Joy Technologies, Inc. v. Secretary of Labor, 95-9540

• Decision Date: 05 November 1996
• Docket Number: No. 95-9540,95-9540
• Citation: 99 F.3d 991
• Parties: JOY TECHNOLOGIES, INC., Coal Field Operations, Petitioner, v. SECRETARY OF LABOR, Mine Safety and Health Administration, Respondents.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 991

99 F.3d 991

JOY TECHNOLOGIES, INC., Coal Field Operations, Petitioner, v. SECRETARY OF LABOR, Mine Safety and Health Administration,

Respondents.

No. 95-9540.

United States Court of Appeals, Tenth Circuit.

Nov. 5, 1996.

W. Scott Railton (Christopher L. Killion and Marjorie P. Alloy with him on the brief), Reed, Smith, Shaw & McClay, McLean, VA, for Petitioner.

Robin A. Rosenbluth, Attorney (Thomas S. Williamson, Jr., Solicitor of Labor, Edward P. Clair, Associate Solicitor, and W. Christian Schumann, Counsel, Appellate Litigation, with her on the brief), U.S. Department of Labor, Office of the Solicitor, Arlington, VA, for Respondents.

Before PORFILIO, TACHA and BRORBY, Circuit Judges.

TACHA, Circuit Judge.

In this petition for review, we must examine the regulatory jurisdiction of the Mine Safety and Health Administration (MSHA) under the Federal Mine Safety and Health Act of 1977 (Mine Act), codified as amended at 30 U.S.C. §§ 801-962. Joy Technologies, Inc., (Joy) manufactures and sells mining equipment and sends service representatives onto mine property in connection with the sale of its products. In enforcing a safety regulation promulgated under the Mine Act, the Federal Mine Safety and Health Review Commission (FMSHRC) upheld the assessment of a penalty by MSHA against Joy for its failure to provide required annual refresher training to its service representatives. On appeal, Joy contests MSHA's jurisdiction to assess the penalty, arguing that (1) Joy is not an "independent contractor" because it did not have a contract for services and did not control any mining related operations and (2) Joy is not an "operator" because it was not sufficiently involved in the extraction process and was not continually present at the mine. We have jurisdiction over this petition for review pursuant to 30 U.S.C. § 816(a) and affirm.

BACKGROUND

I. Federal Mine Safety and Health Act

In 1969, Congress enacted the Federal Coal Mine Health and Safety Act (Coal Mine Act), Pub.L. No. 91-173, 83 Stat. 742, which subjected to regulation every coal mine affecting commerce and every operator of such coal mine. § 4, 83 Stat. at 744. Section 3(d) of the Coal Mine Act defined an "operator" as "any owner, lessee, or other person who operates, controls, or supervises a coal mine." § 3(d), 83 Stat. at 744. Although section 3(d) did not specifically include independent contractors within the definition of "operator," courts interpreted this provision to include independent contractors whenever the contractors, in performing services at a coal mine, controlled or supervised all or part of the mine. See Association of Bituminous Contractors, Inc. v. Andrus, 581 F.2d 853, 860-62 (D.C.Cir.1978) ("[A]n independent construction company, which operates, controls, or supervises excavation work ... is an 'operator of a coal mine' within the meaning and purposes of [the Coal Mine Act]."); Bituminous Coal Operators' Ass'n v. Secretary of Interior, 547 F.2d 240, 246 (4th Cir.1977) ("[W]hen a company exercises control and In 1977, in order to improve and promote safety and health in the nation's mines, Congress amended the Coal Mine Act, renaming it the Federal Mine Safety and Health Act. See Pub.L. No. 95-164, §§ 101, 102(a), 91 Stat. 1290. Congress broadened section 3(d) of the Coal Mine Act to include in the definition of operator "any independent contractor performing services or construction at [a] mine." 30 U.S.C. § 802(d). The Secretary of Labor, through MSHA, an agency within the Department of Labor, see 29 U.S.C. § 557a, issued a regulation defining an independent contractor as "any person ... [who] contracts to perform services or construction at a mine." 30 C.F.R. § 45.2(c).

supervision over a specific area of land while it is constructing one of the facilities mentioned in the act, it is functioning as an operator of a coal mine.").

II. Procedural History

On April 6, 1992, Joy Technologies delivered a new continuous miner to the Sanborn Creek Mine, operated by Somerset Mining Company (Somerset) in Gunnison County, Colorado. On this occasion, as well as on at least four previous occasions during 1992, Dick McElhannon, a Joy service representative, visited the Sanborn Creek Mine and performed a variety of services, including assuring that Joy's equipment was delivered in proper condition, advising and assisting in repairs, and procuring necessary replacement parts. McElhannon's own reports show that he helped Somerset's maintenance staff in "troubleshooting" problems with the equipment both above ground in the mine's maintenance shop and below ground in the mine. McElhannon, however, did not personally unload, assemble, or service any machine. The parties do not dispute that Joy did not have a service contract with Somerset. The only contracts between the parties were for the sale of parts and new equipment.

