American Home Products, Docket No.3

SECRETARY OF LABOR,
Complainant,
v.	OSHRC DOCKET NO. 3
AMERICAN HOME PRODUCTS
Respondent.

Having reviewed the record in this case the Commission concludes that under all the circumstances therein, approval of the Hearing Examiner’s proposed disposition of the case comports satisfactorily with the purposes of the Act.

These proceedings were initiated by the respondent’s notice of contest, dated June 28, 1971. On September 1, in accordance with section 12(j) of the Occupational Safety and Health Act of 1970 (84 Stat. 1590; 29 U.S.C. 651, et seq.), hereinafter referred to as the Act, this Commission unanimously directed a review of the Hearing Examiner’s report of August 19 which tacitly approved a proposed stipulated disposition of the proceedings by the parties. By its order of September 1, the Commission unanimously remanded the case to the Hearing Examiner for his initial determination of specific factual and legal questions, viz., (1) whether the respondent’s affected employees had been apprised of their rights to participate as parties to these proceedings, (2) whether such employees were in agreement with the proposed stipulated disposition, and (3) whether the proposed stipulated settlement of the issues herein is consistent with the provisions of the Act.

The Hearing Examiner’s decision on remand answered these questions affirmatively. That decision was reviewed by the Commission at my direction, and that review resulted in an order to the parties, dated November 16, to show cause why the Commission’s final order should not be a modification of the Secretary’s citations, proposed penalties, or both, or be a direction of other appropriate relief.

In his response to that order the Secretary addressed himself solely to the question whether the Commission has the right to take any action in this instance except perfunctorily to approve the agreement of the parties that the citations and proposed penalties are unimpeachable. The respondent shares the Secretary’s view that the Commission’s adjudicatory role does not include the right to determine whether a proposed stipulated disposition of its proceedings is consistent with the purposes of the Act and accords with public policy.

In his dissenting opinion of November 16, the Chairman attempts to rely upon the Administrative Procedure Act to support his view that the parties to an administrative proceeding are to be afforded an opportunity for a hearing only ‘. . . to the extent that the parties are unable to determine a controversy by consent’ 5 U.S.C. 554(c)(2). This reliance is misplaced as in ignores the preceding subsection which provides that such parties shall be given an opportunity for ‘the submission . . . of offers of settlement, or proposals of adjustment when time, the nature of the proceedings, and the public interest permit.’ 5 U.S.C. 554(c)(1), emphasis added.

It is well settled that an attempt to compromise a controversy ‘. . . may be disregarded where it is illegal, is against public policy, or in contravention of a statute or the policy thereof . . .’ 45A Corpus Juris Secundum, sec. 5, p. 262 (Compromise and Settlement). Appellate procedures follow the same established rule:

Although it has been held that dismissal cannot be allowed without the sanction of the court, ordinarily an appeal may be dismissed where both parties so request or agree, if the dismissal will not affect the rights of others and no question of public interest is involved. 5 C.J.S., sec. 1349, p. 396 (Appeal and Error), emphasis added.

I must specifically disavow the view that the Commission has neither sole nor primary responsibility to ‘fret about ‘whether the stipulated disposition is consistent with the provisions of the Act and accords with the public interest.’’ (The Chairman’s dissent of November 16, 1971). The effectiveness of the Commission emanates from the expertise which reposes in its members.

Presumably that was one of the reasons Congress though it wise to divide responsibilities for the enforcement of the Act and for the adjudication of controversies concerning that enforcement. That administrative agencies, such as this Commission, are charged with the responsibility of deciding controversies consistent with the public interest is unmistakenly decided in Scenic Hudson Preservation Conference, et al., v. Federal Power Commission, 354, F.2d 608, 620 (2 Cir., 1965):

In this case, as in many others, the Commission has claimed to be the representative of the public interest. This role does not permit it to act as an umpire blandly calling balls and strikes for adversaries appearing before it; the right of the public must receive active and affirmative protection at the hands of the Commission.

As recently as July 23, 1971, Judge J. Skelly Wright, speaking for the District of Columbia Circuit Court, stated in a footnote:

In recent years, the courts have become increasingly strict in requiring that federal agencies live up to their mandates to consider the public interest. They have become increasingly impatient with agencies which attempt to avoid or dilute their statutorily imposed role as protectors of public interest values beyond the narrow concern of industries being regulated. Calvert Cliffs’ Coordinating Committee, Inc., et al., v. United States Atomic Energy Commission, et al., 449 F. 2d 1109, 1119, fn. 21.

