BAY MARINA, INC.

OSHRC Docket No. 2102

Occupational Safety and Health Review Commission

January 31, 1975

[*1]

Before MORAN, Chairman; VAN NAMEE and CLEARY, Commissioners

OPINIONBY: VAN NAMEE

OPINION:

VAN NAMEE, COMMISSIONER: This matter is before the Commission on Chairman Moran's order directing review of a decision rendered by Judge James D. Burroughs. The Judge assessed a $315 civil penalty under section 17(d) of the Occupational Safety and Health Act of 1970 (29 U.S.C. 651 et seq. ) for Respondent's failure to abate its admitted violation of the standards published at 29 C.F.R. 1910.178(a)(4) and (q)(6).

We have reviewed the entire record and find no prejudicial error in the Judge's disposition.

Accordingly, it is ORDERED that the Judge's decision be and the same is hereby affirmed.

CONCURBY: CLEARY

CONCUR:

CLEARY, COMMISSIONER, concurring: The Chairman directed review in this case on the issue of whether the standard under which respondent was originally cited contained an illegal delegation of standard setting to a party other than the Secretary. For the reasons set forth below, I do not believe that this issue can properly be considered by the Commission.

In the first place, respondent contested only the proposed penalty for its admitted failure to abate. n1 Consequently, under section 10(a) [*2] of the Act, the proposed penalty is the only element of this case that is properly before the Commission. Inasmuch as the issue on review relates to an uncontested element of this case, specifically, the validity of the standard and thus respondent's failure to abate its non-compliance therewith, the Commission has no authority to consider the issue raised by the Chairman. Florida East Coast Properties, Inc., No. 2354 (February 5, 1974).

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n1 It should be noted that respondent has never contested the validity of the standard under which it was cited. In addition to choosing not to contest the citation alleging a failure to abate, respondent chose not to contest the original citation containing the proposed abatement date upon which the instant failure to abate citation was grounded. Indeed, respondent even chose not to respond to the invitation for submission on the issue raised in the direction for review.

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Secondly, the Commission has no authority to rule on the validity of standards. Such authority [*3] rests solely with the courts of appeals under section 6(f) of the Act. United States Steel Corp., Nos. 2975 & 4349 (November 14, 1974) (Cleary, Commissioner, concurring). As I noted in United States Steel:

section 17(d) indicates that a penalty is assessable thereunder for each day during which the " Failure or violation continues" (emphasis added). In other words, it is clear that a penalty thereunder is for the failure to abate rather than the exposure of employees per se. In some industrial settings, mitigation of the hazard would normally be expected on weekends or other holidays, as well as any other times when operations are shut down (footnotes omitted).

In excluding non-working days the Judge noted that "the failure to abate still continues but no employees are exposed." Noting that exposure is a component of a violation of the Act, the Judge then stated: "It seems only fair and reasonable that for purposes of uniformity the exposure factor should also apply in failure to abate cases." I cannot agree with this reasoning. Exposure of employees to the unabated hazard is a consideration going to the amount of the penalty to be assessed, not to the failure to [*4] abate. This, as the Judge correctly noted, continues, and it is for this failure that respondent has been assessed additional penalties under section 17(d).

In my view, while there may be reasons to reduce, or even eliminate, the penalty assessed for certain non-working days during which the failure to abate continues, the reasons must be unusual and compelling. All calendar days of non-abatement must be counted for purposes of a failure to abate proceeding and a penalty should be assessed for each day in all but the most unusual circumstances.

Despite the erroneous exclusion of non-working days, I would, nevertheless, affirm the penalty assessed by Judge Burroughs. The Judge carefully applied the section 17(j) penalty assessment factors n3 to the facts of this case. The factors of respondent's good faith and the gravity of the violation are of special importance. Respondent was cited for using a forklift modified by increasing the counterweight n4 that was neither installed by nor specifically approved of by the manufacturer. This additional counterweight, however, was installed prior to respondent's acquisition of the forklift. Moreover, respondent never used [*5] the forklift in any manner that exceeded its lifting capacity exclusive of the additional counterweight. The forklift was operated on the average of two hours per day and only two employees were exposed to any potential hazard from the forklift while it was in operation. Finally, in the event the forklift had overturned the operator was protected by overhead and side guarding. Considering the above facts along with the "additional" non-working days, I deem a $315 penalty appropriate.

