Interstate Brands Corp.

Plain-English summary

An Interstate Brands chief engineer lost three fingers after pulling the wrong disconnect levers, failing to apply locks or tags, and reaching into an energized sugar-system rotary valve. Applying Third Circuit precedent, the Commission found that the supervisor's departure from a well-communicated and enforced lockout program was not foreseeable. It also found that the Secretary did not prove deficiencies in the written procedures and that Interstate Brands lacked fair notice after OSHA had reviewed the program, recommended changes that the company adopted, and expressed satisfaction with the result. All three lockout/tagout items on review were vacated.

Decision snapshot

• Cited standard(s): 29 C.F.R. § 1910.147(c)(4)(i), (ii)(C), and (ii)(D)
• Outcome: The Commission affirmed the judge's vacation of all three lockout/tagout items.
• Key point: Under controlling Third Circuit law, a supervisor's isolated failure to follow an adequate and enforced safety program is not attributable to the employer unless the Secretary proves the misconduct was foreseeable.

Full text (OSHRC public release)

Interstate Brands Corp.,Docket No. 00-1077

SECRETARY OF LABOR,

Complainant,

v.                    

OSHRC Docket No. 00-1077

INTERSTATE BRANDS CORP.,

Respondent.

DECISION

Before: RAILTON, Chairman; ROGERS and STEPHENS, Commissioners.

BY THE COMMISSION:

This case arose out of the Secretary’s citation charging Interstate Brands Corp.
(“IBC”) with three violations of the lockout/tagout (“LOTO”) standard at 29 C.F.R.
§ 1910.147, for failing to document and implement energy control procedures.
Administrative Law Judge Covette Rooney vacated all three violations.

We affirm the
judge.

Background

IBC operates a bakery at its facility in Wayne, New Jersey, and has installed
various units to automate the baking process. This case focuses on the bulk sugar system
that automatically provides sugar as an ingredient to various food mixtures. The system,
which is housed in a room adjacent to the main baking facility, consists of four main
components: a large storage bin; a use bin rotary valve (“rotary valve”); a sifter; and a
pneumatic conveyor line. When sugar is needed for a particular product, a remote
electronic signal or “call” is sent to the rotary valve, which measures out a programmed
amount of sugar from the storage bin and drops it through a rubber sleeve or “boot” into
the sifter. The sugar then feeds onto a pneumatic conveyor line that carries it to the use
point in the baking facility where it is mixed with other ingredients.

Three circuit breaker panels located adjacent to the bulk sugar system control the
electric power to the rotary valve, the sifter, and the conveyer line. The record establishes
that a label is affixed to the front of each panel identifying the component whose electric
power it controls. Each circuit breaker is manually operated by a switch lever that moves
between an upward “on” position and a downward “off position.”

The end of each lever
is a rubberized handle, the upper portion of which is colored black and the lower portion
is colored red. Thus, when a lever is in the upward “on” position, the red colored portion
of the handle is prominently visible; when a lever is in the downward “off” position, the
black colored portion of the handle is prominently visible.  

On an almost daily basis, the bulk sugar system jams when a blockage called a
“sugar bridge” occurs in the storage bin located above the rotary valve. When this
happens, the rotary valve spins continuously as it receives repeated remote calls for sugar,
but sugar cannot be dispensed due to the blockage. IBC’s established procedure for
breaking up a sugar bridge requires an operator to unscrew a ½-inch plug located at the
base of the storage bin above the rotary valve and insert a steel rod to break up the
blockage. This procedure does not expose the operator to any hazard and does not require
that power to the bin be shut off.

On January 6, 2000, IBC’s chief engineer accompanied a maintenance technician,
who had been directed to check the sugar storage bin for a sugar bridge, into the room
that housed the bulk sugar system.

The chief engineer testified that he believed that the
bridge had occurred inside the rotary valve, which was situated beneath the storage bin
and which had not previously been the location of a blockage. As noted, the rotary valve
is powered by electrical energy and can be deenergized by pulling down one of the
disconnect levers located on a panel in the same room as the bulk sugar system.

The chief engineer pulled down two of the three levers on the nearby panels, but
he failed to pull the third disconnect for the rotary valve, despite the label identifying it as
controlling the rotary valve. Because the levers were in the same room as the rotary valve
and nobody could enter the room without his knowledge, he did not lockout or tagout
these levers. After throwing the two levers, the chief engineer claims he visually verified
that the rotary valve was not spinning.

He then removed the rubber boot located just
below the rotary valve and stuck his hand up into the valve. However, the valve was still
rotating, and three of his fingers were amputated.

The chief engineer testified that the accident occurred because he had pulled the
wrong lever. According to the record, IBC required employees to visually verify that
the machine was disconnected by checking that the appropriate lever was in the down or
“off” position and the black side of the lever’s handle – as opposed to the red side – was
showing.

Item 1a

In item 1a, the Secretary alleges that IBC violated 29 C.F.R. § 1910.147(c)(4)(i)
because it did not utilize energy control procedures to secure electrical power to the rotary
valve while employees were engaged in maintenance operations.

The gravamen of the
violation is that the chief engineer: (1) failed to apply locks and/or tags to the power
levers; and (2) failed to properly verify that the rotary valve was isolated. The judge
vacated the item finding that the Secretary failed to establish, as part of her prima facie
case, that IBC had knowledge of the violation. Specifically, she applied the test for
knowledge set forth in Pennsylvania Power and Light Co. v. Secretary, 737 F.2d 350 (3d
Cir. 1984), and found that the Secretary failed to establish that the chief engineer’s failure
to properly lockout the rotary valve was foreseeable.

The judge noted that the three
disconnect levers were specifically labeled to enable an employee to determine which
lever controlled which part of the bulk sugar system and that there were several methods
to verify that a component of the system had been isolated. The judge also found that IBC
adequately trained its employees, undertook inspections to discover violations, and
utilized a progressive disciplinary policy. Finally, the judge noted that the chief engineer
had an excellent safety record and a reputation as a safe employee.

