BECHTEL CORPORATION

OSHRC Docket No. 1038

Occupational Safety and Health Review Commission

October 31, 1974

[*1]

Before MORAN, Chairman; VAN NAMEE and CLEARY, Commissioners

OPINIONBY: MORAN

OPINION:

MORAN, CHAIRMAN: A decision of Review Commission Judge Henry C. Winters dated March 16, 1973, is before this Commission for review pursuant to 29 U.S.C. 661(i). That decision, vacating complainant's citation and proposed penalty, is affirmed for the reasons herein set forth.

Respondent, an engineer and construction manager, contracted with Portland General Electric Company, the owner of the worksite where the alleged safety violations occurred, to plan, administer, inspect and observe the work of numerous contractors thereon. At the time of inspection respondent employed 62 persons, six of whom were actually on the jobsite.

Pursuant to the provisions of the Occupational Safety and Health Act of 1970, n1 complainant inspected the said worksite on April 19 and 20, 1972. The inspection resulted in a citation alleging a failure by respondent to comply with the standards codified at 29 C.F.R. 1926.25(a) (Housekeeping requirements), 1926.350(a)(1) (Gas cylinder valve cap requirements) and 1926.550(b)(7) (Guardrail requirements).

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n1 84 Stat. 1590, 29 U.S.C. 651 et seq., hereinafter the Act.

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Respondent was not responsible for the creation of the alleged hazards described therein, nor did it know which of the many other contractors was responsible therefor. No evidence established that respondent's employees were exposed to the alleged hazards other than that their inspection work could have taken them into these areas. We find this to be insufficient evidence upon which to predicate a violation of 29 U.S.C. 654(a)(2).

A violation of this Act is not established unless there is evidence that employees of respondent have been exposed to hazard as a result of noncompliance with the requirements of an occupational safety and health standard. Secretary v. Hawkins Construction Co., Secretary v. J.E. Roupp and Company and Denver Dry Wall Co., secretary v. Gilles and Cotting, Inc., Secretary v. City Wide Tuckpointing Service, [*3]

Not only does the evidence in this case fail to clearly establish employee exposure, n2 it does not even permit a reasonable inference to be drawn therefrom. n3

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n2 See Secretary v. Otis Elevator Co.,

n3 See Secretary v. Sun Shipbuilding and Drydock Co.,

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The burden of so establishing is part of complainant's prima facie case. Secretary v. Armor Elevator Company, Inc., 5 OSAHRC 260 (1973); Secretary v. Arvin Millwork Co., Secretary v. Ellison Electric, 1 OSAHRC 547 (1972); 29 C.F.R. 2200.73(a).

Absent such proof, no violation of 29 U.S.C. 654(a)(2) exists. The decision below therefore correctly vacated the citation and proposed penalty based thereon.

DISSENTBY: CLEARY

DISSENT:

CLEARY, COMMISSIONER, dissenting: Review was directed in order to determine whether the Judge erred in concluding that employees of respondent are not subject to the safety and health regulations for construction [*4] issued pursuant to section 6 of the Act and, if so, whether the Secretary sustained his burden of proving that respondent's employees were exposed to the cited hazards. The majority affirms the Judge, who vacated the citation on the grounds that respondent's engineering and managerial personnel are not within the coverage of the safety and health regulations for construction.

The majority affirms the Judge's vacation of the citation but their decision turns on the lack of employee exposure. I disagree with both the results and reasons in the majority's opinion. Moreover, in reaching the question of exposure, the majority has, sub silentio, rejected the Judge's conclusion that respondent's employees are not subject to the Act. I agree, but I cannot agree that these employees were not exposed to the hazards herein.

