UNITED STATES OF AMERICA

OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION

 

SECRETARY OF LABOR,

 

                                             Complainant,

 

                         v.

OSHRC DOCKET NO. 78-2485

REYNOLDS METALS COMPANY,

 

                                              Respondent.

 

 

January 12, 1979

ORDER

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

COTTINE, Commissioner:

            The August 10, 1978 Order of Administrative Law Judge Seymour Fier, approving a settlement agreement filed by the respondent, Reynolds Metals Company (‘Reynolds’), and the Secretary of Labor, is before the Commission for review under § 12(j) of the Occupational Safety and Health Act of 1970, 29 U.S.C. § 651 et seq. The issues to be considered include: (1) whether the authorized employee representatives[1] were served with all documents filed in this case in accordance with the Commission Rules of Procedure, and (2) whether they were afforded a sufficient opportunity to file objections to the settlement agreement.

            On May 18, 1978, Reynolds was issued a citation alleging a serious violation of 29 C.F.R. § 1910.151(c) and a serious violation of section 5(a)(1) of the Act, 29 U.S.C. § 654(a)(1). Reynolds timely contested these items of the citation, and a settlement agreement was subsequently negotiated by Reynolds and the Secretary. According to the terms of the agreement, Reynolds would withdraw its notice of contest, the penalties would be reduced, and the abatement dates would be extended.

            In a letter received by the Commission on October 6, 1978, and served on Reynolds and the authorized employee representatives, the Secretary requests the Commission to affirm Judge Fier’s Order. The Secretary states that the authorized employee representatives, as parties, should have been served with copies of the proposed settlement agreement at the time it was filed with Judge Fier. However, the Secretary notes in his letter that the solicitor’s office has contacted the two authorized employee representatives and has been informed that the representatives have received and reviewed the agreement and have no objections to its provisions. In addition, the Steelworkers have indicated their approval of the settlement agreement in a September 28, 1978 letter to the Commission.[2]

            Reynolds also requests the Commission to affirm the judge’s order. It does not dispute the authorized employee representatives’ right to receive service of the proposed settlement agreement or Reynolds’ failure to serve the agreement in this case. However, Reynolds indicates it was unaware of the representatives having elected party status until it received the Direction for Review.

            Election of party status entitles the authorized employee representative to meaningful participation in settlements. Aspro, Inc., Spun Steel Division, 78 OSAHRC 78/C8, 6 BNA OSHC 1980, 1978 CCH OSHD ¶23,032 (No. 78–1381, 1978).[3] One consideration in reviewing settlement agreements is whether affected employees and their representatives have been notified and afforded an opportunity to be heard. The Commission Rules of Procedure specifically provide for employee notice by requiring that proposed settlement agreements be served upon represented and unrepresented affected employees. Commission Rule 100(c); 29 C.F.R. § 2200.100(c).[4] Thus, regardless of their party status, the employee representative should have been served.[5] Service of the settlement is particularly important where the authorized employee representatives have indicated an interest in the proceedings and an intent to participate.[6]

            In the present case, neither Reynolds nor the Secretary was aware that the representatives of the Steelworkers and the Machinists had elected party status. It is imperative that the Secretary and the Respondent be informed that party status elections have been made.[7] It is, therefore, incumbent upon the Commission judge to advise the Respondent and the Secretary of elections of party status.[8] IMC Chemical Group, Inc., OSAHRC Docket No. 76–4761, slip op. at 6, n. 4 (November 17, 1978).

            In addition, the settlement agreement in this case indicates that any objections to the entry of an order approving the agreement should be filed with the Executive Secretary of the Commission. However, Commission Rule 100(c) provides for service of the proposed agreement on affected employees before the settlement agreement is submitted to the Commission judge. Employee objections to the agreement should be filed with the judge who is considering the merits of the agreement in the first instance. Instructing affected employees or their authorized employee representatives to file objections with the Commission Executive Secretary may preclude the employees from having their objections considered by the judge.[9] See Aspro, Inc., Spun Steel Division, supra.

            The Commission has received a letter from the Machinists dated September 19, 1978, reiterating the request originally made in its election of party status to participate in ‘a hearing before the Review Commission if a hearing is held.’ We have previously referred to the Secretary’s letter of October 5, 1978, stating that neither authorized employee representative objects to the settlement agreement. However, in light of the fact that the September 19 letter from the Machinists represents our last direct communication from that representative, we are uncertain whether any objections to the agreement remain at this date. We consider it necessary, therefore, to afford the authorized employee representatives an opportunity to be heard on this matter.

            Accordingly, the August 10, 1978 Order of Judge Fier, approving the settlement agreement executed by the Secretary and Reynolds, is affirmed unless, 10 days from the issuance of this Order, affected employees or their authorized employee representatives indicate an objection to the agreement. The objection, if any, is to be communicated to the Executive Secretary.

