Before: ROGERS, Chairman; THOMPSON and ATTWOOD, Commissioners.
BY THE COMMISSION:
At issue before the Commission is whether the judge properly affirmed, as repeat, two
citations issued to Loretto-Oswego Residential Health Care Facility (“Loretto Oswego”) under
the Occupational Safety and Health Act of 1970, 29 U.S.C. §§ 651-678. The judge based the
repeat characterizations on his finding that Loretto Oswego operated as a “single employer” with
two affiliated health care facilities against which there were Commission final orders for
violations substantially similar to the ones cited in these cases.
Loretto Oswego operates a nursing home in Oswego, New York. The two affiliated
facilities at issue here, Loretto-Rest Residential Health Care Facility (“Loretto Rest”) and
Loretto-Utica Residential Health Care Facility (“Loretto Utica”), operate nursing homes in
Syracuse and Utica, New York, respectively. All three Loretto facilities are affiliates of Loretto
Management Corporation (“LMC”), which is located in Syracuse at the same address as Loretto
On June 24, 2002, following two inspections of the Loretto Oswego facility, the
Occupational Safety and Health Administration (“OSHA”) issued five citations to Loretto
Oswego alleging violations of various general industry standards. All five citations were timely
contested and were docketed by the Commission as two separate cases. The parties
subsequently resolved all of the issues in both cases, except for the repeat characterization of one
citation in each case, which the Secretary based on prior Commission final orders against Loretto
Rest and Loretto Utica.
The parties agreed with regard to these two citations that Loretto
Oswego would pay a total penalty of $56,250 if the repeat characterizations were affirmed, and
if they were not, that the citations would be characterized as serious and Loretto Oswego would
pay a total penalty of $11,250.
Before the judge, Loretto Oswego did not dispute that the citations issued to the two
other affiliates were final orders of the Commission and included violations substantially similar
to the ones at issue here. Rather, Loretto Oswego argued that because LMC and the other
Loretto affiliates are separate and legitimate non-profit corporations, a fact that the Secretary
does not dispute, the final orders against Loretto Rest and Loretto Utica could not serve as a
basis for characterizing the violations committed by Loretto Oswego as repeat. After a hearing
on this matter, the judge issued a decision in which he concluded that LMC and its three
affiliates constituted a single employer. Based on this conclusion, he affirmed the items in the
two outstanding citations as repeat and assessed the agreed-upon penalty of $56,250. For the
following reasons, we reverse the judge, affirm the items in these two citations as serious, and
assess the $11,250 agreed-upon penalty.
In finding that LMC and its three affiliates constituted a single employer, which the
Secretary alleged as the sole basis for the repeat characterizations, the judge evaluated the record
evidence under Commission precedent holding that “related employers are regarded as a single
entity where . . . they share a common worksite, have interrelated and integrated operations, and
share a common president, management, supervision, or ownership.” Vergona Crane Co., 15
BNA OSHC 1782, 1783, 1991-93 CCH OSHD ¶ 29,775, p. 40,496 (No. 88-1745, 1992); accord
C.T. Taylor Co., 20 BNA OSHC 1083, 1086-88, 2002-04 CCH OSHD ¶ 32,659, pp. 51,340-41
(No. 94-3241, 2003) (consolidated); Trinity Indus., Inc., 9 BNA OSHC 1515, 1518-19, 1981
CCH OSHD ¶ 25,297, pp. 31,322-23 (No. 77-3909, 1981).
But applying this precedent here,
we conclude the Secretary has failed to establish that a single-employer relationship existed
between Loretto Oswego and LMC or the previously cited affiliates.
In finding a single-employer relationship in Vergona Crane and C.T. Taylor, the
Commission relied on strong evidence of close identity between the two companies involved in
each case. In Vergona Crane, the two companies were owned by the same family, had the same
president, and operated out of the same office, and the leases for the crane at issue in that case
appeared to use the names of those companies interchangeably. 15 BNA OSHC at 1783, 1991-93 CCH OSHD at p. 40,495. In C.T. Taylor, the two companies were owned and controlled by
the same individual and operated out of the same office; one of the companies, on behalf of the
other, essentially performed all administrative functions and, as to the job at issue, controlled and
directed employee work and maintained responsibility for employee safety. 20 BNA OSHC at
1085-87, 2002-04 CCH OSHD at pp. 51,339-40. In this case, there are some areas of
commonality, but in contrast with Vergona Crane and C.T. Taylor, we find that the evidence
here falls short of showing that Loretto Oswego and the other Loretto corporations constituted a
We look first at the president and other upper management officials of the Loretto
corporations. At the time of the violations, LMC and the three affiliates shared the same
president, chief executive officer, and chief financial officer. This outward appearance of a
common identity gives way, however, when we consider the extent to which LMC and its
affiliates had “interrelated and integrated operations.” In terms of general administrative
matters, the record shows little to no interaction among the affiliates themselves, but some
involvement on LMC’s part with Loretto Oswego’s operations. For instance, LMC provided
support to Loretto Oswego on financial matters. Budgets prepared by Karen Jeffreys, Loretto
Oswego’s administrator, were submitted to and approved by LMC’s Board of Trustees.
also discussed budget issues on a monthly basis with her supervisor, Mitchell Marsh, LMC’s
vice-president of nursing home services. Financial matters at Loretto Oswego were reviewed
once or twice a year by LMC’s corporate controller, who communicated regularly with Loretto
Oswego’s financial director. And monthly financial reports were submitted by Loretto Oswego
But the record shows that on a day-to-day basis, administrative personnel at Loretto
Oswego operated independently of LMC. For instance, Jeffreys and her nursing director
determined who to accept as residents at the facility. And even though the president and CEO of
Loretto Oswego, who also held these same positions at LMC and each affiliate, had the authority
to hire, discipline, or fire any Loretto Oswego employee, he delegated these responsibilities to
Jeffreys, who was also directly accountable to the New York State Department of Health as a
licensed nursing home administrator. All management employees at Loretto Oswego reported to
Jeffreys, not any of her superiors, and although Jeffreys’ monthly meetings with Marsh included
some discussion of staffing issues, personnel issues were regularly handled in-house by a Loretto
Oswego employee, with LMC being consulted only if a complicated issue arose. Finally,
although Loretto Oswego and the other affiliates engaged in union contract negotiations at the
same time, each one entered into a separate contract with the union.
In terms of safety matters, the evidence in the record is particularly weak as to whether
LMC and its affiliates were so integrated that they acted as one employer. Although each
affiliate had an exposure control plan for containment of infectious diseases that was revised by
a Loretto infection control practitioner apparently on LMC’s behalf, and some LMC personnel
were present during OSHA’s February 2002 inspection of the Loretto Oswego facility, this
evidence—whether considered separately or in the context of the record as a whole—fails to
establish that the affiliates and LMC “handled safety matters as one company.” See C.T. Taylor,
20 BNA OSHC at 1087, 2002-04 CCH OSHD at p. 51,340. The infection control practitioner
provided copies of the revised exposure control plan to the affiliates and discussed her revisions
at meetings attended by representatives of LMC and the affiliates. She also provided bloodborne
pathogen training to Loretto Oswego employees on one occasion and to employees of the other
affiliates as well. These specific measures undoubtedly served an important safety purpose, but
addressed only a single aspect of employee safety at the affiliate facilities, and may represent
nothing more than resource sharing rather than the level of integration necessary to show a
Nor do we view LMC’s participation in the OSHA inspection here as indicative of a
broader involvement in safety matters at Loretto Oswego. The record shows that Jeffreys
requested that the compliance officers (“COs”) wait until LMC’s safety manager and director of
facilities could arrive from Syracuse before inspecting the Loretto Oswego facility. During the
inspection, the LMC personnel facilitated immediate abatement of the violations and LMC’s
newly-hired corporate safety manager provided the COs with abatement dates for violations that
could not be corrected immediately. The corporate safety manager was also present at the
settlement conference with Jeffreys and LMC’s vice-president of support services, who the judge
found had the authority to enter into a settlement on behalf of Loretto Oswego. It is not
surprising, however, that LMC became more involved in Loretto Oswego’s operations
concerning the handling of a regulatory enforcement action—that action could have resulted in a
monetary fine against Loretto Oswego and, as noted, LMC had some responsibility for
overseeing the affiliate’s financial matters.