On April 7, 1992, an MSHA inspector entered the maintenance shop while Somerset's maintenance crew was assembling the continuous miner. The inspector observed McElhannon using a remote control to move the main frame of the continuous miner to help a Somerset mechanic pin the machine together. The inspector believed that McElhannon was operating the remote control in a hazardous manner. When the inspector determined that McElhannon had not received eight hours of annual refresher training as required of all miners under 30 C.F.R. § 48.28(a), the inspector issued a citation against Joy.

Joy contested MSHA's citation and civil penalty proposal, and a hearing was held before an administrative law judge on July 20, 1993. The ALJ issued a decision affirming the violation and assessing a civil penalty of $100 against Joy. Joy Technologies, Inc., 15 F.M.S.H.R.C. 2147, 2152 (1993). Thereafter, FMSHRC granted Joy's petition for review, and on August 14, 1995, FMSHRC issued a final decision affirming the ALJ's decision that Joy was both an independent contractor and an operator within the meaning of the Mine Act. Joy Technologies, Inc., 17 F.M.S.H.R.C. 1303 (1995). Relying on a previous decision, Bulk Transp. Servs., Inc., 13 F.M.S.H.R.C. 1354, 1358 n.2 (1991), FMSHRC concluded that Joy did not need a specific service contract with Somerset to qualify as an independent contractor. FMSHRC did not address Joy's argument that control was required for independent contractor status. FMSHRC further concluded that Joy was an operator, applying the two-part test set forth in FMSHRC's Otis Elevator Co. line of cases: Otis Elevator, Inc., 11 F.M.S.H.R.C. 1896 (1989) (Otis I ), and Otis Elevator Inc., 11 F.M.S.H.R.C.1918 (1989) (Otis II ), aff'd on other grounds, 921 F.2d 1285 (D.C.Cir.1990). Under this test, FMSHRC examines (1) "the independent contractor's proximity to the extraction process" and (2) "the extent of [the contractor's] presence at the mine." Otis I, 11 F.M.S.H.R.C. at 1902. Applying this test, the Commission found that Joy was an operator because it "engaged in activities essential to the extraction process" and that "Joy's contacts with the mine were more than de minimis." Joy Technologies, Inc., 17 F.M.S.H.R.C. at 1307-08.

DISCUSSION

I. Standard of Review

At the outset, we address the question of the appropriate standard of review to apply to MSHA's interpretation of section 3(d) of the Mine Act. In reviewing MSHA's interpretation, we must first inquire "whether Congress has directly spoken to the precise question at issue." Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842, 104 S.Ct. 2778, 2781, 81 L.Ed.2d 694 (1984). If a statute's meaning is clear and unambiguous, the inquiry ends. Id. at 842-43, 104 S.Ct. at 2781-82. If a statute is silent or ambiguous on a specific issue, we give deference to the interpretation adopted by the agency entrusted with administering the statute. Id. at 842-45, 104 S.Ct. at 2781-83; Thunder Basin Coal Co. v. FMSHRC, 56 F.3d 1275, 1277 (10th Cir.1995); Utah Power & Light Co. v. Secretary of Labor, 897 F.2d 447, 449-50 (10th Cir.1990); Emery Mining Corp. v. Secretary of Labor, 744 F.2d 1411, 1415 (10th Cir.1984). We must uphold the agency's interpretation as long as that interpretation is one of the permissible interpretations the agency could have selected. Chevron, 467 U.S. at 843, 104 S.Ct. at 2782; Thunder Basin, 56 F.3d at 1277; Utah Power & Light Co., 897 F.2d at 450. If a regulation promulgated by the agency is ambiguous, an interpretation "which is reasonable and consistent with the statute ... is to be preferred." United Telecommunications, Inc. v. Commissioner, 589 F.2d 1383, 1390 (10th Cir.1978), cert. denied, 442 U.S. 917, 99 S.Ct. 2839, 61 L.Ed.2d 284, (1979). If the Secretary of Labor and FMSHRC have conflicting interpretations of the Mine Act, the Secretary's interpretations rather than FMSHRC's are entitled to deference under Chevron. Secretary of Labor v. Western Fuels-Utah, Inc., 900 F.2d 318, 321 (D.C.Cir.1990); Secretary of Labor v. Cannelton Industries, 867 F.2d 1432, 1435 (D.C.Cir.1989). We next apply these principles to MSHA's construction of section 3(d) to determine whether Joy qualifies as both an "independent contractor" as well as an "operator" under the Mine Act.

II. Joy's status as an "Independent Contractor"

We first determine whether Joy is an independent contractor under section 3(d) of the Mine Act. Section 3(d) states the following:

"operator" means any owner, lessee, or other person who operates, controls, or supervises a coal or other mine or any independent contractor performing services or construction at such mine.

30 U.S.C. § 802(d) (emphasis added). MSHA's regulations implementing section 3(d) define an "independent contractor" as any person or business "that contracts to perform services or construction at a mine." 30 C.F.R. § 45.2(c). In contesting MSHA's jurisdiction, Joy argues that it is not an independent contractor under section 3(d) because: (1) it did not have a specific service contract with...