Mauritania, Benin, Cameroon and Côte d’Ivoire have all implemented (to varying degrees) a legal framework or, as often called, electricity or energy codes, that allow freedom of energy production. These enable the development of CPPs via either of the two models outlined above. However, it is worth noting that the transmission (rather than production) of the electricity is often still state-regulated. In some countries, such as Chad, while the transmission is under state monopoly, the distribution and construction of CPPs can be carried out by private actors.
In several regions, the relevant authorisations, concessions and/or licences for off-grid production in relation to IPMs are dependent on power purchase agreements being entered into with entities that constitute “Eligible Clients,” a term usually defined in the relevant energy code which shows a maintained, albeit reduced, level of control on the part of the state. The authorisation of SPMs is largely dependent on the installed capacity of the CPP, where sale of surplus is authorised, but the amount is capped by reference to a restricted percentage of the project’s installed capacity. The identity of the buyer is also often restricted, as above, to an entity constituting an “Eligible Client” or, in some jurisdictions, such as Togo, the grid operator. The various authorisations and concessions are granted by the relevant ministerial committees responsible for the state’s energy sector.
For the sake of comprehensiveness, references in the report are occasionally made to regimes with installed capacity thresholds that are likely too low to support the development of a CPP project.
While the report has outlined some of the trends we are seeing as regulations develop, the details for each state vary, with some requiring further investigation with the relevant administration. It is therefore important to ensure that each CPP proposal is tailored and considered in line with the relevant state’s particular legislation and restrictions.
CEQ Sounds the Death Knell for Existing NEPA Regulations
The rapid changes relating to NEPA-implementing regulations accelerated this week, as the White House Council on Environmental Quality (CEQ) published an interim final rule (IFR) removing its NEPA regulations from the Code of Federal Regulations.
Effective April 11, 2025, CEQ’s IFR removes all iterations of its NEPA regulations, including 40 CFR parts 1500, 1501, 1502, 1503, 1504, 1505, 1506, 1507, and 1508, which federal agencies and developers alike have relied on in permitting projects since the 1970s.
This seismic shift in the implementation of NEPA—an area of the law that remained relatively stable for nearly a half century—comes on the heels of the D.C. Circuit Court of Appeal’s denial of the requests (by both petitioners and respondents) for rehearing en banc of that court’s opinion in Marin Audubon.
As we described in our November 2024 client alert, the panel majority in Marin Audubon concluded that the CEQ lacks authority to issue binding NEPA regulations. The D.C. Circuit declined to review the panel’s opinion, but, in a concurring opinion, seven out of 12 D.C. Circuit judges described the discussion regarding CEQ’s regulatory authority as dicta.
The IFR also follows on other important judicial developments. In early February 2025, the District Court for the District of North Dakota, in Iowa v. Council on Environmental Quality, issued an opinion in which it vacated the Biden Administration’s 2024 Phase 2 NEPA rules.
The court explained that its judgment would revert the CEQ regulations to an earlier version, namely, the version promulgated by the first Trump administration in 2020 as amended by the Biden administration’s 2021 Phase 1 NEPA rules. Although the court did not finally resolve the issue, it further opined that “it is very likely that if the CEQ has no authority to promulgate the 2024 Rule, it had no authority for the 2020 Rule or the 1978 Rule and the last valid guidelines from CEQ were those set out under President Nixon.”
Citing these decisions and President Trump’s Executive Order (EO) 14154, Unleashing American Energy—which revoked President Carter’s EO 11991 that served as the basis for CEQ’s NEPA regulations—the IFR has now made it clear that CEQ’s NEPA regulations will be rescinded in full.
What does this mean for your project?
In conjunction with its IFR, CEQ released a memo to the heads of federal departments and agencies directing them to:
Revise or establish new NEPA regulations within the next year consistent with EO 14154
Not delay pending NEPA analyses while those NEPA procedures are being updated
Most importantly, “consider voluntarily relying on [the soon-to-be-rescinded] regulations in completing ongoing NEPA reviews or defending against challenges to reviews completed while those regulations were in effect.”
CEQ also encouraged agencies to use the 2020 NEPA regulations as an “initial framework” for developing revisions to their own NEPA regulations, and provided suggested guidelines for those regulations.
As the implications for project proponents and litigants unfold, we are closely monitoring not only the enforceability of CEQ’s rescinded regulations, but also the agency-specific procedures that will replace them.
Clear rules foster timely and cost-efficient environmental reviews. Project proponents should consider active participation in the rulemakings that we will see across multiple federal agencies over the next 12 months to ensure adoption of legally defensible NEPA-implementing regulations that streamline and accelerate the permitting process.
