Northern Illinois Steel Supply Company

Plain-English summary

Northern Illinois Steel Supply delivered steel to Vulcan Materials' Lemont quarry and its drivers helped unlock and rig the loads for unloading. An MSHA inspector saw a Northern Illinois employee standing on the steel without a safety belt and line, and the company contested the citation by arguing that it was not subject to Mine Act jurisdiction. The Commission held that Northern Illinois was an independent contractor performing services at a mine and therefore an operator under section 3(d) of the Mine Act. It affirmed the judge's decision and the citation under 30 C.F.R. § 56.15005.

Decision snapshot

• Cited standard: 30 C.F.R. § 56.15005.
• Outcome: The judge's decision affirming the citation was affirmed.
• Key point: A company that delivers materials to a mine and performs work closely related to unloading them may be an independent-contractor operator under the Mine Act, even when the mine owner supplies the unloading equipment.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION
1730 K STREET NW, 6TH FLOOR
WASHINGTON, D.C. 20006

                                   February 28, 2001

SECRETARY OF LABOR, :
MINE SAFETY AND HEALTH :
ADMINISTRATION (MSHA) :
:
v. : Docket Nos. LAKE 99-78-RM
: LAKE 99-120-M
NORTHERN ILLINOIS STEEL :
SUPPLY COMPANY :

BEFORE: Jordan, Chairman; Riley, Verheggen, and Beatty, Commissioners

                                      DECISION

BY THE COMMISSION:

    This consolidated contest and civil penalty proceeding arises under the Federal Mine

Safety and Health Act of 1977, 30 U.S.C. § 801 et seq. (1994) (“Mine Act” or “Act”). At issue is
the decision of Administrative Law Judge David F. Barbour to affirm a citation issued to
Northern Illinois Steel Supply Company (“Northern Illinois”) alleging a violation of 30 C.F.R.
§ 56.15005.1 22 FMSHRC 246 (Feb. 2000) (ALJ). The Commission granted Northern Illinois’
petition for discretionary review challenging the judge’s holding that Northern Illinois was an
“operator” under section 3(d) of the Mine Act, 30 U.S.C. § 802(d), and thus subject to the Mine
Act’s jurisdiction. For the reasons that follow, we affirm the judge’s decision.

                                           I.

                          Factual and Procedural Background

     Northern Illinois sells prime domestic steel products such as bars, rods, and plates to

businesses and individuals. 22 FMSHRC at 248; Tr. 9, 11, 28. It is not involved in installation
or fabrication on its customers’ premises. Tr. 52. One of Northern Illinois’ customers is Vulcan
Materials Company (“Vulcan”), a company which operates the Lemont quarry in Romeoville,
Illinois. 22 FMSHRC 247; Tr. 49. The Lemont quarry is a mine subject to the jurisdiction of the

   1
    30 C.F.R. § 56.15005 provides, in pertinent part: “Safety belts and lines shall be worn

when persons work where there is danger of falling . . . .”

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Page 2

Department of Labor’s Mine Safety and Health Administration (“MSHA”). 22 FMSHRC at 247.
Steel is delivered from Northern Illinois’ plant to the quarry on flatbed trucks owned or leased by
Northern Illinois and operated by Northern Illinois drivers. Id. at 248.

    Once the trucks reach the delivery point at the Lemont quarry, the steel is unloaded using

Vulcan-owned and operated equipment. Id. Vulcan uses either a crane with a hoist, a forklift, or
a loader to unload the steel from the truck. Id. at 249. When steel is lifted by a crane, a hook is
attached to the crane’s hoist line to lift the steel from the flatbed truck. Id. Up to and including
the time of the subject inspection, a Northern Illinois driver usually facilitated the unloading
process by walking around the truck and releasing the restraints binding the load. Id.
Occasionally, the driver also climbed onto the loaded flatbed to guide the hook into the lifting
chain surrounding the load, an act described as “rigging” the load. Id. Rigging requires someone
to stand on the steel on the flatbed truck. Tr. 93. Northern Illinois has made steel deliveries to
Vulcan, usually once or twice a week, for approximately two years. 22 FMSHRC at 248. On
each visit to Vulcan’s mine, Northern Illinois employees work approximately 20-30 minutes. Id.
at 247; Joint Ex. 1 ¶5. In 1998, Northern Illinois employees spent a total of 68 hours at Vulcan’s
mine. 22 FMSHRC at 247; Joint Ex. 1 ¶5.