It is undisputed that under the Contract Work Hours and Safety Standards Act n4 compliance by an employer with the safety regulations prescribed for construction work is predicated upon there being a "laborer or mechanic employed in the performance of the contract. . . ." n5 This provision, however, is inapplicable to standards promulgated pursuant to the [*5] Act. As of the date of the instant citation, 29 CFR 1910.12(c) regarding the adoption and extension of established federal standards was in effect. n6 It reads as follows:

(c) Construction Safety Act distinguished. This section adopts as occupational safety and health standards under section 6 of the Act the standards which are prescribed in Part 1926 of this chapter. Thus, the standards (substantive rules) published in Subpart C and the following subparts of Part 1926 of this chapter are applied. This section does not incorporate Subparts A and B of Part 1926 of this chapter. Subparts A and B have pertinence only to the application of section 107 of the Contract Work Hours and Safety Standards Act (the Construction Safety Act). For example, the interpretation of the term "subcontractor" in paragrapy (c) of 1926.13 of this chapter is significant in discerning the coverage of the Construction Safety Act and duties thereunder. However, the term "subcontractor" has no significance in the application of the Act, which was enacted under the Commerce Clause and which establishes duties for "employers" which are not dependent for their application upon any contractual relationship [*6] with the Federal Government or upon any form of Federal financial assistance.

The reference in the Construction Safety Act, to "laborer or mechanic" is part of an interpretative section that has no bearing on the Safety and Health Regulations for Construction. n7 The subsequent enactment of 29 CFR 1910.11(b) clarifies the intent not to adopt interpretative rules, n8 and 29 CFR 1910.12(c), relied upon herein, amply supports that conclusion when read in its entirety and in light of the purpose of the Act. That purpose is "to assure so far as possible every working man and woman in the Nation safe and healthful working conditions." n9 The Act contains no limitations or exceptions to this broad coverage, n10 except for the narrow exemption of section 4(b)(1), which merely states that certain other statutes affecting occupational safety or health preclude application of the Act. That exemption has no application to the instant case. Judge Winters has misstated the question at hand when he asks, "Did the Secretary in issuing 29 CFR 1910.11 and 1910.12 intend to expand the coverage of the Construction Standards to persons engaged solely in engineering and management [*7] functions?" In the absence of any limitation on the Act's coverage of every working man and woman, respondent's employees are subject to the Act and the standards promulgated thereunder. No exception has been cited that relieves respondent of responsibility for its employees' exposure to hazardous conditions. Nor are the specific endeavors engaged in by respondent's employees necessarily the determining factors with respect to whether respondent is subject to construction standards, general safety and health standards, or both. The non-compliance with the cited construction n11 standards constitutes hazardous conditions to which respondent's employees are alleged to have been exposed. I would hold that respondent and its employees are subject to the safety and health regulations for construction.

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n4 40 U.S.C. 327, hereinafter referred to as the "Construction Safety Act."

n5 Construction Safety Act, section 107(a); 40 U.S.C. 333.

n6 By amendment at 37 F.R. 26008, December 9, 1972, 29 CFR 1910.11(b) was adopted which states in relevant part.

[s]imilarly, the incorporation by reference of Part 1926 in 1910.12 is not intended to include references to interpretative rules having relevance to the application of the Construction Safety Act, but having no relevance to the application to the Occupational Safety and Health Act.

n7 Cf. Tishman Realty & Constr. Co., Inc., No. 567 (July 31, 1973).

n8 See note 4, supra.

n9 Section 2(b) of the Act.

n10 See American Bridge Div. United States Steel Corp., No. 440 (February 14, 1972) (Ruling on respondent's motion to vacate).

n11 Respondent is engaged in construction work according to the clear meaning of that term.

[*8]

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With respect to whether the Secretary has proved that respondent's employees were exposed to the cited hazards, it is undisputed that several of respondent's employees were on the construction site at various times. The Secretary contends that the nature of respondent's work, i.e., observation and inspection, leads to the conclusion that employees performed their duties throughout the construction site and thus the Secretary has established that respondent's employees were exposed to the hazardous conditions. I agree.

I would find that where the Secretary has shown non-compliance with a standard at a workplace, that this is sufficient to make out a prima facie case of a violation of section 5(a)(2) of the Act. Florida Peach Growers Assoc. v. Dept. of Labor, 489 F.2d 120, 124 (5th Cir. 1974). The lack of exposure of any employee to a non-complying condition should be an affirmative defense to be proven by respondent, for respondent has specific information readily accessible only to it regarding work assignments of its personnel. J.E. Roupp & Co., Inc. and Denver Dry Wall [*9] Co., Nos. 146 & 147 (April 15, 1974) (dissenting opinion). Here, respondent has produced no evidence rebutting the Secretary's prima facie case.

