Ocean Elec. Corp. v. Secretary of Labor, and Occupation Safety and Health Review Com'n

• Decision Date: 16 March 1979
• Docket Number: No. 76-1060,76-1060
• Parties: 5 O.S.H. Cas.(BNA) 1672, 7 O.S.H. Cas.(BNA) 1149, 1979 O.S.H.D. (CCH) P 23,404 OCEAN ELECTRIC CORPORATION, Petitioner, v. SECRETARY OF LABOR and Occupational Safety and Health Review Commission, Respondents.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 396

594 F.2d 396

5 O.S.H. Cas.(BNA) 1672, 7 O.S.H. Cas.(BNA) 1149,

1979 O.S.H.D. (CCH) P 23,404

OCEAN ELECTRIC CORPORATION, Petitioner, v. SECRETARY OF LABOR and Occupational Safety and Health Review

Commission, Respondents.

No. 76-1060.

United States Court of Appeals, Fourth Circuit.

Argued May 1, 1978.

Decided March 16, 1979.

Charles R. Waters, II, Norfolk, Va., Henry H. Mansbach, Thomas E. Cabaniss, Norfolk, Va., Conrad M. Shumadine, Richmond, Va., David Y. Faggert, Kaufman & Oberndorfer, Norfolk, Va., on brief, for petitioner.

Dennis K. Kade, Atty., Dept. of Labor, Washington, D. C. (Carin A. Clauss, Sol. of Labor, Benjamin W. Mintz, Associate Sol. for Occupational Safety and Health, Allen H. Feldman, Acting Counsel for App. Litigation, U. S. Dept. of Labor, Washington, D. C., on brief), for respondents.

Before HAYNSWORTH, Chief Judge, FIELD, Senior Circuit Judge, and WIDENER, Circuit Judge.

WIDENER, Circuit Judge:

This case comes to us on a grant of petition for rehearing. The Occupational Safety and Health Review Commission found that Ocean Electric Corporation had committed a serious violation of OSHA Regulation 29 C.F.R. § 1926.957(a)(3) by failing to provide a barricade or barrier between its employees and energized electrical bus bars. We previously filed an opinion affirming the Commission, but a petition for rehearing was granted, and the case was reargued before a reconstituted panel. ¹ We now withdraw the first opinion and reverse the Commission.

Ocean Electric is a Virginia corporation engaged in business as an electrical contractor. Pursuant to contract, it was installing an additional switch gear unit at a Navy electric power station in Virginia Beach, Virginia. The job was to be done in two parts. The first part required setting the new unit in place adjacent to an existing unit. The second part would have involved energizing the new unit by tying it to its adjacent unit, which required de-energizing the adjacent unit.

On the day the first part of the job was to be performed, J. W. Kistler, the job superintendent, inspected the jobsite, drew up a work plan, and assigned three men to the project, Jack Watson, Marcel Burger, and the decedent, Jerry Kephart. Watson, the foreman, was an experienced journeyman electrician who had a perfect safety record prior to this accident. Burger also was an experienced electrician who had first aid training. Kephart was an apprentice electrician of outstanding ability with three years' experience, at least twelve months of which were with Ocean.

When the men began work, Watson noticed that a ground bus bar extended some six inches out from the base of the existing switch gear unit. To facilitate placement of the new unit, Watson decided to remove this unenergized ground bus bar. In order to determine how to accomplish this task, Watson opened the door on the existing switch gear unit. The ground bus bar ultimately was removed, but the last time Watson opened the door he neglected to close it.

The new unit was lowered into place by crane. The cables attaching the unit to the crane became slack when the unit touched the ground, and Watson ordered his assistants to grab them. Kephart grabbed the cables with his right hand, and at the same time stuck his left hand through the open door of the existing unit and touched an energized bus bar. He was electrocuted.

The case was tried on a stipulated statement of facts, and, in addition to the basic facts related above, the parties made the following stipulations among others: The decision to remove the unenergized ground bus bar was made at the last minute and was not contemplated by the superintendent; Watson's act in leaving the door open was accidental, not intentional, and purely a human error; the accident was caused solely by human error; and all three employees were all acquainted with the dangers involved in handling energized bus bars.

An OSHA compliance officer visited the jobsite and cited Ocean for failure "to provide a barricade, a barrier, or insulating equipment that would prevent accidental contact by employees with conductors energized by high voltage electricity." This failure, it was alleged, violated OSHA Regulation 29 C.F.R. § 1926.957(a)(3) which in turn is a breach of the employer's duty under the Occupational Safety and Health Act of 1970, 29 U.S.C. § 654(a)(2). ² Since an employee was killed, Ocean was cited for a serious violation of the Act. 29 U.S.C. § 666(j). A penalty of $700 was assessed. The original penalty was $1000, but this amount was reduced by ten percent for good faith and twenty percent because Ocean had no past history of violations under the Act.

