Brennan v. Occupational Safety & Health Review Com'n

• Decision Date: 25 February 1974
• Docket Number: Docket 73-1729.,No. 360,360
• Citation: 492 F.2d 1027
• Parties: Peter J. BRENNAN, Secretary of Labor, Petitioner, v. OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION and John J. Gordon Company, Respondents.
• Court: U.S. Court of Appeals — Second Circuit

492 F.2d 1027 (1974)

Peter J. BRENNAN, Secretary of Labor, Petitioner, v. OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION and John J. Gordon Company, Respondents.

No. 360, Docket 73-1729.

United States Court of Appeals, Second Circuit.

Argued January 16, 1974.

Decided February 25, 1974.

Donald Etra, Dept. of Justice, Washington, D. C. (Irving Jaffee, Acting Asst. Atty. Gen., and Walter H. Fleischer, Dept. of Justice, Washington, D. C., and Michael H. Levin, Dept. of Labor, Washington, D. C., of counsel), for petitioner.

Submitted by Barth, Sullivan & Lancaster, Buffalo, N. Y. (John J. Sullivan, Jr., Buffalo, N. Y., of counsel), for respondent John J. Gordon Co.

Before MOORE, FRIENDLY and ANDERSON, Circuit Judges.

FRIENDLY, Circuit Judge:

The Occupational Safety and Health Act of 1970, 29 U.S.C. §§ 651-678, is one of many important but as yet rather unfamiliar pieces of federal regulatory legislation enacted in recent years. It requires, § 654, "each employer" to "furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees" and authorizes, § 655, the Secretary of Labor to promulgate standards to implement this. The term "employer" is defined, § 652(5), to mean "a person engaged in a business affecting commerce who has employees . . ." Sections 658 and 659 authorize the Secretary to issue citations for violations of the Act, fixing a reasonable time for the abatement of each violation and indicating the penalty, if any, proposed to be assessed. If the employer desires to contest the citation or proposed assessment of a penalty, he is to notify the Secretary and the case is determined by the Occupational Safety and Health Review Commission (OSHRC), whose orders are reviewable, § 660, in the courts of appeals.

Respondent John J. Gordon Company, Inc. (Gordon) is a medium-sized company engaged in sandblasting, painting, masonry contracting, window cleaning and janitorial work on industrial and commercial buildings in the Buffalo, N. Y., area. On August 6, 1971, two employees were painting a building in Buffalo. The citations later issued charged, as has not been seriously challenged, that the scaffold had no horizontal hand rail, no toeboard, no tie-back lines, and no life lines, and that no safety belts were used by the employees. Although the Administrative Law Judge noted that the specific standards, promulgated by the Secretary, which would be violated by these failings, see 29 C.F.R. §§ 1910.28(g)(5); 1910.21(f) (21), (31); 1910.28(g)(9); cf. 1926.107(b), (c), (f), were not effective as against Gordon at the relevant time, he went on to hold, and Gordon does not dispute, that the same failings "constituted a hazard which is generally and commonly recognized as such in the industry in which Gordon was engaged." The scaffold fell; one employee was killed and the other seriously injured. After investigation the Secretary promptly issued two citations which, as amended, proposed a penalty of $1300.

Gordon having served notice of its desire to contest the citations, Administrative Law Judge Harris directed the parties to be prepared to stipulate facts about which there could be no reasonable dispute, including circumstances which would indicate whether Gordon "was engaged in a business affecting commerce." The parties stipulated that the nature of Gordon's business was as indicated above. In the course of the hearing some testimony came in to the effect that Gordon had worked on a Blue Cross building and a Bethlehem Steel plant. Counsel for Gordon made no claim that it was not in a business affecting commerce — an issue which he first presented in proposed findings of fact submitted after the record had been closed.

