__________________________________
                                  :
SECRETARY OF LABOR,               :
                                  :
          Complainant,            :
                                  :
          v.                      :   OSHRC DOCKET NO. 00-1643
                                  :
INTERSTATE BRANDS, INC.,	  :
                                  :
          Respondent.             :
__________________________________:

DECISION AND ORDER

By motion dated October 20, 2000, the Secretary of Labor seeks an order
dismissing a notice of contest filed by Respondent on the ground that an
informal agreement signed by the parties resolves all issues arising
from a citation issued to Respondent on July 24, 2000. Moreover, by
signing the agreement, according to the Secretary, Respondent waived its
right to file a notice of contest. Respondent opposed Complainant's
motion and seeks a hearing on the merits of the case.

Background

On July 20, 2000, a representative of Complainant, Compliance Officer
Trina Mailloux, entered Respondent's worksite located in Billings,
Montana, for the purpose of conducting a safety and health inspection.
Respondent is engaged in the bakery business at that location. Ms.
Mailloux was directed to Ms. Debra Weisgarber who was identified as the
Human Resources Manager for the facility. Ms. Weisgarber informed the
compliance officer that she was not authorized to consent to an OSHA
inspection; however, upon conferring with corporate headquarters, Ms.
Weisgarber was granted authority to allow the inspection. The compliance
officer was accompanied on the inspection by Ms. Weisgarber, Mitch
Holmberg, Production Manager, Dan Bader, Assistant Engineer, and Mark
Heide, Controller; all of whom were management representatives. Mr. Lee
Miller, an employee and union steward, also participated in the
inspection as the employee representative.

During the inspection, the compliance officer requested to expand the
scope of the inspection to include an on-site warehouse. Ms. Weisgarber
stated that she was not authorized to consent to the inclusion of the
warehouse as part of the inspection. However, upon consultation with
corporate headquarters, Ms. Weisgarber agreed to allow the compliance
officer to inspect the warehouse. The inspection was completed within
approximately 45 minutes.

At the conclusion of the inspection the compliance officer conducted a
closing conference. According to the compliance officer's affidavit, Ms.
Weisgarber "and the others" were present and informed by the compliance
officer that they could request an informal settlement conference to
discuss, and possibly settle, any citations that issued as a result of
the inspection. Thereafter, on August 1, 2000, an informal conference
requested by Respondent was conducted and Ms. Weisgarber, Mr. Holmberg
and Mr. Bader were Respondent's representatives. Compliance officer
Mailloux and Assistant Area Director Charles Peaton represented the
Secretary. Mr. Eusebio Diaz, Business Agent for Local 466 and Mr. Russ
Murray, shop steward, represented the employees. The citation issued to
Respondent on July 24, 2000 listed one serious citation with two
subparts and four instances of violation with a proposed penalty in the
amount of $5,000.00. At the conclusion of the discussion between the
attendees, a written "informal settlement agreement" was signed by Mr.
Peaten on behalf of the Secretary and Ms. Weisgarber on behalf of
Respondent wherein Respondent agreed, /inter alia,/ (1) to correct the
violations and (2) to pay a reduced penalty in the amount of $3,000.00.
Respondent also waived its right to contest the citation and penalty as
amended by the agreement. The conference was concluded upon the signing
of the agreement.

On August 8, 2000, Respondent, by counsel, filed a written notice of
contest with the Billings Area Office contesting the citation and
proposed penalty. The notice of contest was returned to Respondent's
legal representative on August 11, 2000 with an explanation that the
notice was not being forwarded to the Review Commission on the ground
that Respondent had waived its right to contest the citation by signing
the settlement agreement. Thereafter, Respondent filed its notice of
contest directly with the Review Commission. By letter dated October 20,
2000, the Secretary filed a notice to vacate Respondent's notice of
contest. Respondent filed an opposition to Complainant's motion on
December 20, 2000. By letter dated December 29, 2000, Complainant now
seeks an extension of time to engage in discovery to establish a basis
for replying to Respondent's opposition.

Discussion

The Secretary does not dispute that Respondent filed a notice of contest
to the citation within the time period required by section 10© of the
Act. However, according to the Secretary, Respondent waived its right to
contest the citation when its representative, Ms. Weisgarber, signed the
informal settlement agreement on August 1, 2000. Respondent argues that
the agreement, admittedly signed by its employee, is not a valid waiver
of its right to contest the citation because that employee did not have
authority, either actual, apparent or inherent, to sign the agreement on
behalf of Respondent. Respondent insists that it be granted its right to
contest the citation.