[The Judge's decision referred to herein follows]

WINTERS, JUDGE: This is an action on the complaint of the Secretary of Labor, hereinafter called the Secretary, to obtain affirmance of a citation issued under Section 9(a) of the Occupational Safety and Health Act of 1970 (29 U.S.C.A. 651 et seq. ), hereinafter called the Act, and seeking affirmance of a notification of proposed penalty issued under Section 10(a) of the Act.

Both the Citation and Notification of Proposed Penalty have been contested by the Respondent, hereinafter called Bechtel.

Citation Number 1, issued May 24, 1972 to Bechtel by the Secretary's Area Director at Portland, Oregon, states that on the basis of an inspection of a workplace under Bechtel's ownership, operation, or control, located at Trojan Nuclear Plant, Prescott, Oregon and described as "Nuclear reaction containment vessel," the Respondent has violated the Act in the following respects:

Item No. -- Standard or regulation allegedly violated -- Description of alleged violation.

1. -- 29 CFR 1926.25(a) [*10] -- Work areas and passageways, inside and outside containment vessel cluttered with scrap wood building material debris.

2. -- 1926.350(a)(1) -- No valve protection caps on compressed gas cylinders stored inside and outside reaction containment vessel.

3. -- 1926.550(b)(7) -- Floor openings 2' X 3' X 15" inside containment vessel not protected by cover on guard rails.

By Notification of Proposed Penalty, issued May 24, 1972, the Area Director advised Bechtel that a civil penalty of $25.00 was proposed for each of Items 1, 2 and 3 for a total penalty of $75.00.

The matter came on for oral hearing before the undersigned Judge at Portland, Oregon, on October 25, 1972. No oral testimony was offered by either party. The matter was submitted upon an "Agreed Statement of Facts." Briefs and proposed findings were submitted by both parties.

ESSENTIAL STIPULATED FACTS

Bechtel is the "Engineer and Construction Manager" at the Trojan Nuclear Plant (Project) at Prescott, Oregon, under a contract (Contrary) dated July 18, 1968, with Portland General Electric Company (Owner).

Construction work within the meaning of 29 CFR 1910.12(b) was being performed at the Project. The physical [*11] construction work on the Project was being performed by various independent contractors who had direct contracts with the Owner and not with Bechtel. At the time of the inspection in April, 1972, there were 22 different prime contractors employed on the Project. These are all prime contracts although many of the contractors have employed one or more subcontractors in connection with their particular work. There were 4 contractors on the Project with whom Bechtel has no connection as manager or otherwise, but these four contractors were not responsible for conditions existing at the Project which could be related to the alleged violations. The contract between the Owner and each of the various contractors contains, among other provisions, the following (Exhibit B attached to Exhibit No. 1):

GC-19 SAFETY, SANITARY AND MEDICAL REQUIREMENTS

The Contractor shall, at its expense, promptly and fully comply with and carry out safety, sanitary and medical requirements as prescribed by Federal, state or local laws or regulations; and it shall be the Contractor's sole responsibility to take such other measures as may be necessary to assure that the safety and health of the [*12] employees and of the public may be safeguarded. The Contractor shall appoint a "Safety Supervisor", who shall be responsible for the proper conduct and maintenance of an effective safety program and who shall represent the Contractor at project-wide safety meetings schedule and conducted under the direction of the Engineer.

The Contractor shall stress safe practices by its employees in all phases of work and shall provide and enforce the use of such guards, barricades, helmets, goggles and other safety devices as may be necessary or required.

The Contractor shall maintain all portions of work in a neat, clean and sanitary condition at all times. Unless otherwise provided in the Contract, toilets shall be furnished by the Contractor where needed for use of its employees. The use of toilets shall be strictly enforced.

Unless otherwise provided in the Contract, the Contractor shall keep adequate first-aid facilities and supplies available.

The Contractor shall assure that its subcontractors of all tiers shall, without expense to the Owner, comply with the foregoing.

Bechtel has no craft labor at the construction site. At the time of the inspection Bechtel had 62 employees working [*13] at the Project. Most of these employees are office and administrative people who are not allowed to go on the jobsite at all. Approximately 30 of the employees were engineers. There were 19 employees who under certain circumstances would go upon the jobsite where work was under way. There were 6 Bechtel employees, including the Bechtel safety representative, who were on or about the construction work and various areas from time to time. Bechtel has no contract with any labor unions which represent workmen who perform craft labor for the Project. Bechtel's employees who are on or about the construction work observe and inspect the work of the contractors.