See also Environmental Defense Fund, Inc., v. Ruckelhouse, 439 F. 2d 584 (D.C. Cir.; 1971); Moss v. Civil Aeronautics Board, 430 F. 2d 891, (D.C. Cir. 1970); Power Reactor Development Co., v. International Union of Electrical, Radio and Machine Workers, AFL-CIO, et al., 367 U.S. 396, 81 S. Ct. 1529 (1961).

That the preservation of the nation’s human resources (section 2 of the Act) is as much in the public interest as provision for a healthful environment, equitable transportation costs, etc., cannot seriously be denied. These judicial pronouncements, read and understood in light of the expressed intent of the Congress, lead to no other conclusion than that the parties’ argument is grossly fallacious.

The authority possessed by the Commission carries with it certain duties and responsibilities for each member of the Commission. Acceptance of those responsibilities precludes making a decision in this or any other case on the basis of an incomplete record. There can be no serious question about the Commission’s duty to inquire into and carefully consider all the relevant facts. No facts have been adduced in this case save those set forth in the scanty stipulation intended to effect the settlement, and in affidavits regarding the employees’ representative’s position. Indeed, the respondent’s president makes assertions by affidavit, dated December 13, 1971, which contradict the Hearing Examiner’s factual findings. Thus, it seems there is not unanimity regarding the essential facts. There is no way for the Commission intelligently to determine whether the substantial number of conditions alleged in the one citation constitute a single violation of section 5(a)(1) of the Act, or whether each hazard is a separate violation; whether the conditions alleged in the second citation were properly classified by the Secretary as other than serious in nature, particularly in view of the Hearing Examiner’s factual finding (later refuted by respondent) that an amputation had previously resulted from such conditions; whether the alleged violations were willful or repeated in nature, particularly in view of the Hearing Examiner’s finding that seven amputations previously resulted from such conditions; whether the penalties proposed by the Secretary are reasonable under all the factual circumstances; or whether the stipulated settlement is consistent with the provisions of the Act and in conformity with its public interest objectives.

Without a complete record any endeavor to apply the law in this instance can produce nothing more than meaningless, if not misleading, rhetoric. The Commission should not refuse to address itself to the issues presented and to afford the Secretary and the public a meaningful and candid disclosure of its views on substantial questions of policy and law.

The court, in deciding Scenic Hudson Preservation Conference v. Federal Power Commission (supra, at p. 621) quotes with obvious approval from Landis, The Administrative Process:

For [the administrative] process to be successful in a particular field, it is imperative that controversies be decided as ‘rightly’ as possible, independently of the formal record the parties themselves produce. The ultimate test of the administrative is the policy that it formulates; not the fairness as between the parties of the disposition of a controversy on a record of their own making.

In viewing the public interest, the Commission’s vision is not to be limited to the horizons of the private parties to the proceeding. Michigan Consolidated Gas Company v. Federal Power Commission, 283 F. 2d 204 (D.C. Cir., 1960).

I would, therefore, again REMAND this case to the Hearing Examiner for further action consistent with these views.

Mindful that in assessing civil penalties the Act mandates that it give due consideration to the appropriateness of the penalty with respect to the size of the business of the employer charged, the gravity of the violation, the good faith of the employer, and the history of previous violations, the Commission finds the record as a whole inadequate for the purpose of making a final determination of these questions. Thus, this inadequacy leaves the Commission in doubt concerning whether the stipulated disposition is consistent with the provisions of the Act and accords with the public interest.

The parties are, therefore, ORDERED TO SHOW CAUSE, if any there by, why the Commission’s order, based on findings of fact, should not be a modification of the Secretary’s citation, proposed penalties, or both, or be a direction of other appropriate relief. The parties shall have 30 days from the date of this order to submit written briefs treating the following questions:

(1) whether the conditions alleged in citation numbered 1 constitute a single violation of section 5(a)(1) of the Act, or whether each hazard is a separate violation; (2) whether the conditions alleged in citation numbered 2 were properly classified by the Secretary as other than serious in nature (particularly in view of the factual finding that an amputation had previously resulted from such conditions); (3) whether a citation for other than serious violations can be issued under the general duty clause (section 5(a)(1)) of the Act; (4) whether the alleged violations were willful or repeated in nature (particularly in view of the seven amputations which previously had resulted from such conditions); (5) whether the penalties proposed by the Secretary are reasonable under all the factual circumstances; (6) whether the stipulated settlement is consistent with the provisions of the Act and in conformity with its public interest objectives; and (7) whether a hearing should be held.

