“UNITED STATES OF AMERICAOCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION \u00a0 SECRETARY OF LABOR, \u00a0 ???????????????????????????????????????????? Complainant, \u00a0 ???????????????????????? v. OSHRC DOCKET NO. 7390 GORDON CONSTRUCTION COMPANY, \u00a0 ????????????????????????????????????????????? Respondent. \u00a0 August 10, 1976Before BARNAKO, Chairman; MORAN and CLEARY,Commissioners.OPINION BY: CLEARY, Commissioner:??????????? OnApril 2, 1975, Administrative Law Judge Harold A. Kennedy issued his decisionvacating two citations issued to respondent Gordon Construction Company forviolations of section 5(a)(2) of the Occupational Safety and Health Act of1970, 29 U.S.C. ? 651 et seq., [hereinafter cited as ?the Act?].[1] The citations were vacatedon the ground that respondent was not the ?employer? of the employees allegedlyexposed to the violations.??????????? Pursuantto section 12(j) of the Act I granted the petition for review filed by theSecretary. It raised the following issues:??????????? (1)Whether the Administrative Law Judge erred in finding that respondent, underthe circumstances of this case, was not an ?employer? within the meaning of theAct???????????? (2)If so, whether respondent violated the Act as alleged in the citation.??????????? Forthe reasons given below, we reverse and remand.??????????? Respondentis a contractor engaged in excavating and trenching. In February 1974,respondent was hired by the North Little Rock, Arkansas, Sewer Department toassist in digging trenches for the replacement of sewer lines. Respondent washired because of its expertise in digging through solid rock. According to anoral agreement, respondent was to receive costs plus ten percent overhead.Respondent was to provide the department with men and equipment. It assignedthree employees, a backhoe operator and two laborers, to the job. Respondentmaintained employee records; paid the employees; and was responsible for theirworkmens? compensation coverage. When questioned by the compliance officer,these employees identified themselves as employees of respondent.??????????? Mr.Wilson, the backhoe operator, was assigned by respondent to head the crewassigned to the worksite. In that capacity he was responsible for maintainingrespondent?s records, including a tabulation of hours worked by himself and thetwo laborers. It was from these records that respondent charged the sewerdepartment for the labor of the employees.??????????? Althoughthe project was under the supervision and control of the city engineer, Mr.Kimbrough, Mr. Wilson exercised authority to direct the laborers to performspecific tasks incidental to their job. Also, Mr. Kimbrough was often absentfrom the jobsite, and in his absence Mr. Wilson exercised broad supervisoryauthority. Indeed, when approached by the compliance officers, Mr. Wilsonindicated that he was the person in charge.??????????? Inhis decision Judge Kennedy concluded that, although the three employeesconsidered themselves to be in respondent?s employ and were paid by respondent,they ?looked … to the sewer department?s field engineer … as the person incomplete charge of their work activities ….? On the basis of this finding heconcluded that respondent was not the employer of the three workers forpurposes of the Act. No other findings or conclusions were made, and thecitation was vacated.??????????? Thequestion of whether an employment relationship exists is answered byconsidering all the facts in light of the Act?s purpose. The common lawdefinition of ?employer? as determined by the so-called ?control test? is aterm of tort law evolved for the purpose of determining a superior?s liabilityfor the acts of his subordinates. Brennan v. Gilles & Cotting, Inc.,503 F.2d 1255, 1261 (4th Cir. 1974). The scope of the common law definition of?employer? is related to the tort doctrine of respondeat superior and does nottake into account the purpose of the Act. It is, therefore, not suitable fordetermining liability under the Act. Frohlick Crane Service, Inc. v.O.S.H.R.C., 521 F.2d 628, 631 (10th Cir. 1975); Brennan v. Gilles &Cotting, Inc., supra. Instead, we must define employment relationships on acase by case basis, considering both the economic realities of the situationand the remedial purposes intended by Congress. Brennan v. Gilles &Cotting, Inc., supra; Dayton Tire & Rubber Co., 1974-75 CCH OSHDpara. 