Bechtel's duties in connection with the Project consist only of inspection, engineering, and administrative work. Under the contract of July 18, 1968, Bechtel agreed to provide construction management services including organizing, planning and administering to construction program as a whole. The Contract contained the following provisions with respect to services performed at the construction site (page 4 and 5 of Exhibit A attached to Exhibit 1):

1. Construction Management Option

Bechtel shall perform its Construction [*14] Management Services hereunder as Agent for Owner and under Owner's control and direction. Bechtel shall be at all times the authorized Agent of Owner in dealing with third parties and Bechtel shall be so identified in writing in all contracts entered into by or on behalf of Owner for the performance of construction or other work under such contracts. These Services shall include the following:

a. Organizing, planning and administering the construction program as a whole.

b. Managing and administering all contracts for construction and related work performed by Contractors and conducting inspections of Contractor's work, including final inspection and furnishing assistance to Owner in determining the fulfillment of all such contracts. For the purpose hereof and upon completion of each portion of the Project or agreed portions thereof, Bechtel shall have each Contractor carry out the test provided in his contract insofar as such tests can be carried out before such Contractor's work as a whole is completed and tested. Bechtel shall witness and inspect these tests and make reports thereon to Owner and, when results are satisfactory, shall so notify Owner in writing. [*15] In the event that the results are unsatisfactory, Bechtel shall notify the Contractor and, upon Owner's instructions, shall require the Contractor to make the necessary corrections. When Owner has accepted a Contractor's work, Bechtel shall provide Contractor with a certificate of acceptance from Owner.

c. Receiving, inspecting and storing all Owner-furnished equipment, materials and supplies, issuing them to Contractors as required.

d. Operating a testing laboratory for testing and control of materials.

e. Providing surveying services for general layout and measurement for quantity payments.

f. Approxing disbursement of funds as required in the administration of purchase commitments and contracts, or for such other purposes as may be required by Owner.

g. Preparing budget and cost control procedures and keeping accounts of the cost of the Project and expenditures in connection therwith and issuing monthly cost and progress reports and estimates for monthly cash requirements and Contractor's payments, all in accordance with procedures to be set forth in a Project Procedures Manual.

As part of the administration of the Project the Owner has issued a document entitled "Memorandum [*16] of Organization and Procedures for Engineering, Procurement and Construction Management." The memorandum, which is effective February 10, 1971 and was in effect at the time of the alleged violation, is not part of the Constract itself but contains two sections which are relevant to the subject matter at issue (Paragraph no. 12 -- Safety Program and 13 -- First Aid) (Exhibit C attached to Exhibit 1) and which provide as follows:

12. SAFETY PROGRAM

The Field Construction Manager will establish and maintain an overall project safety program. This program will coordinate the individual contractor's responsibilities under GC-19, Safety, Sanitary and Medical Requirements. Each construction Contractor will designate one permanent status supervisory employee to serve on a Project Safety Committee chaired by the Field Construction Manager. The Field Construction Manager will also:

a. Be responsible for reviewing for adequacy the proposed safety programs of each of the construction Contractors and coordinate the programs of all Contractors.

b. Monitor the day-to-day construction activities of all Contractors for compliance with statutory safety standards and provide [*17] vigilance against unsafe work practices.

c. Order suspension or termination of unsafe construction methods or work practices as well as order the removal, repair or modification of unsafe tools and equipment in compliance with GC-19.

d. Be responsible for project housekeeping and fire prevention. Require compliance of these requirements by all Contractors.

e. Conduct regularly scheduled safety meetings for his staff to further promote safety consciousness.

f. Coordinate all reporting and statistical requirements of PGE and Bechtel.

g. In case of an accidental fatality, assure that notification by telegram has been sent immediately to the Workmen's Compensation Board, Labor and Industries Building, Salem, Oregon 97310. Copies of each telegram will also be sent to PGE's Insurance Department, 802 Electric Building, Portland, Oregon 97205, and the appropriate Bechtel management personnel designated in the Field Construction Manager's internal (Bechtel) procedures manual.

h. Report promptly each accident involving injury to members of the public or damage to property of third parties to the appropriate insurance carrier and mail promptly copies of each accident report to [*18] the PGE and Bechtel Insurance Departments.

i. Report promptly each accident involving damage to property belonging to PGE or Bechtel to the PGE and Bechtel Insurance Departments.