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n3 These factors include respondent's size, good faith, history of previous violations, and the gravity of the violation.

n4 The additional counterweight would serve to increase the lifting capacity of the forklift.

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DISSENTBY: MORAN

DISSENT:

MORAN, CHAIRMAN, dissenting: The Judge's decision should be reversed in this case because the standards which the respondent allegedly violated are invalid.

The respondent was initially cited for several violations of the Act. Since it did not contest the citation within fifteen working days after receipt [*6] thereof, the citation subsequently became a final order of the Commission. 29 U.S.C. 659(a). Thereafter, the respondent was notified that its failure to correct the violation alleged in item 8 of the original citation by the date provided therein had resulted in the proposal of additional penalties in the total amount of $535.00. Although the respondent did not contest the notice of failure to correct, it did duly file a notice of intent to contest the additional penalties proposed for the failure to abate.

Item 8 of the original citation averred that the respondent had violated 29 U.S.C. 654(a)(2) by failing to prohibit the use of a forklift which had been "altered and/or modified without manufacturer's approval" as required by two occupational safety standards codified at 29 C.F.R. 1910.178(a)(4) and (q)(6). These standards respectively provide that modifications affecting the capacity and safe operation of powered industrial trucks and the additional counterweighting of fork trucks are not permitted unless approved by the manufacturer thereof. I would hold that these standards are null and void because private corporations cannot have the power to make Federal [*7] regulations and no agency of the Federal government can delegate to such firms its lawmaking or enforcement authority.

The above standards were promulgated as national consensus standards under 29 U.S.C. 655(a) which gave the Secretary of Labor authority to adopt interim standards for a period of two years from the effective date of the Act without public scrutiny and without observing the procedural safeguards afforded by the Administrative Procedure Act, 5 U.S.C. 553. 29 C.F.R. 1910.178(a)(4) has as its source the American National Standards Institute standard B56.1-1969. The source of 29 C.F.R. 1910.178(q)(6) is the National Fire Protection Association standard 505-1969.

The effect of prohibiting the modification of trucks without the prior approval of their manufacturers is to bestow on the manufacturers the authority to establish safety standards. Congress obviously did not contemplate such a result for it provided in 29 U.S.C. 655(a) that the Secretary would not promulgate as an occupational safety or health standard any national consensus standard until he had made a determination as to whether it would result in improved safety or health. See also 29 U.S.C. [*8] 655(b). The standards at issue here preclude the Secretary from making that determination.

In addition, the cited standards fail to implement the purposes of this law since it permits alteration solely upon prior written approval of the manufacturer without any requirement that such manufacturer's approval be conditioned upon worker safety. Under these standards a manufacturer could approve an alteration which made the equipment less safe than it was before the alteration.

This case also provides a good illustration of one of the undesirable aspects of enforcing a standard that has not been properly promulgated. The forklift was purchased by the respondent from the Small Business Administration. A counterweight had been installed on it before purchase. The respondent used the forklift to lift boats and place them "in high dry storage." It had used the forklift with the counterweight for about five years and had experienced no difficulty with the forklift's stability or injuries from its use. It was never used to lift boats with weights in excess of the forklift's rated maximum capacity. After removal of the counterweight, the respondent found that it was necessary [*9] to reduce its lifting operation by about one-half because it was unsafe to lift the heavier boats. In Secretary v. Industrial Steel Erectors, Inc., 6 OSAHRC 154, 156 (1974), we indicated that the purpose of the Act "is to augment and not to reduce the safety of working conditions." Compliance with the standards caused the opposite in this case.