We affirm the judge’s finding that the Secretary failed to show the violation was
foreseeable. As the judge held, under Third Circuit precedent, the Secretary could prove
foreseeability by demonstrating the inadequacy of the company’s safety program, training
or supervision. Pennsylvania Power and Light Co., 737 F.2d at 358 . However, where a
standard does not specify a particular type of abatement but rather leaves it to the
employer to meet the obligations imposed by a standard, a violation is not to be
considered “preventable” simply because the employer does not have a work rule that
tracks the Secretary’s interpretation of the governing standard. Id. Rather, employers
should be encouraged to develop work rules that will reasonably respond to their
particular working conditions. Id.

The evidence demonstrates that IBC has a well communicated and adequately
enforced safety policy. Employees are familiar with the company’s LOTO program and
are directed to lockout by their supervisors. IBC has a progressive disciplinary policy
that provides for a verbal reprimand, a written reprimand, a one-day suspension, a three-day suspension, and a suspension pending further investigation. Employees have
specifically been disciplined for LOTO violations. This includes one employee who was
suspended for being disruptive during LOTO training.

We find no merit in the Secretary’s argument that IBC’s LOTO program and
training of supervisors was inadequate because they “had not received the training
necessary to effectively isolate the electrical energy.” The evidence establishes that the
chief engineer involved in the accident received LOTO training from Drakes Bakeries,
IBC’s predecessor corporation, and that he attended a LOTO seminar given by the State
of New Jersey in 1990. While the training involved general lockout/tagout procedure,
there is no evidence that the hazards posed by the rotary valve were any different than
those presented by other equipment at the facility such that additional training was
required.

To the contrary, the evidence establishes that the rotary valve was similar to
other, older equipment at the plant, including a similarly engineered system for
automatically obtaining flour from bulk storage. Indeed, Edward Grund, vice-president of
ID Group, a safety and health consulting company, testified that IBC’s lockout/tagout
procedures exceeded OSHA’s model plans, including the training requirements.

The Secretary also failed to demonstrate that IBC did not take adequate steps to
discover violations by supervisors. Thomas Bent, IBC director of operations, testified that
he spends approximately 20 percent of his time every day checking on the status of the
various maintenance activities in the facility. Approximately once a week, he specifically
checks that lockout/tagout procedures are being followed. On the floor, the rules are
enforced on a day-to-day basis by the supervisors. Until the accident, no IBC employee
had been injured by the unexpected energization of electricity. Heinz Hentschel, IBC’s
former chief engineer, testified that he conducted audits of the lockout/tagout procedures
at least once a month. These reports were shown to OSHA two to three times over the
past 10 years. We also note that IBC had no reason to suspect that the chief engineer
involved in the accident was not following prescribed procedures. Not only was he
considered a safe employee, his safety record and adherence to safety procedures were
factors in his being chosen as chief engineer. See Pennsylvania Power & Light , 737 F.2d
at 359 (supervisor’s “unblemished safety record” at odds with his hazardous actions).

We also decline to find a violation based on testimony from the chief engineer that
on previous occasions, he did not lock out other equipment when it was under his full
control and could not be energized by another employee without his knowledge. As found
by the judge, the Secretary failed to establish that the chief engineer’s failure to lock out
other equipment actually involved activities covered by the LOTO standard. See General
Motors Corp., Delco Chassis Div. , 17 BNA OSHC 1217, 1993-95 CCH OSHD ¶ 30,793
(No. 91-2973, 1995) (consolidated), aff’d , 89 F.3d 313 (6th Cir. 1996). The record
contains no evidence about the type of work he was performing during these earlier
occasions, whether the equipment he worked on was subject to unexpected energization
that could cause injury, or whether the work involved placing his hands or other body
parts into a zone of danger. Therefore, this testimony does not establish that the chief
engineer violated lockout procedures in the past.

Thus, we find that the record fails to demonstrate that it was foreseeable that the
chief engineer would fail to use IBC’s LOTO procedures to properly secure power to the
rotary valve. Accordingly, Item 1a is vacated.

Items 1b and 1c

Items 1b and 1c allege that IBC failed to adequately document its energy control
procedures in violation of 29 C.F.R. §§ 1910.147(c)(4)(ii)(C) and (D).

Item 1b alleges a
violation on the grounds that specific control procedures for different equipment in the
facility (such as the rotary valve) were not included in IBC’s written energy control
procedure. Item 1c alleges a violation based on IBC’s failure to have a procedure for
verifying the effectiveness of the energy control measures in the rotary valve.

The judge vacated these items on two grounds. With regard to the rotary valve, she
found that it came within the documentation exception to §1910.147(c)(4)(i)

and that no
written LOTO procedure was required prior to the date of the accident. The judge also
found that the Secretary failed to present evidence relevant to other machines or
equipment sufficient to determine the adequacy and applicability of IBC’s written LOTO
program. We affirm the judge’s decision but on different grounds.

The evidence establishes that IBC had a written LOTO procedure applicable to all
the equipment and machinery at its facility. We agree with the judge that there is no basis
for the Secretary’s claim that this single procedure was inadequate as to “other”
machinery and equipment because of general statements by the chief engineer that the
facility had equipment that used energy sources other than electricity and that those
machines required lockout/tagout. Specifically, the Secretary did not establish how IBC’s
procedure for the “placement, removal and transfer of lockout devices or tag-out devices”
was inadequate as to its other machines. The evidence fails to establish either the nature
of the energy involved, the function of these machines, their operations, or the
circumstances under which they would require lockout/tagout. Accordingly, any
conclusion that IBC was required to document different procedures for these unidentified
machines would be mere speculation.  

We also note that OSHA reviewed IBC’s written LOTO procedures in previous
inspections. During an inspection in October 1995, OSHA discussed IBC’s written
procedures with the company and made several recommendations to improve the
program, which the company made and which are reflected in IBC’s current written
procedures. Indeed, because of OSHA’s satisfaction with IBC’s program, OSHA invited
the company to join its voluntary protection program. Where an employer takes
affirmative measures in reliance on OSHA’s recommendations, we find that the employer
lacks fair notice when, on reinspection, the Secretary claims that those measures did not
comply with the standard. See Miami Industries, Inc. , 15 BNA OSHC 1258, 1991-93
CCH OSHD ¶ 29,465 (No. 88-671, 1991), aff’d in part without published opinion, 983
F.2d 1067 (6th Cir. 1992). Accordingly, even if we were to find that IBC’s written
procedures were deficient, IBC lacked fair notice of those deficiencies.

