Warzala Construction

Plain-English summary

OSHA investigated after a worker fell nearly 30 feet through a deteriorated metal roof and died. It cited Warzala Construction for failing to provide fall protection and for failing to report an employee fatality to OSHA within eight hours. The worker had performed other hourly labor for Warzala, but the roofing project was controlled by another contractor who set the work and had access to the site. Applying the common-law agency factors, the judge found that Warzala did not control the manner or means of the roofing work and that most factors supported independent-contractor status for this project. Because the Secretary did not prove that the worker was Warzala's employee, the cited duties did not apply to Warzala. Both citations were vacated and no civil penalties were assessed.

Decision snapshot

• Cited standard(s): 29 C.F.R. § 1926.760(a)(1) and 29 C.F.R. § 1904.39(a)(1).
• Outcome: Fall-protection and fatality-reporting citations vacated with no civil penalties.
• Key point: OSHA must prove an employer-employee relationship for the worker exposed to the cited condition, and project-specific control is central to that inquiry.

Full text (OSHRC public release)


WARZALA CONSTRUCTION OSHRC Docket No. 19-0265

United States of America

OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION

1120 20th Street, N.W., Ninth Floor

Washington, DC 20036-3457

SECRETARY OF LABOR,

Complainant,

v.

OSHRC Docket No.
19-0265

WARZALA CONSTRUCTION

Respondent.

DECISION AND ORDER

Attorneys and Law firms

For Complainant: Stephanie D. Adams, Esq., Trial Attorney, Office of the Solicitor, U.S. Department of Labor,
Cleveland, OH

For Respondent: Kevin P. Murphy, Esq.,
Harrington, Hoppe & Mitchell, Ltd.,
Warren, OH

BEFORE: John B. Gatto, United States Administrative Law Judge

I. INTRODUCTION

The United States Department of Labor, through its Occupational Safety and Health Administration (“OSHA”), investigated the death of Scott Stone, a worker at the site of a waste transfer facility located in Warren, Ohio. Following that investigation, OSHA determined Stone was employed by Respondent, sole proprietor Richard
Warzala
d/b/a
Warzala
Construction
(“Warzala”), 1
and issued two citations to
Warzala
on January 29, 2019, under the Occupational Safety and Health Act of 1970 (the “Act”), 29 U.S.C. §§ 651-678. 2

Citation 1 asserted
Warzala
committed a serious 3
violation of 29 C.F.R. § 1926.760(a)(1), one of OSHA’s fall protection standards. Citation 2 asserted
Warzala
committed
an
other-than-serious violation of 29 C.F.R. § 1904.39(a)(1), for failing to report the death of an employee to OSHA within eight hours.
After
Warzala
timely contested the citations, the
Complainant,
Secretary
of Labor
filed a formal complaint with the Commission seeking an order affirming the citations
and proposed penalties. 4
A
bench trial
was held in Cleveland, Ohio.

The Court finds that at all relevant times
Warzala
was engaged in a business affecting commerce and was an employer within the meaning of sections 3(3) and 3(5) of the OSH Act.
(Compl. ¶¶ 2(a), 3(a); Answer ¶¶ 2, 4;
see also
Joint Status Report (“JSR”) ¶¶
(c)(1)-(4)). Pursuant to Commission Rule 90, after hearing and carefully considering all the evidence and the arguments of counsel, the Court issues this Decision and Order
as its findings of fact and conclusions of law , which constitutes its final disposition of the proceedings.
All arguments not expressly addressed have nevertheless been considered and rejected. 5
F or the reasons indicated
infra , the Court
VACATES
the citation s
without civil penalty assessment s .

II. BACKGROUND

A. Warzala

Warzala
is a sole proprietorship owned by Richard
Warzala
whose principal place of business
is located in
Warren, Ohio. (JSR ¶
(c)(2)).
Warzala
has been in the construction industry since 1985. (Tr.
80). Regular jobs for
Warzala
include residential remodels and renovations, flooring, concrete work, and, at least at some point in the past, roofing. (Tr. 58, 61-62).
Warzala
had at least
two
employees at the
time relevant to this proceeding:

two “laborers” named Wally Weaver and Joe Bush. 6
(Tr.
77-78).
Warzala
assigned Bush and Weaver tasks such as
“clean[ing]
up, unload[ing], basically whatever needed done labor-wise.” 7
(Tr.
77).
Warzala
paid both employees weekly at an hourly rate.
(Tr.
55, 77-78).
Weaver
was paid $12
an hour while
Bush
was paid $13
an hour
because he “was there a little longer.”
( Id. )
Warzala
completed
a W-2 for Bush and Weaver. (Tr.
55, 77).

