Joy Technologies Inc. - Coal Field Operations (Commission decision, August 14, 1995)

Plain-English summary

Joy Technologies provided mining equipment and service support at Somerset Mining Company's underground Sanborn Creek Mine. A Joy service representative visited the mine regularly, worked with essential mining equipment, and operated a continuous miner during an assembly task without the required annual refresher training. The Commission held that Joy was an independent contractor-operator under the Mine Act because its services were sufficiently related to extraction and its mine contacts were more than de minimis. It affirmed the finding that Joy was liable for the training violation and the $100 civil penalty.

Decision snapshot

• Cited standard(s): 30 C.F.R. § 48.28(a)
• Outcome: The ALJ decision finding Joy liable as an independent contractor-operator and assessing a $100 penalty was affirmed.
• Key point: An independent contractor may qualify as a mine operator when its services are closely related to extraction, expose its employees to mine hazards, affect miner safety, and involve more than de minimis mine contact.

Full text (FMSHRC public release)

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

August 14, 1995

SECRETARY OF LABOR,
:
MINE SAFETY AND HEALTH
:
ADMINISTRATION (MSHA)
:
:
v. : Docket No. WEST 93-129
:
JOY TECHNOLOGIES INC. -
:
COAL FIELD OPERATIONS
:

BEFORE: Jordan, Chairman; Doyle, Holen and Marks, Commissioners

DECISION

BY: Jordan, Chairman; Doyle and Holen, Commissioners

This civil pena lty proceeding a rises u nder the Federa l M ine Sa fety a nd Hea lth A ct of 1977, 30 U.S.C. § 801 et seq. ( 1988) ( "M ine A ct" or "A ct"). It presents the issu es of w h ether Joy Technolog ies Inc. - Coa l Field Opera tions ( "Joy") is a n independent contra ctor- opera tor w ithin the m ea ning of section 3( d) of the M ine A ct, 30 U.S.C. § 802( d),1 a nd, if so, w h ether it w a s lia ble for a viola tion of 30 C.F.R. § 48.28.2 Com m ission A dm inistra tive La w Ju d g e Gary Melick concluded that Joy was an operator under the Mine Act and that it was liable for the

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Section 3( d) of the M ine A ct provides:

"opera tor" m ea ns a ny ow ner, lessee, or other person w h o opera tes, controls, or su pervises a coa l or other m ine or a ny inde- pendent contra ctor perform ing services or constru ction a t su ch m ine[.]

30 U.S.C. § 802( d).
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Section 48.28(a), which implements the refresher training requirement of section 115(a) of the Mine Act, 30 U.S.C. § 825(a), provides: "Each miner shall receive a minimum of 8 hours of annual refresher training as prescribed in this section." Section 115(a) of the Mine Act provides in part: "all miners shall receive no less than eight hours of refresher training no less frequently than once each 12 months . . . ." 30 U.S.C. § 825(a).

violation. 15 FMSHRC 2147 (October 1993) (ALJ). The Commission granted Joy's petition for discretionary review. For the reasons that follow, we affirm the judge's decision.

I.

Factual and Procedural Background

Joy manufactures, sells and services mining equipment, and has provided equipment to Somerset Mining Company for use at its Sanborn Creek Mine, a n u nderg rou nd coa l m ine. 15 FM SHRC a t 2147. Joy em ploys service representa tives w h o, a fter a n equ ipm ent sa le, provide follow - u p services to cu stom ers. Id. a t 2147- 4 8; Tr. 13.

D ixson M cElha nnon is the Joy service representa tive for the Sa nborn Creek M ine. 15 FM SHRC a t 2148. His responsibilities inclu de a ssu ring tha t equ ipm ent is delivered in proper condition, a dvising a nd a ssisting in a ssem bly a nd repa irs, a nd procu ring necessa ry pa rts. Id. a t 2 147- 4 8; Tr. 13- 14, 34- 35, 43- 4 4 . He "trou bleshoots" when problem s a rise w ith Joy equ ipm ent. 15 FM SHRC a t 2148; Tr. 13. M cElha nnon perform s services both on the su rfa ce a nd u nderg rou nd. Tr. 36; Stip. 10 ; Ex. M - 2 . Consistent with Joy's policy, McElhannon=s service calls at Sanborn Creek Mine continued after the warranties on Joy equipment expired. 15 FMSHRC at 2148; Tr. 46.

