Ups, Inc. v. Bureau of Safety & Regulation

Decision Date15 November 2007
Docket NumberDocket No. 269720.
Citation745 N.W.2d 125,277 Mich. App. 192
PartiesUNITED PARCEL SERVICE, INC., Petitioner-Appellant v. BUREAU OF SAFETY AND REGULATION, Respondent-Appellee.
CourtCourt of Appeal of Michigan — District of US

Dykema Gossett, PLLC (by Martin Jay Galvin and James F. Hermon), Detroit and Gibson, Dunn & Crutcher, LLP (by Baruch A. Feliner, Matthew R. Estabrook, and John W.F. Chesley), Washington, DC, for the petitioner.

Michael A. Cox, Attorney General, Thomas L. Casey, Solicitor General, and Richard P. Gartner, Assistant Attorney General, for the respondent.

Price, Heneveld, Cooper, DeWitt & Litton, LLP (by Jason Leonard Budd), Grand Rapids, for the National Federation of Independent Business Legal Foundation and the Chamber of Commerce of the United States, amici curiae.

Before: MARKEY, P.J., and SAAD and WILDER, JJ.

MARKEY, P.J.

Petitioner United Parcel Service, Inc. (UPS), appeals by leave granted the circuit court's order affirming administrative rulings upholding two civil citations that alleged UPS violated Mich. Admin. Code, R. 408.13308(1), by failing to assess its aircraft repair facilities located at Lansing and Romulus to determine if hazards necessitating the use of personal protective equipment (PPE) were present. We conclude that the plain text of the rule mandates that an employer "assess the workplace to determine if hazards that necessitate the use of personal protective equipment are present or are likely to be present." The rule does not specify how the employer must make this assessment. Accordingly, we hold that the hearing officer committed a "substantial and material error of law," MCL 24.306(1)(f), by ruling that a representative hazard assessment of one or more similar workplaces where identical job tasks are performed can never satisfy R. 408.13308(1). We reverse the circuit court's order affirming the rulings and report of the hearing officer and remand for entry of an order vacating those parts of the citations alleging that UPS violated R. 408.13308(1).

I. Facts and Proceedings

UPS appeals two civil citations that allege it violated Mich. Admin. Code, R. 408.13308(1), adopted under the authority of Michigan's Occupational Safety and Health Act,1 MCL 408.1001 et seq. Upon a violation of the act or a rule promulgated under it, MCL 408.1035 provides that the enforcing agency may assess a civil penalty in an amount dependent on the culpability of the violator. The act affords an aggrieved party the right to a hearing conducted in accordance with the procedures applicable to a contested case under the Administrative Procedures Act (APA), MCL 24.201 et seq. See MCL 408.1042 and MCL 408.1043. The Board of Health and Safety Compliance and Appeals (the board) decides the appeal after receiving the hearing officer's report. MCA. 408.1004(3); MCL 408.1044; MCL 408.1046. "The report of the hearing officer shall become the final order of the board within 30 days after filing with the board and parties, unless a member of the board directs that the report be reviewed and acted upon by the board." MCL 408.1042. An aggrieved party, such as UPS, may obtain judicial review of the board's decision pursuant to the APA. See MCL 408.1044(3).

Both federal regulations, issued under the Occupational Safety and Health Act (OSHA), 29 USC 651 et seq., and state regulations require employers to assess workplaces to determine if hazards necessitating the use of PPE are present. The Michigan rule provides:

(1) An employer shall assess the workplace to determine if hazards that necessitate the use of personal protective equipment are present or are likely to be present. If the hazards are present or are likely to be present, then the employer shall do all of the following:

(a) Select, and have each affected employee use, the types of personal protective equipment that will protect the affected employee from the hazards identified in the hazard assessment.

(b) Communicate selection decisions to each affected employee.

(c) Select the personal protective equipment that properly fits each affected employee. [Mich Admin Code, R 408.13308(1).]

The federal rule provides:

(1) The employer shall assess the workplace to determine if hazards are present, or are likely to be present, which necessitate the use of personal protective equipment (PPE). If such hazards are present, or likely to be present, the employer shall:

(i) Select, and have each affected employee use, the types of PPE that will protect the affected employee from the hazards identified in the' hazard assessment;

(ii) Communicate selection decisions to each affected employee; and,

(iii) Select PPE that properly fits each affected employee. [29 CFR 1910.132(d).]