The concurring opinion asserts that the Commission lacks jurisdiction to consider whether the standards were properly promulgated because the citation for the failure to abate became a final order of the Commission when the respondent failed to file a notice of contest thereto within fifteen working days after receipt of that document. See 29 U.S.C. 659(b). That contention lacks merit.

If an agency of the United States goes beyond the powers conferred on it by Congress in promulgating regulations, the regulations so promulgated are void. Utah Power & Light Company v. United States, 243 U.S. 389, 410 (1917); Federal Maritime Commission v. Anglo-Canadian Shipping Company, 335 F.2d 255 (9th Cir. 1964). When an issue exists as to whether the Secretary exceeded the limits of his delegated authority in promulgating a standard, [*10] a question of subject matter jurisdiction is raised. n5 See Secretary v. Stevens Equipment Company, 2 OSAHRC 1501 (1973). Jurisdictional issues may be raised by the Commission at any time and on its own motion. See Clark v. Paul Gray, Inc., 306 U.S. 583, 588 (1939); Hackner v. Guaranty Trust Company of New York, 117 F.2d 95 (2d Cir. 1941); Fed. R. Civ. P. 12(h)(3).

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n5 Secretary v. Florida East Coast Properties, Inc., 6 OSAHRC 404 (1974), cited in the concurring opinion, is clearly distinguishable from the instant case because that case did not involve a jurisdictional defect in a citation which had become final by operation of law.

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Since item 8 of the initial citation is based on standards that are void, that part of the citation is void. It therefore follows that all subsequent actions which had their genesis in that citation are also void. n6

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n6 In a decision written by the author of the concurring opinion herein, the Commission held that the validity of an uncontested citation may be raised as a defense to a charge of failure to abate the conditions enumerated in the uncontested citation. Secretary v. York Metal Finishing Co., 7 OSAHRC 845 (1974).

[*11]

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The Commission has asserted its authority to determine the legal validity of standards in numerous cases. Further questioning of that authority has now been obviated by several appellate decisions which have dealt with the correctness of the Commission's action in some of those cases without questioning the Commission's authority to so act. Brennan v. OSAHRC & Santa Fe Trail Transport Co., 505 F.2d 869 (10th Cir. 1974); McLean Trucking Co. v. OSAHRC, 503 F.2d 8 (4th Cir. 1974); Ryder Truck Lines, Inc. v. Brennan, 497 F.2d 230 (5th Cir. 1974).

My disagreement with the views expressed in the concurring opinion concerning the penalty computation for a failure to abate is demonstrated by the exclusion of weekends in computing such penalties in Secretary v. Empire Art Products Co., Inc., 12 OSAHRC 298 (1974).

[The Judge's decision referred to herein follows]

BURROUGHS, JUDGE: This is a proceeding under Section 10(c) of the Occupational Safety and Health Act of 1970, 29 U.S.C. 651 et seq., 84 Stat. 1590 (hereinafter referred to as the Act) contesting a Notification of Failure to Correct [*12] Violation and of Proposed Additional Penalty issued by the complainant on January 15, 1973, against respondent pursuant to Section 10(b) of the Act.

Respondent concedes that at all times material to this proceeding it was engaged in a business affecting commerce within the meaning of the Act and that the Commission has jurisdiction of the parties and of the subject matter herein.

The Notification of Failure to Correct Violation and of Proposed Additional Penalty alleges that as a result of a reinspection conducted by complainant on January 8, 1973, respondent failed to abate by December 29, 1972, a violation described in item 8 of a citation issued November 22, 1972. The notification proposed an additional penalty of $500.00. In addition a $35.00 abatement credit previously allowed was added to arrive at a total proposed additional penalty of $535.00.