Service reports filed by M cElha nnon show tha t, du ring the 2 2 m onth period from Ja nu a ry 24 throu g h A pril 7, 1992, he visited the m ine on a t lea st fou r occa sions, tw ice for tw o- d a y periods, for a tota l of six da ys. 15 FM SHRC a t 2148- 50 . McElhannon also visited the mine on other occasions but did not prepare a report. Id. at 2148.

D u ring his visit on M a rch 2 a nd 3, M cElha nnon a ssisted in the u nloa ding of tw o new shu ttle ca rs. Id. a t 2149. He check ed the ca rs to ensu re tha t they w ere in w ork ing condition, provided technica l a ssista nce in identifying a problem w ith one of the ca rs, a nd obta ined a repla cem ent pa rt. Id.

On April 6, 1992, he visited the mine to oversee the unloading and assembly of a new Joy continuous miner and to ensure that it worked properly when assembled. Id. at 2149-50; Tr. 31-

32. After unloading, the miner was taken in sections to the maintenance shop; assembly of the
    miner began on April 7. 15 FMSHRC at 2150. While assisting in the assembly, McElhannon operated the remote control to move the mining machine so that the maintenance workers could insert pins. Id.

    That same day, Inspector Larry Ramey from the Department of Labor's Mine Safety and
    

    Health Administration ("MSHA") arrived in the shop to continue his inspection of the mine. Tr. 62-63; 15 FMSHRC at 2150. At that time, the maintenance workers were having some difficulty with the equipment=s hydraulic system. Tr. 64-65, 106-07. Ramey observed McElhannon at the remote controls, raising and lowering the cutter head. Tr. 64-65. A coal miner was standing in front of the head while it was being raised and lowered. 15 FMSHRC at 2150; Tr. 63-65. Ramey

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believed that the equipment operator was endangering the safety of that miner; the inspector was primarily concerned that the head could become energized and strike the employee, causing his death. Tr. 63-64. Ramey determined that McElhannon had not received refresher training within the preceding year and issued Order No. 3581501, which required the withdrawal of McElhannon from the mine pursuant to section 104(g)(1) of the Mine Act,3 30 U.S.C. § 814(g)(1). 15 FMSHRC at 2148; Tr. 66, 71; Ex. M-3.

Follow ing a n evidentia ry hea ring , the ju d g e conclu ded tha t Joy w a s a n independent contra ctor- opera tor su bject to lia bility u nder the M ine A ct. 15 FM SHRC a t 2150 - 52. He ba sed his determ ina tion on Joy' s perform a nce of "continu ing services in connection w ith . . . contra cts of sa le." Id. a t 2151. The ju d g e a lso fou nd tha t "Joy' s representa tive w a s . . . perform ing lim ited bu t necessa ry services a t the Sa nborn Creek M ine . . . ." Id. Relying on section 3( d) of the A ct, on Otis Eleva tor Co. v. Secreta ry of La bor, 921 F.2d 1285 ( D .C. Cir. 1990), a nd on the Com m ission' s decisions in Bu lk Tra nsporta tion Services, Inc., 13 FM SHRC 1354 ( Septem ber 1991), a nd La ng Brothers, Inc., 14 FM SHRC 413 ( Septem ber 1991), the ju d g e conclu ded tha t, beca u se Joy w a s providing essentia l services closely rela ted to the extra ction process, Joy' s presence a t Sa nborn Creek M ine w a s su fficient to m a k e Joy a n opera tor w ithin the m ea ning of Section 3( d) of the A ct. 15 FM SHRC a t 2151- 52.

