The Economic & Employment Enforcement Coalition (EEEC), a government enforcement unit comprised of investigators and inspectors from several state agencies including EDD, Cal OSHA, the Labor Commissioner’s Office and other agencies, was on hand to speak to the membership at the East Bay California Autobody Association (CAA) membership on March 8 in Dublin, Calif.
Of concern to many members in attendance was "how can body shops avoid expensive fines levied on their businesses by a wide range of government watchdog organizations?"
Seemingly simple things like not posting safety posters, minor errors on payroll bookkeeping or forgetting to offer your employees 15-minute breaks during peak times can all lead to citations which can seriously interrupt or even halt operations at collision facilities throughout the state.
Deputy Labor Commissioner Kevin O’ Connor, OSHA Senior Safety Engineer Eric Berg, and EDD Joint Enforcement Agent Archana Mathur gave separate presentations to the 70 East Bay CAA members on hand.
O’Connor opened the evening meeting by outlining EEEC’s primary purpose and discussing how the Division of Labor Standards Enforcement, Cal OSHA, Employment Development Department (EDD) and the U.S. Wage and Hour Division (WHD), along with the Bureau of Automotive Repair (BAR) and the State Board of Equalization (BOE) have been stepping up their efforts and performing more and more unannounced inspections for compliance within the collision industry, to collaborate for vigorous and targeted enforcement against unscrupulous body shops statewide.
O’Connor explained that body shops will usually appear on the EEEC’s radar initially when anonymous tips are called in to their offices or through surveillance efforts. In most cases, it's a former employee or an unhappy competitor who blows the whistle.
The first thing the EEEC will do when performing a sweep is to go through their standard onsite protocol, which includes verifying compliance with state and federal laws, employment tax laws and health safety laws. Then the EEEC needs to validate appropriate licenses, workers’ compensation insurance coverage, time and payroll records, required postings, and other labor or Industrial Welfare Commission requirements. Everything has to be in place and records must be properly recorded, or citations and fines will follow. Any body shop that has been inspected knows this drill all too well.
The most common issues cited by the Labor Commission found in body shops are workers’ compensation-related infractions, as well as record keeping problems relating to wages and hours, O’Connor said.
OSHA Senior Safety Engineer Eric Berg then spoke to the members about workplace safety. He admitted that his organization’s rules and regulations are many and complex (700 pages) and some are not so easy to interpret, but he also emphasisized that OSHA is inspecting body shops for the purpose of protecting employees from serious injuries and hazards that potentially exist in any collision facility.
The most common OSHA-related issues cited in body shops, in Berg’s experience, include first-aid kits that aren’t present in shops or properly stocked; improperly stored chemicals and a whole host of spray booth safety concerns, such as filters not getting changed at proper intervals and ventilation problems.
The final speaker of the evening was EDD Joint Enforcement Agent Archana Mathur, who outlined several employee-related pitfalls that body shops encounter. These include misclassifying employees (1099 vs. W2); under-reporting or non-reporting of employees’ wages and taxes and unreported cash compensation, she said.
The overall message from the three government agency representatives was to be proactive in dealing with problems now, so that they don’t lead to citations and fines when the EEEC may come knocking at your door tomorrow or in the immediate future.