Transcript How To Handle A Recall

How To Handle A Recall
Tim Brown, MAS, PPAI Product Responsibility Manager
This information is being furnished by PPAI for
educational and informational purposes only. The
Association makes no warranties or representations
about specific dates, coverage or application. Consult
with appropriate legal counsel about the specific
application of the law to your business and products.
Agenda
•
•
•
•
Why a recall strategy
Strategies to mitigate the risk of product recalls
Develop a plan for if or when a product is recalled
Steps to take when a recall becomes necessary
• Much of this information is sourced from the CPSC Recall
Handbook. Review it online for more information at
www.cpsc.gov//PageFiles/106141/8002.pdf
Product Recalls…It’s all about
preparation
Consumer Product Safety Commission
• The U.S. Consumer Product Safety Commission
(CPSC) has jurisdiction over more than 15,000 kinds
of consumer products used in and around the home,
in sports, recreation and schools including:
–
–
–
–
–
–
–
–
–
Appliances
Clothing
Electronic / Electrical
Furniture
Household
Children's Products
Lighting / Lighter
Outdoor
Sports / Exercise
CPSC Comment On Recalls
• “No company likes to recall one of its products, but
when a safety problem makes a product recall
necessary to prevent injuries and save lives, it
benefits everyone to move quickly and effectively.”
- CPSC Recall Handbook
RECALL HANDBOOK
Benefit of Recall Readiness
• Companies who develop a product recall plan before
a product incident occurs are more able to move
quickly and effectively in the event of a recall.
– Save lives
– Prevent injuries (or further injuries)
– Limit damage to brand
• Your company’s brand
• Your customer’s brand
– Decrease impact on the bottom line
Who Is Responsible?
• Recall responsibility impacts companies that:
–
–
–
–
–
Manufacture
Import
Distribute
Retail
Sell Consumer Products
• Promotional products generally fall under consumer products
What Should You Do?
• Anticipate problem products
• You have an obligation to continuously survey the
market
– Websites
• Saferproducts.gov
– Social media
• Develop a system to maintain and review complaints,
warranty returns and other critical analyses of
products
Reporting Requirements
• Outlined in the Consumer Product Safety Act
• Section 15
• Section 37
• Child Safety Protection Act
• Section 102
Section 15
• A firm must notify the CPSC immediately if a product:
– Fails to meet a consumer product safety standard or
banning regulation
– Contains a defect which could create a substantial hazard
to a consumer
– Creates an unreasonable risk of serious injury or death
– Fails to comply with a voluntary standard which the
Commission has relied on, under the CPSA
What and Where To Report
Section 15
• Must file a report with the CPSC Office of Compliance
–
–
–
–
–
Telephone: 301-504-7520
Mail: 4330 East West Hwy, Bethesda, MD 20814
Electronically: www.cpsc.gov
Fax: 301-504-0359
Email: [email protected]
• Designated contact with decision making authority,
knowledge of product and reporting requirements
Information Needed
Section 15
• Description of the product
• Name and address of the company (manufacturer, distributor,
importer or retailer)
• The possible product defect or unreasonable risk of serious
injury or death
• Nature and extent of the injury or possible injury associated
with the product
• Name, address and telephone number of the person
informing the Commission
• A timetable for providing information not immediately
available
When To Report
Section 15
• Must report “immediately”
– Within 24 hours of obtaining the information
• Encourages to report potential substantial product
hazards even while own investigations are continuing
• May conduct own investigation for 10 working days
• Commission will presume that all information has
been received and considered at the end of the 10
working days
Evaluation of Report
• Commission will evaluate whether or when an incident should
have been reported
– Evaluation based on what the company actually knew about the
hazard posed by the product or on what a reasonable person should
have known about the product hazard
– A company is deemed to know what it would have known had it
exercised due care in analyzing reports of injury, consumer complaints,
warranty of returns, reports of experts, etc.
• Reporting a product to the Commission under section 15 does
not automatically mean that the Commission will conclude
that the product creates a substantial product hazard or that
corrective action is necessary.