With regard to the rotary valve, there is no evidence to suggest that IBC’s written
LOTO procedures were inadequate as to the placement, removal and transfer of lockout
devices or tag-out devices. IBC’s written procedures require employees to lockout all
energy sources and apply a tag to the power source. According to his testimony, the chief
engineer understood that this was precisely what he was supposed to do to isolate the
rotary valve, and he knew how to accomplish that task.  

Turning to whether IBC’s LOTO verification process was deficient, we note that
the Secretary has not maintained a consistent litigating position on this issue throughout
these proceedings.

For the first time on review, the Secretary claims that IBC’s visual
verification process failed to account for the possibility that a presumably deenergized
rotary valve may in fact not be spinning because it is not receiving a remote call for sugar,
not because its power has been properly isolated. However, our review of the record
shows that the Secretary made no attempt at the hearing to tie this alleged violation to
remote calls for sugar. In her post-hearing brief to the judge, the Secretary’s focus was
IBC’s reliance on visual verification in general; there is no mention made of remote calls
or “false positives” with regard to the rotary valve. Indeed, having never been presented
with this argument, the judge did not address it in her decision.

It is only on review before the Commission that the Secretary has raised this
specific contention regarding visual verification of the rotary valve. We not only find
nothing in the record to support her theory, but also note that IBC’s visual verification
process related only to the status of the appropriate disconnect lever, not the rotary valve
itself. Indeed, the chief engineer’s testimony demonstrates that had he closely examined
the two levers he had pulled down in accordance with this verification process, the
elements of which he was clearly aware, he would have discovered that he had not pulled
the lever properly labeled as controlling the rotary valve.

This unfortunate accident was
not caused by a failure of IBC’s verification process, but by the chief engineer’s
unforeseeable failure to follow it. Therefore, we find that the Secretary has not
demonstrated that any part of IBC’s LOTO procedure was inadequate.

ORDER

For reasons stated above, the judge’s decision and order is affirmed and items 1a,
1b, and 1c are VACATED. It is so ordered.  

/s/  

W. Scott Railton

Chairman

/s/

James M. Stephens  

Commissioner

Dated: April 24, 2003

ROGERS, Commissioner, concurring and dissenting:  

I concur with the result reached by the majority to the extent that items 1a and 1b
are vacated. However, I must dissent with respect to the disposition of item 1c as I would
affirm a violation of that item. I believe the verification process in the lockout/tagout
procedure used by Interstate Brands Corp. (IBC) is clearly inadequate with respect to the
bulk sugar system use bin rotary valve.

The majority has vacated item 1a on the ground that the Secretary failed to show
the violation was foreseeable under Third Circuit case law. Pennsylvania Power and
Light Co. v. Secretary , 737 F.2d 350 (3d Cir. 1984)(“ PPL” ).

In view of the language of
the citation, the gravamen of the alleged violation charged by the Secretary with respect
to item 1a is the failure to utilize energy control procedures with respect to the bulk sugar
system use bin rotary valve, in which the conduct of the chief engineer is a factor.

The Secretary argues that the chief engineer’s conduct was foreseeable. However,
the evidence leads me to conclude that even if IBC s procedures were fully compliant,
the chief engineer’s conduct would have been the same. He failed to properly verify that
the rotary valve was de-energized. I agree with the Secretary s position that IBC’s
verification process was defective. But the chief engineer also failed to apply locks here,
notwithstanding the fact that no deficiency has been shown in this aspect of IBC’s
lockout/tagout procedure. Given PPL s admonition that “the Secretary may not shift to
the employer the ultimate risk of non-persuasion,” I believe, based on the totality of the
evidence of record, that the Secretary has failed to prove that the chief engineer’s failure
to utilize proper energy control procedures was foreseeable. PPL , 737 F.2d at 358. His
“departure from that safe course of conduct cannot be explained by any deficiencies in”
IBC’s lockout/tagout procedures and thus was not foreseeable. Id. at 359. Thus, under
the circumstances here, I too would vacate this item.

I also agree that item 1b should be vacated because the gravamen of the violation
charged by the Secretary with respect to item 1b relates to the “procedural steps for the
placement, removal and transfer of lockout devices or tagout devices and the
responsibility for them.” See 29 C.F.R. 1910.147(c)(4)(ii)(C). The Secretary has not
shown any deficiency with respect to that specific aspect of IBC’s lockout/tagout
procedure, with respect to either the use bin rotary valve or any other machine.

However, I respectfully dissent with respect to item 1c. The gravamen of this
alleged violation focuses on the adequacy of the verification procedure, where the
conduct of the chief engineer is irrelevant. In my view, the verification procedure used
by IBC is clearly inadequate here.

The lockout/tagout standard recognizes that human error is possible and seeks to
protect employees involved in servicing operations from the potentially severe
consequences of human error. For example, as the Preamble to the standard points out,
“. . . even though the machine or equipment has been shut off, and even if residual energy
has been dissipated, an accident can still occur if there is an inadvertent activation of that
machine or equipment. Inadvertent activation can occur due to an error on the part of the
employee who is conducting the maintenance or servicing activity, or by any other
person.” 54 Fed. Reg. 36,644, 36,647 (1989).

Thus, the requirement of the standard for employers to develop lockout/tagout
procedures is designed to protect employees involved in servicing from injury, even if
human error may be a contributing factor. The fact that human error may have occurred
here does not absolve the employer when its own procedure did not even adequately
address the factual circumstances at issue. The majority seems to suggest, by focusing on
the chief engineer’s lapse in judgment, that the cited verification deficiencies here recede
into the background. As the Commission has consistently noted, however, where a
workplace accident occurs, the existence of a violation is unrelated to whether that
violation caused the accident. Cleveland Consolidated, Inc. , 13 BNA OSHC 1114, 1116
n.1, 1986-87 CCH OSHD 27,829 at 36,427 n.1 (No. 84-696, 1987) (“the cause of an
accident, and particularly whether a violation of a standard caused an accident, is not
necessarily relevant to whether an employer violated a regulation”). After all, standards
are intended to protect against injury resulting from an instance of inattention or bad
judgment as well as from the risks arising from a machine s operation. Trinity Industries,
Inc. , 15 BNA OSHC 1581, 1593-94, 1991-93 CCH OSHD 29,662 at 40,196 (No. 88-1545, 1992)(consolidated), rev d & remanded on other grounds , 16 F.3d 1149 (11th Cir.
1994).