Indeed, other evidence in the record shows that it was Loretto Oswego personnel, not
employees of LMC, who were primarily responsible for safety matters at the facility. Like all of
the affiliates, Loretto Oswego had its own safety committee comprised of only its employees,
and it was Loretto Oswego, not LMC, that handled safety orientations for new employees. In
fact, LMC had no employee dedicated to safety issues until the hire of its first corporate safety
manager just three months prior to OSHA’s inspection of the Loretto Oswego facility, and the
record sheds little light on his role with respect to the affiliates during the period prior to the
inspection. Most of the newly-hired safety manager’s interactions with Loretto Oswego and the
other affiliates, including any training or safety education requested by the affiliates, did not
occur until after his first appearance at the Loretto Oswego facility on February 14, 2002, the
day that OSHA commenced its inspection. And a new corporate-wide safety policy that the
safety manager had drafted was not completed until the end of that month, and was not due to be
“rolled out” in the Loretto facilities until March 1, 2002.
Further, other interactions regarding safety and health matters that occurred before
OSHA’s inspection were infrequent and, for the most part, focused on the safety and health of
the Loretto Oswego facility’s residents, not its employees. Indeed, on the two occasions over an
eight-year period that Marsh organized mock inspections for Loretto Oswego and the other
affiliates, the sole purpose was to prepare them for state regulatory surveys that were focused
exclusively on safety and health conditions for residents, not employees. And despite Marsh’s
presence at the facility during one of these surveys, the Department of Health issued its
Statement of Deficiencies specifically to Jeffreys as the licensed administrator, who then
prepared a plan of correction for the facility with assistance from her own staff. Moreover, on at
least one occasion Jeffreys herself hired an outside consultant to inspect the Loretto Oswego
facility in preparation for a state survey.
With respect to Loretto Oswego’s premises, its own building manager was responsible
for maintaining the facility, and the two LMC managers who visited the facility four or five
times a year limited their evaluation to “environmental and maintenance” issues, and provided
some training to certain Loretto Oswego personnel on just these issues. And there is no evidence
in the record that employee safety and health was the subject of Marsh’s monthly meetings with
Jeffreys and the affiliate’s nursing director, during which Marsh reviewed “quality indicators”
and performed “an environmental round.”
Finally, the record shows that Loretto Oswego does not “share a common worksite” with
either Loretto affiliate or LMC. The facilities of the three affiliates are located in different cities,
and although LMC’s offices are located at the same address as Loretto Rest, LMC has no
physical presence at either Loretto Oswego or Loretto Utica. Given these circumstances and the
record evidence discussed above regarding the lack of integration among Loretto Oswego and
the other Loretto corporations concerning administrative matters and employee safety, we
conclude that the Secretary has failed to demonstrate the existence of a single-employer
relationship. As this was the Secretary’s only basis for the repeat characterizations, we find that
the record does not support characterizing any of the violations at issue as repeat.
With respect to Docket Number 02-1164, we affirm as serious Items 1 through 4 of
Citation 2, and assess penalties totaling $8,250. With respect to Docket Number 02-1174, we
affirm as serious Items 1 through 3 of Citation 2, and assess penalties totaling $3,000.
Thomasina V. Rogers
Horace A. Thompson III
Cynthia L. Attwood
Dated: January 7, 2011 Commissioner
UNITED STATES OF AMERICA
OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION
SECRETARY OF LABOR, :
v. : DOCKET NOS. 02-1164 & 02-1174
LORETTO-OSWEGO RESIDENTAL :
HEALTH CARE FACILITY, :
Marc G. Sheris, Esquire Paul M. Sansoucy, Esquire
U.S. Department of Labor Paul Limmiatis, Esquire
Office of the Solicitor Bond, Schoeneck & King, PLLC
New York, New York Syracuse, New York
For the Complainant. For the Respondent.
BEFORE: MICHAEL H. SCHOENFELD
Administrative Law Judge
DECISION AND ORDER
This proceeding is before the Occupational Safety and Health Review Commission
(“the Commission”) pursuant to section 10(c) of the Occupational Safety and Health Act of
1970, 29 U.S.C. § 651 et seq. (“the Act”). The Occupational Safety and Health
Administration (“OSHA”) inspected Respondent, Loretto-Oswego Residental Health Care
Facility ( “Loretto-Oswego”), a 120-bed skilled nursing home located in Oswego, New
York, during February and March of 2002.
As a result, OSHA issued two Citations and
Notifications of Penalty to Respondent on June 24, 2002. The citation relating to Docket No.
02-1164 alleges serious and “repeat” violations of various subparts of 29 C.F.R. § 1910.1030
and “repeat” violations of 29 C.F.R. §§ 1910.133(a)(1) and 1910.151(c). The citation
relating to Docket No. 02-1174 alleges a serious violation of 29 C.F.R. § 1910.303(f),
“repeat” violations of 29 C.F.R. §§ 1910.101(b), 1910.147(c)(4)(i) and 1910.303(g)(2)(i),
and an “other” violation of 29 C.F.R. § 1910.305(g)(1)(iii). Respondent contested the
citations, bringing this matter before the Commission, and the two cases were consolidated.
Prior to the hearing in this matter, Loretto-Oswego filed a motion for partial
summary judgment, asserting that the Secretary’s classification of various of the citation
items as repeat was improper because the previous violations related to two other employers
which, while sharing the “Loretto” name and having a common corporate parent, were
nonetheless separately incorporated and distinct legal entities.
The Secretary filed a cross-motion for partial summary judgment, asserting that where, as in this case, separate but
affiliated corporations share a common business purpose, it is appropriate to disregard the
corporate form and to consider the entities to be a single employer for purposes of the Act.
The motions were denied in an order dated May 1, 2003, based on my conclusion that there
were material facts that were undetermined and in dispute with respect to the
interrelationship of the various legal entities under the Loretto “umbrella.” Following my
order, the parties on May 9, 2003, reached a stipulation resolving all issues other than the
repeat classification. Specifically, Loretto-Oswego agreed to the affirmance of the
underlying violations in this matter.
The parties also agreed that if the repeat classification
was upheld, Loretto-Oswego would pay one-half of the proposed penalties; if, on the other
hand, the repeat classification was not upheld, Loretto-Oswego would pay one-half of the
penalties proposed for the serious items and one-half of the penalties that would have been
proposed for the repeat items had they been classified as serious rather than repeat
The hearing in this case took place in Oswego, New York. Both parties have
filed post-hearing briefs.