Confidentiality of Reports
Section 15
• The Commission is prohibited to release information
unless a remedial action plan has been accepted by
the firm in writing, a complaint has been issued or
the reporting firm consents to the release
• The reporting firm must mark “confidential” on the
report if the information submitted is
trade secret, confidential commercial
or financial information
Criteria For Substantial Product
Hazards
• Pattern of defect
• Number of defective products distributed in
commerce
• Severity of risk
• Likelihood of injury
Hazard Priority System
• Class A Hazard
– Highest level of attention
– Risk of death, grievous or serious injury or illness is likely or very likely
– Immediate action must be taken to identify and notify consumers,
retailers and distributors having the defective product
– Remedy the defect through repair, replacement, refunds, etc.
• Class B Hazard
– Risk of death or grievous injury or illness is not likely to occur, but is
possible, or when serious injury or illness is likely or moderate injury
or illness is very likely
• Class C Hazard
– Risk of seriously injury or illness is not likely but is possible or when
moderate injury or illness is not necessarily likely, but is possible
Fast Track Product Recall Program
• Expedites recall process
– Within 20 working days of filing a potential product defect
report, the CPSC can implement a consumer-level
voluntary recall
– Allows the company and the Commission to create an
immediate corrective action
with out spending time and
other resources to investigate
Fast Track Product Recall Program
• Provide all information required for a full report
• Request to participate in this program
• Submit a proposed corrective action plan with
sufficient time for the Commission to analyze any
proposed repair, replacement or refund and to
evaluate all notice material before implementation of
the voluntary recall
Reporting Requirements – Section 37
• Must notify the Commission immediately if a product:
– Is the subject of at least three civil actions filed in federal
or state court
– Each suit alleges the involvement of the product in death
or grievous bodily injury
– During two-year periods, each of the three actions result in
either a final settlement involving the manufacturer in a
court judgment in favor of the plaintiff
– Manufacturer is involved in the defense of or has notice of
each action prior to the entry of the final order
Information Needed for Report
Section 37
• Name and address of the manufacturer
• Model and model number
• A statement as to whether the civil action alleged
death or grievous bodily injury and the nature of
injury
• A statement as to whether the case resulted in a final
settlement or judgment
• Name and case number and the court in which is was
filed
When and Where To Report
Section 37
• 30 days after judgment or final settlement in the last
of the three lawsuits
• In writing to the Office of Compliance, U.S. Consumer
Product Safety Commission
Confidentiality of Reports
Section 37
• Commission may not disclose to the general public
any information reported under Section 37 (Unlike
Section 15)
– Reporting under Section 37 is not an admission of the
existence of unreasonable risk of injury or defect, product
hazard, or any other liability
Reporting Requirements
Section 102
• Child Safety Protection Act requires companies to
report certain choking incidents if:
– A child, regardless of age, choked on a marble, small ball,
balloon or small part; and
– As a result of the incident, the child died,
suffered serious injury, ceased breathing
for any length of time or was treated by a
medical professional
Information Needed For Reporting
Section 102
• Name and address of the child who choked
• Name and address of the person who notified the
firm of the incident
• Any resulting injuries or medical treatment
• Information about any changes made to the product
involved or its warning labels
• Details of any public notice or other corrective action
planned
When and Where To Report
Section 102
• Must be filed within 24 hours of obtaining the
information
• Must be filed with the Office of Compliance
– By Mail
– By Telephone: 301-504-7520
• Telephone reports must be followed with written confirmation)
– By Fax: 301-504-0359
Confidentiality of Reports
Section 102
• Reports receive the same confidentiality treatment
as information submitted under Section 15
Reporting Requirements
(Recommendations)
• Companies should develop a system for maintaining
and reviewing information that might suggest a
product defect or unreasonable risk of injury or death
• Information should include:
–
–
–
–
–
–
–
Consumer complaints
Warranty returns
Insurance claims or payments
Product liability lawsuits
Reports of production problems
Product test reports
Design evaluations / risk assessments
Identifying A Defect
•
•
•
•
•
What is the utility of the product?