Is It Defamatory to Call Your Contractor a Crook and a Con Man?
Not according to a decision from a federal court in Ohio. The case involves a landscaping project at a hillside home in Cincinnati. The property overlooks the Ohio River, but like many projects that become cases, it ended up in the ditch. Dissatisfied with the progress of the work, the owner told her neighbors that the contractor was a “crook” and a “con man” who had photoshopped pictures of the work he had done. The case inevitably wound up in litigation with both sides suing the other for breaking their respective promises. In addition to breach of contract damages for unpaid work, the contractor also sought unspecified damages for defamation.
On summary judgment, the court reviewed the elements of a defamation claim under Ohio law and concluded that many of the owner’s insults did not constitute actionable defamation. For example, the court held that referring to the contractor as a crook and a con man was not defamatory but instead constituted the expression of an opinion. As to the statement that the contractor had photoshopped evidence, the court concluded that this was not a protected opinion but rather a statement of verifiable fact that could potentially constitute defamation. The court therefore allowed this portion of the contractor’s defamation claim to proceed to the jury.
The court’s analysis contains a helpful summary of defamation law, which construction lawyers don’t come across every day. Here is the meat of that summary:
Defamation is a false publication that injures a person’s reputation, exposes the person to public hatred, contempt, ridicule, shame, or disgrace, or affects the person adversely in his or her trade or business…. If allegedly defamatory words are susceptible to two meanings, one defamatory and one innocent, the defamatory meaning should be rejected, and the innocent meaning adopted.
The elements of defamation are (1) a false and defamatory statement, (2) unprivileged publication to a third party, (3) a requisite amount of fault on the part of the publisher, and (4) actionability or special harm caused by the statement. Truth is a complete defense to a claim for defamation.…
Whether an allegedly defamatory statement is protected opinion or actionable assertion of fact is a question of law for the district court. Consideration of the totality of circumstances to ascertain whether a statement is opinion or fact involves at least four factors. First is the specific language used, second is whether the statement is verifiable, third is the general context of the statement and fourth is the broader context in which the statement appeared….
Courts examining similar situations of name-calling are split as to whether such statements are defamatory or protected opinion. The majority position seems to be that such name-calling is not defamatory.
A copy of the court’s 42-page opinion addressing these and other claims and counterclaims can be found here.
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Joshua Tree Conservation Plan Remains Under Review
The California Fish and Game Commission (Commission) accepted public comment on the draft Western Joshua Tree Conservation Plan (Draft Conservation Plan) at its February 12, 2025 meeting, but no formal action was taken.
As detailed in our previous alert, the California Department of Fish and Wildlife (CDFW) released the Draft Conservation Plan to the Commission on December 12, 2024, as required by the Western Joshua Tree Conservation Act (Act). The Draft Conservation Plan sets forth management practices and guidelines for the avoidance and minimization of impacts to western Joshua trees.
The Commission’s February 12 meeting featured a presentation by CDFW, substantive discussion by the Commissioners, and robust public comment. Many commenters expressed concern about the cost and ultimate feasibility of the Draft Conservation Plan’s requirements. In particular, the Large Scale Solar Association voiced concerns regarding the Draft Conservation Plan’s potential to interfere with the siting and development of solar energy projects, indicating that additional costs generated by required mitigation measures would be passed on to ratepayers. Residents and politicians from desert communities — where Joshua trees are most abundant — focused on the Draft Conservation Plan’s costs and obligations as potential hindrances to affordable housing and local job opportunities. Commenters emphasized that collaboration with CDFW is essential in developing a workable and sustainable conservation effort.
CDFW acknowledged the public comments and ultimately declined to take any formal action at the meeting. Written comments are still being accepted on a rolling basis, though any substantive changes to the Draft Conservation Plan should be submitted by the beginning of March to be considered. The Act mandates that the Commission must take action to adopt the Conservation Plan by June 30, 2025.
The Commission will review the Draft Conservation Plan again at its April 16-17, 2025, meeting. In advance of that meeting, CDFW confirmed it will publish a revised set of Joshua tree relocation guidelines and a list of proposed changes to the Draft Conservation Plan. CDFW Director Bonham also suggested that, in the interim, CDFW may host workshops and/or other community outreach events to solicit further public feedback, though no further details have been provided.