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Section 104( g )( 1) of the M ine A ct provides in pa rt:

If . . . the Secreta ry . . . sha ll find em ployed a t a . . . m ine a m iner who ha s not received the requ isite sa fety tra ining a s determ ined u nder section 115 of this A ct, the Secreta ry . . . sha ll issu e a n order u nder this section w h ich decla res su ch m iner to be a ha za rd to him self a nd to others, a nd requ iring tha t su ch m iner be im m edia tely w ithdra w n from the . . . m ine, a nd be prohibited from entering su ch m ine u ntil . . . the Secreta ry determ ines tha t su ch m iner ha s received the tra ining requ ired by section 115 of this A ct.

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The ju d g e a lso fou nd tha t, beca u se M cElha nnon ha d not received a nnu a l refresher tra ining , Joy ha d viola ted section 48.28( a ). Id. a t 2152. He conclu ded tha t the viola tion w a s not sig nifica nt a nd su bsta ntia l a nd a ssessed a civil pena lty of $10 0 . Id.

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II.

D isposition

A . W hether Joy is a n Independent Contra ctor

Joy a sserts tha t it is not a n independent contra ctor w ithin the m ea ning of section 3( d) of the M ine A ct. It relies on the definition of independent contra ctor set forth in 30 C.F.R. ' 45.2 4 a nd a rg u es tha t it ha s not contra cted to perform services a t Sa nborn Creek M ine. J. Br. a t 9- 11. The Secreta ry responds tha t section 3( d) of the M ine A ct does not requ ire the existence of a contra ct to esta blish independent contra ctor- opera tor sta tu s. S. Br. a t 22 n.8.

W e reject Joy' s a rg u m ent tha t the a bsence of a service contra ct preclu des a finding tha t Joy is a n independent contra ctor. In Bulk, the Commission stated:

Our focus is on the actual relationships between the parties, and is not confined to the terms of their contracts. . . . [T]he deter- mination of whether a party is properly designated to be within the scope of section 3(d) of the Act is not based upon the existence of a contract, nor the terms of such a contract.

13 FMSHRC at 1358 n.2. M oreover, it is settled la w tha t a n entity m a y be held to be a n independent contra ctor ba sed on its perform a nce of w ork "in connection w ith, or for the

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Section 45.2 sta tes:

A s u sed in this pa rt:

....

( c) Independent contra ctor m ea ns a ny person, pa rtnership, corpora tion, su bsidia ry of a corpora tion, firm , a ssocia tion or other org a niza tion tha t contra cts to perform services or constru ction a t a m ine . . . .

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pu rpose of ca rrying ou t, the contra ct of sa le . . . ." 41 A m .Ju r.2d, Independent Contra ctors ' 18. W e conclu de tha t the reg u la tion' s reference to "contra cts to perform services" is not restricted to w ritten contra cts a nd encom pa sses services perform ed incident to a contra ct of sa le. A ccording ly, w e a ffirm the ju d g e' s conclu sion tha t Joy is a n independent contra ctor.

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B. W hether Joy is a n Opera tor

The pa rties a lso disa g ree on the a ppropria te sta nda rd for determ ining opera tor sta tu s u nder section 3( d) of the M ine A ct. A sserting tha t it provided only lim ited services a t Sa nborn Creek M ine a nd, therefore, w a s not a n opera tor, Joy a rg u es tha t the Com m ission ca ses cited by the ju d g e w ere w rong ly decided. J. Br. a t 11- 2 0 . Relying on the decision of the United States Court of Appeals for the Fourth Circuit in Old Dominion Pow er Co. v. D onova n, 772 F.2d 92 ( 1985), in which the court held that a power company that installed, maintained and read an electric meter monthly at a substation separated by a chain link fence from the rest of the mine property was not an operator within the meaning of section 3(d), Joy urges the Commission to adopt a narrow definition of operator. J. Br. at 15-22.