Respondent asserts that it has been a long standing policy that OSHA
citations be forwarded to the Corporate Safety Department located in
Kansas City, Missouri, to be reviewed by the Director of Safety or the
Director of Loss Services. Respondent argues that only the Director of
Safety and his supervisor have authority to settle OSHA citations. This
policy is contained in a corporate document entitle /Interstate Brands
Corporate Occupational Safety and Health Administration Inspection
Policy./ This written policy is "widely disseminated throughout"
Interstate Brands, Inc. (Respondent's brief pg. 5). Although Ms.
Weisgarber does not state in her affidavit that she has seen or read the
aforesaid corporate document, she acknowledges that OSHA compliance
issues at the Billings location are the responsibility of Jerry
Valentine, Chief Engineer and Mitch Holmberg, Product Manager. Moreover,
she "was not authorized to enter into the informal settlement agreement"
(Weisgarber affidavit pg. 4). Thus, according to Respondent, Ms.
Weisgarber did not possess actual authority to enter into a settlement
agreement on behalf of Respondent.

Nor, argues Respondent, did Ms. Weisgarber display apparent authority to
act on behalf of the Company. Respondent points to the fact that Ms.
Weisgarber refused to allow the OSHA inspection to commence without
permission from "corporate." Moreover, Ms. Weisgarber declined to expand
the scope of the inspection as requested by the compliance officer
without first contacting her superiors at the Kansas City location.
Thus, argues Respondent, the Secretary knew that Ms. Weisgarber did not
have authority to act as Respondent's representative regarding OSHA
matters without permission. Therefor, according to Respondent, the
Secretary's representative should have determined whether Ms. Weisgarber
had obtained permission from her superiors to sign the settlement agreement.

Respondent relies upon the First Circuit Court of Appeals' articulation
of the basis for establishing apparent authority as follows:

To establish the apparent authority of an agent to do a certain act,
facts must be shown that the principal has manifestly consented to the
exercise of such authority or has knowingly permitted the agent to
assume the exercise of such authority; that a third person knew of the
fact and, acting in good faith had reason to believe and did actually
believe that the agent possessed such authority; and that the third
person, relying on such appearance of authority, has changed his
position and will be injured or suffer loss if the act done or
transaction executed by the agent does not bind the principal.

/Bates v. Shearson Lehman Bros. /42 F.3d 79, 82 (1st Cir. 1994)
(/American Title Ins. Co. v. East West Fin.Corp. /16 F.3d 449, 454 Cir.
1994)).



Ms. Weisgarber, on two separate occasions during the OSHA inspection,
informed the compliance officer that she could not grant permission to
engage in certain activities without permission from her superiors. On
each occasion permission was granted and Ms. Weisgarber authorized the
inspection and its expansion. Moreover, the employer initiated the
request for an informal settlement conference and, as previously stated,
Ms. Weisgarber accompanied by two management and two union officials
attended the meeting. According to Ms. Weisgarber's affidavit, she
discussed her attendance at the settlement conference with the Corporate
Safety Director prior to the meeting. It is reasonable to infer, based
upon her prior conduct, that Ms. Weisgarber discussed the parameters of
her authorization at the settlement conference at that time. Moreover,
it is reasonable to conclude that Respondent "manifested" its consent to
allow Ms. Weisgarber to Act as its representative at the meeting with
OSHA personnel by the fact that she appeared on behalf of Respondent.
Furthermore, since no objections were raised, it is apparent that Ms.
Weisgarber and the other management representatives at the meeting as
well as the union representatives, believed that Ms. Weisgarber had
authority to sign the agreement on Respondent's behalf.

Based upon prior experiences with Ms. Weisgarber, the OSHA
representatives had reason to believe that Ms. Weisgarber would only act
on behalf of the Company after receiving permission to do so from her
superiors. Thus, it was reasonable for the OSHA representatives to
assume that Ms. Weisgarber had obtained permission to attend the
settlement conference and participate in the discussion. It was also
reasonable for the agency representatives to assume, based upon prior
experiences, that Ms. Weisgarber obtained prior permission to sign the
settlement agreement on Respondent's behalf. These assumptions are
supported by the failure of the other management attendees to raise an
objection particularly since their duties included OSHA related matters.

Respondent's reliance upon the fact that the written corporate policy
regarding OSHA citations, mentioned above, was widely disseminated,
fails to support its position. To the contrary, the fact that the policy
was known by the management participants at the conference and, with
that knowledge, none of the management representatives objected to the
signing of the agreement supports the conclusion that all three
individuals believed and, by their actions, caused the Secretary's
representatives to believe that Ms. Weisgarber had authority to sign the
agreement on behalf of Respondent.

Finally, it is clear that Complainant, by relying upon the apparent
authority exercised by Ms. Wiesgarber, changed her initial position by
amending the original citation to achieve a settlement of the case and
avoid further litigation. Furthermore, as noted by the Secretary, the
vast majority of OSHA citations are settled informally, thus relieving
the Administration of lengthy and costly litigation. An inability to
rely upon management representations regarding authority to act on
behalf of a corporate entity, as in this case, would adversely affect
the Secretary's ability to resolve cases without litigation.

ORDER

Thus, it is concluded that the settlement agreement is valid and binding
upon Respondent. Since Respondent, by entering into the settlement
agreement, waived its right to file a notice of contest in this matter,
the notice of contest dated August 8, 2000 is VACATED. Complainant's
motion for discovery is DENIED.





/s/

Robert A. Yetman

Judge, OSHRC

Dated: February 20, 2001