DRAVO CORP. v. OCCUPATIONAL SAFETY, ETC. No. 79-1435.
613 F.2d 1227 (1980)
DRAVO CORPORATION, Petitioner, v. OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION and Ray Marshall, Secretary of Labor, Respondents.
United States Court of Appeals, Third Circuit.
Decided January 14, 1980.
Charles R. Volk (argued), Jane A. Lewis, Thorp, Reed & Armstrong, Pittsburgh, Pa., for petitioner.
Ann D. Nachbar (argued), Ronald R. Glancz, Allen H. Feldman, Acting Counsel for Appellate Litigation, Carin A. Clauss, Sol. of Labor, Benjamin W. Mintz, Associate Sol. for Occupational Safety and Health, Nancy L. Southard, Acting Asst. Counsel for Appellate Litigation, U. S. Dept. of Labor, Washington, D. C., Marshall H. Harris, Regional Sol., U. S. Dept. of Labor, Philadelphia, Pa., for respondents.
Before SEITZ, Chief Judge, ALDISERT, Circuit Judge, and HUYETT, District Judge.
OPINION OF THE COURT
ALDISERT, Circuit Judge.
The major questions for decision in this petition for review of a final order of the Occupational Safety and Health Review Commission under 29 U.S.C. § 660(a) require us to decide whether the commission correctly determined the applicability of maritime standards, as well as general industry standards, to the structural shop of Dravo's Engineering Works Division, Neville Island, Pittsburgh, Pennsylvania. The administrative law judge determined that maritime standards were appropriate because the majority of the work performed in the structural shop involved the forming, welding and fitting of vessel components and was therefore "related" to "shipbuilding" as those terms are defined in Safety and Health Regulations for Shipbuilding, 29 C.F.R. § 1916.2 (1978). He issued a decision and order which also affirmed in relevant part citations issued by OSHA compliance officers, seven items of which form a separate basis of this petition for review. Dravo petitioned the commission for discretionary review of the report of the ALJ, but when no commissioner directed review, the ALJ's order became the final order of the commission by operation of law.
The Engineering Works Division of Dravo Corporation is engaged in the year-round manufacture of heavy equipment including barges and towboats, raw material processing machinery, material handling equipment and major components for dams, locks and power plants. The division is on a sixty-eight acre worksite on Neville Island in the Ohio River, about six miles from Pittsburgh. Plant facilities include a 1,800 foot-long waterfront on the Ohio River, a barge shop where vessels are assembled at a rate of over three per week, trade shops where vessels are outfitted, and the structural shop.
Dravo's structural shop is a general fabrication shop in which metal plates are formed, sized, and welded. The operations of the structural shop, as in any general industry fabrication shop, include processes by which metal is formed with the use of press brakes, shears, angle rolls, punch and coping machines, burning machines and welders. These plates are used in the assembly of all of Dravo's major products. Those that are to become parts of vessels are carried by railroad car from the shop on the southern side of the island across the public road that bisects the island and the plant to the boat yard area on the northern side of the island where the vessels are assembled and eventually launched. At least one barge has been assembled in the structural shop. App. at 224a-26a. Faced with this evidence, including testimony that in 1977, "51 percent of the work in the Structural Shop was marine related, that is, the product went into a boat or a barge," while "[t]he balance of the work involved material handling machinery [27%], pelletizing machines, gait hoists [20%] and spare parts [remaining per cent]," App. at 225a, 1034a-35a, the ALJ determined that maritime standards applied to activities in that shop.
The test adopted by the ALJ appears to be that if the major part of the work in a shop at a given time is "shipbuilding" by definition of OSHA regulation 29 C.F.R. § 1916.2(i), that is, "the construction of a vessel, including the installation of machinery and equipment," then the shipbuilding safety standards will apply. In announcing this formula he rejected the approach taken in another proceeding involving Dravo Corporation at OSHRC Docket No. 14818. Dravo Corp., [1976-77] OSH Dec. (CCH) ¶ 20,787 (1976). There, in determining the appropriate standards for Dravo's pipe shop, the ALJ concluded that even though ninety per cent of the pipe shop's production was incorporated into vessels, shipbuilding standards should not apply. Relying on a Fourth Circuit decision subsequently overturned by the Supreme Court, he determined that the applicability of those standards should be limited to shipbuilding and related activities between the ship and the last "point of rest" of equipment. Dravo has thus been confronted in separate OSHRC proceedings with divergent formulations for determining what areas are to be held to shipbuilding safety standards under OSHA.
The central purpose of the Occupational Safety and Health Act of 1970, 29 U.S.C. § 651 et seq., is "to assure so far as possible every working man and woman in the Nation safe and healthful working conditions . . .." 29 U.S.C. § 651(b). The Act authorizes the Secretary of Labor "to set mandatory occupational safety and health standards applicable to businesses affecting interstate commerce," and created the Occupational Safety and Health Review Commission "for carrying out adjudicatory functions [of the Act]." 29 U.S.C.