UPS supports the air division of its package delivery business by operating 63 aircraft repair facilities throughout the United States and its territories. UPS contracted with Keter Consultants, Inc. (Keter), to conduct a study of its aircraft facilities throughout the country to determine what hazards are present in these work environments and the PPE necessary to protect workers from those hazards. Keter determined, and UPS agreed, that the framework of federal regulations the Federal Aviation Administration imposed on aircraft facilities had such a homogenizing effect on UPS aircraft repair facilities that it rendered uniform the hazards presented to employees at these workplaces. Keter concluded that UPS could satisfy its obligations under the federal standard by conducting a single representative assessment at its central hub in Louisville, Kentucky, because all the operations at the other aircraft repair facilities were also conducted at the Louisville facility and FAA regulations mandated that the operations be performed in the same manner at each facility. Keter performed a comprehensive hazard assessment at the Louisville facility and also validated the assessment by inspecting UPS's Des Moines, Iowa, facility. UPS implemented the Keter assessment at all its airport facilities, including those in Michigan. Keter did not actually inspect the Michigan facilities.

UPS asserts that an aircraft mechanics union official filed 63 identical complaints concerning each of its aircraft repair facilities across the country, disputing the validity of the Keter assessment that UPS had implemented. UPS contends that federal OSHA offices initiated 40 investigations that resulted in 13 inspections, 27 letter resolutions, and no prosecutions. State and United States territory complaints resulted in 23 investigations by 20 field offices of 12 state and territorial agencies. UPS contends that none of these inspections, except the two Michigan workplaces in Lansing and Romulus, resulted in a citation for violating 29 CFR 1910.132(d)(1) or the analogous state rule. UPS asserted below and asserts on appeal that these nonprosecutions constitute federal precedent that its representative workplace assessment for necessary PPE satisfies the federal rule, and, under Michigan law, must also be deemed to satisfy Michigan's substantially identical rule. UPS, however, did not establish these factual allegations at an evidentiary hearing during its administrative appeal. Rather, the parties each submitted motions for summary disposition to the hearing officer. The hearing officer ruled that UPS had not supported its factual claim regarding the 61 other complaints with documentary evidence other than by submitting a chart that UPS had prepared.

The MIOSHA inspector(s) initially drafted the citations at issue alleging that UPS conducted inadequate PPE assessments at its Lansing and Romulus facilities, but the final citations alleged with respect to each facility: "Assessment conducted at central location and not validated at each worksite."

UPS's administrative appeal was submitted to the hearing officer on the parties' reciprocal motions for summary disposition, without an evidentiary hearing. The hearing officer rejected UPS's submitted evidence regarding the "detail on the process and conclusions of the workplace hazard assessments in Louisville, Kentucky and Des Moines, Iowa" as being "not material." The hearing officer considered the legal question presented to be "whether any workplace hazard assessment performed anywhere else could satisfy" R 408.13308(1) with respect to workplaces in Lansing and Romulus. In that regard, the hearing officer rejected UPS's claim that its Michigan facilities and those in Louisville and Des Moines were "identical" or "fungible." But the hearing officer agreed that the two out-of-state facilities were "typical or representative"—apparently, given the context, of petitioner's Michigan facilities. Nevertheless, the hearing officer reached a legal conclusion that served as the foundation for affirming the citations: "[S]ince [UPS] did not `validate' its out-of-state assessments at the Michigan workplaces, [UPS] did not perform workplace assessments at all." On this basis, the hearing officer rejected UPS's argument that respondent had not shown that the Keter assessments were inadequate or deficient, and the hearing officer therefore concluded that "any inadequacy or deficiency in the assessments is not relevant to this case."

The hearing officer recognized that R. 408.13308(1) and 29 CFR 1910.132(d)(1) set forth substantially the same standard. But the hearing officer concluded that the plain text "shall assess the workplace" in Michigan's rule, requires a separate hazard assessment at each workplace. The hearing officer reasoned that the focus of the standard is on assessing the workplaces, not just general hazards. On the basis of the legal conclusion noted earlier, the hearing officer ruled that, "[s]ince [UPS] has not assessed the Michigan workplaces, [UPS] has not complied with the standard."

To further support this ruling, the hearing officer cited R...

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