UNIVERSITY OF PITTSBURGH OF THE COMMONWEALTH SYSTEM OF HIGHER EDUCATION

OSHRC Docket No. 77-1290

Occupational Safety and Health Review Commission

February 15, 1980

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Before: CLEARY, Chairman; BARNAKO and COTTINE, Commissioners.  

COUNSEL:

Baruch A. Fellner, Office of the Solicitor, USDOL

Marshall H. Harris Reg. Sol., USDOL

Henry J. Wallace, Jr., for the employer

OPINIONBY: COTTINE

OPINION:

DECISION

COTTINE, Commissioner:

The issue in this case is whether the Respondent, the University of Pittsburgh of the Commonwealth System of Higher Education ("Pitt" or "the University") is a "political subdivision" of the Commonwealth of Pennsylvania and thereby excluded by 29 U.S.C. §   652(5) from the requirements of the Occupational Safety and Health Act of 1970, 29 U.S.C. §   651 et seq. ("the Act"). n1 In an April 4, 1978 decision, Administrative Law Judge Henry F. McQuade vacated two items of a citation alleging nonserious violations of the Act on the ground that Pitt is a public institution operating as a political subdivision of the state.   The Secretary of Labor ("Secretary") filed a petition for discretionary review taking exception to the findngs and conclusions of the judge.   The petition was granted on May 1, 1978, and oral argument was heard by the Commission members on March 6, 1979, in Pittsburgh, Pennsylvania.

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n1 Section 3(5) of the Act, 29 U.S.C. §   652(5), defines "employer" as "a person engaged in a business affecting commerce who has employees, but does not include the United States or any State or political subdivision of a State." Section 5 of the Act, 29 U.S.C. §   654, requires each "employer," (a) to furnish to its employees a workplace that is free from recognized hazards, and (b) to comply with occupational safety and health standards promulgated under the Act.

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I

The central printing shop and office located in the 44-story Cathedral of Learning on the Pitt campus was inspected by an authorized representative of the Department of Labor on March 4, 1977.   As a result of this inspection, one citation alleging five nonserious violations of the Act was issued by the Secretary and timely contested by Pitt.   Three of the items were subsequently withdrawn by the Secretary, leaving in issue alleged violations of the occupational safety standards published at 29 C.F.R. §   1910.36(b)(8) (sufficiency of means of egress) and 29 C.F.R. §   1910.219(e)(1)(i) (guarding of horizontal [*3]   belt drives).

An evidentiary hearing involving both the merits of the alleged violations and Pitt's claim of political subdivision status was held on November 17, 1977.   In his decision, the judge vacated the charges on the basis of Pitt's exemption from the requirements of the Act.   He did not rule on the merits of the alleged violations.

II

Pitt was originally chartered as a private educational institution in 1787 and became a part of the Commonwealth System of Higher Education under the University of Pittsburgh-Commonwealth Act, Act of July 28, 1966, 24 P.S. §   2510-201 et seq. ("Commonwealth Act").   The Commonwealth Act declared Pitt to be an "instrumentality of the Commonwealth to serve as a state-related institution in the Commonwealth system of higher education." 24 P.S. §   2510-202.   The Commonwealth Act served the interests of both the University and the state by solving the University's then-critical financial problems n2 and by establishing a state-related institution in the western part of Pennsylvania that would be responsive to the educational needs of state residents at reduced tuition rates. n3

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n2 According to the court in Braden v. University of Pittsburgh, 552 F.2d 948 (3d Cir. 1977), the University made the initial overtures to the State Board of Education in order to ameliorate what the court described as "dire financial straits." 552 F.2d at 959.

n3 The state "conditioned a massive infusion of moneys on a comprehensive restructuring of the University to reflect the needs of the Commonwealth." Id.

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Under the Commonwealth Act, a 36 member board of trustees is vested with "[t]he entire management, control and conduct of the instructional, administrative, and financial affairs of the university." 24 P.S. §   2510-205.   Twelve of the 36 trustees are Commonwealth Trustees -- 4 appointed by the Governor with the advice and consent of the Pennsylvania Senate, 4 appointed by the President Pro Tempore of the Senate, and 4 appointed by the Speaker of the House.   24 P.S. §   2510-204(a).   The other 24 trustees are "elected annually under such terms and conditions as may be provided by the university by-laws." 24 P.S. §   2510-204(c).   They include 12 Charter Trustees elected [*5]   by the sitting trustees, 6 Term Trustees also elected by the sitting trustees, and 6 Alumni Trustees elected by the sitting trustees following nomination by the University alumni body.   The Governor, the State Secretary of Education, and the Mayor of Pittsburgh are non-voting ex officio members of the Board.   24 P.S. §   2510-204(a).   Under 24 P.S. §   2510-204(a) and Ch. I., Art. I of the University By-laws ("By-Laws"), the Chancellor of the University is a voting member of the Board of Trustees.

