1 of 202 DOCUMENTS

TURNER COMPANY


A. SCHONBEK & CO., INC.


NORANDA ALUMINUM, INC.


GENERAL MOTORS CORP., GM ASSEMBLY DIV.


ALLIED PLANT MAINTENANCE CO. OF OKLAHOMA, INC.


CLEMENT FOOD COMPANY


MILLCON CORPORATION


FWA DRILLING COMPANY, INC.


CCI, INC.


GENERAL ELECTRIC COMPANY


CONSOLIDATED ALUMINUM CORPORATION


THE BRONZE CRAFT CORPORATION


CARGILL, INC.


CHAPMAN CONSTRUCTION CO., INC.


GALLO MECHANICAL CONTRACTORS, INC.


SPECIAL METALS CORPORATION


WILLAMETTE IRON AND STEEL COMPANY


NASHUA CORPORATION


WESTINGHOUSE ELECTRIC CORPORATION


RESEARCH-COTTRELL, INC.


ROCKWELL INTERNATIONAL CORPORATION


NEWPORT NEWS SHIPBUILDING & DRYDOCK CO.


NEWPORT NEWS SHIPBUILDING & DRYDOCK CO.


BUNKOFF CONSTRUCTION CO., INC.


GENERAL MOTORS CORPORATION, FRIGIDAIRE DIVISION


HARRIS BROTHERS ROOFING CO.


GENERAL DIVERS COMPANY


ORMET CORPORATION


R. ZOPPO CO., INC.


COEUR D'ALENE TRIBAL FARM


L. A. DREYFUS COMPANY


CMH COMPANY, INC.


BENTON FOUNDRY, INC.


MICHAEL CONSTRUCTION CO., INC.


WHIRLPOOL CORPORATION


BROWN & ROOT, POWER PLANT DIVISION


MARION POWER SHOVEL CO., INC.


ERSKINE-FRASER CO.


MORRISON-KNUDSEN AND ASSOCIATES


THE BOAM COMPANY


DIC-UNDERHILL, a Joint Venture


C. R. BURNETT AND SONS, INC.; HARLLEE FARMS


STRIPE-A-ZONE, INC.


FORTE BROTHERS, INC.


RAYBESTOS FRICTION MATERIALS COMPANY

OSHRC Docket No. 80-2793

Occupational Safety and Health Review Commission

October 31, 1980

[*1]

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

COUNSEL:

Baruch A. Fellner, Office of the Solicitor, USDOL

Marshall H. Harris, Reg. Sol., USDOL

Dennis J. Morikawa, for the employer

OPINION:

DECISION

BY THE COMMISSION:

This case is before the Commission under section 12(j), 29 U.S.C. 661(i), of the Occupational Safety and Health Act of 1970, 29 U.S.C. 651-678 ("the Act"). Administrative Law Judge Cecil L. Cutler, Jr., approved a settlement proposal submitted by the Secretary of Labor ("the Secretary") and the Respondent, Raybestos Friction Materials Company ("Raybestos"). Commissioner Cottine directed on his own motion that the judge's decision be reviewed. The issues raised by the direction for review are whether the judge erred in approving the settlement proposal where proof of service upon employees required by Commission Rule 100(c), 29 C.F.R. 2200.100(c), is lacking and where the submitted settlement agreement states:

3. Both Complainant and Respondent understand that the actions and/or procedures agreed to by Respondent herein shall not be binding upon the Respondent or on the Complainant or have any precedential effect in any other matter between the Complainant [*2] and any other party nor shall such action be deemed to constitute a waiver of any defenses which could be asserted by Respondent in any other proceeding related to the subject-matter of the Citation herein or constitute an admission by Respondent that it violated the previsions of the Occupational Safety and Health Act. [Emphasis added.]

We find that the judge did err, and for the reasons that follow, we disapprove the settlement proposal.

