OREGON OCCUPATIONAL SAFETY & HEALTH DIVISION, Petitioner on Review,
CBI SERVICES, INC., Respondent on Review
Argued and submitted November 4, 2013.
WCB 0900126SH; CA A147558. On review from the Court of Appeals. [*]
Rebecca M. Auten, Assistant Attorney General, argued the cause and filed the brief for petitioner on review. With her on the brief were Ellen F. Rosenblum, Attorney General, and Anna M. Joyce, Solicitor General.
Carl B. Carruth, McNair Law Firm, Columbia, South Carolina, argued the cause for respondent on review. Joel S. DeVore, Luvaas Cobb, Eugene, filed the brief for respondent on review.
[356 Or. 579] LANDAU, J.
ORS 654.086(2) provides that an employer is not liable for a " serious" violation of the Oregon Safe Employment Act (OSEA) if " the employer did not, and could not with the exercise of reasonable diligence, know of the presence of the violation." At issue in this case is what the statute means when it says that an employer " could not with the exercise of reasonable diligence know" of a violation. The Court of Appeals held that the statutory phrase refers not to whether an employer " could" know--in the sense of being capable of knowing--of the violation; rather, the phrase refers to whether, taking into account a number of specified factors, an employer " should" know of the violation. Or. Occupational Safety & Health Div. v. CBI Servs.., 254 Or.App. 466, 295 P.3d 660 (2013). For the reasons that follow, we conclude that the Court of Appeals erred in its construction of ORS 654.086(2), but we affirm on other grounds.
The relevant facts are not in dispute. Employer CBI Services, Inc., a contractor, performed work on a water treatment tank that was under construction. At that time, the tank consisted of a 32-foot-high wall that created a circular enclosure about 130 feet in diameter. It did not yet have a roof. Around the inside of the tank, there was a carpenter's scaffold, about four feet below the tank's top edge. The scaffold would prevent falls to the inside of the tank. There was, however, no such scaffolding on the outside of the tank.
An Oregon Occupational Safety and Health Division (OR-OSHA) safety compliance officer, Brink, conducted a safety inspection of the construction site. As he approached the water tank, he saw a worker sitting on its top rim. The worker, later identified as Crawford, was welding and did not appear to be using fall protection. Brink took several pictures. He then approached the site supervisor, Vorhof, who was working at ground level, inside the entrance to the tank, rigging anchor cables. Brink and Vorhof were about 65 feet from Crawford, who was visible from where they stood. Brink told Vorhof what he had seen. Vorhof looked up at Crawford, who was still sitting on the rim of the tank. [356 Or. 580] Crawford was not wearing a safety harness and lanyard. Vorhof told Crawford to get down.
While Brink was talking to Vorhof, he noticed a second worker, Bryan, also working without required fall protection. Bryan was operating a lift, several feet from the ground. He was wearing a harness with a lanyard, but he had not attached the lanyard to the lift. Bryan also was about 65 feet from where Vorhof was working. Brink pointed to Bryan and said to Vorhof, " Hey, that man is not tied off." Vorhof then asked Bryan whether he was tied off, at which point Bryan noticed that he had not secured the lanyard to the lift and quickly did so. Bryan had been on the lift without fall protection for about 10 minutes.
Brink later issued employer a citation and notification of penalty for two " items," that is, two serious safety violations. Item one cited employer for failing to ensure that Bryan used required personal fall protection while working on the lift, while item two cited employer for failing to ensure that Crawford used fall protection when working while exposed to a 32-foot fall hazard. Employer disciplined
Crawford, Bryan, and Vorhof as a result of the citation. At the time, employer had in place safety rules, precautions, and training mechanisms--including fall-protection training and mandatory worksite safety meetings. Employer's fall-protection rules required, among other things, the use of either protective scaffolding or a lanyard attached to a body harness whenever a worker was exposed to a fall hazard of six feet or more.
Employer requested a hearing before an administrative law judge (ALJ) with the Hearings Division of the Workers' Compensation Board. At the beginning of the hearing, employer moved to dismiss the citation on the ground that OR-OSHA had failed to carry its burden of proving, as part of its prima facie case, that employer knew of the
alleged violations. Employer did not dispute that, under applicable rules, a supervisor's knowledge is imputed to an employer. It argued instead that OR-OSHA had failed to establish that its supervisor, Vorhof, had not been reasonably diligent in monitoring employees and enforcing safety rules. According to employer, OR-OSHA had mistakenly assumed that [356 Or. 581] Vorhof was under the obligation to keep constant watch over his workers. OR-OSHA responded that Vorhof was within 65 feet of the violations and had reasonable time to observe them.
The ALJ denied the motions to dismiss, explaining: " Employer argues that continuous observation of employees is neither required [n]or possible and that the conditions existed in such a short window of time that Vorhof did use reasonable diligence in supervising his crew. However, *** I find that there was sufficient time for Vorhof to observe either or both of the workers subject to the citation."