The OSHA Inspection
OSHA compliance officers (“CO’s”) Charlene Schmidt and Dwayne Gary went to
the Loretto-Oswego facility on February 14, 2002, in order to perform a comprehensive
safety and health inspection of the facility. According to their testimony, they met with
Karen Jeffreys, the administrator of Loretto-Oswego, presented their credentials, and
explained why they were there. In response to specific questions, Jeffreys told the CO’s that
Loretto-Oswego had 176 employees, that Loretto Management Corporation (“LMC”),
located in Syracuse, New York, was the controlling corporation, and that LMC controlled
1500 employees. The CO’s then asked for various documents, such as the OSHA 200 logs,
the exposure control plan and the lockout/tagout (“LOTO”) plan. As the CO’s were
reviewing the documents, Jeffreys said that she had contacted Loretto in Syracuse and that
two people were being sent to accompany the CO’s during the inspection; Jeffreys asked if
the CO’s could wait, and the CO’s agreed. When the individuals arrived, they introduced
themselves as Arthur Coughlin, corporate safety manager, and Antonio Tullio, corporate
director of maintenance.
The CO’s began their inspection in the company of Jeffreys,
Coughlin, Tullio and Darlene Nesbitt, Loretto-Oswego’s director of facilities. The CO’s
were unable to complete the inspection and made plans to return another day. (Tr. 269-79;
The CO’s resumed the inspection on February 20, 2002, accompanied by the same
persons as before. When violations were observed, Coughlin and/or Tullio attempted to have
them corrected immediately by calling on facility employees. CO Schmidt testified she spoke
primarily to Coughlin because Jeffreys had to excuse herself at times to attend to other
matters; Jeffreys also referred CO Schmidt to Coughlin or Tullio for anything she was
CO Schmidt held a preliminary closing conference on February 20, 2002;
present were Jeffreys, Coughlin, Tullio, Nesbitt and Diane Harrington, Loretto-Oswego’s
director of nursing. Schmidt discussed the violations, many of which had been remedied, and
Coughlin provided abatement dates for items that had not been corrected. The CO’s returned
to the facility on March 7 and 13, 2002, to interview employees and to hold a final closing
conference; in addition, Coughlin wanted to show Schmidt further items that had been
corrected. On March 7, Scott LaRue, LMC’s vice-president for support services, was at the
He told Schmidt that LMC had 13 facilities, including Loretto-Oswego, that LMC
approved the budgets for the facilities, and that James Introne, LMC’s president, had the
authority to hire, fire and discipline the administrator of Loretto-Oswego. He said that the
corporate safety manager was responsible for going to all the facilities to ensure that safety
issues were taken care of; he also said that mock inspections were done at some sites, which
consisted of LMC officials and facility administrators inspecting sites to make sure things
were being done properly. LaRue was also present for the closing conference on March 13,
at which time Schmidt discussed the violations that had been observed; as to the unsecured
compressed air cylinders, LaRue indicated that this was fairly common in the facilities and
that the nursing staff did not secure them. (Tr. 279-84; 309).
The CO’s reviewed a number of documents during the course of the inspection. CO
Schmidt identified C-11 as the corporate safety policy that Coughlin provided during the
inspection; she testified that he told her that he had developed the policy, that it was
supposed to be “rolled out” in all the facilities by March 1, 2003, and that he was to go to all
of the facilities to provide training in the policy. CO Schmidt also identified C-12 as the
LOTO program that Jeffreys gave her, and she testified that upon reviewing it, she noted that
it was from Loretto’s Nottingham facility, that the written procedures were from the Loretto
Rest facility, and that it nowhere referenced Loretto-Oswego; when she asked Jeffreys if C-12 was in use at Loretto-Oswego, Jeffreys told her it was. CO Gary identified C-14 as a
hazard communication policy that was given to them during the inspection; he testified that
he did not believe that the policy was created at Loretto-Oswego because the cover had the
name and address of Loretto Rest on it.
(Tr. 275-77; 286; 299; 314).
The CO’s also interviewed a number of employees during the course of the
inspection, and CO Gary interviewed employees during March and April of 2002 about the
relationship between LMC and Loretto-Oswego. According to his testimony, Jeffreys told
him that Mitchell Marsh was the corporate vice-president of residential health care facilities
(“RHCF’s”) and that he was in charge of Loretto-Oswego, Loretto Rest RHCF (“Loretto
Rest”), Loretto-Utica RHCF (“Loretto-Utica”) and Nottingham RHCF (“Nottingham”);
Jeffreys also told him that Marsh was at the facility essentially monthly to review quality
control, staffing and budget issues.
Diane Harrington, the director of nursing, and Sharon
Lamore, the assistant director of nursing, also told Gary that Marsh was the vice-president of
RHCF’s. Harrington said Marsh was affiliated with the corporate office and stated that he
could fire her if she did not follow corporate guidelines.
Harrington further stated that, just
prior to the OSHA inspection, Marsh had spent three consecutive half days at the facility for
a New York State regulatory survey. CO Gary also interviewed Melva Neff, who Harrington
referred to as the corporate infection control practitioner. Neff told CO Gary that she had
written C-9 and C-10, the Loretto exposure control plans for 1997 and 1999, and that she
revised the plan annually and provided it to the Loretto facilities. (Tr. 300-01; 309-13).
CO Gary went to LMC’s offices on May 20, 2002, to better understand LMC’s
corporate structure and its relationship with Loretto-Oswego; he met with LaRue, Marsh and
Coughlin, and also with Kathy Collins, the corporate comptroller, and Gregg Lawson, the
corporate human resource manager.
LaRue told him that LMC’s Board of Trustees could
influence the staff of Loretto-Oswego to make sure its wishes were carried out, that either he
or Marsh would exercise that influence, depending on the area, and that the areas of
influence included finance, human resources and information technology. Marsh told him
that if there were budget issues at Loretto-Oswego he would talk to the facility’s
administrator and that if the administrator did not make corrections to keep within the
guidelines he would report the matter to the Board of Trustees, who would hold the
administrator accountable. Gary testified that at the meeting, he was given C-3, a Price
Waterhouse Coopers (“PWC”) financial statement for Loretto-Oswego for 1999 and 2000,
and C-6 and C-7, organizational charts for LMC and Loretto-Oswego, respectively. (Tr. 314-19).
The “Single Employer” Doctrine
In their post-hearing briefs, the parties make essentially the same arguments they
made in their respective pre-hearing motions for partial summary judgment. The Secretary
contends that where, as here, separate but affiliated corporations have a common business
purpose, it is appropriate to disregard the corporate form and to consider the companies to be
a single employer under the Act. Respondent contends that the classification of various of
the citation items as repeat was improper since the previous violations upon which the repeat
classifications were based related to two other companies which, while sharing the “Loretto”
name and having a common corporate parent, were separately incorporated and are distinct
legal entities. Respondent notes that the Commission has never held that separately
incorporated employers may be treated as one for repeat violation purposes, but that, even if
the single employer doctrine is found to apply here, the Secretary has not shown that
Loretto-Oswego constitutes the same employer as Loretto Rest and/or Loretto-Utica.
To establish a repeat violation, the Secretary must show that, at the time of the
alleged repeat violation, there was a Commission final order against the same employer for a
substantially similar violation. Potlach Corp., 7 BNA OSHC 1061, 1063 (No. 16183, 1979).
It is undisputed that, at the time the repeat citation items in this case were issued, there were
final orders against Loretto Rest and Loretto-Utica for violations of the same standards; it is
likewise undisputed that Loretto-Oswego was in violation of the standards cited in this case,
including those that were classified as repeat.
The question to resolve is whether LMC and
its affiliates may be considered a single employer under the Act in order to find that Loretto-Oswego was in repeat violation of the cited standards.