19,246, 2 BNA OSHC 1528 (No. 2719, 1975), petition for review docketed,75-1316, D.C. Cir., March 27, 1975.??????????? TheCommission has considered the following in identifying an ?employer? forpurposes of the Act: (1) the person whom the employees consider to be theiremployer; (2) who pays employees? wages; and (3) who is responsible forcontrolling employees? activities. Weicker Transfer and Storage Co.,1974-75 CCH OSHD para. 19,215, 2 BNA OSHC 1493 (Nos. 1362 and 1373, 1975); BaysidePipe Coaters, Inc., 1974-75 CCH OSHD para. 18,677, 2 BNA OSHC 1206 (No.1953, 1974). As stated, the employees considered themselves to be employed byrespondent. Respondent assigned them to the job, maintained their employeerecords, and carried their workmens? compensation insurance. Furthermore,respondent retained the power to remove the employees from the worksite.Respondent also paid the employees? wages.??????????? Respondent,however, argues that it was not the ?employer? because it lacked control of theworksite. Although the ?control? element is an important factor in determiningwhether an employment relationship exists under the Act, it is, by no means,conclusive. See Brennan v. Gilles & Cotting, Inc., supra. In anyevent, the evidence establishes that respondent maintained a significant degreeof control over the employees. Although the worksite was under the supervisionand control of the sewer department, Mr. Wilson directed the laborers in theperformance of tasks related to the operation of the backhoe and the process oflaying pipe. Also, as indicated above, during Mr. Kimbrough?s frequent absencesfrom the job, Mr. Wilson exercised broader authority.??????????? Furthermore,respondent was hired specifically because of its experience and expertise indigging through solid rock. When questioned about the reasons for hiringrespondent, Frank Murphy, the manager of the North Little Rock SewerDepartment, testified:I contacted Mr. Gordon as I had in thepast about many other jobs, because he had the expertise on dynamite and thehandling of explosives, plus, all the Federal permits to handle the thing.\u00a0He also testified as follows:Under our arrangement, Mr. Gordonfurnished some equipment and some employees. And expertise and many things.\u00a0??????????? Whenan employer is hired for its expertise and that expertise is relied upon, thatemployer is responsible for the actions of its employees relevant to its work.See Frohlick Crank Service, Inc. v. O.S.H.R.C., 521 F.2d 628, 631 (10thCir. 1975); Lidstrom, Inc., 1975-76 CCH OSHD para. 20,564 (No. 3433, 1976)??????????? Respondent?sargument that it had loaned its employees to the sewer department and that,under the common-law principle of the ?borrowed employee,? the department hadbecome their employer is inapposite. As is the case with the term ?employer,?the term ?borrowed employee? is a term of tort law and has no place in anadministrative proceeding brought under remedial legislation designed toprovide a safe place to work for every working man and woman in the Nation. FrohlickCrane Service, Inc. v. O.S.H.R.C., supra at 631.??????????? Thefacts of this case reveal that the prerequisites to an employment relationshipbetween respondent and the three workers have been satisfied. Although the?control? element is satisfied only in part, with the sewer department and respondentsharing different aspects of control over the employees, it is clear thatrespondent, for purposes of the Act, is the employer of the backhoe operatorand the two laborers.[2]??????????? Althougha hearing was conducted by the Judge, he made no findings of fact concerningthe alleged violations. Much of the evidence adduced at; the hearing iscontradictory and requires credibility findings which the Judge is bestqualified to make. See Paul L. Heath d\/b\/a Paul L. Heath Contracting Co.,1975-76 CCH OSHD para. 20,006, 3 BNA 1550 (No. 5467, 1975). Also, on reviewneither party has briefed the issue of whether respondent was in violation ofthe Act, and both parties have requested that the case be remanded for findingsin the event the Judge?s decision is reversed.??????????? Finally,we note that the city sewer department had substantial control over theworksite. Thus, the situation may be analogous to the control problem commonlyfound at multiple employer construction sites. Therefore, respondent may beable to raise certain defenses available to subcontractors at multiple employerconstruction sites. See Anning-Johnson Co., 1975-76 CCH OSHD para.20,690, 4 BNA OSHC 1193 (Nos. 3694 & 4409, 1976); Grossman Steel &Aluminum Co., 1975-76 CCH OSHD para. 20,691, 4 BNA OSHC 1185 (No. 12775,1976). Because these defenses were not available to respondent at the time ofthe hearing we will allow them to be raised on remand.[3]It is ORDERED that the Judge?s decision is reversedand the case is remanded.?DISSENT BY: MORANMORAN, Commissioner, Dissenting:??????????? JudgeKennedy vacated the citations in this case on the ground that respondent wasnot an ?employer? within the meaning of the Act and could therefore not be heldaccountable for the alleged violations. His decision, which is attached heretoas Appendix A, is eminently correct and should be affirmed in all respects.??????????? Althoughwe have held that employment relationships are not to be construed according totechnical concepts of the common law, and that the question of whether such arelationship exists is to be determined on the facts of each case, we havenevertheless consistently recognized that control over a worker is an importantconsideration in ascertaining