I

On April 11, 1980, the Secretary issued three citations to Raybestos. Citation I alleged that a serious violation of section 5(a)(1) of the Act, 29 U.S.C. 654(a)(1), occurred when Raybestos did not adequately advise employees of lung abnormalities although medical records maintained by Raybestos indicated their existence; a $600 penalty was proposed. Citation 2 alleged that a willful violation of 29 C.F.R. 1910.1001(j)(6)(ii) occurred when Raybestos did not make available to authorized physicians representing the Secretary records of all medical examinations of employees exposed to airborne asbestos fibers; a $2,000 penalty was proposed. Citation 3 alleged that a repeated violation of 29 C.F.R. 1904.2(a) occurred when recordable cases [*3] of dust-related abnormalities were not entered into the log of occupational injuries and illnesses within six working days after Raybestos' medical records indicated their existence and Raybestos recognized them; a penalty of $200 was proposed. Raybestos contested the citations and proposed penalties.

On July 7, 1980, the Secretary filed a settlement proposal with the Commission. On August 7, 1980, Judge Cutler approved the proposal.

Commission Rule 100(c), 29 C.F.R. 2200.100(c), which was in effect when the judge acted, and which codifies long-standing Commission precedent, n1 requires that settlement proposals be served upon affected employees and that proof of service accompany the proposal. The rule also requires that settlements not be approved until at least 10 days after service upon affected employees. The settlement proposal in this case was not accompanied by proof of service upon affected employees. While this would have been reason enough for the judge to have disapproved the proposal, n2 it is noteworthy that notice to affected employees of the terms of the settlement may be particularly important here. The abatement plan described in the settlement proposal [*4] with respect to citation No. 2 concerns the furnishing by Raybestos to the Secretary of medical records of Raybestos employees. The plan speaks of ten-day deadline for particular employees to object to the provision permitting the Secretary to examine the files. The plan also prescribes a procedure for, and conditions on, forwarding to the Secretary those medical records of employees who do timely object to the examination. These matters may, of course, be of special concern to the affected employees.

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n1 Dawson Brothers, Mechanical Contractors, 72 OSAHRC 5/B8, 1 BNA OSHC 1024, 1971-73 CCH OSHD P15,039 (No. 12, 1972).

n2 National Steel & Shipbuilding Co., 80 OSAHRC    , 8 BNA OSHC 2023, 1980 CCH OSHD P 24,748 (No. 79-929, 1980).

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The "not binding" clause quoted above purports to make the entire settlement non-binding. To approve the settlement proposal would therefore settle nothing. Moreover, Commission Rule 100(b) n3 requires a statement that abatement has occurred or will occur by a specific [*5] date. This essential statement is absent from the proposal, and therefore the proposal cannot be approved.

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n3 Commission Rule 100(b) states:

(b) Requirements. Every settlement proposal submitted to the Judge or Commission shall include, where applicable, the following:

(1) A motion to amend or withdraw a citation, notification of proposed penalty, notice of contest, or petition for modification of abatement;

(2) A statement that payment of the penalty has been tendered or a statement of a promise to pay; and

(3) A statement that the cited condition has been abated or a statement of the date by which abatement will be accomplished.

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Finally, we disapprove the proposal because it is incomplete. Exhibits A and B were not attached to the settlement proposal filed with the Commission.

II

In Farmers Export Co., 80 OSAHRC    , 8 BNA OSHC 1655, 1980 CCH OSHD P24,569 (No. 78-1708, 1980) ("Farmers Export"), the Commission re-examined its authority to review and disapprove a settlement proposal in light of [*6] the issue presented in that case -- whether exculpatory clauses in settlement proposals are permissible -- and in light of the decision of the United States Court of Appeals for the Third Circuit in Marshall v. Sun Petroleum Products Co., 622 F.2d 1176 (3d Cir. 1980), pet. for cert. filed, 49 U.S.L.W. 3252 (September 24, 1980) (No. 80-471) ("Sun Petroleum"). The Third Circuit held that the Commission has no authority to review settlements unless employees or their authorized representatives express some interest in the case either by filing a notice of contest or by electing to participate as parties under the Commission's rules of procedure. If employees or their representatives do express an interest in the case, the Third Circuit held, the Commission may review only employee objections concerning the reasonableness of the abatement period agreed to by the Secretary and the employer. 622 F.2d at 1185.

