Empire Steel, Inc.
Commission approves $1,000 settlement with employee-leasing company
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This is citable Commission precedent from 1995, and it may have been appealed since. Ezel checks how it stands today and answers your situation, with citations.
Plain-English summary
The underlying case arose after an employee fell through an opening during a Texas school re-roofing project and sustained fatal injuries. The administrative law judge had substituted employee-leasing company Corporate Compensation and Safety, Inc. for the originally cited Empire Steel, Inc. and affirmed a serious safety-net violation with a $2,000 penalty. While review was pending, the Secretary and CCSI agreed to reduce the penalty to $1,000, and CCSI withdrew its notice of contest without admitting a violation. The Commission approved the settlement and made its terms final. It set aside inconsistent portions of the judge's order, removed CCSI from the caption, and substituted Empire Steel as the respondent for the remaining proceeding.
Decision snapshot
- Cited standard(s): 29 C.F.R. § 1926.105(a).
- Outcome: Settled. CCSI withdrew its contest to the serious fall-protection item and agreed to a reduced $1,000 penalty; the Commission approved the settlement and restored Empire Steel to the caption.
- Key point: The settlement resolved the citation as to CCSI but did not end the separate Commission proceeding concerning Empire Steel's status in the case.
Full text (OSHRC public release)
United States of America
OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION
1120 20th Street, N.W., Ninth Floor
Washington, DC 20036-34 19
Phone:(202)606-5400
Fax:(202)606-5050
SECRETARY OF LABOR, ..
Complainant, ..
.
.
V. . Docket No. 93-3285
.
EMPIRE STEEL, INC., ..
Respondent.
ORDER
The Secretary and Corporate Compensation and Safety, Inc., (CCSI) have filed a stipulation
and settlement agreement in this matter. The stipulation and settlement is approved and its terms
are incorporated into this order. The administrative law judge’s decision and order is set aside to
the extent that it is inconsistent with the stipulation and settlement agreement with respect to
Corporate Compensation and Saf’kty,Inc.
The caption of this matter has been changed to remove CCSI as the respondent and to
substitute Empire Steel, Inc., as the respondent.
FOR THE COMMISSION
Dated: Awust 18.1995
Ray d Darling, Jr
Executive Secretary
I certifj~that a copy of the attached order was served on the following persons on August 18,
1995:
Daniel J. Mick
Noah Connell
OFFICE OF THE SOLICITOR, U.S. DOL
Room S4004
200 Constitution Ave., N.W.
Washington, D.C. 20210
R Bruce Tharpe
CORPORATE COMPENSATION
AND SAFETY, INC.
1776 Woodstead Court, Suite 107-B
The Woodlands, TX 77380
Curtis E. Harvey
CORPOIUUE COMPENSATION
AND SAFETY, INC.
1776 Woodstead Court, Suite 212
The Woodlands, TX 77380
Dated: August 18. 1995 m$iQ 1
Ray H. Darling, Jr.
Executive Secretq
UNITED STATES OF AMERICA
OCCUPATIONAL SAFETY AND HE2JLTH REVIEW COMMISSION
ROBERT REICH, SECRETARY OF LABOR :
0
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Complainant, :
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0
v. :OSHRC Docket No. 93-3285
0
0
CORPORATE COMPENSATION AND 0
0
SAFETY, INC. 0
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Respondent. 0
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STIPULATION AND SETTLERENT AGREXENT
I0
The Secretary and Corporate Compensation and Safety, Inc.
(VCSP) have reached agreement on a full and complete settlement
and disposition of Serious Citation No. 1 Item 1 (as amended in
the Amended Complaint (alleging a violation of 29 C.F.R. 5
1926.105(a)) as it pertains to CCSI; the affirmance against CCSI
of that citation by the Administrative Law Judge is currently
pending before the Commission.
II 0
It is stipulated and agreed between the Complainant,
Secretary of Labor, and the Respondent, CCSI, that:
10 Complainant amends its proposed penalty for Serious
Citation No. 1 Item 1 (as amended in the Amended Complaint,
alleging a violation of 29 C.F.R. g 1926305(a)) from $2000.00 to
$1000.00.
20 Respondent withdraws its notice of contest to Serious
Citation No. 1 Item 1 (as amended in the Amended Complaint) and
to the proposed penalty, as amended (to $1000.00).
