Court Opinion

ID: 185534
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:33:10+00
Date Added: 2024-06-11T17:26:16.558067
License: Public Domain

268 F.3d 1123 (D.C. Cir. 2001)
Kaspar Wire Works, Inc., Petitionerv.Secretary of Labor, Respondent
No. 00-1392
United States Court of Appeals  FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued October 11, 2001Decided November 6, 2001

[Copyrighted Material Omitted]
On Petition for Review of an Order of the Occupational Safety and Health Review Commission
Vic H. Henry argued the cause and filed the briefs for  petitioner.
John Shortall, Attorney, U.S. Department of Labor, argued  the cause for respondent.  With him on the brief were Joseph  M. Woodward, Associate Solicitor, and Bruce F. Justh, Counsel.
Before:  Henderson, Randolph and Rogers, Circuit Judges.
Opinion for the Court filed by Circuit Judge Rogers.
Rogers, Circuit Judge:

1
Kaspar Wire Works, Inc. petitions  for review of the decision of the Occupational Safety and  Health Review Commission holding it responsible for hundreds of willful violations of the Occupational Health and  Safety Act, 29 U.S.C. §§ 651-678 (1990), and imposing penalties for each violation.  Kaspar Wire contends that the decision must be reversed for lack of substantial evidence to  support the findings of willfulness, and because the per  instance penalties are unlawful.  We deny the petition.

I.

2
Kaspar Wire Works, Inc. is a manufacturer of custom wire  products and newspaper racks located in Shiner, Texas.  Between 1982 and 1989, the Occupational Safety and Health  Administration ("OSHA") conducted inspections and issued  no citations for injury and illness recordkeeping violations. However, following a six-month inspection by nine OSHA  inspectors in 1990, the Secretary of Labor issued two citations against Kaspar Wire for over 400 alleged willful and  serious violations of various standards under the Act, proposing aggregate penalties of $1,236,000.  An Administrative  Law Judge found that 382 violations were willful and assessed  an aggregate penalty of $257,700.

3
The Occupational Safety and Health Commission affirmed  the findings of willfulness and the assessment of per-instance  penalties for most of the recordkeeping violations, resulting in  an aggregate penalty of $224,050.  The Commission relied on  evidence that the same personnel had been responsible for  recording serious injuries and illnesses at Kaspar Wire since  1970, that Kaspar Wire had properly reported such incidents  in the past, as reflected in the results of OSHA inspections  from 1982-89, and that OSHA's 1990 inspection revealed that  Kaspar Wire failed to record 357 injuries on form OSHA No.  200, comprising 86.5% of the injuries and illnesses that occurred in its facility during 1988 and 1989.  Included among  the unreported injuries were secondand third-degree burns, a hand ligament injury resulting in 171 lost work days, at  least eight finger amputations (including one employee who  lost three fingers and lost eight weeks of work and another  employee who lost two fingers and lost nine weeks of work),  several broken bones, more than 30 eye injuries, and hundreds of lacerations--all of which were only recorded on  Kaspar Wire's first-aid log.  The Commission concluded that  these were knowing and willful violations that reflected a  "profound[ ] change[ ]" in Kaspar Wire's recordkeeping practices.  One Commission member dissented on the ground that  the evidence did not support a finding of willfulness, but only  carelessness.  The Commission reversed the Administrative  Law Judge's finding of willfulness with respect to errors in  Kaspar Wire's restricted work day recording, because it had  never recorded such items and had never been cited by  OSHA for such failures in the past.

II.

4
At the time of the citations in question, the Occupational  Health and Safety Act ("the Act") provided that "Any employer who willfully or repeatedly violates the requirements  of ... regulations prescribed pursuant to this chapter, may  be assessed a civil penalty of not more than $10,000 for each  violation."  29 U.S.C.  666(a) (1990).1  The Act further provided:

5
Each employer shall make, keep and preserve, and make available to the Secretary [of Labor] or the Secretary of Health and Human Services, such records regarding his activities relating to this chapter as the Secretary [of  Labor], in cooperation with the Secretary of Health and Human Services, may prescribe by regulation as necessary or appropriate for the enforcement of this chapter or for developing information regarding the causes and prevention of occupational accidents and illnesses.... Id.  657(c)(1).  The OSHA recordkeeping regulations require an employer to:

6
(1) maintain in each establishment a log and summary of all recordable occupational injuries and illnesses for that establishment;  and (2) enter each recordable injury and illness on the log and summary as early as practicable but no later than 6 working days after receiving information that a recordable injury or illness has occurred.