According to the By-Laws, the presence of 15 voting members constitutes a quorum of the Board and the actions of a majority of voting members present are considered the actions of the Board. n4 Ch. I. Art. II.   The affirmative vote of 19 voting members is required to elect a Chancellor.   Ch. I. Art. III.   The By-Laws may be amended by the vote of two-thirds of voting members present.   Ch. IV.   The Chancellor serves as the chief administrative officer of the University.

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n4 The By-Laws do not specify whether, or in what proportion, particular classes of trustees -- Commonwealth, Term, Alumni, or Charter -- must be represented.

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III

In concluding that the preponderance of the evidence weighed in favor of Pitt's status as a "governmental agency of the State of Pennsylvania," Judge McQuade focused on several factors: (1) The Board of Trustees' "responsiveness to state control and authority," n5 which he considered to be more important than the method of selecting trustees, (2) Pennsylvania Labor Relations Board rulings that Pitt employees are "public employees," n6 and (3) Board control and management of land and buildings owned by the Commonwealth. n7 Judge McQuade noted that the state government also supervises the functions of the University through auditing of expenditures, analyses of academic credits, review of faculty, and appropriation of funds. n8

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n5 24 P.S. §   2510-207 describes University accountability for the expenditure of appropriated funds.

n6 In the Matter of the Employees of University of Pittsburgh of the Commonwealth System of Higher Education, Case No. PERA-R-2436-W, 3 PPER 122 (1973); In the Matter of the Employees of University of Pittsburgh of the Commonwealth System of Higher Education, Case No. PERA-R-20-W (1971).

n7 The judge did not specify what land or buildings he considered in this category.   However, it can be inferred from the record that he was referring to the Western State Psychiatric Institute and Clinic and new academic buildings that have been constructed with 95% Commonwealth funds.   According to counsel for Pitt, the Hillman Library on the campus is a public library that is open to all state citizens and operated by the state.

n8 24 P.S. §   2510-210 sets forth requirements for annual reports by the University to the Governor and the General Assembly.

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In his petition for discretionary review, the Secretary takes exception to the judge's findings that (1) Pitt is an institution of the Commonwealth of Pennsylvania, (2) University trustees are under the control of the legislature and the Governor, and (3) Pitt employees are state-related employees.   The Secretary also claims that the judge erred in concluding that Pitt is a political subdivision of the state within the meaning of 29 U.S.C. §   652(5).   Review was directed on all issues raised by the Secretary's petition.

IV

The Secretary argues that Pitt meets neither of the two criteria set forth in 29 C.F.R. §   1975.5(b) for determining whether an entity is a "political subdivision" within the meaning of the Act.   That regulation provides as follows:

Part 1975 - COVERAGE OF EMPLOYEES UNDER THE WILLIAMS-STEIGER OCCUPATIONAL SAFETY AND HEALTH ACT OF 1970.

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§   1975.5 States and political subdivisions thereof.

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(b) Tests. Any entity which has been (1) created directly by the State, so as to constitute a department or administrative arm of the government, or (2) administered by individuals [*8]   who are controlled by public officials and responsible to such officials or to the general electorate, shall be deemed to be a "State or political subdivision thereof" under section 3(5) of the Act, and therefore, not within the definition of employer, and, consequently, not subject to the Act as an employer.

The Secretary contends that Pitt was not created directly by the State because the University was originally chartered in 1787 as a private institution, and the 1966 Commonwealth Act was enacted by the legislature merely as the vehicle for providing desperately needed financial assistance to the University.   The Secretary maintains that receipt of state aid does not convert the school into a political subdivision, citing rulings of the National Labor Relations Board ("NLRB") in support of his argument. n9 The Secretary also argues that Pitt is not administered by individuals controlled by the State because only one-third of the trustees are appointed by state officials. n10

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n9 E.g., Morristown-Hamblen Hospital Assoc., et. al, 226 NLRB No. 13, 93 LRRM 1166 (1976).

n10 The Secretary contends that the "political subdivision" test outlined in 29 C.F.R. §   1975.5(b) is the same as the test used by the NLRB in interpreting the identical exemption contained in the National Labor Relations Act, 29 U.S.C. §   152(2), and approved by the U.S. Supreme Court in NLRB v. Natural Gas Utility District of Hawkins County, Tennessee, 402 U.S. 600 (1971) and by the U.S. Court of Appeals for the Third Circuit in NLRB v. Howard Johnson Co., 317 F.2d 1 (3d Cir. 1963), cert. denied, 375 U.S. 920. However, the Board's test is not identical to the test found as §   1975.5(b).   The second element of the NLRB test requires administration "by individuals who are responsible to public officials or the general electorate," 402 U.S. at 604-5, while the second element of OSHA's test requires administration "by individuals who are controlled by public officials and responsible to such officials or to the general electorate." At oral argument, counsel for the Secretary submitted that the additional element of "control" found in the OSHA test is not an additional test, but is to be interpreted consistent with the term "responsible" in the NLRB test.   Oral Argument Tr. 15.   Accordingly, under this interpretation, state involvement need not be "control", nor must Pitt be administered by individuals "controlled" by the state, as those terms are commonly used.