30 There is no authorized employee representative party in
this case.
4 l No affected employee elected party status in this case.
50 Each party agrees to bear its own fees, costs and
expenses incurred by such party in connection with all stages of
this proceeding with regard to this Citation item.
6 l Respondent will submit a check in the amount of
$l,OOO.OO, made payable to W.S. Department of Labor --
Occupational Safety and Health Administration," to the OSHA Area
Director within 30 days from the date of this agreement.
III.
1 l Respondent's signing of this Stipulation and Settlement
Agreement is not an admission by the respondent of any violation
of the Occupational Safety and Health Act or its implementing
regulations.
20 It is understood and agreed that the citation and
penalty affirmed as a result of this Stipulation and Settlement
Agreement shall become a Final Order of the Commission.
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THOMAS S. WILLIAMSON, JR.
Solicitor of Labor
JOSEPH M. WOODWARD
Associate Solicitor for
Occupational Safety and Health
DONALD Go SHALHOUB
Deputy Associate Solicitor for
Occupational Safety and Health
DANIEL J. MICK
Counsel for Regional R/Bruce Tharp& Esq.(Date)
Trial Litigation CCSI Corporate Counsel
1776 Woodstead Court
Suite 107-B
The Woodlands, TX 77380
NOAH CONNELL (Date) CtiTIS E. HARVEY
Staff Attorney for Regional Corporate Safety Officer
Trial Litigation Corporate Compensation and
Safety, Inc.
1776 Woodlands Court
Suite 212
The Woodlands, TX
77380
UNITED STATES OF AMERICA
OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION
One Lafayette Centfe
1120 20th Street, N.W. - 9th Floor
Washington, DC 20036-3419
SECRETARY OF LABOR
Complainant,
v. OSHRC DOCKET
NO. 93-3285
EMPIRE STEEL, INC.
Respondent.
NOTICE OF DOCKETING
OF ADMINISTRATIVE LAW JUDGE’S DECISION
The Administrative Law Judge’s Report in the above referenced case was
docketed with the Commission on August 10, 1994. The decision of the Judge
will become a final order of the Commission on September 9, 1994 unless a
Commission member directs review of the decision on or before that date. ANY
PARTY DESIRING REVIEW OF THE JUDGE’S DECISION BY TEIE
COMMISSION MUST FILE A PETITION FOR DISCRETTONARY REVIEW.
Any such petition should be received b the Executive Secretary on or before
August 30, 1994 in order to ermit sId cient time for its review. See
Commission Rule 91,29 C J? .R. 2200.91.
All further pleadings or communications regarding this case shall be
addressed to:
Executive Secretary
Occupational Safety and Health
Review Commission
1120 20th St. N.W., Suite 980
Washington, D.C. 20036-3419
Petitioning parties shall also mail a copy to:
Daniel J. Mick, Esq.
Come1 for Regional Trial Liti don
Office of the Solicitor, U.S. DOB,
Room S4004
200 Constitution Avenue, N.W. .
Washington, D.C. 20210
If a Direction for Review is issued by the Commission, then the Counsel for
Regional Trial Litigation will represent the Department of Iabor. Any party
hamg questions about review nghts may contact the Commission’s Executive
Secretary or call (202) 606-5400.
Date: August 10, 1994 Ray H. Darling, Jr.
Executive Secretary
DOCKET NO. 93-3285
NOTICE IS GIVEN TO THE FOLLOWING:
Daniel J. Mick, Esq.
Counsel for Regional Trial Liti ation
Office of the Solicitor, U.S. DO5
Room S4004
200 Constitution Ave., N.W.
Washington, D.C. 20210
James E. White, Esq.