B. Stone and
Warzala

Warzala
met Stone at some point in 2018
through a mutual friend. (Tr. 55). At the time, Stone was
working
at the friend’s house. (Tr. 55-56).
Warzala
asked the friend if Stone could work for other people. (Tr. 58). Stone thereafter started doing work for
Warzala. ( Id. ).
Warzala
assigned Stone tasks
similar to
those he assigned his other “laborers,” Bush and Weaver, including raking, cleaning up, and other “odd jobs.”
(Tr.
22,
77).
For example, in 2018,
Stone
assisted
Warzala
with
a bathroom remodel and
a
full residence remodel. (Tr. 58, 80-81).
Stone did not require any tools or special expertise for the jobs assigned to him by
Warzala. (Tr. 72).

Like he did for Bush and Weaver,
Warzala
paid Stone
weekly at a rate of $12 an hour. (Tr. 60, 71-72, 107). Because Stone did not have a driver’s license,
Warzala
also drove Stone to and from the
sites of the
various projects
where he worked, dropping him off at 7:30 in the morning and picking him up at 3:30 in the afternoon. (Tr. 59).
For
Stone’s jobs with
Warzala,
Warzala
knew how much to pay Stone each week because he drove him to each site and thus knew the number of hours he worked. (Tr. 75, 109-10).
Warzala
did not withhold any taxes from Stone’s weekly paychecks, nor did he offer him any employment benefits. (Tr. 81-82, 106;
see also
Ex. R-E).
Stone worked on other jobs with which
Warzala
had no involvement. For example,
Stone
had a gutter cleaning job in Austintown, Ohio and another
job
doing gutter cleaning and roof repair for an individual named Anthony
Tountas. (Tr. 69-70, 89-91). Although
Warzala
drove Stone to the job with
Tountas, he did not do so for the job in Austintown. ( Id. ).

C. The Environmental Transfer Building Project

The building where Stone’s death occurred is called the “Environmental Transfer Station” (“ETS”) and
is located in
Warren, Ohio. (Tr. 91;
see also
Ex. C-2,
Ex. C-6, Ex. C-8). The building functions as a waste transfer facility, where the City of Warren and other entities
bring their garbage to be loaded onto semi-trucks and hauled to a landfill. (Tr. 91). The building itself is owned by an individual named Gil
Reiger, while an individual named Rick Jones runs the waste
transfer business from the building. ( Id. ).
Warzala
has known Jones his whole life and frequently did construction work for him. (Tr. 62).

At some point
before 2018,
Jones contacted
Warzala
about replacing the metal roofing on the ETS. (Tr. 63;
see also
Ex. C-10).
Warzala
initially accepted the job, and
Jones purchased the replacement
roofing
for it. (Tr. 63,
93,
96;
see also
Ex. C-9). However,
for reasons unclear from the record,
Warzala
did not do any work
in furtherance of
the roof replacement for about a year. (Tr. 63, 93).
At some point
thereafter
Warzala
and Jones discussed the roof replacement,
Warzala
separately
contracted with Jones to pour concrete at the ETS.
(Tr. 61).
Stone worked on this job with
Warzala, as did an individual named Norman
Miller. (Tr. 93-94).
Warzala
and Miller had an extensive history, having worked together on approximately 500 projects over six years. (Tr. 70-71).
Warzala
did not consider Miller to be an employee and
completed
a 1099 for him, rather than a W-2. (Tr. 80-83;
see also
Ex. R-F).
He did not extend any employment benefits to Miller. (Tr.
81-83).

While doing
the
concrete work
at the ETS
with
Warzala, Miller saw the metal roofing and inquired about the
roof
replacement
job.
(Tr. 93-94).
Warzala
told Miller he could “have the job,”
but
that he’d
“have to take it and okay it with Rick Jones.” (Tr. 94).
Thereafter,
Warzala
arranged a meeting with
Jones and Miller to discuss the job. (Tr. 94).
The result of that meeting was a “handshake deal”
between
Warzala
and Jones
for Miller to take on the roof replacement job .
(Tr. 40-41). Jones gave Miller a key to access the
ETS
building. ( Id. ).
Warzala
did not have a key or other access to the building. (Tr. 100).
Jones supplied the metal decking to replace the roof as well as a scissor lift that was onsite to access the roof. (Tr. 43-44, 94). For his part,
Warzala
provided a welder and a generator. (Tr. 43-44, 68, 97-98, 108-09). No payment arrangement for the roofing job was ever discussed at this meeting. (Tr. 43, 109) . After this initial meeting,
Warzala
had no further involvement with the roofing job . He had no role in any payment
between Jones and Miller
and did not set the schedule for Miller and Stone to work or complete the job . (Tr.
95 , 100 ).

After Miller had taken on the
roofing job, Stone asked
Warzala
if he
also
could also work on it. 8
(Tr. 95).
Warzala
told Stone it was Miller’s job,
and Stone
would have to
discuss it with him. ( Id. ). Miller agreed to
let
Stonework
on
the job
because he had “12 years in the roofing
business.”
( Id. ). As he did for Stone with his other jobs,
Warzala
drove Stone to the ETS
on the days he worked there. 9
(Tr.
102).