The Secretary points out that section 3(5) of the Act defines “employer” as “a person
engaged in a business affecting commerce....” and that section 3(4) of the Act defines
“person” as “one or more individuals, partnerships, associations, corporations, business
trusts, legal representatives, or any organized group of persons.” (Emphasis added). Thus, as
the Secretary notes, the Act itself recognizes that an employer can be more than one
corporation. The Secretary also points out that in a recent decision, the Commission
reaffirmed its long-standing precedent essentially adopting the single employer concept as
applied by the National Labor Relations Board (“NLRB”). C.T. Taylor Co., 20 BNA OSHC
1083 (Nos. 94-3241 & 94-3327). In that case, the Commission utilized the single employer
doctrine to conclude that C.T. Taylor Company (“Taylor”) and Esprit Construction, Inc.
(“Esprit”) were a single entity at the work site, even though Esprit was separately
incorporated, because both companies were owned and controlled by Taylor; in so
concluding, the Commission relied upon the relationship and interconnections between the
two entities and particularly noted the fact that Taylor and Esprit handled safety matters as
one company. Id. at 1086-87.
The single employer concept was first articulated in Advance Specialty Co., 3 BNA
OSHC 2072, 2075-76 (No. 2279, 1976). There, Commissioner Cleary stated that “the
[NLRB] has consistently held that when two business entities have a combination of most or
all of the following factors: a common worksite, a common president or management, a
close interrelation and integration of operations and a common labor policy, it will treat the
two as one for the purposes of the National Labor Relations Act.” Id. at 2075-76.
Commissioner Cleary then went on to state that “when ... two companies share a common
worksite such that employees of both have access to the same hazardous conditions, have
interrelated and integrated operations, and share a common president, management,
supervision or ownership, the purposes of the Act are best effectuated by the two being
treated as one.” Id. at 2076. The Commission adopted the single employer concept in a later
case, Trinity Indus., Inc., 9 BNA OSHC 1515, 1518-19 (No. 77-39, 1981), and, in C.T.
Taylor, it reiterated the statements that Commissioner Cleary made in Advance Specialty.
C.T. Taylor Co., 20 BNA OSHC at 1083. The Commission also used the single employer
doctrine in Vergona Crane Co., 15 BNA OSHC 1782, 1783 (No. 88-1745, 1992).
I have considered Respondent’s arguments as to why the single employer doctrine
should not be found applicable to this matter. (R. Brief, pp. 8-10). I have also considered
Respondent’s assertion, set out in a supplemental filing, that the Commission’s recent
decision in Eric K. Ho, 20 BNA OSHC 1361 (Nos. 98-1645 & 98-1646, 2003), wherein the
Commission reversed the judge’s decision that related corporations were properly cited for
violations of an individual employer under the “alter ego” doctrine, bears directly on this
case. After reviewing that decision, however, I agree with the Secretary that the holding in
Eric K. Ho does not apply to the circumstances of this case. Moreover, while Respondent is
correct that the Commission itself has not held that separately incorporated employers may
be treated as one for repeat violation purposes, a Commission judge has so held. Southern
Scrap Materials Co., Inc., No. 94-3393, 1997 OSAHRC LEXIS 162.
Commission clearly used the single employer concept in C.T. Taylor to find separate but
related employers responsible for the same condition. C.T. Taylor Co., 20 BNA OSHC at
1087-88. In any case, I conclude that the Secretary, in her discretion, may cite an employer
for an alleged repeat violation that is based on a previous violation of the same or a
substantially similar standard committed by a different but related employer. I further
conclude that the single employer doctrine is the appropriate means of determining the issue
to be resolved in this matter, as follows.
A Common Work Site
As the Secretary points out, while this case does not involve the common work site
that is typical of construction cases, LMC’s offices, as indicated above, have the same
address on Brighton Avenue in Syracuse as Loretto Rest.
Respondent makes much of the
fact that the Commission’s single employer test requires “a common worksite such that
employees of both have access to the same hazardous conditions.” As Loretto’s various
facilities are in and around Syracuse, as well as in Oswego and Utica, New York, it is
apparent that, other than LMC, Loretto Rest and the other programs on the Brighton campus,
they do not share a “common worksite.” (C-27, p. 6). However, due to the nature of
Loretto’s business, most of the facilities would clearly present the same or similar hazards to
employees; that this is so is illustrated by C-27, pp. 42-55, information from Loretto’s web
site, and by the alleged repeat violations in this case. Further, the Commission’s test must
have some flexibility to be utilized in the many types of cases that come before it. Based on
the record, I find that, among the Loretto entities that provide skilled nursing and other
health care, employees are exposed to the same or similar types of hazards as those in this
case. I conclude, therefore, that the Secretary has shown the first element of the
Commission’s single employer test.
A Common President, Management, Supervision or Ownership
A press release on Loretto’s web site describes Loretto as follows:
Loretto is Central New York’s largest elder care provider, with 1,600
employees serving 3,000 men and women at 15 different sites. As a not-for-profit, Loretto offers a broad spectrum of services from independent living
and outpatient rehabilitation to assisted living and skilled nursing home care.
Loretto’s mission is to improve the quality of life for the frail elderly in
Central New York, with a strong emphasis on advancing the dignity,
independence, choices and safety of older adults.
See C-16, p. 7.
Loretto’s web site also discusses Loretto’s Board of Trustees, as follows:
Loretto is a voluntary, not-for-profit agency led by a Board of Trustees whose
purpose is to assure that the organization operates in a manner that is
consistent with its charitable mission of service to the elderly.
See C-27, p. 56.
The by-laws of LMC specifically state, under the section entitled “Purposes and
Relationships,” that “[t]he Corporation will control, oversee, coordinate, represent and
support the interests of all present and future Loretto Corporations.” (C-4, p. 2). The by-laws
then set out the names of the various affiliates, and, after that listing, provide on pages 2 and
The Corporation reserves to itself the following powers for each affiliate:
(a) Approval of annual operating and capital budgets.
(b) Approval of the employment of the chief executive officer.
(c)Access to all information regarding the operation of the affiliate
including financial statements, minutes of board meetings and committee meetings, and any other relevant data.
(d)Participation and cooperation by each affiliate with the Corporation
and the other affiliates in all matters of common interest.
The by-laws state, with respect to the chairperson of LMC’s Board of Trustees, that:
The Chairperson of the Board shall be the chief elected officer of the
Corporation and shall exercise, in behalf of the Board, general supervision of
the affairs of the Corporation with respect to the goals and policies and the
planning and financing of facilities and services as established by the Board.
(C-4, p. 6).
The by-laws further state, in regard to the president of LMC, that:
The President shall be an employee of and the chief executive officer of the
Corporation and shall have and exercise charge and supervision of the
implementation of the goals and policies of the Corporation through operation
of its facilities and personnel. He shall perform such other duties as may be
assigned to him by the Board of Trustees, but shall not be a Trustee of the
(C-4, p. 7).
Finally, C-3, the PWC financial statements for Loretto-Oswego for 1999 and 2000
that CO Gary was provided during the inspection, gives the following information on page
10 about Loretto-Oswego’s transactions with other affiliates:
In its efforts to provide a complete range of services to its residents and
program participants, Loretto-Oswego is affiliated with a number of other
Loretto entities. [LMC] is the sole member of all affiliated Loretto entities
and the overall operations of all entities are under the administrative control
of the President of the Corporations. Because of this controlled group
relationship, generally advances and other balances due from/to affiliated
entities arising in the normal course of business are recorded on an interest
free basis. Amounts due to/from affiliates are collected/paid based on
availability of funds from operations and on expected payment terms.