The Commission may thereafter, upon reasonable notice to the parties, require oral argument regarding these and other pertinent questions.

The Secretary of Labor, the employer, and the duly authorized representative of the employees entered into a stipulated settlement of this case. I have reviewed the record and see no reason why a decision of this Commission should not be entered approving that agreement.

The sure and speedy concessions, the abatement of hazard and the saving of the Commission’s and the Secretary’s resources which a settlement achieves outweigh, in my mind, the possibility that an employer may be made to smart more appropriately by a heavier or more propitious penalty.

Nor should the Commission fret about ‘whether the stipulated disposition is consistent with the provisions of the Act and accords with the public interest.’ In my opinion, the Commission does not have sole or even primary responsibility in this area. The Secretary of Labor’s responsibilities include the determination of employer compliance with the Act (Sec. 9(a)) and he also has both inherent authority, as well as implicit authority within the Act itself, to compromise, mitigate and settle actions initiated by him (see, for example, Sec. 6(e)). Of course, he also may conduct a subsequent inspection at any time and initiate such action as he deems then to be warranted. In view of the Secretary’s enormous responsibility and authority for occupational safety and health, I find his assent to the stipulated settlement of this case most persuasive.

I am also persuaded that this show cause order is rendered inappropriate by the fact that the Act constitutes the cited employer dominus litus. Thus, an employer who seeks to preserve his right to contest the merits of a citation (a right which the Act places exclusively in his hands through the provisions of Section 10(c)), is, by this order, put on notice that his exercise of that exclusive right immediately places the review process beyond his control—even in the event that he experiences a change of mind or heart and wishes immediately to do all that the Secretary requires. Surely, a tentative prayer for relief should not be transmuted into the summoning of an avenging angel.

SECRETARY OF LABOR,
Complainant,
v.	OSHRC DOCKET NO. 3
AMERICAN HOME PRODUCTS
Respondent.

This is an action under Section 10(c) of the Occupational Safety and Health Act of 1970, Pub. Law 91–596; 84 Stat. 1590 et seq; 29 U.S.C. 651 et. seq. (hereinafter referred to as the Act), to review two citations issued by the Secretary of Labor (hereinafter Secretary) pursuant to Section 9(a) of the Act and proposed assessments of penalties upon such alleged violations pursuant to Section 10(a) of the Act.

On May 18 and 19, 1971, the Secretary, by and through two of its authorized compliance officers, made an inspection and investigation of a work place known as the Ekco Housewares Company, located at 1949 North Cicero Avenue, Chicago, Illinois, a Division of America Home Products Corporation, 685 Third Avenue, New York, New York (hereinafter Respondent), to determine compliance with the provisions of the Act. [Citations Nos. 1 and 2; R. pp. 1, 1a; Exh. A. pp. 1, 2, paras. 1–3]. On the basis of this inspection, the Respondent was notified by a Citation for Serious Violation (Citation No. 1) dated June 11, 1971, and by a second Citation (Citation No. 2) also dated June 11, 1971, of alleged violations of Section 5(a)(1) of the Act. [R. pp. 1, 1a]. The Complainant, by its Notification of Proposed Penalty dated June 11, 1971, notified the Respondent that pursuant to the provisions of Section 10(a) of the Act, a penalty of seven hundred dollars ($700.00) was being proposed for the alleged violation set forth in Citation No. 1 and a penalty of seventy dollars ($70.00) was proposed for the other violations set forth in Citation No. 2. [Notification of Proposed Penalty R. p. 2]. By letter dated June 28, 1971, the Respondent gave notice of its intention to contest the above described Citations and the Proposed Penalties. [R. p. 2]. By its notice dated July 9, 1971, the Occupational Safety and Health Review Commission (hereinafter Commission), gave notice to the parties of record of its receipt of this case as forwarded by the Secretary and by its notice dated July 19, 1971, the Commission gave notice to the said parties of the assignment of this case to the undersigned Hearing Examiner. [R. pp. 4, 5]. By letter dated July 22, 1971, addressed to the parties of record, this matter was set for hearing to begin on August 17, 1971, in Chicago, Illinois. Respondent’s request for postponement of this hearing was denied. [R. pp. H–1, H–5, H–8]. On August 16, 1971, counsel for the Complainant and Respondent telephonically notified the Examiner that a stipulation settling this case had been executed obviating the necessity for hearing. By letter dated August 17, 1971, counsel for Complainant filed with the Examiner this executed stipulation. [Exh. A; R. p. H–14]. On August 19, 1971, the Examiner returned the file in this matter to the Commission and the Commission by its notice dated September 1, 1971, remanded this case to the Examiner for the purpose of making specified determinations. [H–15, H–16, H–17, R. p. 8]. By letter dated September 22, 1971, counsel for the Complainant filed the affidavit of the authorized employee representative, and by letter dated September 29, 1971, Respondent filed its affidavit of even date. [Exhs. B and C, R. pp. H–20, H–21]. Having considered the entire record herein, the stipulation, affidavits, representations and admissions of the parties, it is concluded that the substantial evidence on the record considered as a whole, supports the following facts.