D. The Accident
and OSHA Inspection

On the Friday after Thanksgiving in 2018, Stone and Miller were working on the roof of the ETS,
tearing off the old metal roofing. (Tr.
96;
see also
Ex. C-1, p. 25 10 ). Neither was wearing any form of fall protection. (Tr.
19-21;
see also
Ex. C-1, p. 25). At some point,
“[r]ather
than walking on the new metal
roofing,
which was being installed, [Stone] stepped out onto the old roofing. The old metal roofing was highly
deteriorated[,] and he fell through to the concrete floor below[,]”
a distance of nearly thirty feet. (Ex. C-1, p. 25). Stone
died
as a result of
his fall. (Tr.
20-21, 72;
see also
Ex. C-1, pp. 52-60, 76-77). Miller called
Warzala
to inform him of the accident. (Tr.
72).
Warzala
did not inform
OSHA
of Stone’s death. (Tr.
19, 32). However, an
OSHA Compliance
Officer’s father read Stone’s obituary and reported the
accident
to that
Compliance
Officer. (Tr. 32;
see also
Ex. C-1, pp. 76-77). That
Compliance
Officer
then
referred the case to
the area
OSHA
office, which
assigned
Compliance
Officer
Grakauskas
to investigate. (Tr. 32).

Grakauskas
investigated
the worksite on December 3, 2018,
accompanied by a representative
from
the Ohio Bureau of Worker’s Compensation
(“BWC”). (Tr.
32,
33-34;
see also
Ex. C-1, pp. 24-25). The BWC representative measured the height of Stone’s fall, which
was
about 30 feet. (Tr. 19,
24,
33-34).
Grakauskas
interviewed Miller and Jones. (Tr. 30, 33-34).
Grakauskas
determined
Stone had not been using any form of fall protection while working on the ETS roof. (Tr. 19-21;
see also
Ex. C-1, p. 25).

Because Stone’s obituary reported him to be an employee of
Warzala,
Grakauskas
tracked down
Warzala
for an interview. (Tr.
34;
see also
Ex. C-1, pp. 76-77).
Warzala
told
Grakauskas
the
roofing
job was Miller’s,
not his. (Tr. 39;
see also
Ex. C-1, p. 25). Over the course of his interview, however,
Grakauskas
asked a series of questions concerning the
work
relationship between Stone and
Warzala. (Tr.
19-20, 42-43;
see also
Ex. C-1, p. 25).
Grakauskas
ultimately determined Stone was
Warzala’s
employee
and recommended the issuance of
the two citations
at issue.
( Id. ).

III.
ANALYSIS

The fundamental objective of the Act is to prevent occupational deaths and serious injuries.
Whirlpool Corp. v. Marshall , 445 U.S. 1, 11 (1980). The Act “establishes a comprehensive regulatory scheme designed ‘to assure so far as possible safe and healthful working conditions’ for ‘every working man and woman in the Nation. ’ ”
Martin v. Occupational Safety & Health Review Comm'n , 499 U.S. 144, 147 (1991) ( quoting
29 U.S.C. § 651(b)). “The Act charges the Secretary with responsibility for setting and enforcing workplace health and safety standards.”
Id.
To achieve this purpose, the Act imposes two duties on an employer: a “general duty” to provide to “each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees,”  29 U.S.C. § 654(a)(1) ; and a specific duty to comply with all applicable occupational safety and health standards promulgated under the Act.
Id.
§ 654(a)(2) . Pursuant to that authority, the standards at issue in this case were promulgated.
“The Secretary establishes these standards through the exercise of rulemaking powers.”
Id.
See
29 U.S.C. § 665. Meanwhile, the Commission is assigned to carry out adjudicatory functions under the Act and serves “as a neutral arbiter and determine whether the Secretary's citations should be enforced over employee or union objections.”
Cuyahoga Valley Ry. Co. v. United Transp. Union , 474 U.S. 3, 7 (1985) (per
curiam ).

Under the law of the Sixth Circuit where this case arose, 11
to establish a
violation
of a
health
or
safety
standard under
the Act,
“the Secretary must show by a preponderance of the evidence that (1) the cited
standard
applies to the facts, (2) the requirements of the
standard
were not met, (3) employees had access to the hazardous condition, and (4) the employer knew or could have known of the hazardous condition with the exercise of reasonable diligence.”
Carlisle Equip. Co. v. U.S. Sec’y of Labor & Occupational Safety , 24 F.3d 790, 792 (6th Cir. 1994).
Warzala
has
not contested any elements of the Secretary’s
prima facie
case. Rather,
its
case rests on its contention that Stone was not an “employee” as defined by the Act.
(JSR ¶ (b)).