Notwithstanding the errors of the chief engineer, and given the gravamen of this
item, the deficiencies of the verification procedure compel me to conclude that there is a
violation here. First, while it might seem a simple matter to look at the appropriate lever
and determine that it is in the “off” position, the record reflects that the chief engineer
was somewhat confused about which lever of the three actually controlled the particular
component he was servicing. This is similar to the situation any home repairman would
face when trying to determine which of several switches in the circuit breaker box
controlled a particular electric outlet or device. That is why a prudent home repairman,
no less than a prudent employer, would utilize or provide for some extrinsic means of
verification to ensure the correct switch was thrown.

While arguably an extrinsic means, visual verification also is not adequate here.
The record indicates that the turning portion of the valve is painted white, as is the
surrounding area, making it hard to determine if the valve has truly stopped spinning.
Furthermore, even if the valve has stopped spinning, that is no guarantee that it has been
successfully de-energized as the lack of activity by the valve could merely reflect the fact
that there is currently no remote call for sugar - the so-called “false positive” problem.
The Preamble notes the value and importance of visual inspection, but also emphasizes
that “in order to verify that hazardous energy has been isolated, the authorized employee
may need to use a combination of . . . methods. The appropriate combination [of
verification methods] will depend upon the type of machinery or equipment involved, the
complexity of the system, and other factors.” 54 Fed. Reg. 36,644, 36,679 (1989).

Unfortunately, here there was no effective extrinsic means of verification.

The
verification process in IBC s lockout/tagout procedure spoke of turning the machine back
on - after switching off the energy at the main power source - to confirm deactivation, just
like a home repairman would turn off a switch in the circuit breaker box and then see if
the outlet or device was still powered. Unfortunately, here, there was no separate on-off
switch on the use bin rotary valve.

Thus, IBC’s “one size fits all” lockout/tagout
procedure did not fit the sugar use bin rotary valve. In the words of the Third Circuit,
IBC’s procedure does not “reasonably respond to their particular working conditions and
safety needs” and is not “tailored to their respective operations.” See PPL, 737 F.2d at
358-59.

Accordingly, I would find a violation of item 1c based on IBC’s failure to have an
adequate verification process for the sugar use bin rotary valve.

/s/

Thomasina V. Rogers

Commissioner

SECRETARY OF LABOR,

Complainant,  

v.

OSHRC Docket No. 00-1077

INTERSTATE BRANDS CORPORATION,

Respondent.

APPEARANCES:

Suzanne Demitrio, Esquire                                                  Mark S. Dreux, Esquire

Office of the Solicitor                                             James F. Laboe, Esquire

U.S. Department of Labor                                                    Arent, Fox, Kintner, Plotkin & Kahn, PLLC

For the Complainant                                                            For the Respondent

BEFORE: Administrative Law Judge Covette Rooney

DECISION AND ORDER

This proceeding is before the Occupational Safety and Health Review Commission (“the
Commission”) pursuant to Section 10 (c) of the Occupational Safety and Health Act of 1970, 29
U.S.C. 651 et seq . (“the Act”). At all times relevant to this action, Respondent Interstate Brands
Corporation (“IBC”) operated a baked goods factory at 75 Demarest Drive, Wayne, New Jersey.

On January 6, 2000, Michael Morgan, a chief engineer employed at the IBC factory,
sustained an amputation injury to three fingers on his right hand while inspecting a rotary valve
for a possible blockage. The ensuing OSHA inspection resulted in the issuance of one serious
citation, alleging violations of the following standards: 29 C.F.R. §§ 1910.147(c)(4)(i),
1910.147(c)(4)(ii)(C), 1910.147(c)(4)(ii)(D), 1910.146(c)(6)(i)(B) and 29 C.F.R.
1910.147(c)(7)(iii)(A).

IBC filed a timely notice of contest, and a hearing was conducted on February 26 and
February 27, 2001. Post hearing briefs were fully submitted on May 11, 2001, and reply briefs
were fully submitted on May 18, 2001. This matter is ready for disposition.

Background

The rotary valve involved in the accident is part of a bulk sugar system, which measures
and feeds sugar to use points located in other areas of the factory. The rotary valve metes out
measured sugar from a sugar storage bin immediately above it, before sending the sugar through
a rubber boot into a sifter. After passing through the sifter, the sugar travels through an inlet
airlock and then through a pneumatic tube to the use point. The call for sugar originates at the
distant use point and travels by signal to the bulk sugar system control panel. (Tr. 20-23).

The rotary valve is powered by electrical energy that can be deenergized by pulling down
a disconnect lever located on a control panel in the sugar system room. Two additional
disconnect levers are located on the control panel for two other electrically powered pieces of
equipment which make up the bulk sugar system. On the day of the accident, each disconnect
lever had an identifying sign above it. The sign above the disconnect lever on the far right
indicated that it controlled the energy to the use bin rotary valve. The disconnect levers were
black on the top and red on the bottom, and the panel containing the three disconnect levers
indicated that up was “on” and down was “off.” There were thus three ways to determine,
visually, whether a machine in the sugar use system had been isolated: first, the corresponding
disconnect lever looked black; second, it was in the “down” position; and third, the lever was
near the word “off.” If the energy was not disconnected, the rotary valve would spin when a call
from the distant use point was received, and stop spinning once the call was satisfied. (Tr. 20-21,
23, 45, 73-74, 79, 81, 82-83, 137)

IBC obtained the rotary valve one month before the accident, although there was
testimony that IBC maintained a similar piece of equipment for the measurement and
distribution of flour. (Tr. 26-27, 48). According to Thomas Bent, IBC’s director of operations,
other electrically powered equipment located at the factory may be deenergized in essentially the
same manner as is the power to the rotary valve. (Tr. 108, 144-145).

The evidence demonstrates that a sugar bridge, or blockage, occurred in the sugar bin
located above the rotary valve on a daily basis. Accordingly, a practice developed of inserting a
1/4-inch-thick metal rod through a small opening in the side of the sugar bin, to break up any
sugar blockage inside the bin. No arms or body parts came near any rotating equipment during
this procedure, and IBC did not require that the employees who used this procedure lock out the
energy source. (Tr. 139-143, 302-304). With respect to the rotary valve, located below the sugar
bin, Michael Morgan, the injured employee, admitted that IBC’s energy control and power
lockout policy required that the employee wishing to service the rotary valve, isolate and lock
out the corresponding disconnect lever. (Tr. 31).