The record shows that James Introne, the president and CEO of LMC, is also the
president and CEO of the Loretto affiliates, including Loretto-Oswego, Loretto Rest,
Loretto-Utica and Nottingham. (Tr. 15; 85-86; 160; C-5-6). The record also shows that
Introne is responsible to LMC’s Board of Trustees (“the Board”) for the affiliates’
operations, and that the Board, through Introne, exercises oversight over the affiliates. (Tr.
21; 76; 160-63; C-5, No. 5). Introne has the authority to hire, fire and discipline the
administrators and other personnel of the affiliates. (Tr. 86; 184; 283). Introne specifically
hires the administrators of the facilities, and he also gives the administrators general
direction; the administrators, in turn, are responsible to Introne and to the Board. (Tr. 76-77;
86-87; 163). Based on this evidence, I find that LMC and the Loretto affiliates share a
common president and CEO. Moreover, this evidence, together with the information set out
above from Loretto’s web site, LMC’s by-laws and the PWC financial statements for
Loretto-Oswego, strongly suggests common management and supervision among LMC and
the Loretto affiliates. There is also considerable relevant employee testimony, as follows.
The Secretary’s Exhibit C-6, the LMC organizational chart given to CO Gary, shows
that there are four vice-presidents, two of whom are senior vice-presidents, and one chief
financial officer (“CFO”) directly under Introne.
Michael Sullivan testified that he was
LMC’s CFO from 1995 until 2002 and that, since the fall of 2002, he has been LMC’s chief
operating officer (“COO”). As CFO, Sullivan had general oversight of all accounting
functions, including the budgets for LMC and all the affiliates, as well as operational cost
effectiveness and strategic planning. As COO, Sullivan is responsible for the day-to-day
oversight of the Loretto affiliates’ operations, although not their budgets, and he has direct
oversight of support services, human resources and information technology. Sullivan claimed
that Loretto has become more decentralized since about 1997, such that the affiliates are
running as separate entities as if there were no Loretto. He also said that this has resulted in
fewer persons on LMC’s payroll, more persons on the affiliates’ payrolls, and the
administrators, while able to consult as needed with corporate employees, having ultimate
responsibility for their respective facilities; the areas that still have corporate functions are
finance and those he directly oversees. (Tr. 202-17).
Mitchell Marsh, another individual directly under Introne on C-6, testified that he is
the vice-president for the RHCF’s and that he is also the administrator for Loretto Rest and
for Nottingham; he was the administrator at Loretto-Utica until March 1998, when he
became the administrator for Loretto Rest, and he became the vice-president for the RHCF’s
in January 1999.
Marsh said that his primary responsibility is that of administrator of
Loretto Rest, that his second is that of administrator of Nottingham, and that his third is that
of vice-president for the RHCF’s, in which he serves as a liaison for Introne to Loretto-Oswego and Loretto-Utica and a resource or consultant to those sites to make sure Introne’s
directions are being carried out; his duties in this regard include site visits to ensure the
facilities have balanced budgets and are complying with state and federal regulatory
requirements. Marsh visits each site essentially monthly and reviews financial and clinical
records and then walks through the facility to ensure that environment and quality of care
standards are being met. Marsh has also organized mock inspections of sites, in which he and
employees of other facilities inspect a particular site; the intent of these inspections is to have
“fresh eyes” at the site to point out problems that might have been overlooked, but it is up to
the facility staff to decide what items are problems that require correction.
169-79; 187-88; 382-86; 397-98).
Marsh further testified that in his consultant role he provides support and counsel to
Loretto-Oswego and Loretto-Utica, due to his experience in working in nursing homes, and
that he tries to be there for their New York State Department of Health (“DOH”) surveys. He
noted the importance of the DOH surveys and the fact that if deficiencies are found, the
administrator, who has a state-issued license and is legally responsible for the deficiencies,
has to answer to Introne and the Board and must also prepare and sign off on a plan of
correction to DOH.
He also noted that facilities must comply with OSHA requirements,
that he is advised when OSHA issues a citation to one of the RHCF’s, and that he in turn
advises Introne; Marsh was also informed of the OSHA inspection in this case. Marsh said
that Arthur Coughlin is responsible for making sure that the RHCF’s have the information
and assistance they need to have an effective safety and health program.
He noted that
Coughlin had written a safety and health program for Loretto Rest and had disseminated it to
the other facilities so that they could modify it and tailor it to their specific needs. He further
noted that if a Loretto RHCF had a safety program that did not follow OSHA regulations,
and if Coughlin was aware of that fact, Coughlin would notify him.
Marsh would then
discuss the matter with the facility’s administrator and would also report the matter to
Introne, who would take whatever action he deemed appropriate.
(Tr. 163; 169; 174; 177;
180-84; 187-200; 385; 389-90).
Marsh said he is an employee of Loretto Rest and not of LMC, despite his position on
C-6 under Introne with the other vice-presidents and the fact that Introne is his immediate
supervisor; his belief was that of the three other vice-presidents shown at the same level on
C-6, only Sally Berry, the senior vice-president for policy and development, is an LMC
He also said he does not supervise Jeffreys, that she does not report to him, and
that C-7, the organizational chart for Loretto-Oswego, is inaccurate in that it shows an
executive vice-president over the administrator instead of Introne. Marsh assumed Jeffreys
had made C-7, and he noted that it would not surprise him if Jeffreys believed he was her
supervisor because of the interactions they have and because he does her evaluation.
stated that neither he nor Introne supervises or manages Loretto-Oswego’s operations on a
day-to-day basis and that Jeffreys does so. He further stated that he does not have the
authority to hire, fire or discipline Loretto-Oswego employees and that while Introne has
such authority he delegates it to Jeffreys. (Tr. 164-65; 170-72; 378-82; 395-97).
Scott LaRue testified that he is employed by LMC and that he is the vice-president of
support services; he manages the housekeeping, maintenance, food service and human
resources operations at Loretto Rest, and he oversees the other Loretto entities in those areas
and gives them advice and counsel as requested and as needed.
He explained that about 95
percent of his job involves Loretto Rest, due to the size of that facility, and that the rest of
his time is spent on matters in other facilities. He further explained that some entities have
their own human resource and facilities functions, such that he provides less help to those
sites, while other entities do not; Loretto-Oswego, for example, had a facilities director at the
time of the inspection with whom he spoke four to six times a year.
LaRue indicated that
while he works for LMC, the persons who work at Loretto Rest in the areas he oversees,
such as human resources and maintenance, are employed by Loretto Rest but supervised by
him; Antonio Tullio, for example, the Loretto Rest director of facilities, is an employee of
Loretto Rest and reports to LaRue, although Tullio is ultimately responsible to Marsh.
LaRue also indicated that the LMC support services function is to ensure that Loretto Rest is
following state and federal regulations and to assist the other facilities. (Tr. 71; 77-82; 90-91;
LaRue further testified that he is the only LMC official who makes regular visits to
He offers his expertise but does not inspect the sites, and while he
provides advice and counsel the site administrator decides whether to follow his advice; for
example, when he and Tullio had gone to Loretto-Oswego to address maintenance issues
they had offered suggestions to the facilities director and had informed Jeffreys but it was up
to her to implement the suggestions.
LaRue said that, as to an OSHA inspection or a DOH
survey at Loretto Rest, he would be involved in the support service areas noted above and
that Marsh, as administrator, would be responsible for any OSHA violations or DOH
deficiencies found; as to an OSHA inspection or DOH survey at another facility, LaRue
would only be involved if asked, his involvement would be limited to advice, and, if the
facility did not follow his advice, he would voice his concern to the administrator but would
not advise Sullivan.