A. Alleged Violations

1. Citation 1

Citation 1 alleges
Warzala
violated 29 C.F.R. § 1926.760(a)(1)
when its
“employees engaged in steel erection activities were not protected from fall hazards as required. Employees were exposed to a fall of approximately 30 feet while engaged in metal roofing tear off and application.”
( Compl ., Ex. A.) The cited standard
mandates that “each employee engaged in a steel erection activity who is on a walking/working surface with an unprotected side or edge more than 15 feet (4.6 m) above a lower level shall be protected from fall hazards by guardrail systems, safety net systems, personal fall arrest systems, positioning device systems or fall restraint systems.”
29 C.F.R. § 1926.760(a)(1).

2. Citation 2

Citation 2 alleges
Warzala
violated 29 C.F.R. § 1904.39(a)(1)
when it
“failed to report the fatality of an employee.”
( Compl ., Ex. A.) The cited standard
mandates that
“[w]ithin
eight (8) hours after the death of any employee as a result of a work-related incident, you must report the fatality to the Occupational Safety and Health Administration (OSHA), U.S. Department of Labor.”
29 C.F.R. § 1904.39(a)(1).

B. Covered E mployer

As a condition precedent to citing
Warzala, the Secretary must show
Warzala
was an employer within the meaning of the Act.
See All Star Realty Co., Inc. , 24 BNA OSHC 1356, 1358 (No. 12-1597, 2014) (“[T]he Secretary has the burden of proving that a cited company is the employer of the affected workers at the site”) ( citing Allstate Painting & Contracting Co. , 21 BNA OSHC 1033, 1035 (No. 97-1631, 2005) (consolidated)).
Here, the Act defines employer as “a person engaged in a business affecting commerce who has employees.” 29 U.S.C. § 652(5).
“Employee”
is defined
as “an employee of an employer who is employed in a business of his employer which affects commerce.” 29 U.S.C. § 652(6). As the Commission noted, this definition is “unhelpfully circular.”
Don Davis , 19 BNA OSHC 1477, 1480 (No. 96-1378, 2001).
“[W]hen Congress has used the term ‘employee’ without defining it, we have concluded that Congress intended to describe the conventional master-servant relationship as understood by common-law agency doctrine.”
Cmty . for Creative Non-Violence v. Reid , 490 U.S. 730, 739-40 (1989).
Thus,
“[i]n determining whether the Secretary has established that a cited entity is the employer of the particular workers at issue, the Commission relies upon the test set forth in
Nationwide Mutual Insurance Company v. Darden , 503 U.S. 318 (1992).”
Sharon & Walter Constr., Inc. , 23 BNA OSHC 1286, 1289 (No. 00-1402, 2010)).

In
Darden , the Supreme Court held that
“[i]n determining whether a hired party is an employee under the general common law of agency, we consider the hiring party's right to control the manner and means by which the product is accomplished.”
Darden ,
503 U.S. at 323 ( quot ation omitted ).
The
Darden
Court held
“[a]mong
the other factors relevant to this inquiry are the skill required; the source of the instrumentalities and tools; the location of the work; the duration of the relationship between the parties; whether the hiring party has the right to assign additional projects to the hired party; the extent of the hired party's discretion over when and how long to work; the method of payment; the hired party's role in hiring and paying assistants; whether the work is part of the regular business of the hiring party; whether the hiring party is in business; the provision of employee benefits; and the tax treatment of the hired party.”
Darden ,
503 U.S. at 323-24)
T his “common-law test contains no shorthand formula or magic phrase that can be applied to find the answer, ... all of the incidents of the relationship must be assessed and weighed with no one factor being decisive. ”   Id. ,
503 U.S.
at 324 (ellipsis in original)
( quot ation omitted ).

First, the Court finds that
Warzala
did not exercise so much control over the manner and means of
Stone’s work at the
ETS job
as to render him an employee.
The
Secretary
asserts that
Warzala
“controlled all aspects of the [ETS] project, determining who would work on the project, the schedule for the work and the tools to be used.” (Sec’y’s Br. 8). The Court
finds no merit in
the Secretary’s assertion.
Warzala
testified, without contradiction,
that once Miller took over the job after meeting with Jones,
Warzala
had no further involvement in the day-to-day of the job. (Tr. 95, 100).
The Secretary argues “[a]lthough
Mr. Stone did not need direct supervision, Mr.
Warzala
told him what to do, where to do it and he did it.” (Sec’y’s Br. 9).
However, the portion of
Warzala’s
testimony cited by the Secretary for this assertion was extremely general, and the line of questioning related only to the jobs for which Stone worked directly for
Warzala. (Tr. 59-60).