7
29 C.F.R.  1904.2(a) (2000).  The regulation further specifies  that "[f]or this purpose form OSHA No. 200 or an equivalent  which is as readable and comprehensive to a person not  familiar with it shall be used.  The log and summary shall be  completed in the detail provided in the form and instructions  on form OSHA No. 200."  Id. "Recordable" is defined in the  regulations to mean:

8
any occupational injuries or illnesses which result in:

9
(1)  Fatalities, regardless of the time between the injury and death, or the length of the illness;  or

10
(2)  Lost workday cases, other than fatalities, that result in lost workdays;  or

11
(3)  Nonfatal cases without lost workdays which result in transfer to another job or termination of employment, or require medical treatment (other than first aid) or involve:  loss of consciousness or restriction of work or motion.  This category also includes any diagnosed occupational illnesses which are reported to the employer but are not classified as fatalities or lost workday cases.

12
Id.  1904.12(c).  The Commission views the recordkeeping  requirements as "play[ing] a crucial role in providing the  information necessary to make workplaces safer and healthier."  General Motors Corp., Inland Div., 8 O.S.H. Cas.  (BNA) 2036 (1980).

13
Kaspar Wire did not argue either to the Commission or to  the court that its first aid log qualified as an "equivalent" to  OSHA form No. 200.  Rather, Kaspar Wire admitted in its  brief and at oral argument that it did not comply with OSHA  recordkeeping requirements.  For three reasons it contends,  however, that there is no basis for the Commission's finding  that its violations were willful.  First, its recordkeeping personnel were trained by OSHA staff in 1971, and over the  years OSHA inspectors repeatedly reviewed its practices  without ever citing Kaspar Wire for a recordkeeping violation  until the 1990 inspection.  Second, an OSHA inspector testified that it was reasonable for Kaspar Wire to assume that its  recordkeeping practices were in compliance with OSHA regulations.  Third, there is no record evidence that Kaspar Wire  changed its recordkeeping practices at some point in the  1980s.  Kaspar Wire concludes, therefore, that its reasonable  reliance precludes a finding of willfulness.

14
Neither the Act nor the OSHA regulations define the  meaning of the term "willful."  This circuit has defined a  "willful violation" in the OSHA context as "an act done  voluntarily with either an intentional disregard of, or plain  indifference to, the Act's requirements."  Conie Construction,  Inc. v. Reich, 73 F.3d 382, 384 (D.C. Cir. 1995).  The Commission relied on the Fifth Circuit's virtually identical definition  of a "willful violation" as "one involving voluntary action, done  with either an intentional disregard of, or plain indifference  to, the requirements of the [OSHA] statute."  Georgia Elec.  Co. v. Marshall, 595 F.2d 309, 319 (5th Cir. 1979).  Under  either definition, actual malice is not required;  it is sufficient  that there be substantial evidence of voluntary and intentional  disregard for or indifference to the law.  See Conie, 73 F.3d  at 384;  Georgia Elec., 595 F.2d at 318-19.  Consistent with  our standard of review, see National Eng'g & Contracting Co.  v. OSHRC, 45 F.3d 476, 481 (D.C. Cir. 1995), we conclude that  there was substantial evidence to support the Commission's  finding of willfulness.

15
Contrary to Kaspar Wire's position, the fact that the same  recordkeeping personnel who had been trained by OSHA  staff were still in charge in 1988 and 1989 actually supports  the Commission's conclusion that Kaspar Wire knowingly and  voluntarily chose to flout the recordkeeping requirements. That is, Kaspar Wire could have no doubt about what the  regulations required.  Kaspar Wire points to testimony by  one OSHA inspector that inspections conducted between 1982  and 1989 indicated that Kaspar Wire was complying with  OSHA's recordkeeping requirements, and that if Kaspar  Wire's recordkeeping practices remained unchanged it could  reasonably assume in March 1990 that its practices conformed to OSHA standards.  Another inspector testified that  in his view Kaspar Wire's recordkeeping practices had not  changed over time.  However, "the Commission is not bound  by the representations or interpretations of OSHA Compliance Officers."  L.R. Willson & Sons, Inc. v. Donovan, 685  F.2d 664, 676 (D.C. Cir. 1982).  Further, two other OSHA  inspectors testified that based on the 1990 inspection, Kaspar  Wire had clearly and intentionally violated the recordkeeping  requirements of the statute, see 29 U.S.C.  657(c)(1), and  that the Department of Labor's Bureau of Labor Statistics  had independently confirmed that all of the injuries in question should have been recorded on OSHA form No. 200.