The Top 10 Things Every Employer Should Know About OSHA
In the evolving landscape of workplace safety regulations, it is essential for construction employers to stay well-informed about the Occupational Safety and Health Administration’s (OSHA) protocols and guidelines. Our series, “Top 10 Things Every Employer Should Know About OSHA,” breaks down critical aspects ranging from the rights and responsibilities during OSHA inspections to intricacies of compliance standards and potential citation scenarios. This comprehensive guide aims to empower employers with the knowledge needed to navigate OSHA regulations effectively, ensuring safer work environments and minimizing legal risks.
Here’s a recap of our list of the top 10 things every employer should know about OSHA:
No. 1 – Walkaround Representatives
Employers and employees have the right to have representatives present during an OSHA site inspection.
According to 29 CFR 1903.8(c), employers and employees have the right to authorize a representative to accompany OSHA officials during workplace inspections for the purpose of aiding the inspection (also known as walkaround representatives). OSHA regulations require no specific qualifications for employer representatives or for employee representatives who are employed by the employer. We encourage all employers to have a designated walkaround representative present during OSHA inspections, which could include legal counsel.
No. 2 – Be Present in Manager Interviews
We all know that OSHA has the right to interview folks as part of an investigation. Whether a company representative and the company attorney can also attend an interview depends on the position of the person being interviewed.
If the person to be interviewed is a non-managerial employee, OSHA can conduct the interview in private, outside the presence of the employer or the employer’s representatives. Not so with managerial employees. If OSHA wants to interview a management-level employee, the employer has the right to have a company representative and/or attorney present.
No. 3 – Employees Have Rights When It Comes to OSHA Interviews
Although OSHA has the right to conduct private, one-on-one interviews with a company’s non-managerial employees, those same employees have rights too. Read the full article for details and things to consider.
No. 4 – OSHA Must Issue a Citation Within Six Months
OSHA has a time limit on issuing citations. It must issue a citation within six months of the occurrence of any violation. The only exception to this rule is where the employer has concealed the violative condition or misled OSHA. If such a situation occurs, OSHA must issue the citation within six months from the date that OSHA learns, or should have known, of the condition.
So, the moral of the story is just because it’s been a couple months since an OSHA inspection does not mean OSHA has decided not to issue a citation. You can check on the status of OSHA’s investigation by reviewing the OSHA establishment search page to see whether OSHA has closed its inspection or not.
No 5. – OSHA Can Issue Citations for Unsafe Work Conditions That Have Not Resulted in an Employee Injury
Most frequently, employers do not hear from OSHA unless there is a reported workplace injury. When a reported workplace injury occurs, OSHA performs a walkthrough inspection of the worksite and may ultimately issue a citation for hazardous conditions OSHA believes may have caused or contributed to the incident. However, OSHA is not limited to issuing citations for hazardous conditions that may have caused or contributed to a workplace injury. Rather, OSHA can cite employers for any and all hazardous conditions to which workers may have been exposed regardless of whether the cited condition was in any way related to the incident.
No 6. – But No One Was There? OSHA Can Still Cite for Unsafe Work Conditions Where Workers Were Not Exposed
We often hear, “OSHA can’t cite me because I didn’t employ the injured worker.” Unfortunately, this statement is often untrue.
Under OSHA’s Multi-Employer Doctrine, if you are an employer on a worksite where other companies are also performing work (e.g., construction sites and oil/gas well sites), you can be subject to citation for workplace hazards to which other companies’ employees are exposed. OSHA created the Multi-Employer Doctrine in recognition that there are many circumstances in which multiple employers will be working on a single worksite at the same time thereby affecting the working conditions to which all workers are exposed.
No. 7 – OSHA Can Issue Citations for Unsafe Work Conditions That Do Not Violate Any Specific OSHA Standard
Many employers have a false notion that OSHA can’t issue a citation if there is no specific standard violated.
The reality is, however, that OSHA has a catchall/gap filler provision that allows it to cite an employer even if no specific standard was violated: the “General Duty Clause,” Section 5(a)(1) of the Occupational Safety and Health Act. OSHA can cite employers for violations of the General Duty Clause if a recognized serious hazard exists in the workplace and the employer doesn’t take reasonable steps to prevent or abate the hazard. The General Duty Clause is used only where there is no standard that applies to the particular hazard.
No. 8 – Employers Have 15 Working Days to Contest a Citation but Have the Option to Negotiate a Settlement with OSHA Before That Deadline
What happens if OSHA issues a citation and you do not agree with any or all of it? You have 15 working days from the date you receive the citation to contest in writing the citation, proposed penalty, and/or the abatement date. Read the full article to learn more about your options and how to reach a favorable settlement.
