Opinion ID: 2764895
Heading Depth: 2
Heading Rank: 3

Heading: Application: The ALJ’s order

Text: It remains for us to apply our understanding of ORS 654.086(2) to the final order at issue in this case. The ALJ determined that “there was sufficient time for Vorhof to observe either or both the workers subject to the citations and that constructive knowledge was established.” In reaching that conclusion, the ALJ correctly quoted from the statute and appears to have correctly construed whether employer “could not    know” to refer to what employer was capable of knowing or discovering. What is not clear is how the ALJ interpreted or applied the “reasonable diligence” element. 598 OR-OSHA v. CBI Services, Inc. As earlier noted, the term “reasonable diligence” in ORS 654.086(2) is delegative in nature. That means that we ordinarily review an agency’s interpretation and application of the term to determine whether they comport with the range of discretion afforded the agency under the law. Springfield Education Assn., 290 Or at 229. That may be accomplished by administrative rule or by adequate explanation in a final agency order following adjudication. See Salem Firefighters Local 314, 300 Or at 667-68 (Although “[d]elegated policy most obviously occurs when the terms of a statute    authorize and direct the adoption of regulations,    statutory terms often leave important value judgments for direct application without prior specification by rules.”). In this case, however, neither has occurred. The term has not been fleshed out by administrative rule. Nor does the ALJ’s order explain how he arrived at the conclusion that employer could have known of Crawford’s violation had it exercised reasonable diligence. In that regard, this case parallels what happened in McPherson. In that case, an Employment Division referee denied unemployment compensation benefits on the ground that the petitioner had left work without “good cause.” McPherson, 285 Or at 543. The referee based that determination on a Court of Appeals opinion that this court concluded was erroneous, because it failed to take into account the delegative nature of the good-cause standard. Id. at 555. Because the referee had failed to consider the issue of good cause in the proper light of the delegation provided by the legislature, the court explained, it could not tell what criteria might be developed in the absence of that misconception. Id. In this case, somewhat similarly, the ALJ appears to have made his decision unaware of the delegative nature of the statutory standard of “reasonable diligence.” As we have noted, the ALJ simply observed that “there was sufficient time for Vorhof to observe either or both of the workers subject to the citations and that constructive knowledge was established.” The ALJ thus appears to have assumed that, given the Vorhof’s physical proximity to the violations, it was possible for him to have observed them, and that that is enough to establish constructive knowledge under ORS Cite as 356 Or 577 (2014) 599 654.086(2). That it was possible for Vorhof to have viewed the violations, however, is only half of the statutory equation. ORS 654.086(2) provides that the possibility of discovering the violation must be evaluated in the context of “reasonable diligence.” The ALJ’s order in this case lacks any explanation supporting a determination as to employer’s reasonable diligence. For us to review an agency’s decision for consistency with the discretion delegated to the agency by law, it must be evident that the agency exercised that discretion in the first place. Cf., State v. Mayfield, 302 Or 631, 645, 733 P2d 438 (1987) (failure to make a record that reflects an exercise of discretion held reversible error). In exercising that discretion under ORS 654.086(2), any or all of the factors that the Court of Appeals mentioned—the foreseeability of the violations, the general circumstances and level of danger inherent in the work, the potential need for continuous supervision, the nature and extent of the supervisor’s other duties, the supervised workers’ training and experience, and the extent and efficacy of the employer’s safety programs and precautions—may well aid in explaining how “reasonable diligence” factors into a determination of an employer’s constructive knowledge. But the question of which, if any, of those factors matters is one that the legislature has delegated in the first instance to the agency. At all events, there must be some sort of explanation that enables a reviewing court to evaluate whether a decision comports with the authority granted under the law. The decision of the Court of Appeals is affirmed on other grounds. The case is remanded to the Workers’ Compensation Board for further proceedings.