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State involvement in University affairs is described by the Secretary as "oversight" authority rather than control, with reporting and auditing requirements of the Commonwealth Act aimed at assuring account-ability for the expenditure of appropriated funds.   The Secretary points out that the state has no control over University funds from other sources and may only recover appropriated funds expended by Pitt for purposes other than those permitted by the appropriations acts.   24 P.S. §   2510-207(b).

The Secretary maintains that the term "employer" in §   3(5) of the Act, 29 U.S.C. §   652(5), should be liberally construed and exemptions from the Act narrowly construed in order to effectuate the remedial purposes of the legislation. n11 The Secretary also asserts that the focus of the Commission should be on the "locus of control over the working conditions of respondent's employees," citing cases arising under the National Labor Relations Act ("NLRA") for the proposition that in determining whether an entity is a "political subdivision" under the NLRA the most significant factor is the locus of control over [*10]   the statutory concern. n12

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n11 In Griffin and Brand of McAllen, Inc., 78 OSAHRC 48/C13, 6 BNA OSHC 1702, 1978 CCH OSHD P22,829 (No. 14801, 1978), the Commission stated "the term 'employer' is one of art in remedial legislation that is to be defined according to the statutory context in which it is found and the practical realities of the employment relationship being scrutinized." 6 BNA OSHC at 1705, 1978 CCH OSHD P22,829 at p. 27,603.

n12 NLRB v. Howard Johnson Co., supra note 10; Morristown-Hamblen Hospital Assoc., et al, supra note 9.

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In support of his argument that Pitt is not a political subdivision of the Commonwealth of Pennsylvania, the Secretary also relies on the following:

(1) The terms of 24 P.S. §   2510-209(b) indicate that the legislature did not intend to convert the school into an administrative arm of the government because the University is distinguished from political subdivisions of the state. n13

(2) Pitt is a "[s]tate-related institution" under 24 P.S. §   2510-202(c),   [*11]   and is not included in 25 P.S. §   20-2002, which lists state colleges and universities. n14

(3) The NLRB has held that Temple University, whose relationship to the state under 24 P.S. §   2510-1 et seq. is identical to Pitt's, is not a political subdivision of the state. n15

(4) Policy considerations indicate the "propriety" of the Commission asserting jurisdiction because the record fails to reveal that Pitt's employees are adequately protected by an existing occupational safety and health program.

(5) The only state control over University affairs involves the power of the legislature to set tuition and fee schedules for state residents, contingent on sufficient state appropriations to maintain the schedule.   24 P.S. §   2510-206.

(6) The Commonwealth Act provides that the University "shall continue as a corporation for the same purpose as, and with all rights and privileges heretofore granted . . ." 24 P.S. §   2510-208. n16

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n13 The cited subsection of the Commonwealth Act provides:

The university shall have no power at any time or in any manner to pledge the credit or the taxing power of the Commonwealth of Pennsylvania or of any of its political subdivisions, nor shall the Commonwealth of Pennsylvania or any political subdivision thereof be liable for the payment of principle of or interest on such obligations [emphasis added].

n14 The schools listed at 24 P.S. §   20-2002 are state teachers colleges and universities.

n15 In Temple University of the Commonwealth System of Higher Education, 194 NLRB No. 195, 79 LRRM 1196 (1972), the NLRB declined to assert jurisdiction over Temple for policy reasons that the Secretary claims are irrelevant to the case before us.   After reviewing the relationship between Temple and the state, the NLRB stated "[u]nder the special circumstances of this case, we find it would not effectuate the policies of the Act to assert jurisdiction over the University." 79 LRRM at 1198. The NLRB did not specify its reasons for declining to assert jurisdiction nor, contrary to the Secretary's assertion, did it specifically hold that Temple is not a political subdivision of the state.   It was unnecessary for the NLRB to reach that determination because Temple admitted that its status as a private institution was not changed by the 1965 legislation that made it a part of the Commonwealth System of Higher Education.

n16 However, the provision cited by the Secretary goes on to state ". . . unless hereinafter modified or changed."

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In its brief on review, Pitt maintains that "[t]he record evidence demonstrates beyond any shadow of good faith doubt that Pitt is an administrative arm and political subdivision of the Commonwealth of Pennsylvania." It contends that the judge should be affirmed.   Pitt argues that there is an intimate relationship between the University and the state and that Pitt is treated by the state as an integral part of the governmental machinery.   Pitt focuses on the state's extensive financial control over the University through auditing, accounting, and reporting requirements, as well as substantial state involvement in Pitt's management.