What is the need for the product?
What is the nature of injury that could be caused?
What is the population exposed to the product?
What is the Commission’s experience with the
product?
• What other information sheds light on the product
and patterns of consumer use?
Preparing for a Product Recall
1. Identify the defect that caused the hazard
2. Identify what caused the product defect
3. Locate the unsafe products and find out how many
there are
4. Did the product fail to comply with government
safety regulations?
5. Inform the government or appropriate regulatory
body
6. Discontinue production and shipment
Preparing for a Product Recall
7. Notify distributors to stop selling the product
8. Press Release announcing a recall
9. Establish a toll free telephone service to handle
expected calls
10. Estimate the cost of the product recall
11. Provide reports of the progress of the recall to the
Commission
12. Upgrade quality control procedures to avoid similar
situations in the future
Objectives of a Recall
• Locate all defective product as quickly as possible
• Remove defective products from the distribution
chain and from the possession of consumers
• To communicate accurate and understandable
information in a timely manner to the public about
the product defect, the hazard, and the corrective
action.
Communicating Recall Information
• A joint news
release from
the CPSC and
the company
• A video news release to
complement written news
release
• Targeted distribution of
the news release and a
toll free number for
consumers to call
to respond to the recall
• Information on company
website
Communicating Recall Information
• A national news conference and/or television or
radio announcements
• Notice to distributors, retailers, sales representatives
• Social Media!
• Incentives to consumers to return the product
Recall News Releases
Written and Video
• Must include the following:
–
–
–
–
–
–
Name and location of the recalling firm
Name of the product
Number of products involved
Description of the hazard
Number of deaths, injuries and incidents
Detailed description of the product including model numbers,
colors, sizes, and labeling
– A line drawing or photo of the product
– Major retailers or where and when the product was sold and for
what cost
– Complete instructions for consumers on how to participate in
the recall
Recall Poster
•
•
•
•
•
•
•
•
Brief and eye-catching
Describe the hazard and tell consumers what to do
Use color to make the poster stand out
Use a font, size, and color that contrasts with the
background
Include a phone number
Include a “post until” date [must be at least 120 days from
recall announcement]
Consider tear off sheets so the consumer can take the
information home
Recommended to be 11 x 17 inches, but can not be smaller
than 8.5 x 11 inches
Designating a Recall Coordinator
• Knowledge of the recall procedures
• Ability and authority to function as the central
coordinator for receiving and processing all
information
• Responsible for keeping the company’s CEO informed
about the product recall
• Responsible for making decisions about initiating
product recalls
• Authority to involve appropriate departments and
offices within the firm in implementing a product recall
• Responsible for serving as the company’s primary
liaison with the CPSC
Records Maintenance
• Records of complaints, warranty returns, insurance
claims and lawsuits
• Production records
• Distribution records
• Quality control records
• Product registration cards
• Tracking Labels
Tracking Labels
• Permanent, distinguishing marks on the product (to the
extent practicable) and packaging manufactured as of
August 14, 2009
–
–
–
–
Manufacturer or private labeler name
Location of production
Date of production
Other information (batch, run number, sources)
• The overall purpose is to enhance recall effectiveness
– Tracking labels will provide information to help a
manufacturer target the problem and initiate an effective
corrective action program
Consumer Product Safety Database
• Allows consumers to submit reports of harm or risk
of harm
• Allows consumers to search for safety information on
products they own or may consider buying
• Helps CPSC identify product hazards quicker and
provide consumers with safety information
• www.saferproducts.gov
Resources
PPAI: www.ppai.org
• PPAI Product Corporate Responsibility:
–
•
Tim Brown, MAS [email protected]
–
•
www.ppai.org/inside-ppai/corporate-responsibility/
@PromoSafetyGuy
Anne Lardner-Stone [email protected]
Consumer Product Safety Commission:
• www.cpsc.gov ; www.recalls.gov
CPSC Recall Handbook
• http://www.cpsc.gov/BUSINFO/8002.html
• http://www.saferproducts.gov/About.aspx
UL: www.ul.com/consumerproducts