IBC’s written lockout policy, as revised, had been in effect for at least six years prior to
the accident. IBC asserts that this plan was refined following an earlier OSHA inspection.
According to Art Agreda, a safety manager employed by IBC, an unnamed OSHA compliance
officer, (“CO”) inspected the site in 1995, reviewed the written policy, and indicated that it was
in compliance with the OSHA standards. The CO also made two recommendations, which were
incorporated into the written plan. Agreda also testified that the CO invited Agreda to attend a
“voluntary program” based on the written lockout plan. (Tr. 276-278; Exhibit S-5).

The evidence demonstrates that IBC’s safety rules were provided to IBC employees
during orientation. IBC also offered annual refresher seminars on lockout procedures, and
directed its supervisors to enforce the lockout rules on a daily basis. IBC administered a
progressive discipline policy for safety violations, which included, first, a verbal reprimand,
second a written reprimand, and third a final reprimand with a one day suspension. A fourth
violation resulted in a three day suspension, and a fifth violation resulted in complete
suspension, pending further investigation. Morgan had no history of safety violations before the
accident of January 6, 2000. (Tr. 36, 146-149. 152-153).

The Accident and the OSHA Inspection

Morgan testified that he entered the sugar use bin room on January 6, 2000, because no
sugar was released following a call from a use point in the mixing room. Charles Geiger, a
maintenance technician, accompanied him. According to Morgan, the rotary valve was operating
when they first entered the room. Morgan proceeded to the wall on the far side of the equipment,
to the control panel containing the three disconnect levers. He turned off two of the three levers,
believing that one of them operated the rotary valve. Morgan testified that he did not attempt to
verify the purpose of the third lever because he wanted to determine which equipment had
stopped, however, a label above the third lever identified it as controlling the “use bin rotary
valve.” Morgan testified that he did not apply a lock to the levers because the room was small
and contained only one door. Because he and the bulk sugar system were between the door and
the power disconnects, he would know if anyone came through the door and headed towards the
levers. (Tr. 22-24, 30, 74, Exhibit R-12).

Morgan believed that the rotary valve had stopped turning after he pulled down the two
disconnect levers, having made this determination by looking at the shaft to the rotary valve
through the column on the side. However, Morgan testified at the hearing that the rotary valve
must have been operating continuously from the time he entered the room until the accident
occurred. He explained that it was difficult to tell whether the rotary valve was rotating, as it was
painted white on white. (Tr. 24-25, 30, 90-91, 101).

Morgan testified that he next pulled down the rubber boot attached to the bottom of the
rotary valve, to determine whether there was “any material packed in there.” He then placed his
right hand into the interior of the rotary valve, and the valve severed three of his fingers. Geiger,
who was standing on a ladder to Morgan’s right, was the only witness to the accident. (Tr. 22-25,
37- 40, 85-86).

The resulting OSHA inspection was conducted by CO Richard Brown.

CO Brown
testified that he visited the site on April 18 and May 3, 2000, performed off-site interviews, and
reviewed IBC’s OSHA 200 documents, and its lockout policy, before recommending the
issuance of the Citation. A single penalty of $4,500 was proposed for all Items. (Tr. 168-170,
175, 184-187, 244-245).

IBC’s Jurisdictional and Equitable Estoppel Arguments

In its post-hearing brief, IBC for the first time, raises the argument that the Commission
lacks jurisdiction because the Secretary failed to submit proof that IBC was engaged in interstate
commerce. (IBC’s brief, p. 31). However, IBC’s answer admits that the Commission has
jurisdiction over this case and that IBC is an employer engaged in interstate commerce. (IBC’s
answer, paragraphs “2" and “4"). Moreover, IBC failed to raise this issue at any time prior to the
hearing. IBC has thus waived its right to assert a lack of jurisdiction, and its argument in this
regard is rejected.

IBC also argues that the Secretary should be estopped from enforcing Citation Items 1a,
1b and 1c, because IBC’s written lockout policy was developed and refined based on the
comments made by an OSHA CO during a 1995 inspection of the factory. However, IBC failed
to identify equitable estoppel as a defense in its answer.

Commission Rule 34(b)(3), 29 C.F.R. §2200.34(b)(3), requires a respondent to identify
all affirmative defenses in its answer, and pursuant to 29 C.F.R. §2200. 34(b)(4), a respondent
may be prohibited from asserting such a defense. Further, longstanding Commission precedent
holds that affirmative defenses may not be asserted if not raised in the answer, or as soon
thereafter as practicable. See Manti d/b/a Manti Homes 16 BNA OSHC 1458, 1461 (No. 92-2222, 1993). Like its jurisdictional defense, IBC did not formally assert this equitable estoppel
argument until it served its post hearing brief. This is clearly not, “as soon as practicable.” In
any event, even if IBC had raised this defense in a timely fashion, IBC did not meet its burden
of showing the elements of an equitable estoppel defense. See Erie Coke Corp. 15 BNA OSHC
1561, 1568-1579 (No. 90-2634, 1992). In particular, IBC did not show that the CO’s statements
or actions in 1995 constituted a misrepresentation or affirmative misconduct.

The Secretary’s Burden

The Secretary has the burden of proving her case by a preponderance of the evidence. In
order to establish a violation of an OSHA standard, the Secretary must show (a) the applicability
of the standard, (b) the employer’s noncompliance with the standard’s terms, (c) employee
access to the violative conditions, and (d) the employer’s actual or constructive knowledge of the
violation, ( i.e ., the employer knew, or with the exercise of reasonable diligence could have
known, of the violative conditions). Atlantic Battery Co., 16 BNA OSHC 2131, 2138 (No. 90-1747, 1994).

All citation items in this case allege violations of subsections of 29 C.F.R.§1910.147.
This standard is expressly limited in scope to those cases where “the servicing and maintenance
of machines and equipment in which the unexpected energization or start up of the machines or
equipment, or release of stored energy could cause injury to employees.” 29
C.F.R.§1910.147(a)(1)(i) ( emphasis in the original ).