The Administrative Law Judge, sua sponte, reopened the record to take further evidence on this point.¹ At the reopened hearing the Secretary showed, over Gordon's objection but without contradiction, that Gordon supplied services, some on long term service-contracts, to a number of organizations, including McDonald Products Corp. (on whose premises the accident had occurred), Houdaille Industries, Inc., a Chevrolet engine plant, Bethlehem Steel, Blue Cross of New York, and Dunlop Tire & Rubber Co., all of which were engaged in interstate commerce, and that it used supplies produced outside New York State although purchased from local suppliers. It is beyond dispute that this evidence was ample to show that Gordon was "engaged in a business affecting commerce" — a phrase often used when Congress means to signal an intention to go beyond the regulation of businesses engaged "in commerce". Construing essentially the same phrase in the National Labor Relations Act, where Congress supplied a definition, § 2(7), the Supreme Court has held that the Act goes well beyond persons who are themselves engaged in interstate or foreign commerce, NLRB v. Fainblatt, 306 U.S. 601, 604-605, 59 S.Ct. 668, 83 L.Ed. 1014 (1939); cf. NLRB v. Vulcan Forging Co., 188 F.2d 927, 930 (6 Cir. 1951); see also United States v. Ricciardi, 357 F.2d 91, 97-98 (2 Cir.), cert. denied, 384 U.S. 942, 86 S.Ct. 1464, 16 L. Ed.2d 540; 385 U.S. 814, 87 S.Ct. 35, 17 L.Ed.2d 55 (1966) (interpreting the phrase "industry affecting commerce" as defined in the Taft-Hartley Act, 29 U.S.C. § 142(1)). As was said by Congressman Steiger in presenting to the House the Conference Report on the Occupational Safety and Health Act, 116 Cong.Rec. 42199, 42206 (1970):

The coverage of this bill is as broad, generally speaking, as the authority vested in the Federal Government by the commerce clause of the Constitution.

Throughout the legislative history of the Act, the objective was repeatedly stated to be to make maximum use of the commerce power so that, as was almost as often said, states and employers insisting on a high degree of safety should not be disadvantaged by the failure of others to do so. See Sen.Rep.No.91-1282 on S. 2193, 91st Cong. 2d Sess., pp. 4, 22; H.R.Rep.No.91-1291 on H.R. 16785, 91st Cong. 2d Sess., pp. 14-16, 24, U.S.Code Cong. & Admin.News 1970, p. 5177; 116 Cong.Rec. 36509 (Senator Dominick), 36537 (Senator Saxbe), 38369 (Rep. Perkins), 38704 (Rep. Sikes) (1970). Accordingly, the Administrative Law Judge found that Gordon was "engaged in a business affecting commerce." He further found that Gordon had violated its general duty to provide a work place free from recognized hazards, but that only a single serious violation was warranted; thus, he conthem as consolidated, and assessed a solidated the two citations, affirmed penalty of $750.

In addressing the jurisdictional issue, the OSHRC never reached the question of the adequacy of the evidence adduced at the reopened hearing.² By a divided vote it held that it was improper for the Administrative Law Judge to have reopened the hearing and that the evidence at the initial hearing was insufficient. Chairman Moran went to great lengths in condemning the reopening, which he thought "so contrary to the impartiality required of persons presiding at adversary proceedings as to amount to a denial of due process of law." Commissioner Van Namee, concurring, while dissociating himself from this characterization, thought the Administrative Law Judge had abused his discretion. Commissioner Burch dissented. He pointed out that the Commission's rules place upon the Administrative Law Judge the duty to "assure that the facts are fully elicited" and empower him to reopen hearings; while these rules had not yet become effective at the time of the reopening here at issue, he said they merely "make explicit what was implicit in the interim rules."³ He thought the majority was subscribing to a "game theory" of administrative adjudication. So do we.

It is true, as the majority said, that in reviewing agency refusals to reopen or in passing on applications by a petitioner to present additional evidence to an agency under statutes similar to 29 U.S.C. § 660(a), courts have adopted a very strict standard. But the classic statement of that principle, by Mr. Justice Jackson in I. C. C. v. Jersey City, 322 U.S. 503, 514-515, 64 S.Ct. 1129, 88 L.Ed. 1420 (1944), illustrates the distance separating such problems from that with which OSHRC was here confronted. Dealing with a petition for a rate increase which had been pending before the I. C. C. for more than 16 months and on which plenary hearings had been completed more than 13 months before the final order issued, the Court said:

Administrative consideration of evidence — particularly where the evidence is taken by an examiner, his report submitted to the

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