The Secretary responds that the Commission should adopt the broad definition of operator set forth by the United States Court of Appeals for the D.C. Circuit in Otis Elevator Co. v. Secretary of Labor, i.e., tha t section 3( d)' s reference to "a ny" independent contra ctor perform ing services a t a m ine "m ea ns ju st tha t - - a ny independent contra ctor . . . ." S. Br. a t 8- 9 , qu oting 921 F.2d a t 1290 ( footnote om itted) ( em pha sis in orig ina l). In the alternative, the Secretary contends that, in light of the frequency of McElhannon's visits to the mine, his travels under- ground, and the importance of his work to the mining and transporting of coal at Sanborn Creek Mine, Joy is an independent contractor-operator either under the Commission's line of cases interpreting the term "operator" or under Old Dominion. S. Br. at 13-20.

As the Commission has noted, section 3(d) of the Mine Act expanded the definition of "operator" contained in the Federal Coal Mine Health and Safety Act of 1969, 30 U.S.C. § 801 et seq. (1976) (amended 1977), to include "any independent contractor performing services or construction at such mine." E.g., Bulk Transportation, 13 FMSHRC at 1357. In the Otis Elevator Co. cases, 11 FMSHRC 1896 (October 1989) ("Otis I ") and 11 FMSHRC 1918 (October 1989) ("Otis II "), aff'd on other grounds, 921 F.2d 1285, the Commission set forth a two-pronged test for determining whether an independent contractor may be considered an operator under section 3(d). First, "the independent contractor's proximity to the extraction process" and whether its work is "sufficiently related" to that process are examined. Otis I at 1902. The Commission has found a contractor's activity to be sufficiently related to the extraction process where its employees are exposed to mining hazards and have "a direct effect on the safety of others . . . ." Id. Second, the Commission examines "the extent of [the contractor's] presence at the mine." Otis I, 11 FMSHRC at 1902. The Commission has formulated this test as whether the contractor's "contacts with the . . . mine were not so rare, infrequent, and attenuated as to bring this case within the holding of Old Dominion . . . ." Otis II, 11 FMSHRC at 1922-23. As the Commission noted in Otis I, "there may be a point . . . at which an independent contractor's contact with a mine is so infrequent or de minimis that it would be difficult to conclude that services were being performed." 11 FMSHRC at 1900-01, quoting National Indus. Sand Ass'n v. Marshall, 601 F.2d 689, 701 (3d Cir. 1979).

W e conclu de tha t Joy's presence a t Sa nborn Creek M ine w a s su fficient to sa tisfy the test set forth in the Com m ission=s Otis ca ses a nd their prog eny. A s to the first prong of the

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a na lysis, the parties stipulated that the continuous miner is an "essential piece of mining equipment." Tr. 34; Stip. 5. McElhannon testified that the Joy shuttle cars used at the mine are essential to the mining process. Tr. 41. W e a g ree w ith the ju d g e tha t, in trou bleshooting problem s w ith the Joy continu ou s m iner a nd shu ttle ca rs, providing technica l a ssista nce rela ted to the u nloa ding , a ssem bly a nd opera tion of Joy equ ipm ent, a nd secu ring needed pa rts, Joy' s representa tive eng a g ed in a ctivities essentia l to the extra ction process. Coa l cou ld not be m ined w ithou t the continu ou s m iner a nd shu ttle ca rs. The first prong is a lso sa tisfied beca u se, in perform ing his service w ork in the m a intena nce shop a nd u nderg rou nd, M cElha nnon w a s exposed to the ha za rds of the Sa nborn Creek M ine a nd his w ork directly a ffected the sa fety of m iners. The w ithdra w a l order w a s issu ed beca u se Inspector Ra m ey believed tha t M cElha nnon' s opera tion of the continu ou s m iner w a s enda ng ering the sa fety of a n em ployee w ork ing nea rby. W e conclu de tha t su bsta ntia l evidence su pports the ju d g e=s determ ina tion tha t Joy's w ork is su fficiently rela ted to the extra ction process to sa tisfy the first prong of the Com m ission=s opera tor test.