     On January 28, 1999, MSHA inspector Denis Libertoski approached Vulcan’s

maintenance shop and saw a Northern Illinois flatbed truck with a load of steel parked about 100
feet from the shop. 22 FMSHRC at 249. The steel was to be used in building a catwalk,
handrail, and platform at the crusher. Id.; Tr. 68-70. Libertoski observed a man standing on top
of the steel, rigging the load so that it could be lifted from the truck. 22 FMSHRC at 249. As the
inspector walked towards the truck, he saw that the man standing on the steel was not wearing a
safety belt and line. Id. Libertoski talked with the person and determined that he was a Northern
Illinois employee. Id. at 250. Although a Vulcan employee was running the equipment used to
unload the steel and two other miners were in the area, no Vulcan supervisors were present when
Libertoski saw the Northern Illinois employee on the steel. Id. at 249-50; Tr. 145-46, 153, 185.
A Vulcan management official arrived as Libertoski walked towards the truck. 22 FMSHRC at

250. Libertoski cited Northern Illinois for a violation of 30 C.F.R. § 56.15005 because the
     Northern Illinois employee was working without a safety belt and line. Id. Northern Illinois
     contested the citation and related civil penalty on the ground that it was not an “operator” subject
     to the Mine Act’s jurisdiction.

     In affirming the citation, the judge concluded that Northern Illinois was an “operator”
     

     under section 3(d), 30 U.S.C. § 802(d). Id. at 252. The judge noted that, in enacting the Mine
     Act, Congress intentionally expanded the statutory definition of the term “operator” from its
     definition under the Federal Coal Mine Health and Safety Act of 1969, 30 U.S.C. § 801 et seq.
     (1976) (“Coal Act”) to include independent contractors, and that the Secretary retains some
     discretion as to whether a regulation applies to a particular independent contractor. Id. at 250-51.
     He reasoned that, because a Northern Illinois employee drove the steel truck and rigged the steel,
     because Vulcan was not supervising the rigging of the steel, and because Northern Illinois’
     delivery of steel was performed pursuant to its contract with Vulcan, Northern Illinois was an

                                      23 FMSHRC 163
     

Page 3

independent contractor. Id. at 251-52. The judge then applied a two-pronged test — developed
by the Commission in its Otis Elevator Co. decisions, 11 FMSHRC 1896 (“Otis I”), and 11
FMSHRC 1918 (“Otis II”) (Oct. 1989) — used to determine whether an independent contractor
should be deemed an operator for purposes of Mine Act jurisdiction. Under the first prong of
that test, the judge found that Northern Illinois performed a service at the Lemont quarry, and
that the service was closely related to the mining process. Id. at 252. Under the second prong,
the judge found that Northern Illinois had a significant presence at the Lemont quarry. Id.

                                            II.

                                       Disposition

     Northern Illinois maintains that the judge erroneously concluded that it was performing a

service by delivering its products to Vulcan. PDR at 6-7. Northern Illinois also claims that the
judge, in finding that the services Northern Illinois performed were closely tied to Vulcan’s
mining process, erred by focusing on the eventual use of the steel delivered rather than the
relationship between the work Northern Illinois employees performed and the mining process.
Id. at 7.2

    The Secretary responds that the judge correctly determined that Northern Illinois was

performing a service at the Lemont quarry on the day the citation was issued. S. Resp. Br. at 8­

10. The Secretary also argues that, under any of the various legal tests that have been used by the
    Commission and the courts to determine independent contractor-operator status under section
    3(d) of the Mine Act, Northern Illinois is an independent contractor-operator. Id. at 10-20.

