Dep't of Labor v. Hayes Drilling, Inc.

• Decision Date: 02 September 2011
• Docket Number: No. 2010–CA–000021–MR.,2010–CA–000021–MR.
• Citation: 354 S.W.3d 131
• Parties: DEPARTMENT OF LABOR, Now J.R. Gray as Secretary of Labor Cabinet, Appellant, v. HAYES DRILLING, INC., and Commonwealth of Kentucky, Occupational Safety And Health Review Commission, Appellees.
• Court: Kentucky Court of Appeals

354 S.W.3d 131

DEPARTMENT OF LABOR, Now J.R. Gray as Secretary of Labor Cabinet, Appellant,

v.HAYES DRILLING, INC., and Commonwealth of Kentucky, Occupational Safety And Health Review Commission, Appellees.

No. 2010–CA–000021–MR.

Court of Appeals of Kentucky.

Sept. 2, 2011.

James R. Grider, Jr., Office of General Counsel, Kentucky Labour Cabinet, Frankfort, KY, for appellant.

Thomas M. Moore, Kansas City, MO, Tammy Meade Ensslin, Lexington, KY, for appellee, Hayes Drilling, Inc.

Frederick G. Huggins, General Counsel, Kentucky Occupational Safety and Health Review Commission, Frankfort, KY, for appellee, Kentucky Occupational Safety And Health Review Commission.Before ACREE, LAMBERT and THOMPSON, Judges.

OPINION

THOMPSON, Judge:

The substantive issues presented concern the issuance of a citation and imposition of penalties under the Kentucky Occupational Safety and Health Act (KOSHA), Kentucky Revised Statutes (KRS) 338.011 through 338.991 upon Hayes Drilling Inc., a subcontractor working at a multi-employer work site. After the Franklin Circuit Court reversed the decision and order of the Kentucky Occupational Review Commission, the Kentucky Department of Labor appealed. The issues presented are: (1) whether the Department's failure to provide Hayes an opportunity to be present for the opening conference and the walk around inspection mandated dismissal of the citation; (2) whether the citation issued was invalid because the abatement date was prior to its issuance; (3) whether Hayes was a creating or controlling employer on a multi-employer work site; (4) whether the contract between Hayes and Wilburn relieved Hayes of responsibility for KOSHA violations; and (5) whether the intentional removal of a hole cover precluded the citation.

FACTS

The citation was issued after an April 19, 2005, accident on a construction site at Bryan Station High School in Lexington, Kentucky, which resulted in an injury to Billy Evans, an employee of River City, a masonry subcontractor.

The general contractor on the project, D.W. Wilburn, Inc., and Hayes executed a contract pursuant to which Hayes agreed to drill caisson holes that later became part of the building's foundation. The contract contemplated that Hayes would drill approximately 800 holes. Once drilled, Wilburn was responsible for filling the holes with concrete and reinforcing steel. There was no provision in the contract that obligated Hayes to barricade the holes and, until the creation of the hole into which Evans fell, Wilburn established a pattern of protecting the caisson holes by building barricades.

On the date of Evans's injury, Hayes drilled an eighteen-feet deep and thirty-six inches wide hole as instructed by Wilburn. On the same date and time, Evans was putting block on a section of the building approximately fifty to sixty feet from the drilling location.

After the first hole was completed and because Wilburn's employees were not present to barricade the hole, the Hayes drill operator directed a Hayes laborer to place unmarked plywood over the hole as a temporary cover. The workers then proceeded to drill on a second hole, twenty feet from the first hole.

Within approximately ten minutes of the completion of the first hole, Evans, who was operating a sky track fork lift truck, noticed the plywood and exited the truck to remove the plywood so that he would not run over it. He testified that he was unaware that the plywood was being used to cover a hole. When Evans lifted the plywood, he fell into the hole and broke his ankles.

On July 6, 2005, Compliance Officer Shannon Dowdell inspected the project site. At that time, Hayes had completed its work and departed. As a result, Hayes did not receive notice of the inspection and had no representatives at the site. It did not attend the opening conference or walk around inspection but did attend the closing conference where it learned about the possible citations.

Three separate sets of serious citations were issued to Wilburn, Hayes, and River City pursuant to the fall protection subpart of the construction standards. Section 29 CFR 1926.501(b)(4)(i) states: “Each employee on walking/working surfaces shall be protected from falling through holes ... more than 6 feet ... above lower levels, by personal fall arrest systems, covers, or guardrail systems erected around such holes.” Hayes was cited for the following specific violations of the KOSHA regulations found at 29 CFR 1926.502(i)(1), (3) and (4), adopted in Kentucky by 803 KAR 2:412:

(1) Covers located in roadways and vehicular aisles shall be capable of supporting, without failure, at least twice the maximum axle load of the largest vehicle expected to cross over the cover.