13. FIRST AID

First aid services will be provided by PGE for the benefit of the personnel of all organizations performing on site utilizing either a registered nurse or a qualified first aid attendant employed by the Field Construction Manager.

a. A small first aid dispensary and a standby ambulance type vehicle will be provided in support of the first aid program. The ambulance type vehicle will be used only for taking ambulance cases to medical facilities. Contractors will be responsible for transporting their respective employees for treatment when use of an ambulance is not warranted.

b. Written records will be maintained of all first aid service rendered and a detailed report and photographic record made of each serious accident.

There is a Project Safety Committe, the chairman of which is the Field Construction Manager, an employee of Bechtel. Bechtel has a full time safety representative on the Job. Weekly safety meetings are held at the Project. The Project Safety Program [*19] is administered and coordinated by Bechtel. Any unsafe or hazardous condition created by the contractors or their subcontractors is called to the attention of the appropriate contractor. This is done orally and is confirmed in writing.

The conditions described in Item Numbers 1, 2 and 3 of the Citation existed as alleged at the time of the inspection. Each of the conditions was created or caused by various contractors at the Project and not by Bechtel or by any person employed by Bechtel. Two other contractors, namely, the Hoffman Construction Company and Tri-M Erectors, were issued citations for these same violations. n1

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n1 Whether the citations issued to the other two contractors have been contested and other details with respect to them are not of record in this proceeding.

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With regard to the first condition, Bechtel has no knowledge of which contractor was responsible for the scrap wood building material debris. With respect to the second condition, Bechtel has no knowledge of the ownership or custody of [*20] the gas cylinders to which the citation refers. With respect to the third condition, there was a recess in the floor of the containment vessel approximately 2' by 3' by 15" deep. This recess would not "open," on any lower area and the bottom of this recess is solid concrete. This recess was not surrounded by guard rails or covered. Bechtel has no knowledge of which contractor is responsible for this condition.

CONTENTIONS OF THE PARTIES

Bechtel, in its initial brief contends as follows:

(1) Bechtel, as the Owner's managing engineer, was not engaged in construction work" within the meaning of the Act;

(2) Bechtel did not create the hazard and therefore cannot be cited for the violation:

(3) Bechtel did not know nor should it have known of the hazard, and therefore it is not liable;

(4) Bechtel, as the Owner's managing engineer, had no means of correcting the conditions;

(5) Even though Bechtel agreed to conduct a safety program, by doing so its duties under the Act were not increased;

(6) The contractors who were responsible for and had the capacity to remedy the hazards have been cited and the conditions have been corrected; and

(7) Item 3 of the Citation does [*21] not state a violation of 29 CFR 1926.500(b)(7).

The Secretary in his initial brief contends as follows:

(1) Bechtel was engaged in construction work at the Project worksite;

(2) Exposure of Bechtel's employees to the hazards, and not the creation of the hazards, constitutes the violation; and

(3) The proposed penalties are reasonable and appropriate.

In its reply brief, Bechtel reiterates its argument that the meaning of construction work under the Act should not include one whose duties encompass only management service, points out that there is no evidence that Respondent's employees were exposed to the hazards, and argues that citation of a construction manager, except for exposing its employees to "recognized hazards which are causing or are likely cause death or serious physical harm", are simply not contemplated under the Act.

The Secretary in his reply brief argues:

(1) the rationale of Bechtel's arguments regarding the definition of "construction" pertains to other statutes than the Act here involved; (2) the work performed by Bechtel is an integral part of the construction work at the Project; (3) the violations arise by reason of Bechtel's employees being exposed [*22] to the hazards which exist because standards have been violated; (4) Bechtel's role as engineering and construction manager precludes the assertion of ignorance of actual worksite conditions; and (5) the fact that the floor opening involved in Item Number 3 is only 15 inches deep bears on the gravity of the violation rather than upon the existance of a violation.

DISCUSSION

There is no doubt that Bechtel is an "employer" as defined in Section 3(5) of the Act and subject to the provisions of the Act including Section 5 thereof. Bechtel does not contend otherwise.