16
From this evidence, the Commission could reasonably infer,  see United States Testing Co., Inc. v. NLRB, 160 F.3d 14, 19  (D.C. Cir. 1998), that sometime prior to 1988, Kaspar Wire's  recordkeeping practices underwent a dramatic change that  was not explainable by changes in the number of persons it  employed.  As the Commission found, in addition to the sheer  magnitude of the recordkeeping violations--which the Commission characterized as "far exceed[ing] that of any other  case decided by the Commission"--the nature of the injuries  that were unreported belies Kaspar Wire's claim that its  actions were merely negligent or careless.  The violations at  issue were not mere technical omissions;  rather, the violations involved the failure to report injuries as serious as  finger amputations, broken bones, eye injuries and severe  burns that resulted in prolonged absences from work.  Kaspar Wire thus cannot reasonably contend that there was  confusion about whether injuries of this nature had to be  reported on form OSHA No. 200 or its equivalent.  Nor can  Kaspar Wire seriously contend that it was entitled to rely on  its lack of prior violations to undermine a finding of willfulness.  See Cedar Constr. Co. v. OSHRC, 587 F.2d 1303, 1306  (D.C. Cir. 1978);  cf. Herman v. Palo Group Foster Home,  Inc., 183 F.3d 468, 473 (6th Cir. 1999);  National Steel and  Shipbldg. Co. v. OSHRC, 607 F.2d 311, 317 (9th Cir. 1979). Otherwise, an employer with no prior citations could choose  to violate a regulatory obligation without risking a finding of  willfulness, contrary to common sense and the definition of a  "willful violation" in the OSHA context.

17
Conie is instructive.  In that case, a construction company  challenged an OSHA citation for the willful violation of a  regulation governing the slope of a trench that had been  excavated to install a sewer manhole.  The OSHA compliance  officer testified that the company foreman acknowledged that  the walls of the trench did not comply with the sloping  regulation, but nevertheless opted to ignore the requirement  because he thought the trench was safe.  The court upheld  the Commission's finding of willfulness in view of the evidence  that the company knew of the regulation and intentionally  chose not to comply with OSHA's excavation requirements. See Conie, 73 F.3d at 384;  see also Donovan v. Williams  Enterprises, Inc., 744 F.2d 170, 179-80 (D.C. Cir. 1984); Finer Food Sales Co., Inc. v. Block, 708 F.2d 774, 777-78  (D.C. Cir. 1983).  Similarly, here the Commission could reasonably find that Kaspar Wire knew of and intentionally  chose to ignore OSHA recordkeeping regulations, and thereby jeopardized not only the ability of the Secretary and  OSHA to carry out their statutory responsibilities, but the  health and safety of Kaspar Wire's employees.

18
Kaspar Wire's attempt to rely on cases cited by the Secretary fails, for they clearly support the Secretary's position. For example, although the court concluded in L.R. Willson,  685 F.2d at 676, that a finding of willfulness with respect to  an ambiguous safety requirement could not be sustained, this  result was so only because the employer had not been given adequate notice of what was required.  Kaspar Wire makes  no claim there was ambiguity about what the recordkeeping  regulations required.  See also Brock v. Morello Bros.  Constr., Inc., 809 F.2d 161 (1st Cir. 1987);  Williams Enterprises, 744 F.2d at 179-80;  Cedar Constr., 587 F.2d at 1306.