With regard to
the ETS job,
Warzala
specifically testified that Stone had to make any arrangements with Miller, not
Warzala. (Tr. 95).
Indeed,
Jones gave Miller, not
Warzala,
the key to access the ETS building and complete the work.
(Tr. 66-67). When Stone approached
Warzala
about possibly working on the ETS job,
Warzala
told him it was Miller’s job and Stone would
have to
ask him to work on it.
(Tr. 95).
The Secretary cites no support in the record, and the Court finds none, for his assertion that “Miller was told by Mr.
Warzala
to complete the transfer station job with Mr. Stone.” (Sec’y’s Br. 9).
Thus, the Court does not find the record supports the level of control
the Secretary
alleges. 12

The preponderant evidence establishes that while
Warzala
had initially contracted for the roofing job at the ETS building, this job was eventually given to Miller. (Tr. 39-41, 67-68, 94). After Miller took the job from
Warzala,
Warzala
had no further involvement in the project, including any supervision over Stone on the day-to-day of the project. (Tr. 95, 100).
Thus,
Warzala
retained no “right to control the manner and means by which the ETS roofing job was accomplished.”
This finding heavily weighs
in favor of finding Stone was
not
Warzala’s
employee.

Turning next
to the
nonexhaustive
list of twelve additional factors set forth in
Darden , the majority support the conclusion that Stone
was an independent contractor. First, regarding
“the skill required,”
where a hired party provides highly specialized labor
to a hiring party,
this factor weighs in favor of independent contractor status.
Weary v. Cochran,  377 F.3d 522, 527 (6th Cir.
2004).
Here, there is no dispute that the work Stone was doing was not
performing highly specialized work,
mainly providing
labor to remove the metal decking from the ETS roof.
(Tr. 96;
see also
Ex. C-1, p. 25). As the Secretary also points out, the other work Stone performed for
Warzala
consisted of unskilled manual labor
similar to
the work performed by
Warzala’s
two other
employees,
Bush,
and Weaver. (Tr. 72, 77;
see also
Sec’y’s Br. 10).
This factor
weighs in favor of finding Stone was
Warzala’s
employee.

Second, as to “the source of the instrumentalities and tools,”
a
hired party supplying
all of
his own tools
supports his
status as an independent contractor, but if the hiring party supplies or owns the tools, this
factor
favors finding
the hired party is an employee.
Absolute Roofing & Constr., Inc. v. Sec’y of Labor , 580 F.
App’x
357, 361 (6th Cir. 2014) (unpublished)
(citing
Trs . of Resilient Floor Decorators Ins. Fund
v.
A & M Installations, Inc. ,  395 F.3d 244, 250 (6th Cir.
2005)).
As the Secretary correctly points out, for most of the work Stone did
for
Warzala,
like
cleaning up or unloading materials,
few specialized tools were required. For the ETS
roofing
job
in particular,
Warzala
admitted to supplying at least two pieces of equipment
necessary to complete the work:

a generator and a welder.
(Tr.
20, 43-44, 68, 97-98, 108-09).
Ultimately, Miller and Stone used their own generator. (Tr. 97-98).
On the other hand, the
replacement roofing was supplied by
Jones, who also supplied
a forklift necessary to complete the work.
(Tr. 43-44, 94).
Thus, on balance, this factor weighs more heavily toward the conclusion that S tone
was an independent contractor than toward the conclusion that he was an employee.

As to the third factor, “the location of the work,”
when a hired party regularly reports to a site owned or controlled by the hired party, or the hiring party otherwise controls the location of the work to be performed, this factor weighs in favor of finding the hired party is an employee.
Absolute Roofing , 580 F.
App’x
at 361
(citing
Weary ,  377 F.3d
at
526–27). Warzala
did not own or control the ETS worksite.
The building itself was owned by an individual named Gil
Reiger, while
Jones
ran the waste transfer business from the building. (Tr. 91). For the roofing job, only
Miller had
a key to access the worksite.
(Tr. 40-41, 100).
Warzala
did not assign Stone to work at the ETS; rather,
Stone
arranged with Miller to work there.
(Tr. 95).
This finding weighs in favor of finding Stone was
not
Warzala’s
employee.

On the other hand, the fourth factor, “the duration of the relationship between the parties,” appears to militate toward employee status
in light of
Stone’s
relationship with
Warzala, since evidence of an indefinite duration favors employee status rather than independent contractor status.  See Absolute Roofing , 580 F.
App’x
at 351
( citing
FM Home Improvement,  22 BNA OSHC 1531,
1538
(No. 08-0452,
2009)
(ALJ)).
As the Secretary points out,
Warzala
met Stone sometime in 2018 and hired him for several projects throughout that year. (Sec’y’s Br. 11).
This factor weighs in favor of finding Stone was
Warzala’s
employee.

