By James L. CurtisAdam R. Young, and Craig B. Simonsen

Seyfarth Synopsis:  We had blogged previously that OSHA appealed an Administrative Law Judge (ALJ) ruling that severely limited OSHA’s Multi-Employer Worksite Doctrine and citation of a “controlling employer” general contractor. Acosta v. Hensel Phelps Constr. Co., No. 17-60543 (5th Cir. August 4, 2017).  The Fifth Circuit has now reversed the ALJ, and upheld OSHA’s Multi-Employer Worksite Doctrine.

In dramatic language, the U.S. Court of Appeals for the Fifth Circuit (governing federal law in Texas, Mississippi, and Louisiana) announced, that “thirty-seven years ago, this court, in a tort case, announced that ‘OSHA regulations protect only an employer’s own employees’.”  Melerine v. Avondale Shipyards, Inc., 659 F.2d 706, 711 (5th Cir. 1981).  That decision had endured despite the seismic shift brought about by Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), and of broader employer liability under the Act.  Acosta v Hensel Phelps Construction, No 17-60543 (5th Cir November 26, 2018).  OSHA’s Multi-Employer Worksite Doctrine enables the Agency to cite employers who are “controlling,” “exposing,” “creating,” or “correcting” safety hazards.  OSHA regularly cites general contractors as “controlling” employers with regard to hazards only faced by subcontractor employees.

In the instant appeal, the Court was asked whether OSHA has the authority, under either the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq. (the Act), or regulations, “to issue a citation to a general contractor at a multi-employer construction worksite who controls a hazardous condition at that worksite, even if the condition affects another employer’s employees.”  The Court concluded that OSHA does indeed have that authority under the Act.

Factually, an OSHA compliance officer conducted an inspection of the site and discovered three sub-contractor employees working at the base of an unprotected wall of evacuated soil.  The contractor’s and the subcontractor’s superintendents were present at the wall, with full views of the subcontractor’s employees working near the wall.  OSHA cited both contractor and the subcontractor for willfully violating 29 C.F.R. § 1926.652(a)(1) for allegedly “exposing employees to a cave-in hazard from an unprotected excavation at a construction site.”

The ALJ determined that the contractor met the requirements to be considered a “controlling employer” who had a duty under 29 U.S.C. § 651 et seq., to “act reasonably to prevent or detect and abate violations at the worksite even when the affected employees are those of another employer.”  However, because the citation arose within the jurisdiction of the Fifth Circuit, the ALJ found that “Fifth Circuit precedent foreclosed the citation” against the general contractor.  The ALJ relied on Melerine, Inc., 659 F.2d at 711, finding that “an employer at a worksite within the Fifth Circuit cannot be held in violation of the Act when the employees exposed to the hazard were employees of a different employer.”

Rather than follow Commission precedent and uphold the citation, the ALJ found that “where it is highly probable that a Commission decision would be appealed to a particular circuit, the Commission has generally applied the precedent of that circuit in deciding the case – even though it may differ from the Commission’s precedent.” Kerns Bros. Tree Service, Docket No. 96-1719, 2000 WL 294514 (Mar. 16, 2000).  Therefore, the ALJ ruled that “applying 5th Circuit precedent, Respondent cannot be liable for a violation of the Act based solely upon a subcontractor’s employees’ exposure to the condition,”  and vacated the citation.

The Court here concluded that “an agency’s interpretation of its governing statute in an administrative adjudication ‘is as much an exercise of delegated lawmaking powers as is the Secretary’s promulgation of a workplace health and safety standard… The Multi-Employer Worksite Doctrine is an agency document that provides guidance to OSHA inspectors as to when it may be appropriate to cite a particular employer.”  The Secretary did not derive any authority from the Policy in issuing the citation to Hensel Phelps; “he relied on the statute itself and engaged in adjudication on the basis of that statutory authority.”  The Court found that the Secretary’s construction of the statute as granting authority to issue citations to controlling employers is a “reasonably defensible” one.

Accordingly, OSHA’s Multi-Employer Worksite Doctrine is now fully enforceable in the Fifth Circuit.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Workplace Safety and Health (OSHA/MSHA) or Workplace Policies and Handbooks Teams.

By Meagan Newman, Elizabeth Leifel Ash, and Craig B. Simonsen

The DC Circuit Court of Appeals has reaffirmed the Occupational Safety and Health Administration’s (OSHA) use of constructive knowledge to impose liability on employers arising from activities at workplaces where more than one employers employees are working. In Summitt Contractors, Inc. v Occupational Safety and Health Review Commission, No. 10-1329, __ F.3rd __ (DC Cir., December 14, 2011) the Court affirmed, both the administrative law judge (ALJ), who affirmed the OSHA citation, and the Occupational Safety and Health Review Commission (OSHRC) which reviewed and approved of the ALJ decision.

The Court explained that under the Occupational Safety and Health Act, the requirement for employer knowledge is satisfied, even where multiple employers are involved at the site, if the employer “had either actual or constructive knowledge of the violation: ‘i.e., the employer either knew, or with the exercise of reasonable diligence could have known, of the violative conditions,’ and a ‘supervisor’s knowledge is imputed to the company’.” (Citations removed.)

The Court found that “substantial evidence supports the Commission’s finding that Summit could have known of the violative condition with the exercise of reasonable diligence. Summit’s agreement with its subcontractor stated that Summit ‘may provide . . . temporary electrical . . . services,’and that if it did, the subcontractor ‘shall make use of [the service] as provided’.” “In fact, Summit’s supervisor did order the electrical equipment in question but neither requested [ground fault circuit interrupters] nor checked the equipment when it arrived — even though doing so would have taken only a few seconds and required no specialized expertise.”

This decision marks the most recent challenge by an employer to OSHA’s so-called multi-employer worksite doctrine, which gives the Agency the ability to cite multiple employers for the same condition.