As to the second prong of the test, Joy's contacts with the mine were more than de minimis. McElhannon visited Sanborn Creek Mine regularly. He spent at least six days at the mine during a 2 2 month period, and his contacts could be expected to continue. Joy was present at the mine at least as frequently as the contractors in Otis I (six hours per month) and Lang Bros. (seven to ten days on a non-continuing basis). As the judge concluded, Joy's contacts were sufficient to establish that services were being performed. 15 FMSHRC at 2151. Moreover, in Lang Bros., the Commission explained that "[a]n 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." 14 FMSHRC at 420. We conclude that substantial evidence supports the judge's determination that Joy's presence at Sanborn Creek Mine also satisfies the second prong of the Commission's operator test.

W e a re not persu a ded by Joy' s a rg u m ent tha t, ba sed on Old Dom inion, w e shou ld na rrow ly constru e the term "opera tor." In Old Dom inion, the court set forth a two-part test for determining whether a contractor is an operator under the Mine Act: whether the contractor is "engaged in the extraction process" and whether it has a "continuing presence at [a] mine." 772 F.2d at 96-97.

In Otis I, the Commission declined to construe Old Dominion narrowly, stating:

To adopt . . . [a] restrictive interpretation of Old Dominion . . . would . . . frustrate Congress' clear intent, when it expanded the definition of "operator" in the Mine Act, to broaden and facilitate direct regulation of independent contractors on mine property.

11 FMSHRC at 1901-02. The Commission's interpretation of Old Dominion is consistent with recent case law in the Fourth Circuit. In United Energy Services, Inc. v. MSHA, 35 F.3d 971 (4th Cir. 1994), decided after the filing of the briefs in this case, the court did not narrowly construe the term Aoperator.@ The contractor in United Energy maintained a conveyor belt, a small portion

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of which was located on mine property, that was used to transport coal waste to an adjacent power plant. Id. at 973. The court stated:

[T]he activities of United Energy's employees are part of the coal preparation process and thus are sufficiently a part of the mining process to qualify United Energy as an independent contractor covered by the Act. We therefore conclude that United Energy had contacts with the mine site of sufficient frequency and of such a nature as to meet those requirements for being an "independent contractor" performing services at a coal mine. Cf. Otis Elevator Co. v. Secretary of Labor, 921 F.2d 1285, 1290-91 (D.C. Cir.
1990) (interpreting statutory language to include any independent contractor performing services at a mine).

Id. at 976 (emphasis in original).

In lig ht of ou r disposition, w e do not rea ch the Secreta ry' s a rg u m ent tha t the
Com m ission shou ld a dopt the opera tor test set forth by the D .C. Circu it in its decision a ffirm ing Otis I a nd II. Clea rly Joy w ou ld be a sta tu tory opera tor u nder tha t test.

C. Joy' s Other Contentions

W e reject Joy' s contention tha t it shou ld not be held to ha ve viola ted ' 48.28( a )
beca u se it cou ld not ha ve provided the necessa ry tra ining . A s the Secreta ry points ou t, Joy m a y a rra ng e w ith Sa nborn Creek M ine to provide the tra ining , a s w a s done to a ba te the cited viola tion. S. Br. a t 22- 23 . Nor does Joy's lia bility for the viola tion in this ca se a u tom a tica lly su bject it to lia bility for a ll hea lth a nd sa fety viola tions a t the m ine, a s Joy a rg u es. J. Br. a t 2 1- 2 2 . The Secreta ry notes tha t, "[i]f a reg u la tion perta ins to a m a tter over w h ich Joy a nd its em ployees tru ly ha ve no control, there is no rea son to expect tha t Joy w ou ld be held responsible for a viola tion of tha t reg u la tion." S. Br. a t n.10 . See a lso III M SHA Prog ra m Policy M a nu a l 6 ( "som e provisions of the A ct, sta nda rds or reg u la tions m a y not be directly a pplica ble to independent contra ctors or their w ork "). In a ny event, Joy m a y cha lleng e fu tu re cita tions if it believes the ow ner- opera tor shou ld ha ve been the object of the Secreta ry' s enforcem ent a ction. "[T]he Com m ission ha s recog nized tha t its review of the Secreta ry' s a ction in citing a n opera tor is a ppropria te to g u a rd a g a inst a bu se of discretion." W - P Coa l Co., 16 FM SHRC 1407, 1411 ( Ju ly 1994) ( cita tions om itted).5
5
In its Petition, Joy also assigned as error the judge's failure to address its contention that McElhannon was not a "miner." Pet. at 9. We do not address this issue because Joy did not argue it in its brief. See Asarco Mining Co., 15 FMSHRC 1303, 1304 n.3 (July 1993).