 

It is so ORDERED.

 

FOR THE COMMISSION:

 

RAY H. DARLING, JR.

EXECUTIVE SECRETARY

DATED: JAN 12, 1979

 

BARNAKO, Commissioner, Concurring in part and Dissenting in part:

            I concur in affirming the order of Administrative Law Judge Seymour Fier approving the settlement executed by the Secretary and Reynolds Metals Company (‘Reynolds’), but I dissent from the conditions my colleagues attach to the affirmance. They permit both the United Steelworkers of America (‘Steelworkers’) and the International Association of Machinists and Aerospace Workers (‘Machinists’) to file with the Executive Secretary any objections to the settlement, in which event the Commission presumably will withdraw its affirmance approving the settlement and remand for further proceedings. For the following reasons, I would not permit the Steelworkers the right to object to the settlement, and I would limit the Machinists’ opportunity to do so.

            As my colleagues note, after Reynolds contested the May 18, 1978 serious citation and notification of proposed penalties,[10] the Steelworkers and the Machinists, the authorized representatives of affected employees, elected party status, by letters dated July 17 and July 28 respectively.[11] Their letters were filed with the Executive Secretary of the Commission.[12] The Steelworkers also served a copy of their election letter on the Secretary. Thereafter, on July 21, the Secretary and Reynolds entered into a settlement by which the Secretary extended the time for abatement and reduced the amount of penalty, and Reynolds withdrew its notice of contest. The Secretary and Reynolds certified the settlement had been served on the employees pursuant to Commission Rule 7[13] in the following manner:

(1) By mailing or personal delivery of said Settlement Agreement to those employees represented by an authorized employee representative, if any, in accordance with section 7(f) of the Rules of the Commission, and/or (2) by posting in a place where the Citation is required to be posted, a copy of this Agreement so as to inform employees who are not represented by an authorized employee representative, if any, in accordance with section 7(g) of the Rules of the Commission (emphasis added).

 

            Notice was also given that, within ten lays of the posting of the settlement, employees or their authorized representatives should file with the Executive Secretary of the Commission any objections to the settlement.

            Judge Fier approved the settlement in an order issued on August 10, one day after he received the settlement. Subsequently, on September 11, Commissioner Cottine sua sponte directed the case for review on the issues, essentially, of whether the authorized employee representatives as parties in the proceedings were served with all documents filed in the case in accordance with the Commission Rules of Procedure, and whether they were given sufficient opportunity to object to the settlement.

            In responding to the Direction for Review, the Secretary and Reynolds concede that the Steelworkers and Machinists were not served with the documents, including the settlement, in this case. Reynolds also essentially concedes that the unions were not given an opportunity to participate in the settlement negotiations or to object to the terms of settlement. Reynolds states that the Direction for Review was the first indication it had that employees had elected party status, and that therefore, after receiving the Direction for Review, it served the unions with all documents including the settlement. Reynolds argues that the unions may now either file statements with the Commission that they have no objections or make any objections known to all parties for their consideration. The Secretary, by letter dated October 5, states that he discussed the details of the settlement with both unions before submitting the settlement to the judge. He further asserts that he contacted both the Machinists and the Steelworkers subsequent to their receipt of the settlement served by Reynolds, and was informed by them that they did not object to the settlement.

            On September 15, apparently before review of the terms of the settlement served by Reynolds on September 14, the Steelworkers objected to the lack of notice and opportunity to participate in the settlement; but on September 28, the Steelworkers stated that, having considered the settlement terms, they have no objection. The Machinists have not responded to the Direction for Review or to the settlement except by filing, on September 19, a letter stating, in the same words as their July 28 election letter, that they intend to participate in any hearing that may be held in this case before the Commission.

            This case primarily involves two issues. The first is the right of the authorized employee representative of affected employees to be served with the settlement agreement pursuant to Commission Rule 100(c) and Rules 7(f) and (c).[14] I agree with the majority that this right exists regardless of the election of party status by the representative and would add that it is to be accomplished through service of the settlement agreement on the authorized employee representative by postage pre-paid first class mail or by personal delivery before the settlement is submitted to the judge. Although both the Secretary and Reynolds concede that the Steelworkers and Machinists were not served with the settlement agreement prior to its submission to the judge, Reynolds has represented that it has now served the unions with the settlement so that any issue regarding this requirement is moot.[15]

            The second issue involves the right of the authorized employee representative of affected employees who has elected party status to participate in settlement negotiations. In Kaiser Aluminum & Chemical Corp., No. 76–2293 (Dec. 4, 1979) (dissenting opinion),[16] I stated that the Secretary should inform the employees or their representative who have elected party status of any settlement negotiations prior to formulation of the final settlement so that the employees may make their views known and raise any objections concerning the proposed settlement to the Secretary. The Secretary should then consider their views in determining whether to proceed with settlement.[17] However, if the Secretary and employer have agreed to a settlement despite objections by the union and presented the settlement agreement to the judge, it is my position that the union can object before the judge only to the reasonableness of the time specified in the settlement for abatement, provided that the settlement concerns a period for abatement. See ITT Thompson Industries, Inc., supra note 6 (concurring opinion and cases cited therein), and IMC Chemical Group, Inc., supra note 6 (dissenting opinion).

