D.A. Collins Construction Co., Inc. v. Secretary of Labor

Citations: 117 F.3d 691; 1997 CCH OSHD 31,361; 17 OSHC (BNA) 2099; 1997 U.S. App. LEXIS 16156; 1997 WL 359314Docket: 1713

Court: Court of Appeals for the Second Circuit; July 1, 1997; Federal Appellate Court

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D.A. Collins Construction Co. Inc. petitioned for review of an Occupational Safety and Health Review Commission decision, which found the company in violation of the Occupational Safety and Health Act of 1970. Collins argued that the decision lacked substantial evidence and improperly shifted the burden of proof regarding their awareness of the violation and the nature of employee misconduct. The case arose from a fatal incident involving a carpenter, Stan Matusz, who fell to his death while working on a bridge without using required safety measures. Witnesses, including another carpenter and the foreman, confirmed that safety protocols were not followed, as they did not "tie off" while moving on the platform. Although OSHA's investigation did not link the failure to tie off directly to Matusz's fall, it led to a citation for a serious violation. An administrative law judge found Collins in violation of safety regulations, particularly 29 C.F.R. 1926.105(a), and imposed a $3,000 penalty, which Collins later contested. The Commission's denial of Collins's review request rendered the ALJ's decision final.

The Commission's findings of fact must be upheld if supported by substantial evidence from the entire record, as per 29 U.S.C. 660(a). An order can only be overturned if it is deemed arbitrary, capricious, an abuse of discretion, or not in accordance with the law under 5 U.S.C. 706(2)(A). To establish a prima facie serious violation of a safety standard, the Secretary must demonstrate that: 1) the standard applies, 2) its requirements were unmet, 3) employees were exposed to the violative condition, 4) the employer knew or could have known about the condition, and 5) there was a substantial probability of death or serious harm resulting from it. Collins argues that the Commission wrongly placed the burden of proof regarding knowledge of the violative condition on it. However, the Secretary contends that Collins cannot contest this determination because it did not raise the issue in its petition to the Commission for review, as mandated by 29 U.S.C. 660(a), which limits objections not previously urged before the Commission. The court must determine if Collins is barred from arguing the Commission's findings on knowledge were erroneous. The Secretary points out that Collins's petition primarily focused on the rejection of its defense of unforeseeable employee misconduct, while Collins claims it did raise concerns about the Secretary's prima facie case. Nonetheless, the record indicates that Collins did not adequately present this argument to the Commission, thus waiving it on appeal. Additionally, Collins contends that the Commission incorrectly required it to prove the violative condition resulted from unforeseeable employee misconduct, asserting that the Secretary should bear the burden of showing this defense is inapplicable.

Collins did not successfully establish the affirmative defense of "unforeseeable employee misconduct." The Commission aligned with other circuits in requiring employers to prove this defense after the Secretary demonstrates a prima facie violation of the Occupational Safety and Health Act. Collins argued that the Commission's findings lacked substantial evidence but the court upheld the Commission's decision, confirming that the findings were supported by substantial evidence in the record. 

To prove the defense, an employer must show that: (1) work rules were established to prevent violations, (2) these rules were adequately communicated to employees, (3) steps were taken to discover violations, and (4) rules were effectively enforced. While Collins met the first two criteria, the Administrative Law Judge (ALJ) found deficiencies in the third and fourth. Evidence indicated that Collins did not ensure supervisors enforced safety rules, with specific testimony that a supervisor failed to act on violations for an extended period, which undermined claims of effective enforcement. 

The court concluded that Collins waived the argument regarding its knowledge of the violative condition by not raising it during the Commission's discretionary review process. Consequently, the petition for review of the Commission’s decision was denied.

The terms "violative conduct" or "violative condition" are utilized by the Commission and reviewing courts to describe employer actions or workplace conditions that violate duties defined by the Act, as seen in relevant case law. A "serious violation" exists if there is a substantial probability of death or serious physical harm from an employment condition, unless the employer could not reasonably be expected to know of the violation (29 U.S.C. 666(k)). This regulation stems from the "special duty clause" (29 U.S.C. 654(a)(2)), which mandates employer compliance with occupational safety standards. In the absence of specific standards under this clause, the Secretary may invoke the "general duty clause" (29 U.S.C. 654(a)(1)), which requires employers to provide a workplace free from recognized hazards. The term "substantial evidence" in this context aligns with its definition under the Administrative Procedure Act (APA), as clarified by the Supreme Court in American Textile Manufacturers Institute v. Donovan, which referenced similar standards in other statutes. Lastly, Collins mischaracterizes the requirement for the third element, simplistically stating it necessitates only employee training on compliance methods.