Re .onal Solicitor
O&e of the Solicitor U S DOL
525 Griffin Square Blbg.,‘&ite 501
Griffin & Youn Streets
Dallas, TX 752tf2
Curtis E. Harvey, WSO-CSM
Co orate Safety Officer
177‘8 Woodlands Co- Suite 212
The Woodlands, TX 77380
Stanley M. Schwartz
Administrative Law Jud e
Occupational Safety an cf Health
Review Commission
Federal Building, Room 7Bll
1100 Commerce Street
Dabs, TX 75242 0791
_ 00109453100:06
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UNITED STATESOF AMERICA
OCCUPATIONAL SAFtEl-YAND HEALTH REVIEW COMM ISSION
ROOM 7811, FEDERAL BUILDING
1700 COMMERCE STREtr
DALIAS, TEXAS 752424791
PHONE: FM:
COM (214) 767-527: COM (214) 767435s
FE (214) 767-5271 FTS (214) 767-3350
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v. .. OSHRC DOCKET NO. 93-3285
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CORPORATE COMPENSATION AND .0
SAFETY, INC., ..
Respondent?
APPEARANCES:
RobertA Fitz, Esquire CurtisHarvey
Dallas,Texas The Woodlands,Texas
For the Complainant. For the Respondent,
pro se.
Before: Administrative Law Judge Stanley M. Schwartz
DECISION AND ORDER
This is a proceeding before the Occupational Safety and Health Review Commission
(“the Commission”) pursuant to section 10 of the Occupational Safety and Health Act of
1970, 29 U.S.C. 6 651 et seq. (“the Act”). The Occupational Safety and Health
Administration (“OSHA”) inspected a school re-roofing project in Spring, Texas, after an
accident on June 14,1993; the accident occurred when an employee fell through an opening
in the roof and stiered fatal injuries. As a result of the inspection, OSHA issued a serious
‘Empire Steel, Inc. (“Empire”) was the employeroriginallycitedin this case; however,at the hearingthe
Secretarymovedto includeCorporateCompensation and safety,Inc. (“CCSP’)as a joint Respondentbased
on the evidenceof record. For the reasonsset out below,CCSIhasbeensubstitutedas the sole Respondent
in this matter.
I
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citation with two items.2 The citation was contested, and a hearing was held May 13, 1994.
The Secretary and Respondent have filed briefs in this matter, and the arguments of both
parties have been thoroughly considered.
The Secretary’s Motion to Amend
As noted supra, the Secretary moved at the hearing to amend the citation to include
CCSI as a joint Respondent along with Empire, the employer originally cited; the basis of
the motion was the testimony of Frank Gunnels, Empire’s president. (Tr. 9-10; 20-21). The
undersigned reserved ruling on the motion but advised Curtis Harvey, who appeared on
behalf of Empire and identified himself as a safety professional with both Empire and CCSI,
an employee leasing firm, that he should clarify the matter during the hearing because a
determination of which company was the employer was an issue to be resolved. (Tr. 4-5;
21-23). After the hearing, the Secretary submitted a written motion to conform the
pleadings to the evidence pursuant to Commission Rule 2200.2(b) and Federal Rule of Civil
Procedure 15(b). CCSI’s corporate counsel has filed an objection to the motion. The
essence of the objection is that CCSI was not represented at the hearing, and that naming
it as a joint Respondent would violate due process as CCSI had no notice it was required
to appear and present evidence in its defense.
Rule 15(b) provides for amendments to conform to the evidence, and Rule 15(c)
provides for the relation back of amendments to the date of the original pleading if the
conditions of the rule are met. It is well settled Rule 15 applies to Commission proceedings,
and that a party may be substituted for the originally-named party pursuant to Rule 15(c)
as long as the party (1) has received such notice of the institution of the action that it will
not be prejudiced in maintaining a defense on the merits, and (2) knew or should have
known that, but for a mistake concerning the identity of the proper party, the action would
‘As issued,itemone allegeda violationof section5(a)(l) and item2 allegeda violationof 1926.850(i). The
Secretarfs complaintamendeditem 1 to allegea violationof 1926.105(a),and his withdrawalof item 2 was
grantedat the hearing (Tr. 5-6). The secretary’scomplaint@o states that the citation%designationas
citationnumber2 was erroneous; accordingly,the citationis hereinaftereferredto as citation number 1.
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have been brought against it. See C’.H Company, Inc., 9 BNA OSHC 1048, 1052-53, 1980
CCH OSHD ll 24,967, pp. 30,824.25 (No. 78-5954, 1980).