The University maintains that it routinely has been recognized as a political subdivision of the state, pointing to the rulings of the Pennsylvania Labor Relations Board, n17 the NLRB ruling in the Temple University case, n18 and the University's voluntary participation under 42 U.S.C. §   418 in the public employee social security coverage program.   Pitt also maintains that the federal courts have held that Pitt is "a state institution whose conduct may be actionable under [*13]   the Civil Rights Act," citing Johnson v. University of Pittsburgh, 435 F. Supp. 1328 (W.D. Pa. 1977) and Braden v. University of Pittsburgh, 392 F. Supp. 118 (W.D. Pa. 1975), aff'd, 552 F.2d 948 (3d Cir. 1977). n19

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n17 See note 6 supra. The Secretary counters this argument by stating that although Pitt has been held to be a "public employer" under §   301(1) of the Public Employee Relations Act, 43 P.S. §   1101.101 et seq., that section defines a "public employer" to include "any nonprofit organization or any . . . educational or welfare institution receiving grants or appropriations from local, State or Federal governments but shall not include employees covered or presently subject to coverage under . . . the 'National Labor Relations Act.'"

n18 See note 15 supra.

n19 Both the Johnson and Braden cases involved sex discrimination complaints filed by female faculty members against the University.   For the purpose of determining the state action prerequisite for a claim under 42 U.S.C. §   1983, the Johnson court relied on the findings of the same court in Braden. 392 F. Supp. 118. However, as will be discussed infra, the decision of the district court in Braden, subsequently affirmed by the court of appeals, 552 F.2d 948, was limited to the denial of Pitt's motion to dismiss based on lack of state action. Neither the district court nor the court of appeals affirmatively found state action. 552 F.2d at 955 n. 35, 966.

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Pitt also argues that it falls within the test set forth in 29 C.F.R. §   1975.5 for establishing the existence of a political subdivision because it was created by the Commonwealth Act as an "instrumentality of the Commonwealth," 24 P.S. §   2510-202, and it is administered by a board of trustees that is controlled by and responsible to the state legislature.   The University argues that although only 12 trustees are state-appointed, the remaining trustees are elected by the sitting trustees, thereby giving the Commonwealth either direct or indirect involvement in the selection of all 36 trustees.

Pitt notes that Commonwealth appropriations comprise approximately one-third of the University operating budget and the University has the benefit of Commonwealth capital improvement programs.   Moreover, bonds issued by the University have tax-exempt status and the University is exempt from state sales tax.   Meetings of the Board are open to the public under the state Sunshine Law.   In addition to reporting to the legislature annually on the expenditure of Commonwealth appropriations, the University reports on [*15]   the number and distribution of academic credits, as well as faculty hours dedicated to classroom teaching, class preparation, research, and public service.   Annual audits are conducted by the Commonwealth Auditor General.   The University board of trustees also manages the state psychiatric facility at Western State Psychiatric Institute and Clinic, formerly run by the Commonwealth Department of Welfare.   While on campus or immediately adjacent to Pitt property, campus police have the same authority as Commonwealth police.   The University library is designated a state library.   In addition, the 1971 Commonwealth Master Plan for Higher Education assigns to Pitt primary responsibility for graduate and professional education and research in the western part of the state and prohibits Pitt from establishing branch campuses without state approval.

The University also maintains that it is under the jurisdiction of the Pennsylvania Bureau of Occupational Health, n20 as evidenced by an inspection of Pitt by that agency. n21 Accordingly, Pitt argues that it is erroneous for the Secretary to assert that Pitt employees are not adequately protected.   Pitt concludes that the Secretary's reliance [*16]   on the remedial purposes of the Act is misplaced because there is no absence of occupational safety and health protection under the state program.

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n20 The compliance officer who conducted the inspection in this case was employed previously by the state agency and testified that one of his duties as an inspector for the Commonwealth was to inspect educational institutions.

n21 On August 15, 1977, an inspection of the printing shop was conducted by the Bureau of Occupational Health, in response to a complaint regarding dermatitis.   A recommendation concerning personal protective equipment, hand washing, and medical assistance was made by the agency to Pitt on August 30, 1977.

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V

The issue for determination is whether Pitt, denominated by the Pennsylvania legislature as an "instrumentality of the state" and a "staterelated institution," is a political subdivision within the meaning of section 3(5) of the Act, and therefore exempt from complying with the Act.   It is well-established that in determining the applicability [*17]   of a federal statute, federal law, not state law, controls.   NLRB v. Natural Gas Utility District of Hawkins Co., Tenn., 402 U.S. 600, 603 (1971). Jerome v. U.S., 318 U.S. 101, 104 (1943); NLRB v. Randolph Electric Membership Corp., 343 F.2d 60, 62-63 (4th Cir. 1965). n22 Labels given by state legislatures, agencies, and courts may be considered, but they are not determinative. n23 Id. It is "the actual operations and characteristics" of the entity that are in issue.   Id. at 63. n24

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n22 See also Popkin v. N.Y. State Health & Mental Hygiene Facilities Improvement Corp., 547 F.2d 18, 19 (2d Cir. 1976) (the application of a federal statute is not dependent on state law in the absence of a plain indication to the contrary).

n23 The evidentiary record in this case, the submissions of the parties, and a review of relevant Pennsylvania statutes fail to reveal any legislative purpose or common law interpretation of the statutory phrase "instrumentality of the Commonwealth" as it applies to the University.

n24 See Griffin and Brand of McAllen, Inc., supra note 11 (formal technicalities are not determinative of the employment relationship).