Section 5(a) of the Act contains two distinct classes of proscriptions. Section 5(a)(1) commonly referred to as the "general duty" clause, requires an employer, and this would include Bechtel, to furnish each of its employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to its employees. Section 5(a)(2), on the other hand, requires an employer, such as Bechtel, to comply with occupational safety and health standards promulgated under the Act.

Bechtel is not charged with a violation of Section 5(a)(1), nor under [*23] the factual situation here involved would such a charge be justified.

Bechtel is here charged with violating Section 5(a)(2) in that it is alleged to have violated standards promulgated under the Act. n2 It is elementary that an employee is obliged to comply only with those standards and regulations which have application to the type of activity in which the employer is engaging at the time. The standards which Bechtel is alleged to have violated are part of the Safety and Health Regulations for Construction (Construction Standards) contained in part 1926 (formerly Part 1518) of Title 29, Code of Federal Regulations. In order to determine whether these Construction Standards had application to the type of activity in which Bechtel was engaged at the time of the alleged violations, it is necessary to consider the legislative and regulatory history of the Construction Standards.

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n2 See introductory Paragraph of Complaint filed herein.

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The Construction Standards were originally issued April 17, 1971 n3 under Public [*24] Law 91-54, Act of August 9, 1969 (40 U.S.C. 333) which added Section 107 to the Contract Work Hours and Safety Standards Act (86 Stat. 96; 40 U.S.C. 327), commonly known as the Construction Safety Act. n4 Section 107 of such Act provided as follows:

Sec. 107. (a) It shall be a condition of each contract which is entered into under legislation subject to Reorganization Plan Numbered 14 of 1950 (64 Stat. 1267), and is for construction, alteration, and/or repair, including painting and decorating, that no contractor or subcontractor contracting for any part of the contract work shall require any laborer or mechanic employed in the performance of the contract to work in surroundings or under working conditions which are unsanitary, hazardous, or dangerous to his health or safety, as determined under construction safety and health standards promulgated by the Secretary by regulation based on proceedings pursuant to section 553 of title 5, United States Code, provided that such proceedings include a hearing of the nature authorized by said section. In formulating such standards, the Secretary shall consult with the Advisory Committee created by subsection (e).

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n3 Federal Register, Vol 36, No. 75 pp. 7340 et seq.

n4 Cf Section 4(b)(2) of the Act.

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As originally issued on April 17, 1971, the Construction Standard contained Section 1518.13 (later designated 1926.13) which provided interpretation of certain statutory terms used in Section 107 supra, including "construction," "alteration," "repair," "contractor" and "subcontractor."

Thereafter on May 29, 1971, n5 the Secretary promulgated Part 1910 of Title 29, Code of Federal Regulation, which as originally issued contained the following pertinent provisions: n6

SUBPART B ADOPTION AND EXTENSION OF ESTABLISHED FEDERAL STANDARDS.

Section 1910.11 Scope and purpose.

The provisions of this subpart B adopt and extend the applicability of, established Federal standards in effect on April 28, 1971, with respect to every employer, employee, and employment covered by the Act.

Section 1910.12 Construction work.

(a) Adoption and extension of established safety and health standards for construction. The standards prescribed [*26] by Part 1518 of this title and in effect on April 28, 1971, are adopted as occupational safety or health standards under section 6(a) of the Act and shall apply, according to the provisions thereof, to every employment and place of employment of every employee engaged in construction work. Each employer shall protect the employment and places of employment of each of his employees engaged in construction work by complying with the appropriate standards prescribed by this paragraph.

(b) Definition. For purposes of this section, "construction work" means work for construction, alternation, and/or repair, including painting and decorating. See discussion of these terms in 1518.13 of this title.

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n5 Federal Register, Vol. 36, No. 105 pp 10466 et seq.

n6 Subsequent to the alleged violations (37 Federal Register 26008, Dec. 7, 1972) paragraph (b) was added to Section 1910.11 providing in part: "(b) It bears emphasis that only standards (i.e., substantive rules) relating to safety or health are adopted by any incorporations by reference of standards prescribed elsewhere in this chapter or this title. Other materials contained in the reference parties are not adopted. Illustrations of the types of materials which are not adopted are these . . . Similarly, the incorporation by reference of Part 1926 in 1910.12 is not intended to include references to interpretative rules having relevance to the application of the Construction Safety Act, but having no relevance to the application to the Occupational Safety and Health Act."