As to the fifth factor, “whether the hiring party has the right to assign additional projects to the hired party,”
a
hiring party’s right to assign additional projects is indicative of the hired party’s status as an employee.
Absolute Roofing , 580 F.
App’x
at 362.
The Secretary argues that
Warzala
had the right to assign additional duties based largely on
Warzala’s
testimony that
“he
told [Stone] what to do and he would do it.”
(Sec’y’s Br.
9).
Warzala’s
testimony on this point was heavily influenced by the framing of the question
when
he was
asked, “You told [Stone] what to do and he would do it?” And
Warzala
responded, “Correct.” (Tr. 60).
However, there is nothing in the record to indicate Stone was required to accept the jobs
Warzala
offered
him.
Cf. Absolute
Roofing , 580 F.
App’x
at 362 (finding this factor indicated employee status where hired party received daily job assignments and could be moved around jobsites for the same employer);
see also
Sharon & Walter Constr. ,
23 BNA OSHC 1286,
1289
(No. 00-1402,
2010) (finding in part that a worker was an employee because the company required him to report back to headquarters for additional assignments if he finished his work before the end of his shift).
In fact,
at the time of the accident,
Stone was working on at least one other job in Austintown, Ohio,
with which
Warzala
had no apparent connection at all. 13
(Tr. 89-91, 102).
As to the ETS job specifically,
Warzala
did not assign this job to Stone; rather, he
referred
Stone to
Miller
if he wanted the job.
(Tr. 95).
This finding weighs in favor of finding Stone was
not
Warzala’s
employee.

Sixth, we look to “the extent of the hired party's discretion over when and how long to work”
since an “independent contractor … has complete authority over when and how long to work” while an employee’s hours are controlled by his employer.”
Absolute Roofing , 580 F.
App’x
at 362.
The Secretary argues that
Warzala
had control over Stone’s hours because he drove him to and from
Warzala’s
various worksites and used this to calculate his hours for payment each week. (Sec’y’s Br. 8, 14). As to the ETS job itself, the Secretary further asserts that
Warzala
controlled Stone’s hours because
(1)
Warzala
told Jones the job would only be done on weekends and
(2)
Warzala
drove
Stone
to and from the ETS site on the days he worked there. ( Id.
at 10).
The Court
finds no merit in
the Secretary’s
arguments. Since
Warzala
was not paying Stone for his work on the ETS
(Tr. 95), the Court does not find it particularly relevant as to how
Warzala
kept track of Stone’s hours for the projects
that
Stone
was
working for
Warzala. While
Warzala
did indicate to Jones that Miller and Stone would only be working on the ETS roofing job on weekends, he also testified that on those days he had no control over when or how many hours the two
actually worked. (Tr.
95-100). This is not the sort of control over
an employee’s
hours contemplated by
Darden .
Cf. Weary ,
377 F.3d at 527 (finding in part that, because the hired party controlled his hours and was “free to take vacation at his leisure and did not report his hours to anyone,” the hired party was an independent contractor).

Further,
the Court finds no merit in
the Secretary’s assertion
that
when
Warzala
drove Stone to and from the ETS site on the days he worked there,
Warzala
had
control over Stone’s hours on those days.
This finding weighs in favor of finding Stone was
not
Warzala’s
employee.

As to the seventh factor, “the method of payment,”
payment
on a commission basis is indicative of
a hired party’s status as an independent contractor while a set hourly rate weighs in favor of employment status.
Absolute Roofing , 580 F.
App’x
at 363.
With regard to
this factor, the Secretary emphasizes that
Warzala
paid Stone weekly at a rate of $12 an hour for his work. (Sec’y’s Br.
13-14). While this may have been true of some of the work Stone performed for
Warzala, there is simply no evidence to rebut
Warzala’s
testimony that this payment arrangement did not apply to the ETS roofing job. (Tr.
95, 100).
This finding weighs in favor of finding Stone was
not
Warzala’s
employee.

As to
the eighth factor, “the hired party's role in hiring and paying assistants,”
a
hired party’s ability
and
discretion to hire and fire his own assistants is indicative of independent contractor status, whereas a hired party’s
lack of authority to hire or fire anyone is indicative of employee status.
Absolute Roofing , 580 F.
App’x
at 381
(citing
Weary,
377 F.3d at 527).

There was no evidence adduced to suggest
Stone
was allowed to
hire
or fire assistants
or had any authority to do so.
This
factor
weighs in favor of finding Stone was
Warzala’s
employee.

As to the ninth and tenth factors, “whether the work is part of the regular business of the hiring party” and “whether the hiring party is in business,”
where a hiring party is in business and
the
hired party's
work
is part of the hiring party’s regular business, this
factor
favors a finding that the
worker
is an employee.
Weary , 377 F.3d
at 528.
There is no material dispute that
Warzala
was generally in the business of construction or that
many of the tasks Stone performed on behalf of
Warzala, like helping with home remodels,
were part of
Warzala’s
regular business
of construction work. While
Warzala
disputes
he was in the business of roofing,
which was the work being performed at the ETS, and
he
testified he
did not typically engage in roofing activities, he also testified that it was work he had done in the past. (Resp’t’s
Br. ¶¶ 4, 43;
Tr.
62-62, 99).
Indeed, he had originally accepted the ETS roofing job from Jones before ultimately giving it to Miller. (Tr. 63, 93, 96). Thus, the Court finds roofing was part of
Warzala’s
regular business.
These
factors
weighs
in favor of finding Stone was an employee.