The Commission in Farmers Export respectfully declined to follow the Third Circuit's decision. We reiterated our long-standing view that the Commission's duty to protect the public interest in employee safety and health requires us to reject settlement proposals [*7] that do not comport with the purposes of the Act. We also observed that Congress established the Commission to formulate occupational safety and health policy in adjudication on a uniform and orderly national basis, and that while the Commission gives deference to the views of courts of appeals, it is not bound to acquiesce in a court's conflicting view. Farmers Export Co., supra, 8 BNA OSHC at 1656 nn.3 & 4, 1661 n.10, 1662 n.1; S & H Riggers & Erectors, Inc., 79 OSAHRC 23/A2, 7 BNA OSHC 1260, 1264-65, 1979 CCH OSHD P23,480 at p. 28,437 (No. 15855, 1979), pet. for review filed, No. 79-2358 (5th Cir. June 7, 1979). In subsequent cases, we have rejected settlement proposals where, contrary to Commission Rule 100, 29 C.F.R. 2200. 100, affected employees were not given notice of the settlement proposals, see, e.g., National Steel, 80 OSAHRC    , 8 BNA OSHC 2023, 1980 CCH OSHD P24,748 (No. 79-929, 1980), and where a definitive statement regarding abatement was lacking. Weldship Corp., 80 OSAHRC    , 8 BNA OSHC 2044, 1980 CCH OSHD P24,750 (No. 77-3769, 1980).

While we are aware that the Third Circuit has held that an agency has no discretion to decline [*8] to follow a court's view, see Allegheny General Hospital v. NLRB, 608 F.2d 965, 970 (3d Cir. 1979), the Third Circuit has more recently recognized that the application of the law of one circuit by an administrative agency with national jurisdiction may be difficult because venue for judicial review may lie in more than one circuit and the law of one circuit may be inconsistent with that of others. See Babcock & Wilcox Co. v. OSHRC, 622 F.2d 1160, 1166 (3d Cir. 1980) (apparent conflict among circuits over meaning of a "willful violation" of the Act). Under section 11 of the Act, 29 U.S.C. 660, persons other than the Secretary who are adversely affected or aggrieved by a final Commission order may seek judicial review in the District of Columbia Circuit, the circuit in which the employer has his principal office, or the circuit in which the violation is alleged to have occurred. The Secretary may seek review only in the latter two circuits.

We take official notice that Raybestos-Manhattan, Inc., the parent company of Raybestos Friction Materials Company, has its principal office in Trumbull, Connecticut; n4 we also note that the citations here allege that the violations [*9] occurred in Manheim, Pennsylvania. Thus, a Commission final order in this case, depending on the outcome, could be appealed in any one of three circuits -- the Second, the Third or the District of Columbia. In light of Babcock & Wilcox, we conclude that the Sun Petroleum decision is not controlling here.

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n4 Standard & Poor's Corp., 1 Register of Corporations, Directors and Executives 1910 (1980).

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In any event, an essential prerequisite to the application of Sun Petroleum, is lacking in this case. In Sun Petroleum, the representative of affected employees had notice of the settlement and objected to it both before the Commission and the court. The court held that where employees formally express an interest in the proceedings, the Commission would have jurisdiction to review the settlement to protect the employees' interest as recognized by the court. The right of employees recognized by the court to object to the settlement agreement and to participate as parties would be defeated, however, if [*10] the authorized representative of the affected employees is left wholly uninformed of the terms of the settlement.

Accordingly, the judge's decision is reversed. The settlement proposal in its present form is disapproved. The case is remanded to the judge for further proceedings consistent with Part I of this opinion and Commission Rule 100.

SO ORDERED.

CONCURBY: CLEARY

CONCUR:

CLEARY, Chairman, Concurring:

I concur in my colleagues' decision to reverse the judge and remand the case for further proceedings. My concurrence, however, is based entirely on the apparent lack of notice to the employees or their authorized representative. I do not join in my colleagues' examination of the binding/not binding nature of the settlement agreement, nor do I find that the missing exhibits necessarily require the rejection of the agreement.