The term "established Federal standard" is defined as "any operative occupational safety and health standard established by any agency of the United States and presently in effect, or contained in any Act of Congress in force on December 29, 1970." 29 U.S.C. § 652(10). The Secretary had promulgated safety standards for shipbuilding prior to 1970 under the mandate of § 41 of the Longshoremen and Harbor Workers Compensation Act.
Thus, the OSHA shipbuilding regulations had their genesis in the LHWCA. The courts have recognized these safety regulations as part of the federal schema both to provide compensation under LHWCA to injured harbor workers in the event of an industrial accident and to prevent accidents involving harbor workers in the course of their maritime activities. Arthur v. Flota Mercante Gran Centro Americana S. A., 487 F.2d 561, 564 (5th Cir. 1973); Grigsby v. Coastal Marine Service of Texas, Inc., 412 F.2d 1011, 1036 (5th Cir. 1969), cert. dismissed, 396 U.S. 1033, 90 S.Ct. 612, 24 L.Ed.2d 531 (1970). Indeed, before the maritime standards were adopted by OSHA, a violation of the safety regulations constituted negligence per se in actions by injured longshoremen against shipowners. Arthur v. Flota Mercante Gran Centro Americana S. A., 487 F.2d at 564; Marshall v. Isthmian Lines, Inc., 334 F.2d 131, 134 (5th Cir. 1964).
The Secretary has also recognized the relationship between the two statutes. Shipbuilding regulation § 1916.1 provides in part that each employer involved in shipbuilding activity shall subscribe to the requirements of § 41 of LHWCA, 33 U.S.C. § 941(a), by furnishing and maintaining employment and places of employment which are reasonably safe for his employees in all employments covered by the statute. The disposition of this petition for review requires
We start our analysis by inquiring whether the "majority of the work" test used by the ALJ is appropriate in the context of an OSHRC citation case. We think that the ALJ erred in concentrating his analysis only upon the regulations defining "shipbuilding"
In determining the areas where Dravo may be held to maritime safety standards, it becomes necessary to consider the contentions of the parties. The Secretary would like to make the coverage of its maritime regulations as broad as possible, broader than the scope of compensation coverage under LHWCA.
Although the courts may be increasingly willing to interpret coverage broadly when an injured plaintiff is in need of compensation, the same approach is not followed in cases implicating penal sanctions. Historically, the applicability of penal sanctions has been narrowly construed by the judiciary. This is so notwithstanding the tendency of courts to construe implementing regulations liberally, and exemptions narrowly, in order to afford workers maximum protection. Bristol Steel & Iron Works, Inc. v.
Diamond Roofing Co. v. OSHRC, 528 F.2d 645, 649-50 (5th Cir. 1976) (citations omitted).
Because we deal here with a penal sanction, we begin with a recognition that the coverage of an agency regulation should be no broader than what is encompassed within its terms. Accordingly, we note that definitions for both "employer" and "employee" limit coverage of the OSHA shipbuilding regulations to maritime work on "the navigable waters . . ., including dry docks, graving docks, and marine railways." 29 C.F.R. §§ 1916.2(c) & (d), supra notes 5 & 6. These definitions do not include structural fabrication shops within their scope; they include only waters, docks, and marine railways.
This court developed a test for interpretation of the Secretary's OSHA regulations in Bethlehem Steel Corp. v. OSHRC, 573 F.2d 157, 161 (3d Cir. 1978):
Because the Secretary has failed in his regulations to state that a structural shop is included with docks and marine railways as a place of maritime employment to which shipbuilding regulations apply, we believe that the structural shop at issue here is not to be held to shipbuilding safety standards. The Act grants the Secretary, and not OSHRC or the courts, the means and the responsibility to amend the regulation if he so desires. Diamond Roofing Co., 528 F.2d at 649; Bethlehem Steel Corp., 573 F.2d at 161. See Marshall v. Pittsburgh-Des Moines Steel Co., 584 F.2d 638, 643-44 (3d Cir. 1978).
Although the Secretary urges that the language of the definitions of "employer" and "employee" does not foreclose their applicability to areas other than waters, docks, and marine railways, we note that the definitions, see notes 5 & 6 supra, do not "state with ascertainable certainty what is
Dravo's position that OSHA coverage should be narrower than LHWCA coverage presents a more difficult issue. As we have noted, the purpose of these OSHA standards is to prevent injury to those harbor workers who, if injured, would be eligible for compensation under LHWCA. Longshoremen, for instance, are covered under LHWCA if they spend "at least some of their time in indisputably longshoring operations," in activities that are an integral part of the process of maritime industry. Northeast Marine Terminal Co. v. Caputo, 432 U.S. at 273, 97 S.Ct. 2348, 2362, 53 L.Ed.2d 320; P.C. Pfeiffer Co. v. Ford, ___ U.S. ___, ___ n.18, 100 S.Ct. 328, 337 n.18, 62 L.Ed.2d 225 (1979).