As to the eleventh factor, “the provision of employee benefits,”
provision of employee benefits is indicative of a
hired party’s
employee status.
Absolute Roofing , 580 F.
App’x
at 361.
The Secretary has not
rebutted
Warzala’s
testimony that he provided no employee benefits to Stone.
(Tr. 81-82).
This finding weighs in favor of finding Stone was
not
Warzala’s
employee.

The twelfth, and final, additional factor from the
Darden
list is “the tax treatment of the hired party.”
An employer’s tax treatment of a
hired party
as an independent contractor (by filing a form 1099 instead of a
W-2)
also
weighs against finding the
party
is an employee.
Absolute Roofing , 580 F.
App’x
at 361.
The Secretary does not dispute
Warzala’s
evidence that
Warzala
treated Stone as an independent contractor for tax purposes.
See
Ex.
R-E.
However, the Secretary does
argue that
“Mr.
Warzala
simply issued a 1099 to Mr. Stone after his death in an effort to deny an employment relationship.” (Sec’y’s Br. 14). The only evidence the Secretary cites in support of this assertion is the following exchange at
trial
between
Compliance
Officer
Grakauskas
and the Secretary’s attorney:

Q    Did you ask Mr.
Warzala
how Mr. Stone was paid?

A    Yes.

Q    Do you recall the response?

A    I believe he said he had given him checks a few times and he was paid hourly depending on what work he was doing.

Q    Did you ask Mr.
Warzala
if he had issued a 1099 for Mr. Stone?

A    I did.

Q    And what
was
his response?

A    I would have to
refer back
to my notes, but I don’t think he had completed one.

(Tr. 21). Grakauskas
then read from his notes that
Warzala
“never had him fill out a 1099” but he “did give him his Social for the end of the year.” (Tr. 22).

The
Court finds no merit in the
Secretary’s assertion that
Warzala’s
issuance of a 1099 for Stone was done “in an effort to deny an employment relationship”
and
his implicit assertion that the timing of
Warzala’s
issuance of a 1099 for Stone was somehow irregular.
Under the Internal Revenue Code, “[i]n connection with payments to ‘independent contractors,’ employers only have to send annual information returns, on Form 1099 to the workers and on Forms 1096 and 1099 to the IRS, indicating the income paid [to the independent contractor] during the year.”
Hosp. Res. Pers., Inc. v. United States,  68 F.3d 421, 424 (11th Cir. 1995).
Forms 1099 and 1096 are required when the “salaries, wages, commissions fees, and other forms of compensation for services
rendered
aggregat[es] $600 or more.” 26 C.F.R. § 1.6041–1(a)(1)(i)(A).
Thus, there
is nothing
unusual about filing a 1099 after the end of a calendar year.
Additionally, the Court notes that the payments reflected in Stone’s 1099 did not reflect any payments made for the ETS job. (Tr. 82).
This finding weighs in favor of finding Stone was
not
Warzala’s
employee.

Lastly,
the Court
considers
the “economic realities” of the relationship between Stone
and
Warzala.
See Wilde , 15 F.3d at 105. Most aspects of this issue have already been addressed in the discussion above, but
the Court
further notes
the lack of any leave or vacation policy and observes
that
the Secretary proffered no evidence that
the
working relationship
could
not
be terminated at will by either party.
Both of these
factors weigh in favor of independent contractor status.

IV.
CONCLUSION

In summary, then, on the general issue of control,
this factor
weighs heavily in favor of finding Stone was
not
Warzala’s
employee.
Of the twelve additional  Darden  factors,
seven
count in favor of independent contractor status
and five
count toward employee status .
Finally, to the limited extent that the economic realities of S tone’s
working relationship with
Warzala
are not reflected in the analysis of the
Darden
factors, they support the view that he was an independent contractor. 14

The Court therefore
concludes
Stone
was an independent contractor, and
therefore,

the
Secretary has failed to establish by a preponderance of evidence
that
Stone was
Warzala’s
employee.

Accordingly,

V. ORDER

IT IS HEREBY ORDERED THAT
both citations
are
VACATED
and no civil penalt ies are
assessed .

SO
ORDERED .

/s/            

First Judge John B. Gatto

Dated: November 1 6 , 2020

Washington, D.C.

"

1
In Ohio, “[a] sole proprietorship has no legal identity separate from that of the individual who owns it.”
Patterson v. V & M Auto Body , 589 N.E.2d 1306, 1308 (Ohio 1992).