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A

Our analysis necessarily begins with the decision of the U.S. Supreme Court in NLRB v. Natural Gas Utility District of Hawkins Co., Tenn., supra, the principal case interpreting the statutory term "political subdivision" in federal remedial legislation.   The Secretary argues that the test under the Occupational Safety and Health Act is identical to the NLRB test approved by the Court in Hawkins. n25 Pitt argues that if the "political subdivision" test contained in 29 C.F.R. §   1975.5 is interpreted in a manner to preclude Pitt's exemption, the regulations are invalid under Hawkins.

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n25 See note 10 supra.

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The Hawkins decision neither approved nor disapproved of the NLRB test for interpreting statutory language identical to §   3(5) of the Act.   In affirming the decision of the Sixth Circuit to deny enforcement of the NLRB order, the Court held that the NLRB's rejection of political subdivision status for the utility [*19]   district involved in that case had no support in the record, no reasonable basis in law, and was the result of a misreading of relevant Tennessee legislation in light of the NLRB's own test.   402 U.S. 605.

The Natural Gas Utility District of Hawkins Co., Tenn. was organized under the state's Utility District Law.   A public hearing had been held and a county judge ruled that creation of the District was required by public convenience and necessity.   The District was administered by judicially appointed commissioners subject to removal at the initiation of the Governor, county prosecutor, or county residents.   The District was delegated the power of eminent domain and declared by the legislature to be a "municipality." This utility was to be operated on a nonprofit basis and its property, revenue, and bonds were exempt from state, county, and municipal taxation.   In addition, income from its bonds were exempt from federal taxation under 26 U.S.C. §   103. Employee social security coverage was voluntary rather than mandatory.   The enabling legislation made all records of the District public records, open for inspection. Annual financial records and rate setting procedures were to be [*20]   published in a newspaper of general circulation and rate protests were to be heard by the Commissioners at public hearings.   The District Commissioners' findings were also published and judicial review obtained in the county court.   The District Commissioners were delegated subpoena power and received a nominal compensation.

After reviewing the facts, the Court concluded that the District was "an entity 'administered by individuals [the commissioners] who are responsible to public officials [an elected county judge]' and this together with the other factors mentioned satisfies us that its relationship to the State is such that respondent is a 'political subdivision' within the meaning of §   2(2) of the [National Labor Relations] Act." 402 U.S. 609.

The Court later defined political subdivision by stating, "[a]s the denomination 'political subdivision' implies, the local governmental units which Congress sought to oring within the Act derive their authority and power from their respective States." National League of Cities v. Usery, 426 U.S. 833, 855 n. 20 (1976). In the National League of Cities case, the Court concluded that the 1974 extension of the Fair Labor Standards [*21]   Act to cover states and their subdivisions, 29 U.S.C. §   203(d) (1970 ed., Supp. IV), intruded on governmental functions reserved to the states.   The exemption for state political subdivisions contained in federal regulatory statutes was viewed as a necessary constitutional limitation on the exercise of federal authority under the Commerce Clause, U.S. Const., Art. 1, Sec. 8, C1. 3, with respect to areas traditionally considered to be integral governmental functions of the State.

Interference with integral governmental services provided by such subordinate arms of a state government is therefore beyond the reach of congressional power under the Commerce Clause just as if such services were provided by the State itself.

426 U.S. at 855 n. 20.

B

The record in the case before us reveals that the relationship between Pitt and the Commonwealth is one of interdependent benefits and obligations.   In exchange for Pitt's "traditional autonomy as a private facility," the state provided extensive funding that made it possible for the University "to survive as an institution of higher education." Braden v. University of Pittsburgh, supra at 961. As a result, the state "was able to [*22]   satisfy the educational needs of its citizens at a cost considerably lower than would have been entailed by the creation of wholly new institutions" (emphasis in original), by incorporating "established, but financially ailing private institutions into the Commonwealth system of higher education." Id. n26 Nevertheless, after the passage of the Commonwealth Act, the University retained its fundamental characteristics as a private institution of higher learning, despite alterations in its tuition rate schedules and the method of financial management and accountability. n27 Although the University is required to report to the Governor and the legislature on University affairs and is audited annually by the Auditor General of the state, influence on University affairs by the state is limited to state control of appropriated monies, comprising approximately one-third of the University's operating budget. n28 As provided by the Commonwealth Act, the Board of Trustees, not the state, is vested with the "entire management, control and conduct of the instructional, administrative, and financial affairs of the university." 24 P.S. §   2510-205.   State appointees comprise only one-third [*23]   of the Board of Trustees and there is no indication in the Commonwealth Act, the University Charter or the By-Laws to suggest that any of these members must be present for the Board or its Executive Committee to conduct business, or that the University Chancellor or Board Chairman are public officials. n29 The two-thirds of the trustee positions which are not state-appointed existed prior to passage of the Commonwealth Act. Vacancies that occur among those positions are filled by majority vote of all the trustees at their annual meeting and appointments to these positions are not controlled by the state. n30 Accordingly, the Board is autonomous and is not controlled by individuals who are controlled by public officials.   Additionally, there is no indication that state involvement in academic affairs goes beyond requiring the University to report to the state on these matters.