Ocean contested the violation, and the Secretary of Labor filed a complaint to have the citation affirmed. 29 U.S.C. § 659(c). Ocean argued that the accident was unforeseeable and unpreventable, and that it should not be held responsible for the human error of its foreman. The administrative law judge rejected this argument, applied the common law doctrine of respondeat superior, and held Ocean responsible for the negligent act of its foreman. 1974-75 CCH OSHD § 18,422. The Occupational Safety and Health Review Commission (OSHRC) affirmed the holding of the hearing examiner, but for a different reason. It recognized Congress did not intend to hold employers to absolute responsibility for acts of their supervisors in each instance, although such may be the general rule, and where a company "has done everything reasonably possible to assure compliance, but a supervisor nevertheless creates a violation which was unforeseeable and therefore unpreventable," no liability should attach. 1974-75 CCH OSHD § 20,167, at 23,993. The Commission obviously viewed this exception, however, as an affirmative defense and held Ocean responsible for Watson's acts because it had not carried its burden of proof by showing the adequacy of its safety program.

The basic issue in this case is the extent of a company's responsibility for its foreman's actions under OSHA. Resolution of this issue requires a consideration of a variety of contexts in which the issue can arise. In this case alone, the issue is raised in three different settings. First, Ocean argues that it, in fact, complied with the regulation by providing a proper barrier between the bus bar and its employees. The Secretary disagrees and argues that a violation occurred when Ocean's foreman left the door open which the Secretary says removed the barrier. The issue is Ocean's responsibility for the foreman's act. If the responsibility for Watson's negligent act is imputed to Ocean, it violated the regulation. If not, Ocean complied.

Second, Ocean argues that it lacked the knowledge required for a serious violation of the Act. 29 U.S.C. § 666(j) states that an employer will not be guilty of a serious violation if it "did not, and could not with the exercise of reasonable diligence, know of the presence of the violation." If Ocean is not responsible in law for the act of its foreman, if it did what it normally could to prevent it, then it is difficult to say that Ocean had actual or constructive knowledge of the violation. On the other hand, if Watson is the personification of Ocean, then his knowledge will be imputed to Ocean and the requirements of § 666(j) will be satisfied.

Finally, Ocean argues that nothing it could have done would have prevented this accident or would prevent future similar accidents; and that to hold it liable for unpreventable accidents would undermine the purpose of the Act. The administrative law judge rejected this formulation of the issue and held Ocean liable on a strict application of respondeat superior. The Commission, as noted, agreed with Ocean's formulation of the issue, but held that Ocean had not met its burden of proof by introducing evidence showing the sufficiency of its safety program. The issue here, once again, is the type of steps Ocean must take in order to separate itself from the negligent acts of its supervisory employees.

Ocean may not escape all responsibility for the acts of its supervisors. A corporation can only act through its agents and to excuse Ocean simply because its foreman was negligent would emasculate the Act. However, an imputation of a supervisor's acts to the company in each instance would frustrate the goals behind the Act. As the Commission correctly stated: "Such a holding would also not tend to promote the achievement of safer workplaces. If employers are told that they are liable for violations regardless of the degree of their efforts to comply, it can only tend to discourage such efforts." 1974-75 CCH OSHD § 20,167, at 22,993. Further, it does not appear that Congress intended the employer to be an insurer of employee safety. "The Congress declares it to be its purpose and policy . . . to assure So far as possible every working man and woman in the Nation safe and healthful working conditions and to preserve our human resources . . . ." 29 U.S.C. § 651(b) (emphasis supplied). And, as stated in the Act's legislative history: "An employer's duty under . . . (the general duty clause) . . . is not absolute." H.R.Rep.No.92-1291, at 21, cited in National Realty and Construction Co. v. OSHRC, 160 U.S.App.D.C. 133, 142, 489 F.2d 1257, 1266 (1973).

We are of opinion that Ocean must accept some, but not unqualified, responsibility for the acts of its foreman. Both the Commission and the Courts of Appeals now accept this basic proposition, but there is not complete agreement as to where to draw the line on an employer's responsibility. In several cases, the Commission gave a fairly broad reading to the unforeseeable/isolated incident limitation on liability. In Secretary v. Otis Elevator Co., 17 OSAHRC Rep. 926 (1975), a company was cited when its employee failed to wear a proper safety belt. The Commission vacated the citation when it was shown that the employee's act was an isolated incident done on the...