2
The Secretary of Labor has assigned responsibility for enforcement of the Act to OSHA and has delegated his authority under the Act to the Assistant Secretary for Occupational Safety and Health, who heads OSHA. See Order No. 4–2010 (75 FR 55355), as superseded in relevant part by 1–2012 (77 FR 3912). The Assistant Secretary has redelegated his authority to OSHA’s Area Directors to issue citations and proposed penalties.
See
29 C.F.R. §§ 1903.14(a) and 1903.15(a). The terms “Secretary” and “OSHA” are used interchangeably herein.

3
The Act contemplates various grades of violations of the statute and its attendant regulations— “willful”; “repeated”; “serious”; and those determined “not to be of a serious nature” (referred to by the Commission as “other-than-serious”). 29 U.S.C. § 666. A serious violation is defined in the Act; the other grades are not.
See
29 U.S.C. § 666(k).

4
Attached to the Complaint and adopted by reference w ere
the citation s
at issue ( Compl ., Ex. A). Commission Rule 30(d) provides that “[s] tatements
in a pleading may be adopted by reference in a different part of the same pleading or in another pleading or in any motion. A copy of any written instrument which is an exhibit to a pleading is a part thereof for all purposes.” 29 C.F.R § 2200.30(d).

5
If any finding is in truth a conclusion of law, or if any stated conclusion is in truth a finding of fact, it shall be deemed so.

6
Warzala
also testified that his niece, and possibly his wife, had some involvement in the operations of the company, like handling payroll. (Tr. 77). However, they were not paid for these services. ( Id. )

7
Warzala
did not testify specifically as to the duties he assigned to Bush, but it appears he held a similar position with the company as Weaver. (Tr. 78).

8
According to
Warzala , Stone was a “hustler” and was “always looking for extra stuff to do.” (Tr. 95).

9
Normally this would be on weekends when
Warzala
did not do his own construction work. (Tr. 94, 105-06). However, the accident occurred on the Friday after Thanksgiving while
Warzala
was working on another job. (Tr. 96).

10
Citations to specific pages in Complainant’s Exhibit 1 are to the Bates number.

11
The employer or the Secretary may appeal a Commission order to the federal court of appeals for the circuit in which the violation allegedly occurred or where the employer has its principal office, and the employer also may appeal to the District of Columbia Circuit.
See
29 U.S.C. §§ 660(a) and (b). Here, the violation occurred in Ohio, in the Sixth Circuit, where
Warzala’s
office is also located.
See
29 U.S.C. § 660(b). The Commission has held that “[w]here it is highly probable that a case will be appealed to a particular circuit, the Commission generally has applied the precedent of that circuit in deciding the case— even though it may differ from the Commission’s precedent.”
Kerns Bros. Tree Serv. , 18 BNA OSHC 2064, 2067 (No. 96- 1719, 2000). The Court therefore applies the precedent of the Sixth Circuit in deciding the case where it is highly probable that the case would be appealed.

12
Although the Secretary cites in support of his position
Loomis Cabinet Co. , 15 BNA OSHC 1635 (No. 88-2012),
aff’d
20 F.3d 938, 942 (9th Cir. 1994),
Loomis
does not compel a different conclusion. In
Loomis , the Commission applied its own “economic realities” test, not the
Darden
factors.
See Loomis Cabinet Co. , 15 BNA OSHC at 1637. Indeed, the Commission expressly declined to apply the
Darden
factors, noting only that it would have reached the same result under the
Darden
test as it did under its economic realities test.
Id.
at 1638 n.9. In any event, the degree of control of the employer in
Loomis
was far more significant than the record demonstrates here, as the Court’s analysis of the
Darden
factors demonstrates
infra .

13
Although t he Secretary argues
Warzala
“had no evidence to substantiate ” its
claim that Stone took on jobs from companies other than
Warzala
(Sec’y’s Br. 13) , it is the Secretary’s burden to prove an employer-employee relationship and he offered no evidence to refute
Warzala ’s
testimonial evidence.

14
The Secretary
also proffered
Stone’s o bituary, which
stated he was
“a roofer and construction worker for
Warzala [.] ” (Ex. C-1, p. 77). However, labels carry little weight in determining a hired party’s status as an employee.
Loomis Cabinet Co. v. Occupational Safety & Health Rev. Comm’n , 20 F.3d 938, 942 (9th Cir. 1994).
T he Court
therefore
give s
little
weight to
Stone’s o bituary .
Warzala
also
proffered
a decision from the Ohio BWC
concluding that
for purposes of worker’s compensation benefits Stone was not
Warzala’s
employee
(Ex. R-H) , which the
Court
does not find relevant since
the factors relied on to determine whether a worker is an employee for
Ohio
worker’s compensation benefits are not coterminous with the
Darden
factors.
Bostic v. Connor , 524 N.E.2d 881 (Ohio 1988).