            Here the Steelworkers and Machinists became parties by filing election letters with the Executive Secretary.[18] There is some dispute as to whether they were informed of the settlement negotiations and had the opportunity to present their views to the Secretary and Reynolds for their consideration in reaching settlement.[19] Nevertheless the Steelworkers have now informed the Commission that they do not object to the settlement terms. Accordingly, there is no reason to give them further opportunity to consider the terms of settlement, and I dissent from my colleagues action in so doing.

            Whether the Machinists wish to object to the settlement is unclear,[20] and this lack of clarity warrants permitting the Machinists the opportunity to present objections. However, I would limit the manner in which they may object. Because the settlement contains terms extending abatement periods, I would afford the Machinists 10 days from the issuance date of this order to raise any objections to the reasonableness of the abatement period by filing objections with the Executive Secretary. Any other objections the Machinists may have to the settlement should be made known to the Secretary and, if they desire, Reynolds, within 10 days following issuance of the Commission order. I would then permit the Secretary and Reynolds an additional ten days in which either may request the Commission to remand the case to the judge for further proceedings if, in view of the Machinists’ objections, either wishes to abrogate consent to the terms of the settlement. Cf. Kaiser Aluminum & Chemical Corp., supra (dissenting opinion). Accordingly, I dissent from my colleagues’ order insofar as they permit any objections, other than to the reasonableness of the abatement time, to be submitted to the Executive Secretary.


[1] The United Steelworkers of America (‘Steelworkers’) elected party status under Commission Rule 20(a), 29 C.F.R. § 2200.20(a), on July 17, 1978. In a July 28, 1978 letter, the International Association of Machinists and Aerospace Workers (‘Machinists’) also elected party status.

[2] The Steelworkers had filed a petition for discretionary review on September 15, 1978–4 days after the date on which the judge’s order would have become final had review not been directed. The petition, however, objects only to the union’s lack of notice, not to the merits of the agreement.

[3] Commissioner Barnako notes his concurring opinion in ITT Thompson Industries, Inc., 78 OSAHRC 70/D10, 6 BNA OSHC 1944, 1978 CCH OSHD ¶22,944 (Nos. 77–4174 & 77–4175, 1978), where he explained his interpretation of the phrase ‘meaningful employee participation.’

[4] Rule 100 Settlement.

(c) Where parties to settlement agree upon a proposal, it shall be served upon represented and unrepresented affected employees in the manner set forth in Rule 7 hereof. Proof of service shall accompany the proposed settlement when submitted to the Commission or the judge.

[5] Commission Rule 7(d), 29 C.F.R. 2200.7(d), requires that a written statement indicating the date and manner of service be filed with the agreement. Paragraph VI of the agreement before us certifies service by mail or personal delivery on authorized employee representatives ‘if any . . . and/or’ by posting. The use of the qualifying terms ‘if any’ and ‘and/or’ renders the certification of service ambiguous and inadequate under Rule 7(d).

[6] Commission Rule 7(a) specifically requires that ‘[a]t the time of filing pleadings or other documents a copy thereof shall be served by the filing party or intervenor or every other party or intervenor.’

[7] We note that the September 28, 1978 letter of the Steelworkers indicates that, in the future, party status elections will be sent to the Regional Solicitor and the cited employer as well as to the Commission. This practice should ensure that the Secretary and the Respondent are aware of party status elections.

[8] We further note that an examination of the record reveals no indication that the authorized employee representatives were served with the judge’s August 10, 1978 Order approving the settlement agreement.

[9] The Direction for Review in this case also questioned whether the judge erred in approving the agreement without waiting a sufficient period of time to allow possible objections to be filed. The judge received the proposed agreement on August 9, 1978, and approved it on August 10, 1978. Commission Rule 37, 29 C.F.R. § 2200.37, allows a party 10 days from service of a motion to file a response. An additional 3 days is afforded if the settlement is served by mail; Commission Rule 4(b), 29 C.F.R. § 2200.4(b). Inasmuch as the authorized employee representatives were not served with the proposed agreement in this case they could not have filed their objections within the responsive period provided by Rule 37. It should be noted, however, that parties are entitled to rely on the period allowed for the filing of responses and it is error for the judge to take action on a motion prior to the expiration of this period.