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n26 See also Isaacs v. Board of Trustees of Temple University of the Commonwealth System of Higher Education, 385 F. Supp. 473 (E.D. Pa. 1974).

n27 The view that Pitt remained essentially a private university even after passage of the Commonwealth Act finds support in the testimony of the University trustees in the Braden case.   Braden v. University of Pittsburgh, 392 F. Supp. at 121-22. For example, Dr. David H. Kurtzman, former Pitt Chancellor and Commonwealth Secretary of Education, there testified: "I have always considered . . . that the University is primarily a private institution, with a relationship to the State under which they agreed to meet certain requirements as far as giving Pennsylvania residents, for example, for admission, and having State representation on the Board of Trustees. . . ." Id. at 122.

n28 Accordingly, all financial matters are not prescribed by statute.   See Popkin v. N.Y. State Health & Mental Hygiene Facilities Improvement Corp., supra note 22.

n29 The officers of the University Corporation include the Chairman and the Chancellor of the University.   The Chairman is elected annually from among the membership of the Board.   The Chairman presides at all meetings of the Board and the Executive Committee and is a voting member of all standing committees of the Board. By-Laws, Ch. I, Art. III.   The Chancellor is elected by the affirmative vote of at least nineteen trustees, and is required to report annually to the Board on all University activities.   Id. The Chancellor is the chief executive officer of the University and the various School Faculties and is a voting member of all standing committees of the Board.   Id.

The Executive Committee consists of the Chairman and Vice Chairman of the Board, the Chancellor and 12 elected members.   The Committee has and may exercise all the power and authority of the Board when the Board is not in session except that the Committee does not have the authority to fill vacancies on the Board or the Executive Committee, elect or remove officers, or amend the By-Laws. By-Laws, Ch. I, Art. V.

n30 Respondent's brief at 19 may be read to imply that the 12 state-appointed trustees in turn appoint the remaining trustees.   This is not the case.   The state-appointed and non-state-appointed trustees jointly vote to fill vacancies.

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Those courts that have ruled in favor of political subdivision exemptions generally have relied, inter alia, on public appointment of all members of the administrative bodies and public accountability through state removal power.   E.g., NLRB v. Natural Gas Utility District of Hawkins Co., Tenn., supra; Popkin v. N.Y. State Health & Mental Hygiene Facilities Improvement Corp., 547 F.2d 18 (2d Cir. 1976). Crilly v. Southeastern Pa. Trans. Auth., 529 F.2d 1355 (3d Cir. 1976). Contra, NLRB v. Lewiston Crchards Irrigation District, 469 F.2d 698 (9th Cir. 1972). Pitt's relationship to the state reveals neither of these characteristics.   Nor does it satisfy the test set forth in 29 C.F.R. §   1975.5(b).   The criteria used in 29 C.F.R. §   1975.5(b) to define political subdivisions and the analytical factors described in §   1975.5(c)-(e) are an adoption of the NLRB test as set forth in NLRB v. Natural Gas Utility District of Hawkins Co., Tenn., supra, and NLRB v. Randolph Electric Membership Corp., supra. n31 We conclude that Pitt was not "created directly by [*25]   the State, so as to constitute a department or administrative arm of the government" and is not "administered by individuals who are controlled by public officials and responsible to such officials or to the general electorate . . .," within the meaning of Hawkins and Randolph Electric. n32 We do not doubt that the legislative terms "instrumentality" and "state-related institution" are more than "empty verbiage." Braden v. University of Pittsburgh, supra at 959. However, in interpreting the Occupational Safety and Health Act we must consider the actual operation of an entity and the economic realities of compliance, as well as the statutory purpose.   See NLRB v. E.C. Atkins & Co., 331 U.S. 398, 403 (1947); Randolph Electric, supra at 62.   We do not find pervasive state control in the actual operations of the University so that Pitt can accurately be described as a subordinate arm of the state government, deriving either its authority or its power from the state.   See Nat'l League of Cities v. Usery, supra. n33

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n31 The same test has been adopted by the Equal Employment Opportunity Commission to define "political subdivision" under Title VII of the Civil Rights Act of 1964, 42 U.S.C. §   2000e et seq. Popkin v. N.Y. State Health & Mental Hygiene Facilities Improvement Corp., supra.

n32 Pitt states that on March 22, 1973, it was informed by an attorney at the OSHA Region III office that as a political subdivision it is exempt from the requirements of the Act and that on May 31, 1977, while this action was pending, an employee complaint filed with OSHA was referred to the Bureau of Occupational Health for investigation.   Assuming these assertions to be accurate, we note that neither the Secretary nor the Commission is bound by an erroneous interpretation of the Act made by an agent of the Secretary.   It is an essential general rule that the government is never disabled from protecting the public interest by reason of the past mistakes of its agents.   See Udall v. Oelschalaeger, 389 F.2d 974, 977 (D.C. Cir. 1968).

n33 At oral argument counsel for Pitt contended that the type of state control required under the Secretary's test for political subdivision status would, in light of Pitt's fundamental purpose as an educational institution, be an inappropriate governmental intrusion into the academic freedom of the University, thereby infringing on first amendment freedoms.   Pitt also argued that the University performs an essential governmental function and should, under Usery v. Nat'l League of Cities, supra, be free from regulation by the federal government.