19
Kaspar Wire protests nonetheless that the Commission's  finding of willfulness makes no sense because Kaspar Wire  had nothing to gain by violating the recordkeeping regulations.  All of the incidents not reported on form OSHA No.  200 were reported on the first aid log.  Also, according to  Kaspar Wire, the incidence of reported violations for 1988 and  1989 on the form 200 exceeded the cutoff of 4.3% needed to  avoid future on-site safety inspections.  These contentions  ignore two salient points.  First, the Secretary has chosen to  fulfill her statutory responsibilities by requiring injury reporting on form OSHA No. 200.  See 29 U.S.C.   657(c)(1),(c)(2) and (g)(2);  29 C.F.R.  1904.2(a).  There  was evidence before the Commission that Kaspar Wire was  an employer whose records were designed to show a low lost  workday injury rate that would exempt them from an on-site  safety inspection.  On three previous occasions, OSHA inspections of Kaspar Wire revealed a lost workday injury rate  that was below the national average, thereby exempting the  company from a comprehensive safety inspection.  As the  Secretary states in her brief:

20
Kaspar [Wire]'s indifference to recordkeeping requirements and inattention to accurate reporting produced a picture of working conditions that would mislead employees and OSHA concerning the true extent of the hazards at Kaspar [Wire].  By obscuring these injuries, Kaspar [Wire] effectively perpetuated the hazards to which its employees were exposed and it disabled an alarm mechanism which might have alerted employees and OSHA to problem areas in the workplace.

21
Respondent's Brief at 58.

22
Second, the Commission's finding of willfulness did not  require evidence of motive.  As the Supreme Court explained  in TWA v. Thurston, 469 U.S. 111, 126 n.19 (1985), "an employer's action may be 'willful' ... even though he did not  have an evil motive or bad purpose."  See also Hazen Paper  Co. v. Biggins, 507 U.S. 604, 617 (1993).  Although to find  willfulness the Commission had to find that Kaspar Wire's  conduct involved more than mere negligence or carelessness,  see McLaughlin v. Richland Shoe Co., 486 U.S. 128, 133  (1988), there was substantial evidence of Kaspar Wire's knowing and intentional disregard of the recordkeeping requirements. See Conie, 73 F.3d at 384.  The Commission took  note of both the unprecedented volume of violations and the  seriousness of the unreported injuries, as well as the abundant evidence of Kaspar Wire's actual knowledge of what was  required under OSHA regulations based on its own admissions and its past recordkeeping practices.  Essentially, then,  the Commission was confronted with a record of unabashed  violations involving serious injuries to employees in the face  of certain knowledge of what was required.  Congress and  the Secretary, not Kaspar Wire, have been entrusted with  determining how best to ensure worker health and safety,  and given the evidence of Kaspar Wire's egregious flouting of  regulatory requirements, the Commission's finding of willfulness is amply supported by the record.

23
Kaspar Wire's challenges to the sufficiency of the evidence  supporting the Commission's findings that it willfully failed to  install point-of-operations guards on a punch press, in violation of 29 C.F.R.  1910.217(c)(1), and failed to ground portable lamps, in violation of 29 C.F.R.  1910.304(f)(5)(V), are  meritless.  An OSHA inspector photographed the unguarded  press, and based on the same photograph, an OSHA supervisor determined that a citation was warranted because the  picture of one employee using the machine indicated that  multiple employees were probably using the machine.  As to  the lamps, the evidence was unrebutted that the lamps were  portable and "clamp" type.  Because the lamps were handled  roughly and used to illuminate trucks that were being loaded,  the Commission could reasonably infer that employees were  exposed to a danger of electric shock.

III.

24
Kaspar Wire also challenges the lawfulness of the per  instance penalties on statutory and procedural grounds. Contending that the Secretary lacks statutory authority to  assess per instance penalties for "egregious and willful" violations, which is not among the four levels of violations set forth  in the Act, see 29 U.S.C.  666(a)-(c), Kaspar Wire claims that  Congress did not authorize per instance penalties.  Kaspar  Wire relies on a structural argument based on the Coal Mine  Health & Safety Act of 1969 ("Coal Mine Act"), 30 U.S.C.   801 et seq. (1996), which Congress enacted one year before  it enacted the Occupational Health and Safety Act.  Kaspar  Wire further contends that even if the Secretary has authority to impose per instance penalties, her new policy violates  the Administrative Procedure Act either because her policy is  a rule subject to notice and comment under 5 U.S.C.  553, or  because her policy was not published in the Federal Register. None of these contentions has merit.