No. 9 – The Particulars on OSHA Violations: How Much Notice Is Enough?
Just what does an OSHA citation have to include? Section 9(a) of the Occupational Safety and Health Act requires that citations “describe with particularity the nature of the violation, including a reference to the provision of the Act, standard, rule, regulation, or order alleged to have been violated.”
This statutory mandate is designed to ensure that OSHA properly informs employers of alleged violations so they can correct hazards promptly and avoid unnecessary litigation. However, the Occupational Safety and Health Review Commission and the courts have consistently interpreted this requirement to mean that citations need only provide employers with “fair notice” of the violation. In other words, as long as an employer is put on notice that a particular condition may violate OSHA standards, additional specifics can be obtained through discovery. As a result, OSHA often issues citations with broad language rather than granular detail.
No. 10 – Unlocking the Secrets of OSHA Inspections Through FOIA Requests
Did you know that you can request files from OSHA? Under the Freedom of Information Act (FOIA), employers, employees, and third parties have the right to request documents from OSHA’s inspection files. These records provide valuable insight into the evidence and reasoning behind OSHA’s decisions, including citations issued during site inspections. They can also be critical in legal proceedings, including lawsuits related to workplace safety.
The Future of NEPA Implementation Without CEQ Regulations
On February 19, 2025, the Council on Environmental Quality (“CEQ”) announced an Interim Final Rule rescinding its longstanding regulations implementing the National Environmental Policy Act (“NEPA”) and issued a new Memorandum on the Implementation of NEPA (“Guidance”) to all federal departments and agencies. President Trump directed both actions in his January 20, 2025 Unleashing American Energy Executive Order (“EO 14154”).
The Interim Final Rule, to be published in the Federal Register on February 25, 2025, removes all existing CEQ regulations implementing NEPA from the Code of Federal Regulations, many of which have been in place since 1978.
The Guidance implements the President’s direction in EO 14154 to “expedite and simplify the permitting process” and strives to minimize potential delays and confusion associated with the removal of CEQ’s regulatory framework for consistent NEPA implementation across agencies. The Guidance “encourages” agencies to use the CEQ regulations issued during the first Trump Administration (the “2020 Rule”) as “an initial framework” while agencies revise or establish agency-specific NEPA implementing procedures over the next year, as directed by EO 14154. Until those changes are complete, the Guidance directs agencies to follow existing practices and procedures, with adjustments for consistency with the NEPA statute, EO 14154, and the Guidance. Further, the Guidance directs agencies to “consider voluntarily relying” on CEQ regulations for ongoing NEPA reviews and lawsuits on NEPA reviews completed while the regulations were still in effect.
The Guidance expressly states that “[a]gencies should not delay pending or ongoing NEPA analyses while undertaking these revisions.” Despite this explicit instruction, the dismantling of a regulatory structure that stood for nearly five decades may cause at least short-term NEPA review delays.
Background
NEPA applies to a broad range of actions with a federal nexus, including federal permit applications, federal land management decisions, highway construction, and other federally funded projects. Through the NEPA process, federal agencies must evaluate the environmental and related social and economic effects of their proposed actions. The NEPA statute and regulations remained largely unchanged from the 1970’s until recent revisions to the CEQ regulations made during the Trump and Biden Administrations in 2020, 2022, and 2024, and statutory amendments to NEPA made by the Fiscal Responsibility Act in 2023.
Over the decades, courts have developed a robust body of caselaw on the NEPA statute and CEQ regulations. In the last several months, however, two court cases questioned CEQ’s underlying authority to issue binding regulations. In November 2024, a D.C. Circuit panel found the CEQ regulations exceeded CEQ’s authority in Marin Audubon Society v. Federal Aviation Administration, although a majority of the court in denying rehearing indicated that portion of the court’s decision was non-binding dicta. More recently, the District of North Dakota vacated Biden’s 2024 Phase II regulations on the grounds that CEQ lacked rulemaking authority in Iowa v. CEQ.
The Interim Final Rule
The Interim Final Rule rescinds all of CEQ’s NEPA regulations and is expected to be published in the Federal Register on February 25, 2025. The Interim Final Rule does not take a position on CEQ’s prior interpretations of NEPA’s procedural requirements, and CEQ avoided a definitive statement on whether it lacks authority to maintain the NEPA regulations. The Interim Final Rule will be effective 45 days after publication.