Commission precedent is also well settled that the “economic realities” test is to be
used to determine which employer was responslible for the safety of workers under the
circumstances of a particular case. The five factors to be considered are:
(1) Whom the employee considers to be his or her employer;
(2) Who pays the employee’s wages;
(3) Who is responsible for controlling the employee’s activities;
(4) Who has the power as opposed to the responsibility to control the
employee; and
(5) Who has the power to tie the employee or to modify the employee’s
employment conditions.
MU Industries, Inc., 12 BNA OSHC 1525, 1526-27, 1985 CCH OSHD B 27,408, p. 35,509
(No. 83-231, 1985). Factors (3) through (5) should be given more emphasis since they
effectuate the remedial purpose of the Act. Ii at 1528 and p. 35,510.
Turning to the evidence of record, Harold Dark, the OSHA compliance officer
(TO”) who inspected the site, testified that Curtis Harvey, CCSI’s corporate safety
coordinator, reported the accident and told OSHA that Empire was the employer on the
project. Dark further testified he called Empire the afternoon of June 14 and asked that
their safety coordinator meet him at the site the next day and that employees be available
for his inspection; he met with Frank Gunnels and Steve Weisinger, another representative
of Empire, on the morning of June 15, and although Curtis Harvey was also there during
part of the inspection Dark believed Empire was the only employer on the job? (Tr. 47-49;
59-61; 74-75; 101-02).
Based on the foregoing, it is understandable that OSHA cited Empire and that the
Secretary was not aware until the hearing of CCSI’s role at the site. However, Frank
Gunnels testified that Moore and Moore, the general contractor, awarded his company the
subcontract to replace the roof on the school, and that he then coordinated with Larry
3At some point,Darkalso spokewitha representativeof Moore and Moore, the generalcontractor of the
projti (Tr. 61).
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Sowell, an employee of CCSI, to provide the workers, equipment and scheduling needed for
the job. He explained that Empire has only three employees, himself and two clerks, and
that all field workers needed for its jobs are leased from CCSI or another concern. He
further explained that all the CCSI employees Empire uses are paid by CCSI, and that while
Empire and CCSI have an ongoing relationship they are not affiliated. Gunnels said CCSI
schedules and oversees the work, employees and safety of all of the jobs it does for Empire,
including the subject project, and that after initial instructions he communicates with Sowell
only if a problem arises; Gunnels also said that Empire had probably five other jobs going
on at the time of the subject job, and that he viewed CCSI as essentially another
subcontractor. (Tr. 9-20; G-3).
In addition to the above, David Livingston and Darvin Scott, two employees on the
job the day of the accident, testified consistently with Gunnels. (Tr. 30-33; 37-39).
Moreover, the only safety materials presented at the hearing were those of CCSI, and
Empire evidently has no such materials of its own. (Tr. 1045; 25-28; G-1-2). Finally, Curtis
Harvey made no attempt to rebut the testimony of Gunnels, even after being advised he
should clarify this matter. (Tr. 21-23). Accordingly, upon applying the economic rezilities
test to this case, it is concluded CCSI was the employer at the site, This conclusion is not
changed by Gunnels’ apparent belief Empire was liable for any OSHAviolations on the job,
or by Empire’s settlement of a 1991 citation relating to a job under the same arrangement,
since it is clear that CCSI was responsl%le for worker safety at the subject site. (Tr. 24;
4956; G-4-14).
Turning to the Secretary’s motion, the undersigned has considered the arguments of
CCSI noted above and finds them unpersuasive. Curtis Harvey, CCSI’s safety coordinator,
told OSHA Empire was the employer at the site; he also participated in the inspection and
then presented himself as Empire’s representative at the hearing. After Gunnels testified,
Harvey was advised he should clarify who was the actual employer as this had become an
issue. Based on Harvey’s failure to offer anything on the issue, it can onlybe concluded that
Gunnels’ testimony represents the true relationship between Empire and CCSI and that
CCSI was the employer at the site. Moreover, due to the evidence as to the violation of
1926.105(a), ~@zz, the undersigned is unable to fathom anything more CcsI might have
presented in its defense. Consequently, CCSI had the notice required by Rule 15(c), and
it is appropriate to substitute CCSI as the Respondent; in this regard, I note Harvey’s
statement that CCSI had two other cases in which it had been cited pending before the
undersigned.4 (Tr. 24-25). The Secretary’s motion is granted, the citation is vacated as to
Empire, and CCSI is the sole Respondent in this matter.