The standard further limits the application
of the standard to those actions involving the “control of energy during servicing and/or
maintenance of machines and equipment.” 29 C.F.R. §1910.147(a)(2)(i). In interpreting these
limitations, the Commission has held that the Secretary must show that unexpected energizing,
start-up or release of stored energy could occur and cause injury. General Motors Corp. 17 BNA
OSHC 1217 (Nos. 91-2973, 91-3116, and 91-3117, 1995), aff’d 17 BNA OSHC 1673 (6th Cir.
1996). The standard expressly excludes normal production operations from its application,
unless while performing those functions, an “employee is required to place any part of his or her
body into an area on a machine or piece of equipment where work is actually performed....” 29
C.F.R. § 1910.147(a)(2)(ii)(B). With respect to IBC’s practice of using a metal rod to break up
the daily sugar bridges in the sugar bin itself, the standard by its terms does not apply, as the
evidence supports that that activity was a normal production operation, during which no body
parts are exposed to a hazard even if sudden energization were to occur. (Tr. 139-141).

The record demonstrates, however, that Morgan was not attempting to break up a sugar
bridge in the bin when he sustained his injuries. Rather, he pulled down the boot located
immediately below the rotary valve and inserted his hand, because he “wanted to see if there was
material packed in there.” (Tr. 22-25). IBC’s accident report is in accordance with Morgan’s
testimony in this regard. (Exhibit S-6). I find therefore, that Morgan was inspecting for a
perceived problem or jam in the rotary valve when the accident occurred. Inspecting a piece of
equipment, such as the rotary valve, where unexpected energization could occur, is a servicing
activity as contemplated by the standard.

The record also demonstrates that the rotary valve was subject to unexpected
energization. Once the disconnect lever to the machine was placed in the “on” position, the
rotary valve would turn on and off, as calls for additional sugar were received. An employee
performing maintenance on the valve would have no notice before the valve started to rotate.
The energization of the valve was thus unexpected, and this unexpected energization was likely
to cause serious personal injury, as happened to Morgan. Accordingly, I find that Morgan’s
activity on the day of the accident is within both the scope and application of the standard.

IBC argues that Morgan’s activity did not fall within the scope of the standard because
the rotary valve was continually in movement from the time Morgan entered the sugar system
room, until the time of the accident, and Morgan knew that this was the case. Thus, according to
IBC, there was no danger of unexpected energization. The evidence demonstrates, however, that
Morgan believed that the rotary valve was not rotating when he placed his hand in it. Further, it
is clear that Morgan attempted to deenergize the rotary valve, and believed he had done so. (Tr.
24-25, 98-99). The energization as to Morgan, therefore, was unexpected. In any event, even if
Morgan were unsure that the valve had stopped, the violation occurred when Morgan failed to
appropriately isolate and lock out the source of energy to the rotary valve, before he commenced
his inspection.

IBC also argues that Morgan’s act of placing his hand in the rotary valve was not part of
a servicing or maintenance operation because it was unnecessary, in that it was ultimately
determined that there was no problem with the rotary valve on the day in question. As is
discussed above, however, the evidence demonstrates that Morgan was in fact addressing a
perceived problem related to a possible blockage in the rotary valve. The standard is not limited
to cases where an inspection of a piece of equipment is ultimately determined to have been
unnecessary. The standard specifically identifies “inspection” as an activity contemplated within
the terms “servicing and maintenance.” 29 C.F.R. §1910.147(b).

This argument is therefore
also rejected.

Finally, IBC argues that the minor servicing exemption is applicable.

IBC bases this
argument on the assumption that Morgan was attempting to break up a sugar bridge in the bin,
rather than inspecting the rotary valve. As is indicated above, however, I find that Morgan was
inspecting for a blockage in the rotary valve at the time of the accident. This inspection and
attempt to unjam the rotary valve is not a routine, repetitive action integral to the use of the
production and IBC presented no evidence that it was. To the contrary, the evidence indicates
that IBC had never previously experienced a blockage in the rotary valve. (Tr. 29) IBC thus
failed to establish that Morgan’s activity fell within the minor servicing exemption.

Citation 1 Item 1a

The cited standard, 29 C.F.R.§1910.147(c)(4)(i), provides that “procedures shall be
developed, documented and utilized for the control of potentially hazardous energy when
employees are engaged in the activities covered by this section.” CO Brown testified that this
item was based on the accident itself, in that two employees were working on the bulk sugar
system, and that one employee (Morgan) placed his hand into the rotary valve which he had not
locked out. (Tr. 177). On investigation, CO Brown discovered that the rotary valve was not
deenergized, that the two disconnect levers Morgan did turn off were not locked out, and that
the isolation of the equipment was not verified. (Tr. 178-179). Morgan admitted that IBC’s
procedures required that he lock out the appropriate disconnect lever and that he did not do so on
the day of the accident. (Tr. 31). There is, therefore, at least one incident when the required
procedures were not utilized. The standard applies, and was violated. The evidence also
demonstrates that Morgan was exposed to the hazard.

The Secretary, however, failed to establish that IBC had knowledge of the violation. In
addressing this issue, it is necessary to look to the Third Circuit’s enunciation of the Secretary’s
burden to show knowledge.

In Pennsylvania Power and Light Co. 737 F.2d 350, (3d. Cir.
1984), the Court reversed a Commission decision affirming a citation where the sole evidence
of knowledge was the supervisor’s misconduct. In so doing, the Third Circuit held that, where
the standard at issue is phrased in “general terms in order to permit employers the flexibility of
developing reasonable work rules for protecting their employees under conditions peculiar to the
employer’s particular work situation,” the Secretary bears the burden of showing that a
supervisor’s violative conduct was foreseeable. Id  at 357. Thus, where a crew leader, found to be
a supervisor, violated a consistently enforced company policy, and where the employer’s safety
policy and procedures were otherwise adequate, the citation was vacated absent proof that the
supervisor’s misconduct, in that one instance, was reasonably foreseeable. Id.

As a preliminary matter, I note that the standard at issue here is phrased in performance
language, in order to provide employers the flexibility to determine the amount of detail
required for a particular work site. See Preamble to the Final Rule, 54 Fed. Reg. 36,644, 36,659-36,660 (1989). Further, it is clear from the record that Morgan, a chief engineer since 1999, has
supervisory status. In particular, he supervises 30 mechanics, one clerk, one planner, three
supervisors and three assistants. He also directs other employees to obey IBC’s lock-out policy.
(Tr. 18-19, 52). See Tampa Shipyards, Inc., 15 BNA OSHC 1533, (No. 86-630, 1992).