On the basis of an inspection on November 13, 1972, of the workplace under the ownership, operation, or control of the respondent located in Naples, Florida, it was alleged in the citation issued November 22, 1972 that respondent violated Section 5(a)(2) of the Act by failing to comply with eleven (11) occupational safety [*13] and health standards promulgated pursuant to Section 6(a) of the Act. Item 8 of the citation alleged a violation of the standard set forth at 29 CFR 1910.178(a)(4) and (p)(6). n1 The citation described the alleged violation as follows:

Failure to prohibit use of "Clarklift" forklift industrial truck altered and/or modified without manufacturer's approval.

An unadjusted penalty of $125.00 was proposed for the alleged violation. A reduction of 40 percent was allowed for good faith, size and history. An additional 50 percent credit was allowed for abatement. This reduced the proposed unadjusted penalty to $35.00.

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n1 The complaint amended the citation to allege that the standard violated was 29 CFR 1910.178(a)(4) and (q)(6). The reference to (p)(6) in the citation resulted from a typographical error.

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The respondent, by letter dated January 22, 1973, filed with the complainant notice of its intent to contest the proposed additional penalty of $535.00. The complainant advised the Commission of the notice of contest [*14] filed by respondent and a complaint was filed with the Commission on February 15, 1973. The Commission assigned the case to this Judge on April 19, 1973, for purposes of conducting a hearing pursuant to Section 10(c) of the Act. A hearing was held in Naples, Florida, on May 18, 1973. No additional parties desired to intervene in the proceeding.

ISSUE

The only issue for determination is the amount of additional penalty, if any, which should be assessed for respondent's failure to abate the violation of 29 CFR 1910.178(a)(4) and (q)(6) by December 29, 1972. Respondent concedes the violation of 29 CFR 1910.178(a)(4) and (q)(6) and its failure to abate by December 29, 1972.

FINDINGS OF FACT

The evidence of record has been carefully considered and evaluated in its entirety. The facts hereinafter set forth are specifically determined in resolving this proceeding.

1. Respondent, Bay Marina, Inc., is a corporation having a place of business and doing business at 845 River Point Drive, Naples, Florida, where it is engaged in selling, storing and repairing boats and engines (Par. II, Complaint and Answer).

2. On November 13, 1972, the complainant, through a duly authorized [*15] compliance officer, conducted an inspection of respondent's premises at 845 River Point Drive, Naples, Florida (Citation).

3. As a result of the inspection of November 13, 1972, a citation was issued to respondent on November 22, 1972, alleging a violation of eleven (11) safety standards (Citation).

4. The violation of item 8 of the citation resulted from respondent's having in operation a forklift which contained an additional counterweight without prior written approval being obtained from the manufacturer. The additional counterweight was composed of cement of concrete. The instruction plate, tag or decal had not been altered to reflect the additional counterweight. The additional counterweight raised the center of gravity and affected the lateral stability of the forklift.

5. Item 8 of the citation of November 22, 1973, was to be corrected by December 29, 1972. Respondent did not file a notice of contest with respect to the citation issued November 22, 1973 (Par. III, Complaint and Answer).

6. The forklift had been in operation by respondent for four or five years. It was purchased at a sale from the Small Business Administration. The weight of the largest boats [*16] being lifted by this forklift was approximately 2400 to 2450 pounds. The weight of the boats being lifted was below the lifting capacity of the forklift without the additional counterweight.

7. The respondent experienced no accidents while operating the forklift with the additional counterweight. The lateral stability of the forklift never presented any difficulties in its operation.

8. The initial penalty finally proposed by complainant in the citation for the violation of 29 CFR 1910.178(a)(4) and (q)(6) was $35.00. The unadjusted penalty proposed was $125.00. The probability of an accident was considered low. In the event of an accident, it was considered that the injury would not be fatal but would likely keep the employee in the hospital for 24 or more hours (Ex. 1).

9. The unadjusted penalty was reduced by 40 percent, which consisted of 10 percent for good faith, 10 percent for size and 20 percent for history. The resulting $75.00 adjusted penalty was reduced 50 percent for abatement credit. The remaining penalty was then rounded off to the nearest five dollars to arrive at a proposed penalty of $35.00 for the initial violation (Ex.1).