LaRue also said that he got involved in the subject inspection only
after learning the violations could be repeat and that he was at the post-citation settlement
conference to try to change OSHA’s position. LaRue stated that Jeffreys, as administrator, is
responsible for whatever happens in her facility, including OSHA matters, and that that
responsibility cannot be delegated to anyone else.
(Tr. 93-96; 103-04; 344-45; 349-51; 368-69).
LaRue said he hired Coughlin to manage the health and safety and worker
compensation programs at Loretto Rest and that he directed Coughlin to write a safety
program for Loretto Rest that could be modified and used by other Loretto facilities if they
He also said he did not instruct Coughlin to write a corporate-wide program that
would apply to all the facilities; he agreed, however, that the safety charter portion of the
program states that the “failure to adhere to written corporate safety policies and rules will be
considered serious infractions and will result in disciplinary actions, up to and including
termination.” LaRue explained that he had not reviewed the program before it went out,
other than a few of the policies it contained, and that Coughlin had been “overzealous” in
writing the charter; he also explained that while the program could be enforced at Loretto
Rest, it could not be enforced at other facilities. LaRue did not recall telling CO Schmidt
Coughlin is expected to visit all of the RHCF’s and address their safety concerns; rather, he
provides advice and counsel and goes to other sites if it is requested. (Tr. 97; 355-57; 363-65; C-11, p. 2).
Antonio Tullio testified that he is employed by Loretto Rest, that his title is director
of support service, and that his duties involve inspecting the building and supervising
He further testified that his duties also include giving support and advice to
other Loretto facilities as needed, although he has no authority over them. Tullio said he
visits other facilities when they ask him to and that he visits Loretto-Oswego four to five
times a year to consult with that facility’s maintenance director. Tullio also said that he was
present during the OSHA inspection at Loretto-Oswego, at the request of that facility’s
maintenance director. He stated that when problems were noted by the OSHA CO’s, he
advised Loretto-Oswego’s maintenance director how to correct them; however, it was up to
the facility to decide how to actually correct the problems. (Tr. 225-34).
Gregg Lawson testified that he is the corporate human resource manager, that he is
employed by LMC, and that his job involves the day-to-day management of the human
resource function, which includes benefits, payroll and labor relations.
He said he is
responsible for making sure that all Loretto facilities are in compliance with human resource
policies and that although he spends 90 to 95 percent of his time on issues in Loretto Rest he
consults with the other facilities as needed. He also said that he supervises Coughlin, the
safety manager, and that he directs his work and gives him assignments; he mostly works
with Coughlin, however, in the areas of disability leave and worker compensation. Lawson
stated that in the past two years he has given advice to Loretto-Utica three to four times and
to Loretto-Oswego twice; he further stated that while he gives the facilities advice he has no
authority to direct them. (Tr. 236-42; 245-46).
Arthur Coughlin testified he is the corporate safety manager, that he is employed by
Loretto Rest, and that he has held this position since November 2001.
He said his job is to
create safety policy, to conduct safety training, and to oversee the worker compensation and
disability programs. He also said that he assists the various Loretto affiliates by providing the
information they need to comply with OSHA and other regulations and that he conducts
training for any affiliate that requests it. Coughlin described his job in this regard as
consultative, and he noted that the affiliates may use or disregard what he provides and that
he does not have authority to do anything, other than advise them they are not in compliance,
if they do not. Coughlin has held safety training at Loretto facilities other than Loretto Rest
four to five times, and two of these were LOTO training he gave at Loretto-Oswego and
Loretto-Utica in the spring of 2002.
(Tr. 117-28; 131-34; 152).
Coughlin further testified that he wrote C-11, the Loretto Corporate Safety Program,
and that he sent a copy to the administrator or program director of each affiliate around
March 1, 2002; the facilities were told to make it site specific and that it would help them to
be in compliance and to have a safer work place. He agreed that the Loretto Safety Charter
set out in C-11 states that the corporate safety manager is responsible for ensuring overall
compliance with policies, statutes and regulations, for monitoring the effectiveness of the
safety programs, and for providing central health and safety services to all areas of Loretto.
He said, however, that he does not really monitor the effectiveness of the safety programs,
and he conceded that his lack of authority to enforce safety rules, such as the requirement to
use syringes with engineered sharps, was inconsistent with the safety charter. He also said
that although LaRue looked at a few of the policies in C-11, no one actually edited, reviewed
or approved the program before it went out. (Tr. 126-34; 147-48; 154-56).
Coughlin’s first visit to Loretto-Oswego was the day the inspection began, and he
was asked to go to the facility because it had no one who was familiar with OSHA. He
assisted in the walk-around of the facility, he answered questions the CO’s asked, and both
he and Tullio suggested ways to abate the violations the CO’s observed; Jeffreys, however,
was the individual responsible for abating the violations. He, LaRue and Marsh met to
discuss the inspection after it had begun, and he also attended a post-citation conference on
May 20, 2002; LaRue, Tullio and Jeffreys were there, as well as an OSHA official and
Respondent’s counsel. Coughlin stated that he himself did not have the authority to settle the
citations. (Tr. 127; 134-39; 146; 152-54).
Melva Neff testified that she is employed by Loretto Rest as an infection control
nurse, that Marsh is her boss, and that she is responsible for infection control at Loretto Rest
and for providing advice in that regard to other Loretto facilities when they request it or
when Marsh directs her to do so.
She said she is the person who made the revisions to C-9
and C-10, the Loretto Rest exposure control plans for 1997 and 1999, and that she makes
such revisions every year. She also said she had trained Loretto-Oswego personnel in blood-borne pathogens in preparation for the DOH survey one year and that she had given similar
training at two or three other sites. (Tr. 251-64).
Karen Jeffreys, the administrator of Loretto-Oswego, testified she reports to Marsh
and that he visits her facility every two months; they discuss DOH, budget and financial
matters, sometimes do an “environmental round,” and at times discuss staffing. She said
LaRue visits her facility about four times a year, usually to address environmental or
maintenance issues and at times staffing, and that Collins visits her facility once or twice a
year to go over financial matters. She also said Tullio is generally with LaRue on his visits
and that Tullio also visits the facility on his own to train the maintenance or housekeeping
staff. Jeffreys identified Marsh, LaRue, Collins and Tullio as LMC personnel, and she said
her belief in this regard was based on C-6; she also said that the person represented by the
“Loretto Exec. V.P.” box on C-7 is Marsh. Jeffreys identified Coughlin as the safety
director; it was her belief he was employed by Loretto Rest. (Tr. 13-25; 29-30; 46-47).
Jeffreys further testified that, while she reports to Marsh and he does her evaluation
and can discipline her, and while he and Introne would be responsible for hiring her
replacement, she herself is the “be all and end all” as far as Loretto-Oswego is concerned.
She explained that as administrator, she is responsible for whatever happens at the facility,
whether it relates to residents, employees, DOH issues or OSHA issues. She noted that a
statement of deficiencies resulting from a DOH survey would be addressed to her
individually and that it would be her responsibility, with the help of her directors, to reply
with a plan of correction.
She also noted that the OSHA citations in this case were
addressed to her in her capacity as administrator, and it was her belief, based upon her state-issued license, that she was ultimately responsible for the citations. Jeffreys did not
remember if she had been at any settlement discussions when OSHA officials were present,
but she had discussed settlement of the citations with LaRue.
(Tr. 15-16; 25-26; 36-38; 40-45; 50; 340-41).