The record, however, is devoid of any proof that Morgan’s action of disobeying IBC’s
lockout policy on the day of the accident was foreseeable. That policy, as it applied to the rotary
valve, was to isolate the power by disconnecting the appropriate lever. (Tr. 31). According to
Thomas Bent, IBC’s director of operations, this policy had been in effect since 1995, and, by
following it, IBC’s employees have been able to safely lock out equipment at the factory. (Tr.
132-133). In addition, the disconnect levers to the three pieces of equipment which made up the
bulk sugar system were specifically identified, so that a worker would be able to determine
which lever controlled which machine. There were also three different ways to determine
whether the levers were turned on or off. (Tr. 47, 74,137). To verify isolation of the rotary
valve, IBC’s procedures required the employee to visually ensure that the lever was in the down
position, near the word “off”, and that the black side of the lever was showing. (Tr. 77-81).
These requirements establish that IBC had an adequate lockout policy for the use bin rotary
valve. The Secretary did not rebut this evidence, and she also failed to refute the evidence that
IBC provided adequate training in lockout during orientation, during its refresher courses and on
a day-to-day basis by its supervisors. (Tr. 36, 146-147). Similarly, the Secretary did not refute
the evidence of IBC’s progressive disciplinary procedures. (Tr. 149).

The record also demonstrates that IBC undertook to inspect for violations. Heintz
Hentschel, a recently retired chief engineer at the factory, testified that he conducted monthly
safety inspections, during which lockout practices of the employees were reviewed. (Tr. 290-293). In addition, Bent testified that he spends approximately 20% of his time walking the
factory and checking for safety problems in production and maintenance, which includes
verifying that lockout procedures are being followed. (Tr. 142-143).

Finally, the evidence demonstrates that Morgan had a good safety record, and, in fact,
was promoted to chief engineer, in part, because of that record. (Tr. 152-153). There is no
evidence that Morgan had previously violated IBC’s lockout procedures. Based on the record, I
find that the Secretary has not met her burden of showing that Morgan’s failure to follow IBC’s
lockout policy on January 6, 2000, was foreseeable.

The Secretary argues that the Morgan’s misconduct on January 6, 2000, was foreseeable
because the written lockout procedure was inadequate as applied to the rotary valve, and, during
the hearing, Morgan testified that there were occasions prior to January 6, 2000, when he did not
lockout a deenergized source prior to performing work on a piece of equipment.

I am not
persuaded that either argument supports a finding that Morgan’s misconduct was foreseeable.
First, as discussed more fully below, there was no requirement as of January 6, 2000, for IBC to
document the lockout policy as it applied to the rotary valve. Thus, the issue of the adequacy of
the written policy is irrelevant. Second, there was no proof that Morgan was involved in activity
covered by the standard, in these earlier occasions. There is no evidence pertaining to what
type(s) of work Morgan was performing during these earlier occasions, whether the pieces of
equipment he worked on were subject to unexpected energization which could cause injury, or
whether this prior activity involved placing his hands or other body parts into a zone of danger.
Morgan’s statement, therefore, does not establish that he had violated lockout procedures in the
past. This citation item is accordingly vacated.

Citation 1 Items 1b and 1c

Item 1b alleges a violation of 29 C.F.R.§ 1910.147(c)(4)(ii)(C), which requires that
energy control and lockout procedures include “specific procedural steps for the placement,
removal and transfer of lockout devices or tag-out devices and the responsibility for them.”
According to CO Brown, this item was issued because IBC’s written policy did not list the
equipment it covered, the magnitude of the energy, and the means to disconnect the energy. (Tr.
200). Item 1c alleges a violation of 29 C.F.R. §1910.147(c)(4)(ii)(D), which requires that the
written procedures contain “specific requirements for testing a machine or equipment to
determine and verify the effectiveness of lockout devices, tag-out devices, and other energy
control measures.” CO Brown recommended this item because he believed that IBC’s
procedures did not include an effective means for verifying that the rotary valve was locked out.
(Tr. 201).

An exception to the requirement that an employer document its lockout procedures for a
machine or piece of equipment is contained in a note to 29 C.F.R. § 1910.147(a)(4). Specifically,
the procedures need not be documented where an employer can show that “(1)...the equipment
has no potential for stored or residual energy or reaccumulation of stored energy after shut down
which could endanger employees; (2) the equipment has a single energy source which can be
readily identified and isolated; (3) the isolation and locking out of that energy will completely
deenergize and deactivate the machine or equipment; (4) the ...equipment is isolated from that
energy source and locked out during servicing or maintenance; (5) a single lockout device will
achieve a locked-out condition; (6) the lockout device is under the exclusive control of the
authorized employee performing the servicing or maintenance; (7) the servicing or maintenance
does not create hazards for other employees; and (8) the employer, in utilizing this exception,
has had no accidents involving the unexpected activation or reenergization of the machine or
equipment during servicing or maintenance.” According to the preamble to the final rule, this
limited exception is “intended to apply to situations in which the procedure for deenergization,
servicing and reenergization can be carried out without detailed interactions of energy sources,
machines, and employees.” 54 Fed. Reg. 36,644, 36,670 (1989).

I find that the foregoing exception applies to the rotary valve at issue. Electricity is the
only source of energy for the rotary valve, there is only one disconnect lever which needs to be
locked out to isolate the rotary valve, and there is unrebutted testimony that the disconnect lever
cannot store energy. (Tr. 145). The disconnect lever for the rotary valve controlled no other
machines or pieces of equipment and was specifically identified by a sign located above it. IBC
also established that its policy required that an employee performing servicing or maintenance
on the rotary valve isolate and lock out the disconnect lever, and that only one lockout device is
required. Under IBC’s procedures, the lockout device would be under the exclusive control of
the authorized employee performing the servicing or maintenance on the rotary valve. Finally, as
of January 6, 2000, there had been no accidents at the machine. Thus, there was no requirement
prior to January 6, 2000, for IBC to develop and maintain a written lockout procedure for the
rotary valve.