(3) All covers shall be secured when installed so as to prevent accidental displacement by the wind, equipment, or employees.

(4) All covers shall be color coded or they shall be marked with the word “HOLE” or “COVER” to provide warning of the hazard.

The hearing officer dismissed Item 1 of the citation and affirmed the remaining two items. The Commission affirmed and Hayes appealed to the Franklin Circuit Court. The circuit court reversed and this appeal followed.

STANDARD OF REVIEW

An agency decision must be affirmed unless the agency acted arbitrarily or outside the scope of its authority, applied an incorrect rule of law, or if the decision itself is not supported by substantial evidence in the record. Kentucky State Racing Commission v. Fuller, 481 S.W.2d 298, 300–301 (Ky.1972). When reviewing issues of law, the court's review is de novo without any deference to the agency. Mill St. Church of Christ v. Hogan, 785 S.W.2d 263, 266 (Ky.App.1990). However, the court's review of factual issues is limited to an inquiry of “whether the agency's decision was supported by substantial evidence or whether the decision was arbitrary or unreasonable.” Cabinet for Human Res., Interim Office of Health Planning and Certification v. Jewish Hosp. Healthcare Servs., Inc., 932 S.W.2d 388, 390 (Ky.App.1996). Substantial evidence means “evidence of substance and relevant consequence having the fitness to induce conviction in the minds of reasonable men.” Owens—Corning Fiberglas Corp. v. Golightly, 976 S.W.2d 409, 414 (Ky.1998).

ANALYSIS

Preliminary to our analysis of the issues presented, we observe that KOSHA is patterned after its federal counterpart, the Federal Occupational Safety and Health Act of 1970 (OSHA), 29 U.S.C.A. §§ 651–678 (2001), and enacted for the purpose of providing “safe and healthful working conditions....” Whirlpool Corp. v. Marshall, 445 U.S. 1, 12, 100 S.Ct. 883, 890, 63 L.Ed.2d 154 (1980). To implement the statutory purpose, obligations are imposed on employers to comply with a “general duty clause” requiring that the employer free the workplace of all recognized hazards, 29 U.S.C. § 654(a)(1), and a “special duty clause” which requires compliance with mandatory occupational safety and health standards issued by the Secretary, 29 U.S.C. § 654(a)(2). Brock v. L.E. Myers Co., High Voltage Div., 818 F.2d 1270, 1275 (6th Cir.1987). The general duty clause was enacted to cover serious hazards not otherwise covered by specific regulations. Teal v. E.I. DuPont de Nemours and Co., 728 F.2d 799 (6th Cir.1984). Because Hayes was cited for violating a specific duty under KOSHA, we are not concerned with the general duty clause.

Finally, prefatory to our discussion, we add that KOSHA is substantially identical to the Federal Act. Pursuant to KRS 338.061(2), the Kentucky Occupational Safety and Health Standards Board is authorized to adopt federal standards for occupational safety and health and Kentucky courts look to Federal decisions for guidance. See Ky. Labor Cabinet v. Graham, 43 S.W.3d 247, 253 (Ky.2001) (abrogated on other grounds by Hoskins v. Maricle, 150 S.W.3d 1 (Ky.2004)).

1. Whether the citations are invalid because Hayes was not afforded the opportunity to attend the opening conference or walk around inspection.

The circuit court agreed with Hayes' contention that it was denied due process when the Department conducted its investigation without a Hayes representative at the site for the opening conference or for the inspection. We disagree.

KOSHA and OSHA contain provisions that afford the employer walk around privileges. KRS 338.111 states:

A representative of the employer and a representative authorized by the employees shall be given an opportunity to accompany the representative of the commissioner during the physical inspection of any place of employment as authorized by KRS 338.101. If there is no authorized employee representative available at the time of inspection, the commissioner's representative shall consult with a reasonable number of employees concerning matters of occupational safety and health in the place of employment. The representative of the commissioner shall be in full charge of the inspection, including the right to limit the number of representatives on the inspection team. Section 8(e) of the Federal Act, 29 U.S.C. § 657(e) contains an identical provision. Additionally, 803 KAR 2:070 Section 4 provides for opening and closing conferences.

Initially, we clarify that although presented as a due process claim, Hayes has failed to present any authority that a violation of KRS 338.111 is necessarily a deprivation of due process.¹ Confronted with a similar argument, the Court, in Sierra Resources, Inc. v. Herman, 213 F.3d 989 (7th Cir.2000), astutely pointed out that there is no basis in the law for the assumption that every statutory or regulatory violation of a procedural nature necessarily includes a due process violation. Id. at 992–993.

Due process requires that Hayes be afforded notice and an opportunity to respond to the citations, not the opportunity to attend the opening conference or participate in the walk around inspection. It is a privilege conferred by statute, not the Constitution. Id. Contrary to Hayes' due process...