25
Section 17(a) of the Act provides that "[a]ny employer who  willfully or repeatedly violates the requirements of ... regulations prescribed ... may be assessed a civil penalty of not  more than $10,000 for each violation." 29 U.S.C.  666(a)  (emphasis added).  The plain language of the Act could  hardly be clearer.  The Commission has long agreed that per  instance citations and penalties are allowed.  See Pepperidge  Farm, Inc., 17 O.S.H. Cas. (BNA) 1993, 2001 (1997);  Sanders  Lead Co., 17 O.S.H. Cas. (BNA) 1197, 1204-05 (1995);  J.A.  Jones Constr. Co., 15 O.S.H. Cas. (BNA) 2201, 2213-14 (1993); Caterpillar, Inc., 15 O.S.H. Cas. (BNA) 2153, 2173 (1993); Hoffman Constr. Co., 6 O.S.H. Cas. (BNA) 1274, 1275 (1978). The availability of such penalties is consistent with the general principle that each violation of a statutory duty exposes the  violator to a separate statutory penalty.  See, e.g., Missouri,  Kansas, & Texas Ry. Co. v. United States, 231 U.S. 112, 119 (1913);  Used Equip. Sales, Inc. v. Dep't of Transp., 54 F.3d  862, 865 (D.C. Cir. 1995).  The statutory language is consistent, moreover, with discretionary per instance assessments  for "egregious and willful" violations, which the OSHA field  operations manual defines as "willful, repeated and high gravity serious citations and failures to abate."  Caterpillar,  Inc., 15 O.S.H. Cas. (BNA) 2153, 2170 (1993) (quoting OSHA  Instruction CPL 2.45A, Field Operations Manual, Ch. VI,   A.2.i.(4), at VI-8 (Sept. 21, 1987)).

26
Kaspar Wire's reliance on the language of the Coal Mine  Act is misplaced.  Section 111(a) of the Coal Mine Act (since  repealed and redesignated as the Federal Mine Safety and  Health Act of 1977) provides that "[e]ach occurrence of a  violation of a mandatory health or safety standard may  constitute a separate offense."  30 U.S.C.  820(a).  However, as the Secretary points out, there is nothing to suggest  that Congress patterned the Act after the Coal Mine Act. The Coal Mine Act employed a significantly different administrative structure, with rulemaking, enforcement and adjudicatory functions concentrated in the Secretary of the Interior. See 29 U.S.C. §§ 801 et seq. (1976).  Only in 1977 was the  administrative structure made to conform to the Act's, with  the vesting of rulemaking and enforcement authority in the  Secretary of Labor and the establishment of an independent  review commission for adjudications.  See 30 U.S.C. §§ 814816, 961(a) (1986).  In any event, Congress is not limited in  the language it may use across statutes to provide that per  instance penalties are authorized.  Moreover, even had Congress had not spoken directly to the question of per instance  penalties, the Secretary's interpretation would be entitled to  deference given her official duty, specialized expertise, investigatory knowledge, and other experience relevant to carrying  out the purposes of the Act.  See United States v. Mead  Corp., 121 S.Ct. 2164, 2175 (2001) (citing Skidmore v. Swift &  Co., 323 U.S. 134, 138 (1944));  cf. Anthony Crane Rental, Inc.  v. Reich, 70 F.3d 1298, 1302 (D.C. Cir. 1995) (citing Martin v.  OSHRC, 499 U.S. 144, 150-51 (1991));  Used Equip. Sales, 54  F.3d at 864-65.