Diane Harrington, Loretto-Oswego’s director of nursing, testified that she did not
know his official title but that Marsh oversees the RHCF’s and is an employee of Loretto
Rest. She further testified she sees Marsh about once a month, primarily to review quality
indicators, and that he offers suggestions to the facility but has no guidelines for it to follow.
Harrington said she does not report to Marsh and he does not supervise her. She did not
recall telling CO Gary that Marsh could fire her if she did not follow staffing guidelines or
that Marsh could “push” Jeffreys to fire her. (Tr. 54-58).
Sharon Lamore, Loretto-Oswego’s assistant director of nursing, testified that Marsh
is the corporate vice-president in charge of the RHCF’s. She further testified that Marsh does
not supervise her and that she has very little to do with him, but she indicated that he does
supervise Harrington. Lamore did not agree that if Marsh wanted to, he could have her fired.
It is apparent from the foregoing that several employee witnesses gave testimony that
was contrary to prior statements they made to the CO’s. For example, LaRue’s statement to
CO Gary, that he and Marsh could influence the staff of Loretto-Oswego to make sure the
wishes of LMC’s Board were carried out, contradicts his hearing testimony that he only
gives “advice and counsel” to the affiliates that the administrators can follow or not. (Tr. 94;
315-16; 350; 368-69). LaRue also told CO Schmidt that the corporate safety manager was
responsible for going to all the facilities to ensure that safety issues were taken care of,
which conflicts with his testimony that Coughlin gives “advice and counsel” to the sites and
only goes to a site if it is requested. (Tr. 97; 284). Coughlin’s statement to CO Schmidt, that
the safety program he had written was to be “rolled out” in all the facilities by March 1,
2003, and that he was to go to all the facilities to train them in the program, is at odds with
his testimony that his job as to safety is consultative, that the affiliates may use or disregard
what he provides, and that he gives training only if a site requests it. (Tr. 119-28; 131-34;
286). Harrington and Lamore both indicated to CO Gary that Marsh could have them fired,
but, at the hearing, they denied this was the case. (Tr. 58; 69; 310-11).
I observed the respective demeanors of the CO’s on the witness stand, and I find their
testimony credible, consistent and sincere. Further, the CO’s were disinterested witnesses,
unlike the employee witnesses, all of whom hold significant positions with Loretto. In
particular, I find the earlier factual statements that employees made describing corporate
relationships more credible than the statements they made after the formulation of
Respondent’s legal defense; in this regard, I note that several employees who testified at the
hearing used the term “advise and counsel” or similar verbiage and that this language never
came up when the CO’s spoke to the employees.
I therefore credit the testimony of the
CO’s over that of the employees to the extent that employee testimony is inconsistent with
prior statements made by them to the CO’s.
Similarly, I do not credit employee testimony to the effect that Loretto facilities
operate as separate, independent entities and that administrators at individual facilities are
free to disregard Loretto policies and the “advice and counsel” of Loretto management
because it is unpersuasive in view of the record as a whole. While such instances abound, the
best example of such testimony is that of LaRue and Coughlin, set out supra, having to do
with C-11, Loretto’s corporate safety program. Their testimony indicating that C-11 was
written for Loretto Rest and that the other facilities could use it if they chose plainly conflicts
with the safety charter, which states that the “failure to adhere to written corporate safety
policies and rules will be considered serious infractions and will result in disciplinary
actions, up to and including termination.”
(C-11, p. 2). Respondent‘s position that
Coughlin’s drafting of the above statement was a mere fanfaronade is rejected. LaRue’s
claim that Coughlin was “overzealous” in writing the charter and that he himself had not
really reviewed the program before it went out was not believable since the manual was an
important document within his province. (Tr. 355-57; 363-65). Moreover, Coughlin
conceded that his lack of authority to enforce safety rules was inconsistent with the safety
charter’s statement that the corporate safety manager is responsible for ensuring overall
corporate compliance with “policies, regulations and statutes.” (Tr. 134; C-11, p. 3).
Finally, for the same reasons, I do not credit certain testimony about the employing
entity of particular individuals. Marsh testified he is employed by Loretto Rest, despite his
position under Introne on C-6 with the other vice-presidents. (Tr. 164-65; 170-71). Jeffreys
and Neff, on the other hand, both indicated that Marsh is an employee of LMC, and LaRue
first identified Marsh as an employee of LMC but then said he works for Loretto Rest. (Tr.
17; 93-94; 256). In addition, LMC’s by-laws state that vice-presidents “shall be employees
of the Corporation,” and Marsh was present for the meeting CO Gary had in LMC’s
(Tr. 315; C-4, p. 7). Neff also testified that she is an employee of Loretto Rest, but
she agreed she had stated at her deposition that she worked for LMC; she also noted that
Marsh told her after her deposition that she was an employee of Loretto Rest.
Coughlin and Tullio testified they are employed by Loretto Rest.
(Tr. 117; 225). LaRue
agreed and indicated that, while both report to him, they are ultimately responsible to Marsh.
(Tr. 81; 90-91; 97; 355). Marsh, however, testified that Tullio reports to LaRue and said
nothing about Tullio reporting to him; he also said Coughlin does not report to him, despite
his stated belief Coughlin is employed by Loretto Rest. (Tr. 180; 200; 387-88). Further,
Coughlin testified he reports to Lawson and LaRue and not to Marsh, and C-6 shows Tullio
and Lawson in LaRue’s chain of command. (Tr. 139-40).
Based on the reliable and probative evidence of record, I find that Marsh, Neff,
Coughlin and Tullio are employees of LMC. Moreover, even if they are not, their positions
are clearly “corporate” in nature, in that their job duties include ensuring that all of the
and not just Loretto Rest, follow regulatory and other requirements
falling within their areas of responsibility.
In this regard, I specifically reject the testimony
of these and other Loretto employees indicating that they give only “advice and counsel” to
the Loretto affiliates and that, other than Loretto Rest, they have no authority to tell the
affiliates what to do; stated another way, I find that Marsh, Neff, Coughlin and Tullio, as
well as admitted LMC employees such as Sullivan, LaRue and Lawson, in fact had the
authority to direct the affiliates. I also specifically reject the testimony of Marsh that he does
not supervise Jeffreys and that she does not report to him. (Tr. 379; 395). Jeffreys testified
that she reports to Marsh, she told CO Gary that Marsh is in charge of all the RHCF’s, and
her statements are supported by C-6, which shows all of the RHCF’s directly below Marsh.
(Tr. 14-15; 309). In view of the record, and for all of the reasons set out in this discussion, I
conclude that LMC and the Loretto affiliates share common management and supervision.
Interrelated and Integrated Operations
COO Sullivan testified he is responsible for the day-to-day oversight of the Loretto
affiliates’ operations and that he has direct oversight of support services, human resources
and information technology operations. (Tr. 206-07). C-6 shows the areas under Sullivan to
be support services, which includes facilities management, nutrition and dining services and
human resources, as well as information technology and the positions of corporate controller
and corporate treasurer; further, Sullivan said that the areas that have corporate functions are
finance and those he directly oversees.
(Tr. 211). Based on his testimony, C-6 and the
record as a whole, I find specifically that LMC and the affiliates have interrelated and
integrated operations with respect to finance, support services and information technology.
Further evidence of the interrelation of Loretto operations follows.