    A. Whether Northern Illinois is an Independent Contractor

    The Mine Act regulates each coal or other mine affecting commerce and “each operator
    

    of such mine.” 30 U.S.C. § 803. Section 3(d) of the Act defines “operator” as “any owner,
    lessee or other person who operates, controls, or supervises a . . . mine or any independent
    contractor performing services or construction at such mine.” 30 U.S.C. § 802(d). The
    definition of “operator” in section 3(d) of the 1969 Coal Act did not expressly include
    independent contractors. As the Commission has noted, Congress’ inclusion of language in
    section 3(d) to include independent contractors under the definition of “operator” represents an
    intentional expansion in the coverage of that statutory term. Bulk Transp. Servs., Inc., 13
    FMSHRC 1354, 1357 (Sept. 1991).

    Our first inquiry is thus to determine whether Northern Illinois is an independent
    contractor under the Mine Act. The term “independent contractor” is not defined in the Act, but
    MSHA regulations define “independent contractor” as “any person, partnership, corporation,

    2
    Aside from disputing the judge’s conclusion that it is an operator, Northern Illinois
    does not contest the finding of violation or the significant and substantial designation.

                                    23 FMSHRC 164
    

Page 4

subsidiary of a corporation, firm, association or other organization that contracts to perform
services or construction at a mine.” 30 C.F.R. § 45.2(c). In ascertaining whether a company is
an independent contractor of a mining company, the Commission and courts have focused on the
nature of the relationship between the mine and its alleged contractor. See Joy Techs., Inc. - Coal
Field Operations, 17 FMSHRC 1303, 1306 (Aug. 1995), aff’d, 99 F.3d 991, 996 (10th Cir.
1996); Joy Techs., Inc. v. Sec’y of Labor, 99 F.3d 991, 996 (10th Cir. 1996). Under this
precedent, the determination whether a company is considered an independent contractor
depends on the nature and extent of services the company performed at a mine. Joy, 17
FMSHRC at 1306 (concluding that Joy was an independent contractor by virtue of its services
performed at a mine); Joy, 99 F.3d at 998 (deferring to MSHA’s interpretation that “independent
contractor status is to be based . . . on the performance of significant services at the mine”).

    In the instant matter, Northern Illinois does not challenge the judge’s finding that its

employees hauled loads of steel once or twice a week onto Vulcan’s property, or his finding that
Northern Illinois’ employees usually got out of the truck and unlocked the chain holding down
the steel. Also, on the day the citation issued — and on prior occasions — a Northern Illinois
truck driver helped to rig a load of steel for unloading. 22 FMSHRC at 249, 252; Tr. 177.
Further, the judge credited Libertoski’s testimony that Northern Illinois’ delivery and assistance
in unloading steel was work which Vulcan would have had to perform had Northern Illinois not
acted. 22 FMSHRC at 252.3 We therefore conclude that the activities of Northern Illinois’
employees at the Lemont Quarry taken as a whole, including delivery, unlocking, and unloading
of steel for Vulcan’s benefit fall within the meaning of “services” as used in section 45.2(c) and
provide substantial evidence to support the judge’s determination that Northern Illinois is an
independent contractor under section 3(d).4

   B.      Whether Northern Illinois is an “Operator”

    In Otis I and Otis II, the Commission set forth a two-pronged test to determine whether

an independent contractor comes under the Mine Act’s definition of “operator.” First, we
examined the independent contractor’s proximity to the extraction process and whether its work
is “sufficiently related” to that process. Otis I, 11 FMSHRC at 1902. Second, we examined “the

   3
      Terry Croxford, manager of construction projects for Vulcan, also testified that, if

Northern Illinois had not delivered the steel to the Lemont quarry, Vulcan would have had to buy
or lease a flatbed truck or contract with a third party for hauling services. Tr. 40-41, 97-98.
4
We are also not persuaded by Northern Illinois’ contention (N. Br. at 7) that its delivery
of steel and periodic assistance in the steel’s unloading constituted only completion of a sale of
its own products rather than a service. The Commission and the Tenth Circuit have held that a
company’s performance of work in connection with a sale may constitute “services” that qualify
the company as an independent contractor under the Act. See Joy, 17 FMSHRC at 1304, 1306;
Joy, 99 F.3d at 999.