We find no indication that mandatory compliance with the Occupational Safety and Health Act of 1970 would in any way interfere with the academic freedom of the institution.   Cf. Mabee v. White Plains Publishing Co., 327 U.S. 178, 184 (1946) (press not immune from the requirements of Fair Labor Standards Act, a regulatory statute applicable to businesses in general); Associated Press v. NLRB, 301 U.S. 103, 132-3 (1937) (freedom of the press not affected by requiring compliance with National Labor Relations Act requirements).   See also Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186, 193 (1946). Furthermore, we note that there are institutions of higher learning within the state that are controlled and operated by the Commonwealth.   24 P.S. §   2001 et seq. In light of this extensive degree of governmental control over educational institutions, we are unconvinced that governmental regulations limited to promoting the safety and health of the University's print shop employees are constitutionally precluded under the first amendment protections of academic freedom.

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The University's reliance on its exemption from state and municipal taxation, benefits that accrue to public bodies, is not persuasive.   Under Pennsylvania law, the state sales tax is not imposed upon retail sales to or by any nonprofit educational institution in the state.   72 P.S. §   3403-203(e).   Moreover, no state or municipal property taxes may be imposed upon any "universities, colleges . . . associations and institutions of learning . . ." 72 P.S. §   5453.202. n34 Pitt's voluntary participation in social security coverage is likewise not persuasive.   The opinions of the state Attorney General interpreting the coverage provisions of the Social Security Act are not determinative on the interpretation of §   3(5) of the Occupational Safety and Health Act. See NLRB v. Natural Gas Utility District of Hawkins Co., Tenn., supra; NLRB v. Randolph Electric Membership Corp., supra at 65 & n. 9. n35

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n34 Despite state tax benefits and declarations by the state legislature and attorney general that the Randolph Electric Membership Corp. was a political subdivision of North Carolina, the Fourth Circuit affirmed the Board's ruling that the named corporation was not an exempt political subdivision under the NLRA.   NLRB v. Randolph Electric Membership Corp., supra.

n35 In Randolph Electric Membership Corp., the court noted that the conflicting Internal Revenue rulings involving Randolph's claim to political subdivision status were not helpful and would not be determinative.

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Neither Pitt management of state-owned property nor its use of campus facilities built and owned by the state is decisive of whether Pitt is an instrumentality of the state.   An entity does not become an administrative arm of the state by occupying or managing state-owned property.   NLRB v. Howard Johnson Co., 317 F.2d 1 (3d Cir. 1963), cert. denied, 375 U.S. 920; Morristown-Hamblen Hospital Assoc., et al, 226 NLRB No. 13, 93 LRRM 1166 (1976). See Highview Inc., 223 NLRB No. 80, 92 LRRM 1088 (1976); Bishop Randall Hospital, 217 NLRB No. 185, 89 LRRM 1249 (1975).

The Secretary notes that the NLRB has considered the "locus of control" to be the most significant factor in determining whether an entity is a political subdivision of a state and thereby exempt from coverage of the NLRA, citing NLRB v. Howard Johnson Co., supra. n36 In affirming the ruling of the Board, the court in Howard Johnson determined that although "the element of control of the enterprise is important in deciding the issue . . . control of the employment relationship is of paramount significance."   [*28]   317 F.2d at 2. n37 The court relied on the Supreme Court decision in NLRB v. E.C. Atkins & Co., supra, which used this type of employment relationship analysis to determine whether formerly civilian plant guards were entitled to the statutory protections of the NLRA or whether their militarization after the plant was converted to war production changed their status as "employees" under the NLRA.   The relationship between the guards' employer and the government was not in issue. n38 The issue focused on whether restrictions imposed by the military authority following militarization of the civilian employees so altered their employment relationship that effective collective bargaining was no longer possible.   The question, therefore, was not whether the employer was an "employer" under the NLRA, but whether the guards were "employees" under that act.

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n36 The Secretary also cites Morristown-Hamblen Hospital Assoc., et al, supra, where the Board considered, among other factors, hospital control over the wages and working conditions of employees.

n37 Howard Johnson maintained that the New Jersey Turnpike Authority so controlled the operations of its restaurant that Howard Johnson was acting merely as an agent of the Authority.   The court concluded that Howard Johnson was an independent contractor, not an agent of the Authority.   It is apparent that Howard Johnson was attempting to gain exempt status on the basis of an agency relationship with an exempt entity. See National Transportation Service, Inc., 240 NLRB No. 64, 100 LRRM 1263 (1979), where the NLRB recently abandoned its "intimate connection" test.

n38 The Howard Johnson decision also cited with approval the NLRB's statement of the decisive elements in establishing an employer-employee relationship set forth in Roane-Anderson Co., 95 NLRB No. 209, 28 LRRM 1465 (1951).