29 C.F.R. d 1926.105(a\
The subject standard provides as follows:
Safety nets shall be provided when workplaces are more than 25 feet above
the ground or water surface, or other surfaces where the use of ladders,
scafEolds, catch platforms, temporary floors, safety lines or safety belts is
impractical.
The record shows that the job at the site involved removing the old metal sheeting
making up the roof of the school, as well as the insulation underneath, and then installing
new sheeting; the roofing was removed two to four sheets at a time, and the openings
created by this process were then covered with new sheeting. The accident occurred when
CCSI employee Clarence Hubbard fell through one of the openings; the area he was
working was above the school cafeteria, and while there was a ceiling grid below the roof
he went through it and fell to the cafeteria floor below. (Tr. 33-36; 3946; 61-75; 84-102;
G-15-21; R-l).
Harold Dark, the CO, testified he measured the distance from the roof to the
cafeteria floor with a surveyor’s rod and found it to be 27 feet, and although Curtis Harvey
questioned Dark in this regard he himself essentially acknowledged the distance from the
roof to the cafeteria floor was greater than 25 feet? (Tr. 73; 102-05). Dark further testified
he saw employees working on the roof when he was at the site, and that while they were in
another area then there were no nets or other means being used to protect against falls
through the roof openings; to his knowledge, this was also the case the day of the accident.
9hese caseshavesincesettled
‘Dark measuredthe distanceby extendingthe rod its full25.foot lengththroughthe hole to the floor, and
the roof wasabout 2 feet higherthan the top of the rod; he also dropped a line throughthe hole to get a
more accuratemeasurement. (Tr. 73; 102-05).
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(Tr. 61-75; 80-81; 100-02). Harvey presented nothing to show CCSI had complied with the
standard the day of the accident; he was also unable to point to anything in CCSI’s safety
manual that addressed fall protection within the context of the standard. (Tr. 25-28; G-l).
Based on the foregoing, the Secretary has shown a violation of 1926.105(a) unless
CCSI is able to prove one of the affirmative defenses recognized by the Commission. In
light of the closing argument of Curtis Harvey, CCSI is contending it was infeasible to use
nets or other fall protection at the site. (Tr. 10840).
The elements an employer must demonstrate to establish the affirmative defense of
infeasibility of compliance were settled by the Commission in 1991 in seibet A&dem Mfg.&
Welding Cop., 15 BNA OSHC 1218,199l CCH OSHD Y 29,442 (No. 88-821,199l). In that
decision, the Commission held the employer must show not only that the abatement methods
prescribed by the standard were infeasible under the circumstances at the site, but also that
an alternative protective measure was used or there was no feasl%le alternative measure.
Id at 1226-28 and pp. 39,682-85.
In view of the record, CCSI has not met its burden of proving that the use safety nets
or other fall protection at the site was infeasl”ble. The only testimonyin this regard was that
of Darvin Scott, one of the employees, who indicated that the workers had to be mobile due
to the nature of the work and that it would have been necessary to remove the ceiling grid
throughout the facility to have put scaffolding or landings under the roof. (Tr. 94-98). This
testimony does not establish the components of infea&lity set out above. Moreover, while
it is evident Curtis Harvey believed that using a safety net or other fall protection at the site
was infeasible, his closing argument was not testimony; even if it had been, it likewise does
not demonstrate infeaslbility of compliance. (Tr. 10840). CCSI was accordinglyin violation
of the standard, this item is affirmed as a serious violation, and the Secretary’s proposed
penalty of $&OOO.OO
is assessed.
Conclusions of Law
1. Respondent, Corporate Compensation & Safety, Inc., is engaged in a business
affecting commerce and has employees within the meaning of section 3(5) of the Act. The
Commission has jurisdiction of the parties and of the subject matter of the proceeding.
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2. Respondent was in serious violation of 29 C.F.R. 6 1926.105(a).
3. Respondent was not in violation of 29 C.F.R. 8 1926.850(i).
Order
On the basis of the foregoing Findings of Fact and Conclusions of Law, it is
ORDERED that:
1. Item 1 of citation 1 is AFFIRMED, and a penalty of $2,000.00 is assessed.
2. Item 2 of citation 1 is VACATED,
Administrative law Judge
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