such a relationship under the Act. Secretaryv. Gilles & Cotting, Inc., 4 OSAHRC 1080 (1973), remanded on othergrounds sub nom Brennan v. Gilles & Cotting, Inc., 504 F.2d 1255(4th Cir. 1974). Under the circumstances of this case, where respondent cededall supervisory control of the workers to the North Little Rock Sewer Department,control is the paramount consideration. When a respondent has neither exercisedcontrol over nor retained the right to control a ?loaned? employee, and thelessee has full control over him, the respondent is not an employer withrespect to that employee.??????????? Thepertinent facts of this case are as follows. The North Little Rock SewerDepartment was in the process of digging an excavation for the purpose ofreplacing a sewer line when it ?went into solid rock.? Although the SewerDepartment had originally undertaken to replace the sewer line with its own menand equipment, upon hitting the solid rock the Department decided to seek theaid of respondent, which had the skill and equipment to dig through such rock.Accordingly, the Department and respondent reached an agreement, wherebyrespondent agreed to furnish to the Department a backhoe with an operator andcertain men and equipment. Respondent?s president then informed Mr. Wilson, abackhoe operator, and two laborers that they were going to ?do a city job.?Soon thereafter the three workers began reporting for work directly to theDepartment?s job site.??????????? Regardingthe issue of supervisory control, respondent?s President, Mr. Gordon, testifiedthat Mr. Kimbrough, the job superintendent for the Sewer Department, exercisedsupervisory authority over the employees and could hire and fire them withoutMr. Gordon?s consent. Mr. Gordon also stated that he had no right to exerciseany authority over the workplace and that, if he saw anything improper at the site,he could do no more than bring the matter to the attention of SuperintendentKimbrough.??????????? TheSewer Department?s manager, Frank Murphy, also acknowledged Kimbrough?sauthority and in response to the Court?s question as to who exercised ?totalcontrol and dominion over the alleged employees of Mr. Gordon, the City or Mr.Gordon,? responded:??Underour arrangement, Mr. Gordon furnished some equipment and some employees. Andexpertise and many things.\u00a0Originally to start out, this was just ablasting job. We plowed up some rock where we are talking about where thiswhole case is based on, they would have to follow Mr. Kimbrough?s instructionson the job.?\u00a0??????????? Inresponse to complainant?s questions during cross-examination, Murphy testifiedthat Kimbrough exercised direct supervision over respondent?s alleged employeesin the following manner:A. Well, I?ve been using the term he toldthem exactly what to do. I think you would find he told them how many beddingsto put under the pipe where they were working around the pipe; he told Mr.Wilson exactly how deep to dig it in the ditch; he told Mr. Wilson where to digand what he wanted to accomplish. He was there all of the time, if he wasn?tthere, he would be back shortly.* * *Q. He was in charge of giving themdirections or instructions??A. Yes, sir.* * *Q. But did Mr. Kimbrough tell these twolaborers??A. Yes, I think one of the laborerstestified that he, Mr. Kimbrough, told him to put a little more rock under thepipe.?Q. Could Mr. Kimbrough hire and fire theseemployees??A. If Mr. Kimbrough didn?t like ? not onlythe city employees we have intermixed with these other employees, if he didn?tlike what Wilson was doing, he could, yes, he could tell Bill Wilson he?sthrough on that job.* * *Q. What about the two laborers; could hetell them??A. If he didn?t like it, he could run themoff.??Superintendent Kimbrough corroborated thetestimony of Mr. Gordon and Mr. Murphy, stating that he was the one whodetermined how the trenches and excavations were dug and that he directed theactivities of all the workers. Specifically, he testified as follows:??Q. Did you have total control of theseemployees??A. Yes, sir.?Q. Who decided how the trench would bedug, how the excavation would be dug, any questions relating to the safety ofthe trench or the excavation, and anything else in sloping, this type of thing??A. I did.?Q. And the employees did that at yourdirection??A. Yes, sir.??In regard to Gordon?s authority ascompared to his, Kimbrough answered as follows:??Q. In the event you have a situationwhere Mr. Gordon came and wanted to suggest a certain way be done to performthe work, who had the firm decision-making authority as to what method would befollowed??A. I would. If yours was a better way thanmine, I would do it, but I would have the decision to make whether to do it ornot.?Q. Was it your final decision as far aswhat safety requirements were [met]??A. Yes, sir.???????????? Duringcross-examination, Kimbrough explained that he meant by ?directed theemployees? that he ?was in charge of everything that needed to be done or theway it was to be