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While analogous considerations are relevant to the Commission's review of this case, we cannot agree with the Secretary that locus of control over the working conditions of Pitt employees is properly the primary concern of the Commission.   The analysis is similar because the working conditions of employees are an integral part of an employment relationship and the ability of a respondent to affect working conditions independent of state control or interference is an important consideration.   On the other hand, the test for determining political subdivision status used by the NLRB and adopted by OSHA in 29 C.F.R. §   1975.5, as well as the principles enunciated by the Supreme Court in Hawkins Co. and the Fourth Circuit in Randolph Electric, clearly focus on the relationship between the entity and the state. n39 Control of working conditions is one of many factors to be considered in assessing the nature of that relationship.   In this respect, we find no record evidence of any state involvement in the working conditions of the Pitt employees involved in this case.

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n39 This focus is consistent with the analysis employed in Bertrand Goldberg Associates, 76 OSAHRC 102/A9, 4 BNA OSHC 1587, 1976-77 CCH OSHD P20,995 (No. 1165, 1976) where the Commission rejected a claim to exempt status as a political subdivision, holding that the architect and manager of a construction project on the campus of a state college was an employer under the Act.   The Commission found that the respondent in that case was an independent entity, separate and distinct from the state that had entered into an agreement with the state after "arm's length" dealings, and that any profits or losses accrued to the independent contractor.

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We do not agree with Pitt that an interpretation of OSHA's political subdivision exemption that excludes Pitt from its coverage would render the regulations invalid under Hawkins and unconstitutional under Nat'l League of Cities. n40 This case presents neither the extensive regulatory control and public accountability considered in Hawkins, nor the "significant impact on the functioning of the governmental [*31]   bcdies" involved in Nat'l League of Cities, supra at 846.

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n40 There is nothing in this record to suggest that expenditures related to the cost of compliance would necessarily come from state appropriations, nor does the record disclose that the type of disruption of public services considered by the court in National League of Cities would occur as a result of compliance.

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C

As a matter of legislative interpretation, federal labor statutes are to be read in harmony.   Boys Markets, Inc. v. Retail Clerks Union, 398 U.S. 235, 250-52 (1970). However, we find no inconsistency in our holding with the Board's decision in the Temple University case to decline to exert jurisdiction for policy reasons that were not stated by the Board. n41

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n41 See note 15 supra.

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Furthermore, the decision of the U.S. Court of Appeals for the Third Circuit [*32]   in Braden v. University of Pittsburgh, supra, does not compel a different result.   The court did not hold that Pitt is a state institution or that the action of the university in issue in that case was state action for the purpose of establishing the jurisdictional prerequisite for a claim under 42 U.S.C. §   1983. Rather, the court held that the district court did not err in denying Pitt's motion to dismiss based on the argument that the University was not acting under color of state law.   Although the court concluded that the relationship between Pitt and the state was intended by the Commonwealth Act to be a close one, and the legislative language "instrumentality" and "state-related institution" was not "empty verbiage," 552 F.2d at 959, the lead and concurring opinions were careful to note that despite language in the district court opinion indicating affirmative state action, the language was limited to the denial of Pitt's motion to dismiss the omplaint on jurisdictional grounds. n42 552 F.2d at 955 n. 35, 966. The court also noted that "since the dismissal motion was submitted by Pitt Dr. Braden, as the opposing party, is entitled to the benefit of all reasonable doubts [*33]   and inferences which may arise in connection with the consideration of such motion [footnote omitted]." n43 552 F.2d at 955.

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n42 Pitt filed a motion to dismiss under Fed. R. Civ. P. 12(b)(6).   Because the district court considered matters outside the pleadings, the motion was converted into a motion for summary judgment under Fed. R. Civ. P. 12(c).

n43 Braden was remanded to the district court for further proceedings.   The question of whether state action did or did not exist remained open for determination by the district court.   According to counsel for Pitt in the proceedings before the Commission, the University has not pursued the state action question since remand.   Therefore, a final determination on the state action claim in Braden will not be made.   However, we also note that an affirmative ruling on state action in the context of a civil rights claim would not be controlling.   An entity need not be a governmental unit in order for state action to be found.   See e.g., Jackson v. Metropolitan Edison Co., 419 U.S. 345 (1974); Burton v. Wilmington Parking Authority, 365 U.S. 715 (1961).

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VI

We conclude that the University of Pittsburgh is not a "political subdivision" within the meaning of 29 U.S.C. §   652(5).

Accordingly, the decision of the Administrative Law Judge finding Pitt exempt from the requirements of the Act is reversed.   This case is remanded for a decision on the merits.

IT IS SO ORDERED.