                                     23 FMSHRC 165

Page 5

extent of [the contractor’s] presence at the mine.” Id. As part of the second prong of this test,
we have looked to whether the contractor’s contact with the mine is de minimis. Id. at 1900-01.

    In analyzing Northern Illinois’ proximity to the extraction process — the first prong of

the Commission’s test — we observe that Croxford testified that steel, such as that regularly
delivered by Northern Illinois, “basically holds everything together” and that the Lemont quarry’s
conveyors, crushers, and the platforms surrounding and supporting them are all made of steel.
Tr. 44-45, 47-49. Croxford also testified that the steel delivered on the day the citation issued
was to be used on several projects at the Lemont quarry, including building a catwalk, a handrail,
and a platform at the crusher. Tr. 68-70.

    Northern Illinois’ involvement at the Lemont quarry is comparable to the involvement of

operators in other cases in which we have determined that the cited independent contractor was
an operator under section 3(d). For instance, in our Otis I decision, we stated: “We are satisfied
that a mine elevator used for daily transport of the work force into and out of the mine has a
sufficient proximity in nature and purpose to the extraction process to be fairly considered . . . ‘an
essential ingredient involved in [that] process.’” 11 FMSHRC at 1902 (alterations in original)
(citations omitted). And in Lang Bros., Inc., we held that, “[i]n cleaning and plugging the gas
wells, Lang performed services clearly related to the extraction process.” 13 FMSHRC 413, 420
(Sept. 1991) (published Mar. 1992). Thus, although the services performed by the contractors in
Otis and Lang Bros. did not directly involve extraction, we held that they were nonetheless a
necessary part of the extraction process. Accordingly, we conclude that substantial evidence
supports the judge’s finding that the services Northern Illinois provided are sufficiently close to
the extraction process to satisfy the first prong of the Commission’s operator test.

    Northern Illinois’ frequent visits to the Lemont quarry and the services it provided there

to Vulcan also support the judge’s finding that the extent of Northern Illinois’ presence at the
mine satisfied the second prong of the test. 5 It is uncontroverted that Northern Illinois delivered
steel, unlocked the restraints on the flatbed truck, and assisted in unloading the steel at the
Lemont quarry for 20-30 minute increments, once or twice each week on the mine site, for a total
of 68 hours during calendar year 1998. Such involvement is comparable to the involvement of
other independent contractors we have determined satisfied the second prong of our operator test.
For example, in Joy we determined that the company’s four reported visits to a mine over a ten-
week period constituted a sufficient presence at the mine to satisfy the second prong. 17
FMSHRC at 1304, 1308.

   In Lang Bros., we held that the contractor’s one-time performance of services for seven to

ten days was more than de minimis. 13 FMSHRC at 420. We also concluded that an

   5
      Frequency of visits to a mine is certainly a material factor to consider whether a

particular enterprise’s involvement at the mine is “more than de minimis.” However, frequency
alone is not determinative of that question or we would be sweeping parcel courier services and
the local pizza delivery shop under the coverage of the Mine Act.

                                     23 FMSHRC 166

Page 6

independent contractor’s presence at a mine “may appropriately be measured by the significance
of its presence, as well as by the duration or frequency of its presence,” and found that the
importance of the contractor’s services to the extraction process along with its “blanket contract”
with the mine to clean and plug gas wells, satisfied the second prong of the Commission’s
operator test. Id. In this proceeding, the steel delivered by Northern Illinois is vital to the
construction and repair of Vulcan’s facilities used in the extraction operation. We also observe
that the actions of Northern Illinois’ employees along with the frequency of their visits to the
mine site contribute to a presence at the Lemont quarry that is more than de minimis. See Nat’l
Indus. Sand Ass’n v. Marshall, 601 F.2d 689, 701 (3d Cir. 1979).