done.? Furthermore, he relayed these instructions both toWilson and the laborers on different occasions. Finally, in response to complainant?squestion as to whether he considered them city employees, Kimbrough stated, ?Asfar as I know, they were. If I could hire or fire them, they were cityemployees or Sewer Department employees.???????????? Thebackhoe operator, Mr. Wilson, testified that he received his instructions fromsuperintendent Kimbrough and that the only instructions he received from Mr.Gordon were that he would be working for Kimbrough and to follow hisinstructions. Similarly, the two laborers, Mr. Leach and Mr. Toney, testified thatKimbrough was in charge. On cross-examination Mr. Leach testified as follows:??Q. And you were working under the controlof the City?s job superintendent, were you not??A. He was there, yeah.?Q. Mr. Kimbrough??A. He was there.?Q. He was the man that had the ultimateauthority as to what you did, and where you were assigned and what type workyou were doing on that day, wasn?t he??A. Right.?Q. He had complete control and authorityover you??A. Right.?Q. And directed your work??A. Right.??Mr. Toney likewise testified as to thissubject as follows:??Q. You knew this was a city job, didn?tyou??A. Yes, sir.?Q. Who had control of the job??A. Mr. Kimbrough.?Q. Mr. Kimbrough??A. Yes.?Q. He was the boss??A. Right.?Q. On this job??A. To my knowledge.?Q. Right. It wasn?t Mr. Wilson, was it??A. No, he was operator.* * *Q. I?ll ask you the same question I askedMr. Leach: what do you understand by the term ?city? employees??A. Well, my understanding was at the beginningof going on the first day, was, my boss that I worked for, Mr. C. D. Gordon,told me we was going down and do a job for the city down on Camp Robinson bythe shopping center. ?You work under Mr. Kimbrough because it is a city job.? Isaid, ?Okay.? He say, ?It is way down there across 47th Street.??I know approximately how to get to the jobbecause I hauls the men to work. I had the transportation.?Q. Could Mr. Kimbrough fire you??A. Yes, he could.?Well, that is my understanding because wewas doing a job for the City. We had to abide by the city rules.?\u00a0??????????? Despiteall of the foregoing testimony, Messrs. Cleary and Barnako conclude that ?theevidence establishes that respondent maintained a significant degree of controlover the employees.? They base this conclusion on two findings: firstly, thatMr. Wilson ?directed the laborers in the performance of tasks related to theoperation of the backhoe and the process of laying pipe;? and secondly, that?during Mr. Kimbrough?s frequent absences from the job, Mr. Wilson exercisedbroader authority.???????????? Althoughthere is some evidence that Wilson gave a few minor directions to hisco-workers, particularly when Mr. Kimbrough was not present, the evidence isoverwhelming that such direction was pursuant to Wilson?s job as the backhoeoperator and not as a supervisor or foreman. Furthermore, the evidence clearlyshows that whatever authority Wilson exercised came either from his ownassumption of such authority, or from Mr. Kimbrough, not from Mr. Gordon. On cross-examinationMr. Wilson testified as follows:Q. Who were youreceiving your instructions from??A. Mr. Kimbrough.?Q. Any from Mr.Gordon??A. Nothing exceptthat?s who I would work for all the time, you know.?Q. Did he tell youto follow the instructions of city employees??A. He did. And meand him talked on the phone of a night to do it and all.?Q. Did you giveinstructions to the laborers, Mr. Leach and Mr. Toney? Did you give themsupervisory instructions??A. At times Iwould if Mr. Kimbrough wasn?t around and I seen something that had to be doneor needed to be done to keep me from having to get off the machine to do it,yes.??On redirect, hecontinued as follows:??Q. At the timeyou were working on this particular job, whose control and direction were youactually under??A. Mr. Kimbrough.?Q. You knew it wasa City job??A. I did.* * *Q. Now there wassome discussion on cross-examination about supervisory instructions. What typeof instructions are you referring to??A. You know, likeif the foreman ain?t around, I?m not afraid on the job, I?m an operator on thejob, and I have got more authority than anybody else.?Q. This is thenormal authority of an operator??A. Normal everydaystuff.?Q. Well, what kindof instructions would you give? Would they be instructions for, you know, toleave the job and go someplace, or would they be instructions along the lineof, ?You can move this pipe.? ?Put it over here.??A. That?s right.?Q. What?s right??A. The pipes, somethinglike that.?Q. Installation ofpipes??A. Yeah.?Q. Did you haveany authority on the job site, the one in question, to make any decisions suchas the type of safety precautions that would be necessary or anything likethat??A. No, sir, Ididn?t have the authority to do that.?Q. Didn?t have theauthority to hire or fire??A. No.?Q. Did you havethe authority to discipline somebody??A. No, sir.?Q. Did