At the hearing itself, employer contested Brink's observation that Crawford was sitting atop the water tank. It also argued that, in any event, it was excused from liability because any violations were a result of " unpreventable employee misconduct." OR-OSHA responded that Brink's testimony and the photographs that he took supported his report that Crawford was sitting on the tank. As for employer's affirmative defense, OR-OSHA argued that employer failed to meet its burden of establishing that it took reasonable steps to discover the violation.
The ALJ vacated item one of the citation and affirmed item two. Beginning with item one, pertaining to Bryan's use of the lift without adequate fall protection, the ALJ concluded that applicable rules did not require the use of fall protection at heights of less than six feet and that OR-OSHA had failed to prove how high the lift was at the time of the alleged violation. As for item two, pertaining to Crawford's failure to use fall protection when working atop the 32-foot tank wall, the ALJ found that, as Brink had testified, Crawford in fact was sitting on top of the water tank at the time of the violation. The ALJ further concluded that Vorhof could have known of the violation with the exercise of reasonable diligence, based on his proximity to Crawford and the duration of the violation. The ALJ further concluded that employer had failed to establish the affirmative defense of unpreventable employee misconduct, an element of which is that employer took reasonable steps to discover the violation. Apparently referring to his prior ruling on the motion to dismiss, the ALJ explained that he had " previously [356 Or. 582] determined [the] element of employer knowledge, the determination that [employer] did not exercise reasonable diligence to detect the violation and established constructive knowledge of the violation."
Employer sought judicial review in the Court of Appeals of the part of the ALJ's order affirming citation item two. Employer argued that the ALJ had used an incorrect legal standard to determine whether OR-OSHA had met its prima facie burden to prove employer knowledge and that the ALJ misinterpreted and misapplied the elements of the unpreventable employee misconduct affirmative defense. OR-OSHA cross-petitioned for judicial review, challenging the part of the ALJ's order vacating citation item one.
The Court of Appeals agreed with both parties and reversed and remanded on both the petition and the cross-petition for review.
On the petition, the Court of Appeals began its analysis by stating that, under ORS 654.086(2), OR-OSHA bore the burden of proving that employer knew or, with the exercise of reasonable diligence, could have known of Crawford's violation. CBI Services, Inc., 254 Or.App. at 473-74. The court noted the dearth of Oregon appellate court case law addressing the question of what ORS 654.086(2) requires, but observed that this court " has intimated that, in deciding cases under the OSEA, we may look to federal case law for guidance." Id. at 474. Cited as authority for that observation was this court's opinion in OR-OSHA v. Don Whitaker Logging, Inc., 329 Or. 256, 263, 985 P.2d 1272 (1999), which the Court of Appeals read to stand for the proposition that federal law may serve as such guidance whenever state law has a counterpart in federal statute. 254 Or.App. at 474.
With that principle in hand, the court concluded that, because the operative wording of ORS 654.086(2) finds an identical counterpart in the federal Occupational Safety and Health Act (OSHA), 29 U.S.C. § 666(k), it was appropriate to turn to [356 Or. 583] federal case law to determine what OR-OSHA was required to prove to make out a prima facie case of Vorhof's knowledge of Crawford's violation. Id. at 474-75.
The court noted that the body of federal case law that has developed in connection with the federal OSHA has identified a number of factors for assessing whether an employer knew or, with the exercise of reasonable diligence, could know of a violation. Id. at 477. Those factors include the foreseeability of the violations, the general circumstances and level of danger inherent in the work, the potential need for continuous supervision, the nature and extent of the supervisor's other duties, the supervised workers' training and experience, and the extent and efficacy of the employer's safety programs and precautions. Id. at 477-78, 481. The Court of Appeals reported that " most federal courts have determined--applying the same statutory language defining a serious violation set forth in ORS 654.086(2)--that the relevant inquiry in proving a serious violation is whether 'an employer knew or should have known of a hazardous condition.'" Id. at 478-79 (quoting American Wrecking Corp v. Secretary of Labor, 351 F.3d 1254, 1264, 359 U.S.App.D.C. 110 (DC Cir 2003) (emphasis added by Court of Appeals). In other words, the OSEA essentially requires OR-OSHA to establish that an employer was " negligent" in failing to know of the violation. Id.
The court concluded that, " to the extent that federal case law dictates" such an approach to the issue of employer knowledge, " the ALJ's inquiry in this case was critically shortsighted." Id. at 479. In particular, the ALJ failed to consider that Crawford's violation " was entirely unforeseeable." Id. Moreover, the court added, " the ALJ failed to take into account employer's extensive safety protocols, including worksite-specific fall-protection planning," as well as " the evidence indicating that Vorhof had no reason to believe that Crawford was exposed to a potential fall hazard at all." Id. at 480. Turning to the cross-petition, concerning the dismissal of item one based on OR-OSHA's failure to establish [356 Or. 584] that Bryan was working at a height covered by the fall-protection rules, the Court of ...