Dravo would have us adopt the reasoning of another ALJ in a proceeding at OSHRC Docket No. 14818. Dravo Corp., [1976-77] OSH Dec. (CCH) ¶ 20,787 (1976). There, the ALJ rejected applicability of the shipbuilding standards to Dravo's pipe shop although ninety percent of the work done there was marine work. But the ALJ relied on I.T.O. Corp. v. Benefits Review Board, 529 F.2d 1080 (4th Cir. 1975), vacated, 433 U.S. 904, 97 S.Ct. 2967, 53 L.Ed.2d 1088 (1977). Because the only case cited in that OSHRC decision was vacated and remanded for reconsideration in light of Northeast Marine Terminal Co. v. Caputo, 432 U.S. 249, 97 S.Ct. 2348, 53 L.Ed.2d 320, and because the decision erroneously relied on the "last point of rest" doctrine rejected by this court in Sea-Land Service, Inc. v. Director, Office of Workers' Compensation Programs, 540 F.2d 629 (3d Cir. 1976), and by the Supreme Court in Northeast Marine Terminal Co., we reject Dravo's suggestion that we rely on the reasoning of that opinion in order to determine what areas are governed by OSHA's shipbuilding standards.
Compensation provisions of LHWCA are broader than OSHA coverage to the extent that a worker may claim compensation even though, at the time of his injury, he was not engaged in work activity specified in the regulations, or was not engaged at that moment in maritime work at all, see note 9 supra. For instance, in Sea-Land Service, Inc. v. Director, Office of Workers' Compensation Programs, 540 F.2d 629, a longshoreman recovered even though he was injured on a public street in the marine terminal not under the employer's control. The court did not construe the statutory coverage under 33 U.S.C. § 903(a) to be
We were required to define "shipbuilding" in Dravo Corp. v. Maxin, 545 F.2d at 380, because Congress failed to supply a definition of the term in the 1972 LHWCA amendments. Dravo was therefore on notice of what activities constitute shipbuilding. The employer was not apprised by regulation, however, of the exact inland areas that would be considered shipbuilding sites in addition to the promulgated "dry docks, graving docks and marine railways." In contrast with his relatively broad exposure to liability in compensation cases, an employer should not be subject to penal sanctions for nonadherence to safety standards without adequate notice in the regulations of the exact contours of his responsibility.
Dravo contends that in areas where maritime standards are applicable, it was error for the ALJ also to allow citations under general industry standards. This practice, however, is expressly provided for by regulation. 29 C.F.R. § 1910.5(c) states:
The general safety standards complement the specific safety standards, of which the set of shipbuilding regulations is one example, by filling the interstices necessarily remaining after promulgation of the specific standards. The Secretary cannot be expected to have anticipated every conceivable hazardous situation in promulgating specific standards. As the Fourth Circuit has noted:
Bristol Steel & Iron Works, Inc. v. OSHRC, 601 F.2d 717, 721 n.11 (4th Cir. 1979) (citations omitted).
Accordingly, even in areas properly citable under specific maritime standards, the Secretary may hold an employer to the general industry standards in those situations where no specific standard is applicable.
In addition to challenging the applicability of certain OSHA standards, Dravo argues that the inspections that led to the citations were the product of harassment. Dravo complains that the OSHA area director had ordered twenty-three previous inspections of its facility while its competitors were inspected one, two, or three times and that therefore the Secretary's inspection of the facility constituted an abuse of his discretion under 29 U.S.C. § 657(f)(1). Upon review of the record we find no error in the commission's determination that the Secretary did not abuse his discretion. The ALJ noted:
App. at 1033a.
Dravo also petitions for review of citations for seven items relating to machine guards, crane operations, and welding. We have carefully considered all the contentions presented by the petitioner. We have reviewed the factual contentions to determine whether the findings of the commission are supported by substantial evidence on the record as a whole. U. S. Steel Corp. v. OSHRC, 537 F.2d 780, 782 (3d Cir. 1976). According certain deference to the agency's construction of the regulations in question, as courts are obliged to do, we have reviewed the legal contentions to determine whether they show the commission's conclusions to be arbitrary, capricious, or an abuse of discretion. Budd Co. v. OSHRC, 513 F.2d 201, 204-05 (3d Cir. 1975). We conclude that the commission's findings are supported by substantial evidence and that its interpretation and application of its regulations were reasonable exercises of its discretion. We therefore affirm the decision of the ALJ as to these specific items.
The petition for review will be granted and that part of the order of the commission holding OSHA shipbuilding standards applicable to the Dravo structural shop will be set aside. The remainder of the commission's order will be affirmed. Each party to pay its own costs.
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