1. The Respondent herein, American Home Products Corporation, 685 Third Avenue, New York, New York, at all times involved in this matter was a Delaware Corporation, and said Respondent owned, operated, and controlled its Division called the Ekco Housewares Company, doing business at 1949 North Cicero Avenue, Chicago, Illinois. [R. p. 1, 1a; Exh. A, paras. 1, 2; R. p. H–14].

2. At all times involved in this case, the Respondent was engaged in the State of Illinois in producing housewares for shipment in interstate commerce to States other than the State of Illinois. [Exh. A, par. 2; R. p. H–14].

3. The inspection of the Respondent’s work place located at 1949 North Cicero Avenue, Chicago, Illinois, on May 18 and 19, 1971, by authorized compliance officers of the Secretary, revealed the following conditions existing at said work place:

(a) As alleged in Citation No. 1, a substantial number of punch presses were not guarded at the point of operation and other presses were inadequately guarded at the point of operation.

(b) Further as alleged in Citation No. 2, a substantial number of foot operated power press pedals were inadequately guarded. [R. pp. 1, 1a; Exh. A, par. 4; R. p. H–14].

4. The conditions found to exist as described in Finding 3(a) supra resulted in serious physical harm to employees of the Respondent, specifically, three employees suffered seven (7) amputations in the month of April, 1971. [R. p. 1; Exh. A, par. 4(a); R. p. H–14].

5. The conditions found to exist as described in Finding 3(b) supra resulted in serious physical harm to an employee of the Respondent, specifically, one amputation in 1971. [R. p. 1a; Exh. A, par. 4(b)].

6. Acknowledged, qualified experts in the field of Occupational Safety and Health are of the opinion, and it is hereby found that the conditions described in Finding 3 supra, constitute recognized hazards as described in Section 5(a)(1) of the Act. [Exh. A, par. 5; R. p. H–14].

7. The conditions described in Finding 3(a) supra, found to exist at the place of employment, under the ownership, operation and control of Respondent, it is hereby found constitute a condition where there was a substantial probability that death or serious physical harm could result to employees of the Respondent. [R. p. 1; Exh. A, par. 6; R. p. H–14].

8. The conditions described in Finding 3(b) supra, found to exist as the place of employment under the ownership, operation and control of Respondent, it is hereby found had a direct and immediate relationship to the occupational safety and health of Respondent’s employees. [R. p. 1a].

9. The Respondent herein was properly notified pursuant to Section 9(a) of the Act of the conditions herein described by proper service of the Citation for Serious Violation, and Citation No. 2, and further, pursuant to Section 10(a) of the Act, was notified of the proposed penalty by service of a Notification of Proposed Penalty. [R. pp. 1, 1a, 2].

10. The Respondent timely noted its intention to contest the violations alleged in the Citations and the penalties proposed to be assessed in the Notification of Proposed Penalty. Further, receipt of said Notice of Contest was acknowledged by the Secretary. [R. p. 3].

11. The Respondent has represented that the conditions described in Finding 3 supra, have been fully abated and further has agreed to tender the amount of the proposed penalty, seven hundred and seventy dollars ($770.00) to the Government. [Exh. A, paras. 7, 8; R. p. H–14].

12. The Respondent has agreed to withdraw its Notice of Contest filed herein and has further agreed that the Citation and Assessment of Penalties as proposed, shall be deemed a final order of the Commission pursuant to the provision of Section 10(a) of the Act. [Exh. A, para. 9; R. p. H–14].

