R. Acosta, Secretary, LABR v. Hensel Phelps Constr
909 F.3d 723
5th Cir.2018Background
- Hensel Phelps was general contractor on an Austin library project; subcontractors (HEW and CVI) performed excavation work where a 12-foot Type C soil wall lacked required protective systems.
- CVI employees worked at the base of the unprotected excavation; Hensel Phelps supervisors observed them and had supervisory authority over the site.
- OSHA cited CVI (settled) and Hensel Phelps under the multi-employer citation policy for violating 29 C.F.R. § 1926.652(a)(1) (no protective system for excavation), treating Hensel Phelps as a "controlling employer."
- Hensel Phelps contested; an ALJ vacated the citation relying on Fifth Circuit precedent (Melerine and related cases) holding OSHA regulates only an employer's own employees.
- The Secretary petitioned for review; the Fifth Circuit evaluated whether the Secretary has authority under the OSH Act § 5(a)(2) (29 U.S.C. § 654(a)(2)) to cite controlling employers at multi-employer worksites and whether pre-Chevron precedent foreclosed deference to OSHA.
Issues
| Issue | Plaintiff's Argument (Secretary) | Defendant's Argument (Hensel Phelps) | Held |
|---|---|---|---|
| Whether § 654(a)(2) authorizes citations to a controlling employer at a multi-employer worksite whose own employees were not exposed | § 654(a)(2) and § 652(8) impose a duty to comply with safety standards covering "places of employment," permitting citations of controlling employers for hazards they create or control | § 654(a)(2) should be read to protect only an employer's own employees (consistent with Fifth Circuit precedent); multi-employer citation expands liability unlawfully | Court held § 654(a)(2) is ambiguous and OSHA’s interpretation is reasonable; Secretary has authority to cite controlling employers |
| Whether pre-Chevron Fifth Circuit cases (e.g., Melerine) unambiguously foreclose OSHA deference under Brand X | Agency interpretation is entitled to Chevron deference; Brand X permits displacing contrary pre-Chevron precedent unless that precedent unambiguously foreclosed the agency view | Melerine and related cases establish the statute/regulations protect only an employer’s own employees and should control | Court held Melerine and predecessor cases did not show the statute unambiguously foreclosed OSHA’s view; Brand X/ Chevron require deferring to OSHA |
| Whether OSHA’s multi-employer citation practice is entitled to Chevron deference despite being reflected in policy guidance | Secretary’s longstanding, consistent enforcement and adjudicatory practice resolving citations in adjudications supports Chevron deference | Policy guidance alone (without notice-and-comment) cannot get Chevron deference under Mead | Court found the Secretary’s interpretation arose from statutory adjudication and longconsistent agency practice and is entitled to Chevron deference (Mead not dispositive) |
| Whether ALJ’s vacatur of the citation was lawful given Chevron/Brand X analysis | ALJ should not have vacated the citation based on Melerine because Brand X/Chevron allow agency interpretation to govern ambiguous statute | ALJ relied on binding Fifth Circuit precedent (Melerine) to vacate citation | Court reversed ALJ/Commission and remanded for further proceedings consistent with decision |
Key Cases Cited
- Melerine v. Avondale Shipyards, Inc., 659 F.2d 706 (5th Cir. 1981) (pre-Chevron Fifth Circuit decision holding OSHA regulations protect only an employer's own employees)
- Chevron U.S.A. Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (U.S. 1984) (two-step framework for judicial review of agency statutory interpretation)
- Nat. Cable & Telecomms. Ass'n v. Brand X Internet Servs., 545 U.S. 967 (U.S. 2005) (prior judicial construction displaces agency interpretation only if the prior decision unambiguously forecloses the agency view)
- Universal Constr. Co. v. Occupational Safety & Health Review Comm'n, 182 F.3d 726 (10th Cir. 1999) (holding § 654(a)(2) ambiguous and can reach all employees at a common worksite)
- United States v. Mead Corp., 533 U.S. 218 (U.S. 2001) (limits to Chevron deference where agency action lacks notice-and-comment or formal adjudication)
- Martin v. Occupational Safety & Health Review Comm'n, 499 U.S. 144 (U.S. 1991) (agency interpretations in adjudications can warrant deference)
- Silva-Trevino v. Holder, 742 F.3d 197 (5th Cir. 2014) (Brand X applied where prior precedent rested on unambiguous statutory text)
- Exelon Wind 1, L.L.C. v. Nelson, 766 F.3d 380 (5th Cir. 2014) (refused deference where prior judicial interpretation rested on plain regulatory text)