Predecessor Company's Violations Count, OSHRC Holds

In a Nov. 18 decision that was a case of first impression, the commission held that a company's change in legal status does not prevent a repeat violation from being upheld against the successor company.

Changing its legal status may not prevent an employer from being cited for a repeat violation of a standard the earlier entity had violated, the Occupational Safety & Health Review Commission ruled Nov. 18. The case, Secretary of Labor v. Sharon & Walter Construction, Inc., Docket No. 00-1402, is an old one, having been decided in 2001 by an OSHRC administrative law judge.

The decision by OSHRC's three commissioners said this issue of changed legal status was one of first impression for OSHRC, meaning it had not decided the question until now. The case arose on April 20, 2001, when an employee of S&W Corporation, Robert H. Bell III, fell from a steeply pitched metal roof at a job site in Pittsfield, N.H. He and another worker on the job were not protected by any means of fall protection, according to the decision.

The commissioners affirmed a willful citation with a penalty of $7,000 and a repeat citation with a penalty of $3,750, holding that the employer (called S&W II in the decision) and its predecessor, S&W I, were essentially the same entity. The same person, Walter Jensen, was sole proprietor of both S&W II, which was incorporated in New Hampshire on July 12, 1995, and S&W I, which had filed for bankruptcy Aug. 16, 1994, and ceased operating six weeks before S&W II was created. The two provided essentially the same construction services, used the same offices and same phone number, and S&W II paid a bill from an S&W I account, according to the decision.

OSHA issued the two citations on the day of the April 2000 accident. In the repeat citation, OSHA noted S&W I had been cited twice for violating the same standard S&W II had allegedly violated -- 29 CFR 1926.503(a)(2).

The commission said Section 17(a), which provides for enhanced penalties against "[a]ny employer who ... repeatedly violates" the OSHA Act, was designed to deter employers from committing violations primarily by creating the potential that a future violation's penalty will be significantly greater. The commissioners wrote, "we conclude that the statutory language in section 17(a) is most reasonably read to permit, in appropriate circumstances, the [Labor] Secretary's application of a 'repeat' characterization to cases where the cited employer has altered its legal identity from that of the predecessor employer whose citation history forms the basis of that characterization. Such an interpretation is not only consistent with the Act's purpose, but also ensures the effectiveness of its enforcement scheme."

Download Center

HTML - No Current Item Deck
  • Free Safety Management Software Demo

    IndustrySafe Safety Management Software helps organizations to improve safety by providing a comprehensive toolset of software modules to help businesses identify trouble spots; reduce claims, lost days, OSHA fines; and more.

  • Track Key Safety Performance Indicators

    IndustrySafe’s Dashboard Module allows organizations to easily track safety KPIs and metrics. Gain increased visibility into your business’ operations and safety data.

  • Analyze Incident Data

    Collect relevant incident data, analyze trends, and generate accurate regulatory reports, including OSHA 300, 300A, and 301 logs, through IndustrySafe’s extensive incident reporting and investigation module.

  • Safety Training 101

    When it comes to safety training, no matter the industry, there are always questions regarding requirements and certifications. We’ve put together a guide on key safety training topics, requirements for certifications, and answers to common training questions.

  • Conduct EHS Inspections and Audits

    Record and manage your organization’s inspection data with IndustrySafe’s Inspections module. IndustrySafe’s pre-built forms and checklists may be used as is, or can be customized to better suit the needs of your organization.

  • Industry Safe
comments powered by Disqus

OH&S Digital Edition

  • OHS Magazine Digital Edition - March 2019

    March 2019


      Not Your Grandpa's Ear Muffs 
      Far Too Many Fatal Falls
      Marijuana in the Workplace
      Ladder Safety Tips
    View This Issue