[10] In item 1 of the citation, the Secretary alleged Reynolds violated section 5(a)(1) of the Occupational Safety and Health Act of 1970 (‘the Act’), 29 U.S.C. 651 et seq., specified abatement by June 16, 1978, and proposed a penalty of $700. In item 2 of the citation, the Secretary alleged Reynolds violated 29 C.F.R. 1910.151(c), specified abatement by May 25, 1978, and proposed a penalty of $500.

[11] Commission Rule 20(a), 29 C.F.R. 2200.20(a), provides that ‘[a]affected employees may elect to participate as parties at any time before the commencement of the hearing before the judge . . ..’ The Steelworkers stated specifically that ‘[o]n behalf of the affected employees, I [the Staff Representative, Safety & Health Department, USWA] wish to elect party status . . ..’ The Machinists stated that ‘. . . we intend to participate in a Hearing before the Review Committee if such a Hearing is held.’

[12] Commission Rule 8(a), 29 C.F.R. 2200.8(a), provides that ‘[p]rior to the assignment of a case to a Judge, all papers shall be filed with the Executive Secretary . . . .’

[13] Commission Rule 100(c), 29 C.F.R. 2200.100(c), pertaining to the service of settlement agreements upon represented and unrepresented affected employees, provides that ‘[w]here parties to settlement agree upon a proposal, it shall be served upon represented and unrepresented affected employees in the manner set forth in rule 7 hereof. Proof of such service shall accompany the proposed settlement when submitted to the Commission or the Judge.’

Service upon represented and unrepresented affected employees is provided for in paragraphs (f) and (g) Commission Rule 7, 29 C.F.R. 2200.7(f) and (g).

Paragraph (f) states that ‘[s]ervice and notice to employees represented by an authorized employee representative shall be deemed accomplished by serving the representative in the manner prescribed in paragraph (c) of this section.’ Paragraph (c) permits service by ‘postage pre-paid first class mail or by personal delivery.

Paragraph (g) states that ‘[i]n the event that there are any affected employees who are not represented by an authorized employee representative, the employer shall, immediately upon receipt of notice of the docketing of the notice of contest or petition for modification of the abatement period, post, where the citation is required to be posted, a copy of the notice of contest and a notice informing such affected employees of their right to party status and of the availability of all pleadings for inspection and copying at reasonable times. [Form of the notice omitted].

[14] See footnote 3 supra.

[15] I agree with my colleagues that the language of the proof of service contained in the settlement indicating the time and manner of service was so ambiguous as to be impermissibly unclear that the required service was accomplished.

[16] See also IMC Chemical Group, Inc., No. 76–4761 (November 17, 1978) (dissenting opinion at note 12), and ITT Thompson Industries, Inc., 78 OSAHRC 70/D10, 6 BNA OSHC 1944, 1978 CCH OSHD para. 22,944 (Nos. 77–4176 & 77–4175, 1978) (concurring opinion).

[17] As the person in charge of enforcing the Act for employee health and safety, the Secretary is acting for the benefit of employees and therefore is the primary person to whom the employees who have elected party status should make their views known. In entering into a settlement, the Secretary may agree to conditions favorable to the employer, such as withdrawal of a citation and reduction in characterization of a violation, and should know and take into consideration the views of those employees who are parties. Additionally, employees or their authorized employee representatives may wish to make their objections known to the employer for its consideration. As parties, employees have this right.

[18] Commission Rule 7(a), 29 C.F.R. 2200.7(a), provides that ‘[a]t the time of filing pleadings or other documents a copy thereof shall be served by the filing party or intervenor on every other party or intervenor.’ The rule pertaining to election of party status by affected employees, Commission Rule 20(a), in note 2, supra, establishes that affected employees have party status upon filing an election letter, and therefore are considered a party within the meaning of the service requirements of Rule 7(a). Therefore the unions were required to serve their election letters on all parties. Accordingly, I disagree with the statement of my colleagues that it is ‘. . . incumbent upon the Commission judge to advise the Respondent and the Secretary of elections of party status,’ and with their mere approval of a voluntary practice of serving the employer and the Secretary.

[19] The Secretary asserts that ‘the authorized representatives of the employees directly affected by the violations’ were informed of the settlement terms prior to submission of the agreement to the judge. The Steelworkers assert, however, that they did not know the terms of the settlement prior to the agreement’s submission to the judge.

[20] With respect to the lack of clarity on their agreement to the settlement, I note that an inference arises that they do not object. The copy of the settlement was served on September 14, and therefore more than three months has elapsed for the Machinists to object. Moreover, the Machinists have not disputed the Secretary’s assertion in his letter filed October 5 and served on them that they informed him they do not object to the settlement on having reviewed it. Nevertheless, whether the Machinists agree to the settlement remains unclear because, rather than waiving objections by affirmatively stating they agree, they have only responded on review by reasserting their intent to participate as a party in the proceedings.