The Secretary argues that the standard was violated because IBC’s written plan, as it
applies to the whole factory, is insufficient. In this regard, the Secretary urges that the standard
requires that a written plan identify the specific machines or pieces of equipment requiring
lockout procedures, and set forth the manner in which the lockout of each such piece of
equipment or machine may be verified. The Secretary’s argument is unpersuasive. The standard,
by its terms, does not require an employer to identify each specific piece of equipment at its
plant requiring lockout procedures. Further, the preamble to the standard clarifies that the
requirement that a plan provide detailed instructions does not necessitate that an employer
identify each machine. In warning against creating overly complicated plans, the preamble
explains that “the employer’s procedures may not need to be unique for a single machine or
tasks, but can apply to a group of similar machines, types of energy and tasks if a single
procedure can address the hazards and the steps to be taken satisfactorily.” While the plan should
be detailed, there is no requirement for “a separate procedure ... for each and every machine or
piece of equipment. Similar machines and/or equipment which have the same or similar types of
controls can be covered with a single procedure.” 54 Fed. Reg. 36,644, 36,670 (1989). Based on
this language, I find the intent was not to require employers to identify each piece of equipment
and to specify for each piece of equipment, the manner of verifying deenergization. See Drexel
Chemical Co,. 17 BNA OSHC 1908 (No. 94-1469, 1997).

But see Akzo Nobel Chemicals,
Inc.,. 18 BNA OSHC 1643 (No. 96-0062, 1998). Rather, where machines have similar controls,
they may be covered under the same procedure.

The Secretary presented insufficient evidence relating to any machinery at the factory,
other than the rotary valve, on which to determine the adequacy and applicability of IBC’s
written program. In fact, with the exception of the rotary valve, there is no evidence that any
machines or pieces of equipment at the facility were subject to unexpected energization. Even if
there were such evidence, there is no proof as to the appropriate manner of locking out these
other machines, no proof that these other machines contained controls that were deactivated in a
manner different than that of the rotary valve, and no proof that these other machines could not
be locked out and verified adequately under the written policy. Based on the foregoing, Items 1b
and 1c of Citation 1 are vacated.

Citation 1 Item 1d

This Item alleges a violation of 29 C.F.R. 1910.147(c)(6)(i)(B), which requires the
employer to conduct periodic inspections of the energy control procedure “at least annually to
ensure that the procedure and the requirements of this standard are being followed.” CO Brown
recommended the this item, based on his review of IBC’s written documents concerning energy
control inspections. He testified that he reviewed audit logs which indicated that IBC had not
conducted an inspection since 1996, during his inspection. (Tr. 203). Hentschel, however,
testified that he conducted periodic inspections or audits of lockout procedures approximately
once a month in 1997, 1998 and for part of 1999. (Tr. 290-293). Hentschel also testified that he
maintained logs from his periodic audits in black books, which he showed to the OSHA CO
during the subject inspection. Upon his retirement in 1999, Hentschel left the black books in
IBC’s maintenance office. (Tr. 290-294, 301).

During the hearing, IBC identified only three audit logs, dated August 15, 1999, August
12, 1996 and March 9, 1996. (Exhibit S-8). No other audit logs were provided, and IBC offered
no explanation as to their whereabouts. However, I watched Hentschel’s demeanor on the
witness stand and find him a credible witness who responded to questions in a straightforward
and candid manner. His credibility is further supported by the fact that he has since retired from
the company and thus has no personal interest in any outcome. While IBC’s failure to produce
all of the audit logs must be given some weight, it is not determinative, especially as there is no
evidence of intentional misconduct on the part of IBC with respect to the documents.
Furthermore, contrary to CO Brown’s recollection, the audit logs do, in fact, indicate that a
lockout inspection took place in 1999, which leads me to believe that CO Brown may have been
mistaken. Based on the weight of the evidence, I find that the Secretary failed to rebut the
evidence that IBC in fact performed periodic inspections as contemplated by the standard. This
Citation Item is vacated.

Citation 1 Item 1e

This Item alleges a violation of 29 C.F.R. 1910.147(c)(7)(iii)(A), which requires
“(r)etraining...of all authorized and affected employees whenever there is a change in their job
assignments, a change in machines, equipment or processes that present a new hazard, or when
there is a change in the energy control procedures.” CO Brown suggest the issuance of this Item
because IBC did not provide specific training on appropriate lockout procedures for the one-month-old use bin rotary valve. (Tr. 204).

It is not disputed that the rotary valve was only one month old on the day of the accident.
Under the terms of the standard, however, it is incumbent on the Secretary to show that the new
equipment presents a new hazard. The only evidence presented by the Secretary in this regard
was CO Brown’s testimony that Morgan and Geiger indicated that they did not know how to
lock out the rotary valve and that they had to figure it out when they got there. (Tr. 242). During
his inspection, CO Brown spent a total of 30 minutes in the bulk sugar use bin room, consisting
of 15 minutes on April 18 and 15 minutes on May 3, 2000. (Tr. 205, 207). While he walked
through the “crumb cake” or “dump” area and observed the “clean in place” system, he did not
examine these other pieces of equipment to ascertain whether they contained hazards similar to
or different from the sugar use bin rotary valve, even though he was aware that other equipment
at the factory contained rotary valves. The only equipment he examined was the bulk sugar
system. (Tr. 206-207, 208-209, 210-211, 257-257). In point of fact, a flour use system at the
factory included a rotary valve similar to the one in the sugar use system. (Tr. 48, 144). Thus,
CO Brown had no knowledge whether the sugar use bin rotary valve presented a new or different
hazard, and the Secretary failed to present any evidence in this regard. The Secretary thus failed
to establish that this standard applies. Item 1e is vacated.

Findings of Fact and Conclusions of Law

The foregoing decision consitutes the findings of fact and conclusions of law in
accordance with Rule 52(a) of the Federal Rules of Civil Procedure.

ORDER

Based upon the foregoing decision, it is hereby ORDERED that:

Citation 1, Items 1a, 1b, 1c, 1d and 1e, alleging serious violations of 29 C.F.R. §§
1910.147(c)(4)(i), 1910.147(c)(4)(ii)(C), 1910.147(c)(4)(ii)(D), 1910.147(c)(6)(i)(B) and
1910.147(c)(7)(iii)(A), respectively, are VACATED.

/s/

COVETTE ROONEY

OSHRC, JUDGE

Dated: June 22, 2001

Washington, DC