[*27]

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Effective March 18, 1972, n7 Section 1910.12 was amended to read as follows:

Section 1910.12 Construction work.

(a) Standards. The standards prescribed in Part 1926 of this chapter are adopted as occupational safety and health standards under section 6 of the Act and shall apply, according to the provisions thereof, to every employment and place of employment of every employee engaged in construction work. Each employer shall protect the employment and places of employment of each of his employees engaged in construction work by complying with the appropriate standards prescribed in this paragraph.

(b) Definition. For purposes of this section, "construction work" means work for construction, alteration, and/or repair, including painting and decorating. See discussion of these terms in 1926.13 of this title.

(c) Construction Safety Act distinguished. This section adopts as occupational safety and health standards under section 6 of the Act the standards which are prescribed in Part 1926 of this chapter. Thus, the standards (substantive rules) published in Subpart C and the following [*28] subparts of Part 1926 of this chapter are applied. This section does not incorporate Subparts A and B of Part 1926 of this chapter. Subparts A and B have pertinence only to the application of section 107 of the Contract Work Hours and Safety Standards Act (the Construction Safety Act). For example, the interpretation of the term "subcontractor" in paragraph (c) of 1926.13 of this chapter is significant in discerning the coverage of the Construction Safety Act and duties thereunder. However, the term "subcontractor" has no significance in the application of the Act, which was enacted under the Commerce Clause and which establishes duties for "employers" which are not dependent for their application upon any contractual relationship with the Federal Government or upon any form of Federal financial assistance.

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n7 Federal Register of February 17, 1972, Vol. 37, No. 33

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At the same time Section 1926.13 was amended n8 by adding paragraph (c). Paragraphs (a) and (b) remained the same as they were when originally [*29] issued on April 17, 1971. As amended, Section 1926.13 at the time, of the alleged violations read as follows:

1926.13 Interpretation of statutory terms.

(a) The terms "construction," "alteration," and "repair" used in section 107 of the Act are also used in section 1 of the Davis-Bacon Act (40 U.S.C. 276A), providing minimum wage protection on Federal construction contracts, and section 1 of the Miller Act (40 U.S.C. 270a), providing performance and payment bond protection on Federal construction contracts. Similarly, the terms "contractor" and "subcontractor" are used in those statutes, as well as in Copeland (Anti-Kickback) Act (40 U.S.C. 276c) and the Contract Work Hours and Safety Standards Act itself, which apply concurrently with the Miller Act and the Davis-Bacon Act on Federal construction contracts and also apply to most federally assisted construction contracts. The use of the same or identical terms in these statutes which apply concurrently with section 107 of the Act have considerable precedential value in ascertaining the coverage of section 107.

(b) It should be noted that section 1 of the Davis-Bacon Act limits minimum wage protection to laborers [*30] and mechanics "employed directly" upon the "site of the work." There is no comparable limitation in section 107 of the Act. Section 107 expressly requires as a selfexecuting condition of each covered contract that no contractor or subcontractor shall require "any laborer or mechanic employed in the performance of the contract to work in surroundings or under working conditions which are unsanitary, hazardous, or dangerous to his health or safety" as these health and safety standards are applied in the rules of the Secretary of Labor.

(c) The term "subcontractor" under section 107 is considered to mean a person who agrees to perform any part of the labor or material requirements of a contract for construction, alteration or repair. Cf MacEvoy Co. v. United States, 322 U.S. 102, 108-9 (1944). A person who undertakes to perform a portion of a contract involving the furnishing of supplies or materials will be considered a "subcontractor" under this part and section 107 if the work in question involves the performance of construction work and is to be performed: (1) Directly on or near the construction site, or (2) by the employer for the specific project on a customized basis. [*31] Thus, a supplier of materials which will become an integral part of the construction is a "subcontractor" if the supplier fabricates or assembles the goods and materials in question specifically for the construction project and the work involved may be said to be construction activity. If the goods or materials in question are ordinarily sold to other customers from regular inventory, the supplier is not a "subcontractor." Generally, the furnishing of prestressed concrete beams and prestressed structural steel would be considered manufacturing; therefore a supplier of such materials would not be considered a "subcontractor." An example of material supplies "for the specific project on a customized basis" as that phrase is used in this section would be ventilating ducts, fabricated in a shop away from the construction jobsite and specifically cut for the project according to design specifications. On the other hand, if a contractor buys standard size nails from a foundry, the foundry would not be covered "subcontractor." Ordinarily a contract for the supplying of construction equipment to a contractor would not, in and of itself, be considered a "subcontractor" for purposes [*32] of this part.