13. On July 22, 1971, a compliance officer of the Secretary, accompanied by an attorney representative from the Office of the Solicitor, U.S. Department of Labor, visited the recording secretary and business representative of the sole certified bargaining agent and authorized representative of the Respondent’s employees herein, at the Union offices located at 6185 West Roosevelt Avenue, Berwyn, Illinois. On this date copies of the Citations, Notification of Proposed Penalty, and Notice of Contest, were delivered to the employee representative together with a copy of the Act. Further, the employee representative was advised of the nature, of this proceeding and that the Union, as the authorized representative of the Respondent’s employees, had the right to participate in this proceeding pursuant to the applicable provision of the Act. [Exh. B, paras. 1, 2 and 3; R. p. H–20].

14. The Union, in its capacity as the authorized representative of the Respondent’s employees, knew that a hearing in this matter was scheduled to commence on August 17, 1971, at 219 South Dearborn Street, Chicago, Illinois, and of its right and opportunity to participate therein. [Exh. B, par. 4; Exh. C, par. 3; R. pp. H–20, H–21].

15. The Respondent herein, in accordance with and in the manner prescribed by the provisions of the Act, posted copies of the Citations and Notification of Proposed Penalty for the period specified by the Act. [Exh. C, par. 3; R. p. H–21].

16. The Union, in its capacity as the authorized representative of the Respondent’s employees, has seen the stipulation entered into by the Complainant and Respondent herein, dated August 16, 1971, attached hereto as Exhibit A, and has no objection thereto. [Exh. B, par. 5; R. p. H–20].

1. At all times involved in this matter, the Respondent herein was an employer engaged in a business affecting commerce within the meaning of Section 3(5) of the Act.

2. At all times involved in this matter, the Respondent furnished employment to its employees and said employees engaged in said employment at a work place within the State of Illinois, specifically at 1949 North Cicero Avenue, Chicago, Illinois. The Occupational Safety and Health Act of 1970 is applicable to such employment within the meaning of Section 4(a) of said Act.

3. The Citations, Notification of Proposed Penalties, and Notice of Contest were served by and upon the respective parties hereto in conformance with the provisions of Section 10 of the Act.

4. Jurisdiction of the Secretary and of the Commission has been in fact conceded.

5. The conditions found at the Respondent’s place of employment on May 18 and 19, 1971, as set forth in Citation No. 1 and No. 2 herein, constitute a violation of Section 5(a)(1) of the Act in that the employer herein on said dates did not furnish to each of his employees, employment and a place of employment which was free from recognized hazards that were causing or were likely to cause death or serious physical harm to his employees.

6. The penalties proposed by the Secretary, specifically, seven hundred dollars ($700.00) based on Citation No. 1 and seventy dollars ($70.00) based on Citation No. 2, totaling seven hundred and seventy dollars ($770.00) are consistent with the provisions of Sections 10 and 17(b) and (c) of the Act.

7. The authorized representative of the affected employees of the Respondent was informed of its opportunity to participate as a party in this proceeding.

8. The authorized representative of the affected employees of the Respondent has examined the stipulation entered into by the Complainant and the Respondent, dated August 16, 1971, and has no objection to said stipulation.

9. Provided the Respondent herein within ten days of the date of this report files a written withdrawal of its Notice of Contest dated June 28, 1971, and provided further that payment of the assessed penalty in the full amount of seven hundred and seventy dollars ($770.00) is made in cash or by certified check within ten days of the date of this report, and further based upon the Respondent’s representation that the violative conditions found to exist on May 18 and 19, 1971, have been fully abated, it is hereby found that the stipulation between the Complainant and Respondent is consistent with the provisions of the Act.

Based upon the foregoing Findings of Fact, Conclusions of Law and Determinations, it is hereby ORDERED:

That the Citation for Serious Violation (Citation No. 1) and Citation for a Non-Serious Violation (Citation No. 2) and the penalties proposed herein by the Secretary are hereby affirmed; provided however that the Respondent herein within ten days of the date of this Order file its formal withdrawal of its Notice of Contest and further, within the same time period, the Respondent shall tender to the Regional Solicitor, U.S. Department of Labor, in cash or by certified check the full amount of the penalties assessed herein, seven hundred and seventy dollars ($770.00).