27
Nor was the imposition of per instance penalties unlawful  on procedural grounds.  The Secretary's decision to assess  per instance penalties reflects use of an enforcement tool  within her authority.  Cf. United Steelworkers of Am. v.  Herman, 216 F.3d 1095, 1097 (D.C. Cir. 2000).  Her decision  followed a comprehensive review of Kaspar Wire's recordkeeping practices, and its virtual admission that it had not  complied with the recordkeeping rule.  The Secretary has  never taken the position that she lacks authority or would  decline to issue per instance citations to employers who  commit multiple violations of the same regulatory requirement, and in fact has exercised her discretion to propose  separate penalties for discrete violations over the years.  See,  e.g., RSR Corp., 11 O.S.H. Cas. (BNA) 1163, 1180-81 (1983); Wheeling-Pittsburgh Steel Corp., 10 O.S.H. Cas. (BNA) 1242  (1981);  Morris-Knudsen & Assoc., 8 O.S.H. Cas. (BNA) 2231,  2239 (1980);  Hoffman Constr. Co., 6 O.S.H. Cs. (BNA) 1274  (1978).  Consequently, the line of cases that require rulemaking upon a change of policy are inapplicable.  See, e.g., Nat'l  Ass'n of Home Health Agencies, v. Schweiker, 690 F.2d 932,  949 (D.C. Cir. 1982);  cf. Aulenback, Inc. v. Fed. Highway  Admin., 103 F.3d 156, 168 (D.C. Cir. 1997) (citing 5 U.S.C.   553).  In addition, there is nothing to Kaspar Wire's contention that per-instance penalties "encode[ ] a substantive  value judgment or put[ ] a stamp of approval or disapproval  on a given type of behavior," American Hosp. Ass'n v.  Bowen, 834 F.2d 1037, 1047 (D.C. Cir. 1987), thereby rendering the policy ineligible for the procedural rule exemption  from notice and comment requirements.  See 5 U.S.C.   553(b)(A).  Such reasoning, as JEM Broadcasting Co., Inc.  v. FCC, 22 F.3d 320 (D.C. Cir. 1994), points out, "threatens to  swallow the procedural exception to notice and comment, for  agency housekeeping rules often embody a judgment about  what mechanics and processes are most efficient."  Id. at 328. Kaspar Wire's reliance on the Fifth Circuit's "substantial  impact" standard for notice and comment requirements, see  Brown Express, Inc. v. United States, 607 F.2d 695, 702 (5th  Cir. 1979), is unavailing because this circuit has expressly  rejected that standard.  See American Postal Workers Union, AFL-CIO v. United States Postal Serv., 707 F.2d 548,  560 (D.C. Cir. 1983).  Furthermore, because the statutory  authorization of per instance penalties is so clear from the  statutory language, publication in the Federal Register was  not required.  See Malkam FM Assoc. v. FCC, 935 F.2d 1313,  1318 (D.C. Cir. 1991);  5 U.S.C.  552(a)(2).

28
Finally, OSHA penalties are meant to "inflict pocket-book  deterrence."  Atlas Roofing Co. v. OSHRC, 518 F.2d 990,  1001 (5th Cir. 1975), aff'd, 430 U.S. 442 (1977).  Section 666(j)  of the Act provides that the Commission is to give "due  consideration to the appropriateness of the penalty with  respect to the size of the business of the employer charged,  the gravity of the violation, the good faith of the employer,  and the history of previous violations."  The Commission  found that Kaspar Wire is a moderate-to-large sized company  employing approximately 850 to 900 employees with a history  of few previous OSHA violations, none of which pertained to  recordkeeping.  It noted that the gravity of recordkeeping  violations is generally considered low. It reasonably declined,  however, to accord good faith credit to Kaspar Wire in light  of the fact that the bulk of the violations were willful and the  failures to record were "largely so obvious."  The Commission affirmed the Administrative Law Judge's per instance  penalties in the amount of $250-$1000 per item, and upon  deducting $17,000 for various vacated items, affirmed an  aggregate penalty of $210,500 for willful recordkeeping violations.  The Commission also affirmed an aggregate penalty of  $4,875 for non-serious restricted workday recording violations  based on the change in characterization.  Kaspar Wire does  not contend that the Commission failed to give due consideration to these penalty criteria, nor (apart from its objection to  the Secretary's authority to impose per-instance penalties)  does it claim that the specific penalty amounts assessed for  each violation were excessive.

29
Accordingly, we deny the petition for review.

Notes:

1
  The penalty amounts were increased in November 1990 to  "not more than $70,000 for each violation, but not less than $5,000  for each willful violation."  See id. (1999);  Omnibus Budget Reconciliation Act of 1990, Pub. L. No. 101-508,  3101, 104 Stat. 1388  (1990).  In assessing penalties against Kaspar Wire, the Commission applied the version of the statute in effect in September 1990,  when the citations were issued.  The other statutory and regulatory  provisions relevant to this opinion have remained unchanged since  that time.