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III.

Conclu sion

For the foreg oing rea sons, w e a ffirm the ju d g e' s decision.

________
Mary Lu Jordan, Chairman

________
Joyce A. Doyle, Commissioner

________
Arlene Holen, Commissioner

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Com m issioner M a rc Lincoln M a rk s, concu rring :

I concu r in the resu lt rea ched by m y collea g u es in this ca se; how ever, I rea ch tha t com m on resu lt by m ea ns of a different a na lytica l pa th.

Specifica lly, in m y view , the D .C. Circu it' s opinion in Otis Eleva tor Co. v. Secreta ry of La bor, 921 F.2d 1285 ( D .C. Cir. 1990) ( "Otis Eleva tor") represents the m ost rea soned a pproa ch to interpreting the term "opera tor" u nder section 3( d) of the M ine A ct, 30 U.S.C. § 802( d). The D .C. Circu it in Otis Eleva tor strictly constru ed section 3( d) of the M ine A ct, w h ich provides tha t the term "opera tor" inclu des "a ny independent contra ctor perform ing services . . . a t [a ] m ine." Section 3( d) of the M ine A ct ( em pha sis a dded). The cou rt sta ted tha t "a ny" m ea nt "a ny independent contra ctor perform ing services a t a m ine." 921 F.2d a t 1290, qu oting Section 3( d) of the M ine A ct ( em pha sis in orig ina l). The D .C. Circu it fou nd no w a rra nt in the pla in la ng u a g e of the A ct, or in the leg isla tive history, for dilu ting the term "a ny." Id.; c.f. Old D om inion Pow er Co. v. D onova n, 772 F.2d 92 ( 4th Cir. 1985); Bu lk Tra nsporta tion Services, Inc., 13 FM SHRC 1354 ( Septem ber 1991); La ng Brothers, Inc., 14 FM SHRC 413 ( Septem ber 1991); Otis Eleva tor Co., 11 FM SHRC 1896 ( October 1989); a nd Otis Eleva tor Co., 11 FM SHRC 1918 ( October 1989). Neither do I. A long w ith the D .C. Circu it, I lea ve open the qu estion of whether there is a ny point a t w h ich a n independent contra ctor' s "conta ct w ith a m ine is so infrequ ent or de m inim is tha t it w ou ld be difficu lt to conclu de tha t services w ere being perform ed." 921 F.2d a t 1290, n.3.

In m y view , this ca se presents the Com m ission w ith a n opportu nity to a lig n its interpreta tion of this section of the M ine A ct w ith tha t set forth in Otis Eleva tor. In contra st to m y collea g u es, I ta k e this opportu nity a nd a dopt Otis Eleva tor. A pplying Otis Eleva tor, I conclu de tha t the record a m ply su pports the ju d g e' s determ ina tion tha t Joy, a n independent contra ctor,6 w a s perform ing services a t a m ine. Specifica lly, the record revea ls tha t Joy' s representa tive: ( 1) w a s trou bleshooting problem s w ith the Joy shu ttle ca r a nd continu ou s m iner; ( 2 ) provided technica l a ssista nce rela ted to the u nloa ding , a ssem bly, a nd opera tion of Joy equ ipm ent; ( 3) secu red needed pa rts; a nd ( 4) opera ted a continu ou s m iner in a w a y tha t resu lted in the insta nt cita tion. Su ch a ctivities clea rly constitu te the perform a nce of services a t a m ine by a n independent contra ctor.

Fina lly, I a g ree com pletely w ith the a na lysis em ployed by m y collea g u es in rejecting Joy's im possibility defense. See slip op. a t 7.

M a rc Lincoln M a rk s

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For the rea sons set forth by m y collea g u es, I a g ree tha t Joy is a n independent contra ctor. See slip op. a t 4.

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