10. A reinspection [*17] of respondent's premises on River Point Drive, Naples, Florida, was conducted on January 8, 1973. The purpose of the reinspection was to ascertain if respondent had complied with the terms of the citation issued on November 22, 1972. The reinspection on January 8, 1973, disclosed that respondent had failed to abate item eight (8) of the citation of November i2, 1973. There was no change in the conditions of the forklift between the initial inspection and the inspection on January 8, 1973 (Par. IV Complaint and Answer).

11. Two employees were observed at the time of the reinspection as being exposed to the hazard created by the violation. One of them was the operator. The driver and one or two employees were usually exposed to the operation of the forklift.

12. Respondent is closed on holidays and Sundays. It operates on Saturdays. The forklift was used every day that the respondent was open for business. It was operated for an average of two hours each day respondent was open.

13. As a result of the reinspection, respondent was issued a Notification of Failure to Correct Violation and of Proposed Additional Penalty n2 proposing an additional penalty of $535.00 [*18] for failure to abate item 8 of the citation (Par. II Complaint and Answer).

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n2 An amended Notification of Failure to Correct Violation and of Proposed Additional Penalty was issued on January 15, 1973, and is the notification on which this case is based. The record does not indicate when the notification was first issued or as to the reason an amended notification was necessary.

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14. The additional counterweight was removed on January 8, 1973, immediately after the reinspection.

15. The additional proposed penalty was based on the determination that the violation existed for four work days. This did not include weekends, New Year's Day or the date of the reinspection. The original unadjusted penalty of $125.00 was proposed for each of the work days, and the $35.00 abatement credit originally allowed was added to reach the total of $535.00 (Ex. 1).

APPROPRIATENESS OF ADDITIONAL PENALTIES

Once a notice of contest is served, the authority to assess civil penalties under the Act resides exclusively with the Commission. [*19] The Commission, is Section 10(c) of the Act, is charged with affirming, modifying or vacating citations issued by the Secretary under Section 9(a) and notifications issued and penalties proposed by the Secretary under Sections 10(a) and 10(b). The Commission, by Section 17(j) of the Act, is expressly required to find and give "due consideration" to the size of the employer's business, the gravity of the violation, the good faith of the employer and the history of previous violations in determining the assessment of an appropriate penalty. See Secretary of Labor v. Nacirema Operating Company, Inc.,

In Nacirema the Commission stated that the four criteria to be considered in assessing penalties cannot always be given equal weight. It indicated that the principal factor to be considered in assessing an appropriate penalty for a violation is the gravity of the offense. In Secretary of Labor v. National Realty and Construction Company, Inc., must be considered, including but not necessarily limited to the following: (1) the number [*20] of employees exposed to the risk of injury; (2) the duration of the exposure; (3) the precautions taken against injury, if any; and (4) the degree of probability of occurrence of an injury.

The complainant based his additional proposed penalty of $500 on the determination that the alleged violation existed for four work days. The abatement date was December 29, 1973. The period from December 29, 1973, to January 8, 1973, the date of reinspection, included two weekends and New Year's Day. The two weekends, New Year's Day and the date of reinspection were excluded in determining the number of days for which a daily penalty should be assessed. These days were excluded without regard to the days the respondent actually conducted business operations. The respondent was open for business every day except Sundays and holidays.

Section 17(d) of the Act provides that any employer who fails to correct a violation within the period permitted for its correction may be assessed a civil penalty of not more than $1000 for each day that the violation continues after the expiration of the abatement period. Thus it is clear that a daily penalty can be assessed by the Commission for each failure [*21] to correct a cited violation within the abatement period. The paramount question is how the number of days over the abatement date should be determined for purposes of assessing the additional penalty.