As to the RHCF’s, the record establishes that Marsh oversees them and supervises
their administrators, that he tries to be there for their DOH surveys, and that he visits each
site essentially monthly. During his visits, he and the administrator discuss budget, financial
and staffing issues; he also reviews clinical records and walks through the facility to ensure
that environment and quality of care standards are being met. (Tr. 15-16; 22-23; 174-77;
187-88). Marsh has conducted mock inspections, in which he goes to an RHCF with
personnel of other RHCF’s; the findings of such an inspection are provided to the site
(Tr. 26-28; 47; 92-93; 178-79; 382-84; 397-98). Marsh is informed when an
OSHA inspection occurs at a site, and he in turn advises Introne; Marsh would also advise
Introne if an RHCF was not following OSHA regulations or keeping within its budget. (Tr.
178; 183-86). LaRue visits the RHCF’s about four times a year, usually to address
environmental or maintenance issues; Tullio is generally with LaRue on such visits, and
Tullio also visits the sites on his own to train the maintenance or housekeeping staff. (Tr. 16-17; 23-24; 93-94; 230-31). Neff has visited the RHCF’s to provide blood-borne pathogen
training. (Tr. 259-60).
As to employee safety and health, the record shows that this function is part of human
resources and that Coughlin, the corporate safety manager, is responsible for going to all the
Loretto sites to address safety issues and to provide safety training as needed. (Tr. 119-21;
152; 284-86). The record also shows that Coughlin wrote C-11, Loretto’s corporate safety
program, that he provided it to all the Loretto sites in March of 2002, and that his duties
include ensuring that the sites comply with it.
(Tr. 126; 154-56; 286). As the safety charter
expresses it, on page 6 of C-11:
The Corporate Safety Manager is responsible for recommending corporate-wide health and safety policies; ensuring overall corporate compliance with
policies, statutes, and regulations; monitoring the effectiveness of the safety
programs; and providing central health and safety services to all areas of
In regard to the subject OSHA inspection, the record shows that Coughlin and Tullio
went to Loretto-Oswego pursuant to Jeffreys’ call, that they were with the CO’s during the
walk-around inspection, and that Coughlin and/or Tullio attempted to correct any observed
violations immediately by calling on facility employees; the record also shows that the CO’s
spoke to Coughlin most of the time, because Jeffreys had to excuse herself to attend to other
matters at times, and that Jeffreys also referred the CO’s to Coughlin or Tullio for anything
she was unsure about. Coughlin and Tullio attended the preliminary closing conference,
Coughlin provided abatement dates for items that had not been corrected, and, during the
CO’s later visits, he showed them items that had been abated. (Tr. 274-75; 278-84; 307-09).
The contemporaneous actions of Coughlin and Tullio that the CO’s described were far more
reliable than their later, carefully-thought-out testimony in this regard. Thus, contrary to the
testimony of LaRue, Coughlin and Tullio, claiming that only Jeffreys had the authority to
abate the violations, I find that Coughlin and Tullio, in light of their actions during the
inspection, exercised their authority to abate the violations.
Besides the above, the record shows that LaRue spoke to CO Schmidt at the site on
March 7, that he participated in the final closing conference at the facility on March 13, and
that he attended the settlement meeting held with OSHA on May 20, 2002; also present were
Jeffreys, Coughlin, Tullio and Respondent’s counsel. (Tr. 138-39; 282-84; 351). Coughlin
testified, and LaRue agreed, that Coughlin did not have the authority to settle the citations.
(Tr. 138; 351). Moreover, although Jeffreys testified that she was ultimately responsible for
the citations, she did not know who had the authority to settle them. (Tr. 30; 36-37; 340-41).
Finally, while LaRue also testified that Jeffreys was ultimately responsible for the citations,
he never said she had the authority to settle them or that he did not have such authority.
103-04; 351). Based on the record, and especially on the fact he was at the settlement
meeting, I conclude LaRue had the authority to settle the citations.
There is still further evidence of the interrelation and integration of Loretto’s
operations. First, monthly systems meetings are held at Loretto Rest; the heads of the various
Loretto sites and programs are present, and the purpose of the meetings is to share
(Tr. 28-29; 88-90; 141-43; 264-65). Second, as noted supra, Loretto Rest
operates a central food commissary and provides food to all but one of its facilities and also
to five non-Loretto facilities. (Tr. 105-06). Third, while Loretto facilities hire their own
employees and have their own employee orientations, Loretto’s web site sets out job
opportunities for the various facilities as well as benefits for “Loretto” employees. (Tr. 44;
260-61; 331-34; 104; 151; C-27, pp. 28-35). Fourth, all Loretto service and maintenance
employees belong to the same union, and, while each facility has its own contract, all of the
contracts were negotiated at the same time and all of the contracts were all signed by
(Tr. 107-11; 114; 243-45). Fifth, and finally, the same insurance agency handles
all Loretto worker compensation claims. (Tr. 370-71).
Based on the foregoing, I conclude that LMC and the Loretto affiliates have
interrelated and integrated relations. I further conclude that, as the Secretary has
demonstrated all of the elements of the Commission’s “single employer” test, LMC and the
Loretto affiliates operate as a single entity. Therefore, for the reasons articulated in the
“single employer doctrine” portion of this decision, I conclude that the Secretary’s issuance
of the subject citations items as repeat was appropriate, and, accordingly, those items are
affirmed as repeat violations.
FINDINGS OF FACT
All findings of fact necessary for a determination of all relevant issues have been
made above. Fed. R. Civ. P. 52(a). All proposed findings of fact and conclusions of law
inconsistent with this decision are hereby denied.
CONCLUSIONS OF LAW
1. Respondent, Loretto-Oswego RHCF, was, at all times pertinent hereto, an
employer with the meaning of the Act.
2. The Commission has jurisdiction over the parties and the subject matter of this
3. Respondent was in serious violation of 29 C.F.R. §§ 1910.1030(c)(1)(iv),
1910.1030(c)(1)(v), 1910.1030(f)(2)(iv), 1910.1030(f)(5) and 1910.1030(h)(5)(i), as alleged
in Items 1 through 5, respectively, of Citation 1 (Docket No. 02-1164).
4. Respondent was in repeat violation of 29 C.F.R. §§ 1910.133(a)(1), 1910.151(c),
1910.1030(f)(2)(i) and 1910.1030(f)(3), as alleged in Items 1a, 1b, 2 and 3, respectively, of
Citation 2 (Docket No. 02-1164).
5. Respondent was in serious violation of 29 C.F.R. § 1910.303(f), as alleged in Item
1 of Citation 1 (Docket No. 02-1174).
2. Respondent was in repeat violation of 29 C.F.R. § 1910.101(b), 1910.147(c)(4)(i),
and 1910.303(g)(2)(i), as alleged in Items 1 through 3 of Citation 2 (Docket No. 02-1174).
3. Respondent was in “other” violation of 29 C.F.R. § 1910.305(g)(1)(iii), as alleged
in Item 1 of Citation 3 (Docket No. 02-1174).
1. Items 1 through 5 of Citation 1 (Docket No. 02-1164) are AFFIRMED, and a total
penalty of $5,750.00 is assessed for these items.
2. Items 1 through 3 of Citation 2 (Docket No. 02-1164) are AFFIRMED, and a total
penalty of $41,250.00 is assessed for these items.
3. Item 1 of Citation 1 (Docket No. 02-1174) is AFFIRMED, and a penalty of
$1,000.00 is assessed for this item.
4. Items 1 through 3 of Citation 2 (Docket No. 02-1174) are AFFIRMED, and a total
penalty of $15,000.00 is assessed for these items.
5. Item 1 of Citation 3 (Docket No. 02-1174) is AFFIRMED, and no penalty is
assessed for this item.
Michael H. Schoenfeld
Dated: December 29, 2003 Washington, D.C.