CEQ issued this as an “interim final rule,” avoiding the typically required notice and comment rulemaking process. CEQ states that this procedural mechanism was appropriate both because the rule is “procedural” and because there was “good cause” for doing so. Although the Interim Final Rule will be effective April 11, CEQ is allowing a “voluntary” 30-day public comment period, and CEQ committed to “consider[ing] and respond[ing] to comments before finalizing” the Interim Final Rule. This is a procedural process that is vulnerable to litigation under the Administrative Procedure Act.
The Guidance
The Guidance directs agencies to establish or revise their NEPA implementing procedures by February 19, 2026, providing at least 30 days but no more than 60 days for public comment on proposed regulations, to the extent public comment is required. The Guidance offers certain recommendations for agencies as they promulgate and revise their own NEPA implementing procedures, including:
developing clear procedures for reviewing project sponsor-prepared environmental assessments (“EAs”) and environmental impact statements (“EISs”);
ensuring procedures comply with statutory deadlines (two years for EISs and one year for EAs);
limiting alternatives analyzed to those that are “technically and economically feasible” and “meet the purpose and need for the proposed action”;
limiting analyzed effects to those that are “reasonably foreseeable,” regardless of whether those effects can be characterized as “cumulative”;
considering the establishment of “thresholds” for Federal funding that would not constitute a “major Federal action” triggering NEPA review; and
eliminating environmental justice analyses from NEPA reviews, except to any extent otherwise required by law.
The Guidance includes additional recommendations to help promote consistency and predictability in the absence of governmentwide CEQ regulations. The Guidance specifies additional elements that agencies should, at a minimum, include in their procedures. It also requires agencies to consult with CEQ in developing or revising their NEPA procedures. Over the next year, CEQ will host monthly meetings of the Federal Agency NEPA Contacts and NEPA Implementation Working Group required by EO 14154 to share additional guidance and provide assistance to agencies as they work to develop or revise their NEPA procedures.
In the meantime, the Guidance recommends that agencies continue to follow their existing NEPA practices and procedures and voluntarily rely on the CEQ regulations for projects currently undergoing NEPA review and legal challenges.
Implications
The intent of the Interim Final Rule and Guidance, consistent with EO 14154, is to expedite critical project approvals. However, the uncertainty caused by such wholesale changes may have the opposite effect, at least in the near term. These significant changes—in many cases to longstanding regulatory requirements—risk creating confusion at the agency level, which could lead to delays in NEPA reviews. This is especially true in the short-term, where CEQ’s NEPA regulations have been rescinded but agencies have not yet implemented new or revised NEPA regulations of their own. Additionally, inevitable litigation—on the Interim Final Rule itself, on CEQ’s rulemaking authority, or on the agency-specific regulations developed through this process—will further add to uncertainty and confusion. There is a risk that projects may benefit from a potentially faster NEPA review, only to face increased litigation risk after project approval. Moving forward, it will be critically important for project proponents and other stakeholders to engage with relevant permitting agencies and participate actively in the development of agency-specific NEPA implementing procedures.
4 Contract Negotiation Tips for Contractors and Owners
Although we are at a time when buildings can be 3D printed, most modern construction is still produced through contractors and manual labor. With prices continuing to rise on a global scale (yes, affecting products even beyond the grocery store), being able to negotiate a fair contract between contractors and owners can make a difference in outlook and favorability for both parties.
Tip #1: If You’re Looking to Cut Corners, Rethink Your Plans
Just because the materials cost a certain amount in February when you draft a contract, does not mean that they will stay that same amount in April. Consider trying to estimate an over/under price in your contract. Beware that “cutting corners” may lessen the quality of work and could affect safety.
Tip #2: Have a Letter of Intent (LOI)
A letter of intent is not required and even having one is non-binding; however, it does provide some security between the two parties. Think of the LOI as the pre-contract, where you can start to set the expectations before having the legally binding contract signed.
Tip #3: Do Not Pay in Full Up Front
While this may seem counterintuitive, it is a strategy that can help retain your contractor before they take on a new project. This does not mean to withhold large percentages of the payment. You should aim to withhold 1-10% of the total sum until the job reaches substantial completion otherwise you may be stuck with finding someone else to do final repairs, clean up, and finishes.
Tip #4: Include Attorney Fees
There may be times that an owner needs to sue its contractor for breach of contract, negligence, misrepresentation and poor quality of work, etc. Negotiating the contractor’s responsibility for attorney fees if it loses the litigation or arbitration can provide some relief.
It is still best practice to talk with your attorney before you begin any negotiations. Often, the attorney can help you research and prep your contract to make sure that you are getting the most out of the transaction without entering into an unfair deal.