Should weekends and holidays be excluded in computing the number of days that the daily penalty should be assessed irrespective of the number of days an employer may be engaging in its business operations? This question must be answered in the negative. Section 17(d) of the Act must be construed in conjunction with the purposes for which the Act was enacted, namely, to assure safe and healthful working conditions for every working man and woman. Where violations have not been abated and an employee is working on the job on weekends or holidays, there is no justifiable reason to exclude those days for assessment of a daily penalty. The chance of suffering an injury is as great on any one working day as another. The fact that the work day must be Saturday or Sunday does not automatically prevent an accident from occurring.

Where an employer is closed for a specific day and is not engaged in business operations, the failure to abate still continues but no employees are [*22] exposed to any unsafe or unhealthful conditions. Generally speaking, there must be some exposure of employees to an unsafe working condition before an employer can be held in violation of a safety standard promulgated under the Act. If an unsafe condition suddenly arises and the employer immediately closes his business because of that condition, he has taken action to assure that his employees are not exposed to any unsafe working condition and the objective of the Act has been achieved. Under such circumstances the unsafe condition may still exist, but there is no employee exposure and it is clear that neither the complainant nor this Commission would hold that employer in violation of the Act. It seems only fair and reasonable that for purposes of uniformity the exposure factor should also apply in failure to abate cases. It is also recognized that an employer may experience difficulty in having the condition corrected on a day that the business operation is closed.

In determining the additional penalty for failure to abate, the number of days not abated should begin on the following date specified in the citation and include all days the employer conducts business operations [*23] and end on the date of reinspection. The date of reinspection should be included as one of the days for failure to abate since employee exposure is the same on that date as any other working day. Under this approach, a daily penalty should be assessed in this case for seven (7) days instead of four (4) days as proposed in the notification.

The complainant has proposed an additional penalty of $125.00 per day for the failure to abate. Under the circumstances of this case, this amount appears excessive. The forklift had been in operation by respondent for four or five years and no accidents or any type of difficulty was ever experienced in its operation. The lateral stability was not a problem in operating the forklift. The additional counterweight was on the forklift prior to its acquisition by respondent and was not added by respondent to obtain additional lifting capacity. Respondent's business operations did not require the additional lifting capacity. The forklift was never used in any manner that exceeded its lifting capacity exclusive of the additional counterweight.

Complainant, in proposing a penalty, concedes that there was little chance of any serious [*24] injury resulting to an employee from the operation of the forklift. The forklift was not constantly in operation while respondent was open for business. It was operated on an average of two hours per day. The driver and one or two other employees were usually exposed to any potential hazard from the forklift while it was in operation. In the event the forklift had overturned the operator was afforded some protection by guards on both sides of him and over him.

After due consideration of the criteria specified by Section 17(j) of the Act and with special emphasis on the gravity of the violation, it is concluded that a penalty of $40.00 per day is appropriate.

CONCLUSIONS OF LAW

1. The respondent was at all times material hereto engaged in a business affecting commerce within the meaning of Section 3(5) of the Act.

2. The respondent was at all times material hereto subject to the requirements of the Act and the standards promulgated thereunder. The Commission has jurisdiction of the parties and of the subject matter therein.

3. The number of days for which an additional penalty should be assessed is determined by commencing counting on the day following the calendar abatement [*25] date specified in the citation and ending on the day of reinspection and excluding days in which the employer does not conduct any business operations.

4. The respondent conducted business operations for seven (7) days during the period commencing after December 29, 1973, and extending through January 8, 1973. An additional penalty of $40.00 per day is appropriate for each of the seven (7) days.

ORDER

Upon the basis of the foregoing findings of fact and conclusions of law, and upon the entire record, it is ORDERED:

That the Notification of Failure To Correct Violation and of Proposed Additional Penalty is modified to reflect an assessment of a total additional penalty of $315.00 which penalty consists of $40.00 per day for seven (7) days plus an additional $35.00 for abatement credit which was previously allowed for the unabated item.