you havethe authority to have somebody stay overtime??A. I sure didn?t.?Q. Would it befair to say that your authority was principally routine instructions of thecrew members in getting the job done that you were assigned??A. Absolutelyright.?Mr. Wilson?s testimony as to his authorityover the laborers, is corroborated by the previously quoted testimony of Mr.Toney. Further corroboration is contained in the testimony of Mr. Leach whotestified on cross-examination as follows:Q. Mr. Leach,there was some testimony on redirect a moment ago about instructions from Mr.Wilson. What type of instructions were you talking about when the term?instructions? was used? Were you talking about just generally how, where hewanted you to lay the pipe and this type of thing??A. Something likethat, yes.?Q. They [weren?t]supervisory instructions along the lines he was going to discipline you, or hewas going to fire you or anything like that, were they??A. No.?Q. Mr. Wilsonwasn?t ?the man? on this job on February the 11th that granted you time off toleave the job early or anything like that, that was Mr. Kimbrough, wasn?t it??A. That?s right.?Q. Mr. Wilson was? the three of you worked as a team and he might have at times indicated wherehe was going to be using this machinery, where you could be out of way and thistype of instruction; right??A. Right.?Q. In other words,sort of a lead-man type instruction, is that correct??A. Leader andbackhoe operator.* * *Q. Yourinstructions from Mr. Wilson were of a routine nature, dealing with theoperations in between the two pipe layers, or theirs and the machineoperator?s, correct??A. Right.?Q. They were notsupervisory in nature as far as lay-off time or anything of that nature,disciplinary action or anything??A. Right.\u00a0??????????? Theforegoing makes crystal clear that any authority Wilson exercised could not bedeemed ?supervisory? by any stretch of the imagination. Furthermore, Mr. Gordonand Mr. Wilson both testified that no authority was granted to Wilson by Mr.Gordon. Accordingly, if any supervisory authority was granted to Wilson at all,it was granted by Mr. Kimbrough. Although the evidence is unclear on thispoint, if, in fact, Kimbrough granted such authority to Wilson, it is manifestthat it cannot be concluded that respondent retained any supervisory control.On the contrary, this is more evidence that Wilson was an employee of the SewerDepartment and not the respondent.??????????? Althoughthe foregoing makes abundantly clear the absurdity of the holding by Messrs.Cleary and Barnako, I would like to make one additional point. In the leadopinion my colleagues cite Frohlick Crane Service, Inc. v. OSAHRC, 521F.2d 628, 631 (10th Cir. 1975) for the proposition that ?When an employer ishired for its expertise and that expertise is relied upon, that employer isresponsible for the actions of its employees relevant to its work.? Thecomplete quotation from the Tenth Circuit?s decision in Frohlick doesnot support the stated proposition. That case involved the issue of whether acrane operator was the employee of the respondent, Frohlick (the lessor)or the lessee. The court stated as follows:In this regard theJudge concluded that Frohlick was the employer, with the comment that where, ashere, the lessee of the crane relies upon the expertise of the craneoperator and gives no particular direction as to the operation of thecrane, then it is the duty of Frohlick, the actual employer of the craneoperator, to comply with the minimum safety requirements as set forth in thestandards. The Commission agreed with this conclusion and the rationale insupport thereof, and so do we. (Emphasis added.)???????????? Ifthe Frohlick case has any relevancy here, it supports the dispositionreached below by Judge Kennedy – for the Sewer Department gave particulardirections to the employees provided by respondent in the instant case.\u00a0[No copy of the ALJ decision has been found.][1] Citation no. 1alleged ?nonserious? violations of the excavation standards published at 29 CFR? 1926.651(m), (p), and (t). Total penalties of $ 160 were proposed.Citation no. 2alleged ?repeated serious? violations of the excavation and trenching standardspublished at 29 CFR ? 1926.65(i)(1) and ? 1926.652(b), (e), and (h). Totalpenalties of $ 1600 were proposed for these violations.[2] We would notethat if respondent is not the employer, the employees would not benefit fromany of the protections afforded by the Act. The city sewer department, as asubdivision of the State of Arkansas, is exempt from compliance with therequirements of the Act. See section 3(5) of the Act.[3] We would observethat even if respondent can show that the sewer department had responsibilityfor safety under the terms of their agreement, respondent, as an employersubject to the requirements of the Act, had a duty to take measures which werereasonable under the circumstances to protect its employees. Anning-JohnsonCo., supra; Grossman Steel & Aluminum Co., supra.”