    The courts of appeals for the Tenth and D.C. Circuits have articulated a different

approach to the determination whether an independent contractor is an operator under the statute.
In Otis Elevator Co. v. Sec’y of Labor, 921 F.2d 1285 (D.C. Cir. 1990), and Joy, 99 F.3d 991, the
Tenth Circuit and D.C. Circuits held that section 3(d), “by its terms . . . extends to ‘any
independent contractor performing services . . . at [a] mine.’” Otis, 921 F.2d at 1290 (quoting 30
U.S.C. § 802(d) (emphasis added)); see Joy, 99 F.3d at 999 (“[T]he definition of ‘operator’ in
section 3(d) of the Mine Act is clear and means just what it says — an operator includes ‘any
independent contractor performing services . . . at [a] mine.’”). Thus, under the reasoning of the
courts of appeals in Otis and Joy, once a company is determined to be an independent contractor
performing services at a mine, it qualifies as an operator under section 3(d). Under the rationale
of the Otis and Joy court of appeals decisions, because we have determined that Northern Illinois
is an independent contractor, it follows that the company is necessarily an operator under section
3(d). See Joy, 99 F.3d at 999-1000; Otis, 921 F.2d at 1289-91.

    Treating Northern Illinois as an operator under the Mine Act is fully consistent with the

remedial purposes of the Act. As we have previously stated, “such questions of statutory
coverage must be resolved within the Act’s overall purpose of protecting miners’ safety and
health.” W.J. Bokus Indus., Inc., 16 FMSHRC 704, 708 (Apr. 1994) (citing Donovan v. Carolina
Stalite Co., 734 F.2d 1547, 1553-55 (D.C. Cir. 1984)); see also 30 U.S.C. § 801 (stating that goal
of Mine Act is to prevent death and injury to any individual working at a mine); Sec’y of Labor v.
Cannelton Indus., Inc., 867 F.2d 1432, 1437 (D.C. Cir. 1989) (stating that Congress “intended
the [Mine] Act to be liberally construed” to protect the health and safety of miners). Here,
Libertoski testified that there was a potential that the Northern Illinois worker could have fallen
from the load of steel on which he was standing at the time the citation issued, a potential
exacerbated by the cold, wet conditions present at that time. Tr. 144. Also, Croxford and
Libertoski testified that if unloading steel is performed incorrectly, the load could fall to the
ground, potentially injuring miners or other people below. Tr. 100, 142. Thus, interpreting
section 3(d) to cover Northern Illinois under the particular facts of this case fully adheres to the
principle that the Mine Act should be construed to protect miner safety.

                                    23 FMSHRC 167

Page 7

   In sum, based on the totality of the circumstances presented here, we affirm as supported

by substantial evidence the judge’s conclusion that Northern Illinois is an independent
contractor-operator under section 3(d) of the Mine Act.6

                                           III.

                                      Conclusion

   For the foregoing reasons, we affirm the judge’s decision.




                                        Mary Lu Jordan, Chairman




                                        James C. Riley, Commissioner




                                        Theodore F. Verheggen, Commissioner




                                        Robert H. Beatty, Jr., Commissioner




   6
      What is not at issue here, and therefore beyond the scope of this decision, is the

incidental presence at a mine of delivery personnel or drivers who are not exposed to mining
hazards, such as the danger of falling encountered here.

                                   23 FMSHRC 168

Page 8

Distribution

Adriana I. Reyes-Villanueva, Esq.
Theodore J. Tierney, Esq.
Vedeer, Price, Kaufman & Kammholz
222 North LaSalle St., Suite 2600
Chicago, IL 60601

Jerald S. Feingold, Esq.
Office of the Solicitor
U.S. Department of Labor
4015 Wilson Blvd., Suite 400
Arlington, VA 22203

Chief Administrative Law Judge David Barbour
Federal Mine Safety & Health Review Commission
1730 K Street, N.W., Suite 600
Washington, D.C. 20006

                                23 FMSHRC 169