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n8 See note 6, supra.

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In order to resolve the issues here involved it is necessary to keep in mind the distinctions between the applicability of Section 107 of the Construction Safety Act (hereinafter referred to simply as Section 107) as compared to that of the Act. Section 107 applies only to Federal public works construction, n9 whereas the Act applies to all types of employment including all types of construction. Section 107 applies only to contractors or subcontractors engaged in such construction whereas the Act applies not only to contractors and subcontractors but also to employers who do their own construction with their own employees. Section 107 is directed toward the protection of laborers and mechanics whereas the Act is directed toward the protection of all types of employees.

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n9 Section 107 applies not only to contracts to which the Federal Government is a party but also to those incident to Federally financed or Federally assisted construction under a wide variety of Federal laws.

[*33]

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Having in mind the foregoing statutory and regulatory provisions, the Judge now turns to consideration of the specific issues raised by Respondent. The first such issue was whether Bechtel is engaged in construction work which is subject to the Construction Standards. Section 107 of the Construction Safety Act, supra, applies to contracts for "construction, alteration, and/or repair, including painting and decorating" and contemplates that such work would be performed by a "laborer or mechanic." The Construction Standards as originally promulgated under Section 107 applied to such construction performed by laborers and mechanics. See paragraphs (a) and (b) of 29 CFR 1926.13, quoted above, which were part of the Construction Standards, as originally issued. The Construction Standards as originally issued obviously were not intended to apply to the type of work done by an engineer and construction manager, such as Bechtel, which employed no laborers or mechanics to perform physical construction work.

Did the Secretary in issuing 29 CFR 1910.11 and 1910.21 intend to expand the coverage of [*34] the Construction Standards to persons engaged solely in engineering and management functions? This Judge believes not. Under Section 1910.12 supra, the standards issued under Section 107 were adopted under 6(a) of the Act and intended to

. . . . apply, according to the provisions thereof, to every employment and place of employment of every employee engaged in construction work. . . . (emphasis supplied).

The phrase "according to the provisions thereof" means according to the provisions of the Construction Standards as issued under Section 107. The phrase "engaged in construction work" means the same under the Construction Standards as adopted under the Act as it did before they were so adopted. Construction is defined in 29 CFR 1910.12(b) in language identical to that used in Section 107. In order to be engaged in construction work and subject to the Construction Standards a person must employ laborers or mechanics for the actual physical work of construction. Bechtel employed no such persons at the site in question and, therefore, is not subject to the standards which it is alleged to have violation. The Citation and Notification of Proposed Penalty should be vacated. [*35]

Since the resolution of this one issue fully disposes of the case, it is unnecessary to consider other issues raised by Respondent.

In consideration of the entire record and of the briefs and proposed findings submitted by the parties, the Judge makes the following Findings of Fact and Conclusions of Law:

FINDINGS OF FACT

1. This Judge adopts as findings of fact those facts recited herein under the heading "Essential Stipulated Facts."

CONCLUSIONS OF LAW

1. The Respondent is, and at all times material hereto was, engaged in a business affecting commerce within the meaning of Section 3 of the Act.

2. This Commission has jurisdiction of the subject matter and of the parties.

3. At the time of the alleged violations, Bechtel was not providing employment or a place of employment for any employee engaged in construction work within the meaning of 29 CFR 1910.12; and, therefore, was not in violation of the Construction Standards as alleged by the Secretary.

4. The Citation and Notification of Proposed Penalty should be vacated and the Complaint dismissed.

ORDER

Accordingly, it is ORDERED that Citation Number 1, issued May 24, 1972, and Notification of Proposed [*36] Penalty, issued May 24, 1972, be, and they are hereby, vacated; and the Complaint be, and it is hereby, dismissed.