STATE OF CALIFORNIA
OCCUPATIONAL SAFETY AND HEALTH
In the Matter of the Appeal of:
ECHO ALPHA, INC., JOHN STAGLIANO, INC.,
EVIL ANGEL PRODUCTIONS, AND JOHN
STAGLIANO INC. dba EVIL ANGEL VIDEO
14141 Covello Street, Unit 8C
Van Nuys, CA 91405
The Occupational Safety and Health Appeals Board (Board), acting
pursuant to authority vested in it by the California Labor Code and having
taken the petition for reconsideration filed by Echo Alpha Inc. (Employer) under
submission, renders the following decision after reconsideration.
Beginning on August 20, 2013, the Division of Occupational Safety and
Health (Division) conducted a complaint-initiated inspection at a place of
employment in Van Nuys, California maintained by Employer. On February
19, 2014, the Division issued three citations to Employer alleging violations of
workplace safety and health standards codified in California Code of
Regulations, Title 8, and proposing civil penalties.
All citations were settled
except for Citation 2, and at hearing the Division withdrew Instance 1 of
Citation 2, Instance 2 alleged a serious violation of section 3203(a)
[failure to correct unsafe work practices].
Employer filed a timely appeal of the citation.
Administrative proceedings were held, including a contested evidentiary
hearing before an Administrative Law Judge (ALJ) of the Board. After taking
testimony and considering the evidence and arguments of counsel, the ALJ
Unless otherwise specified, all references are to California Code of Regulations, Title 8.
The Division withdrew Instance 1 of Citation 2 at hearing. (Decision, 1.)
issued a Decision on March 11, 2015. The Decision denied Employer’s appeal,
imposing a total civil penalty of $9000.
Employer timely filed a petition for reconsideration of the ALJ’s Decision.
The Division filed an answer to the petition.
Was the Employer properly provided notice of the Division’s intention to
cite Citation 2, Instance 2 as serious via the procedures described in
Labor Code section 6432(b)(1)?
Did the ALJ correctly calculate the penalty?
FINDINGS OF FACT
The Division served an administrative subpoena duces tecum to
Employer’s representative, Christian Mann, on August 23, 2013,
requesting various records related to Employer’s business. (Ex. 9.)
Employer issued a written IIPP that included procedures for ensuring
that employees comply with safe and healthy work practices. (Ex. 5.)
Despite having an IIPP that included systems that met the
requirements of section 3203(a) as written, Employer failed to
implement this program in its workplace.
Employer did not have a system for recognition for employees who
followed safe work practices.
Employer did not have formal on the job training or retraining in
matters related to safety.
Employer had a written progressive discipline policy for violations of
safety rules, but this disciplinary policy was never enforced.
No system of communication for health and safety issues, such as
meetings or other methods, was in place at Employer’s worksite.
Four employees and a supervisor were employed in Employer’s
DECISION AFTER RECONSIDERATION
In making this decision, the Board relies upon its independent review of
the entire evidentiary record in the proceeding. The Board has taken no new
evidence. The Board has also reviewed and considered Employer’s petition for
reconsideration and the Division’s answer to it.
Labor Code section 6617 sets forth five grounds upon which a petition
for reconsideration may be based:
That by such order or decision made and filed by the appeals
board or hearing officer, the appeals board acted without or
in excess of its powers.
That the order or decision was procured by fraud.
That the evidence does not justify the findings of fact.
That the petitioner has discovered new evidence material to
him, which he could not, with reasonable diligence, have
discovered and produced at the hearing.
That the findings of fact do not support the order or decision.
Employer petitioned for reconsideration on the basis of Labor Code section
6617(a), (c) and (e).
Employer makes several arguments in its petition for reconsideration:
that the ALJ’s decision relies upon unreliable hearsay, that the Division did not
prove a violation of section 3203, that the serious classification of the violation
was improper, that appellant was not provided adequate notice that the
Division intended to issue the citation as serious, that there was no employee
exposure, and that the penalty was improperly calculated. The Board finds the
majority of these arguments to be unavailing, and to have been thoroughly and
properly addressed in the ALJ’s Decision. However, the issue regarding notice
of intent to issue a serious citation is one of first impression for the Board, and
merits closer inspection.
As background, Labor Code section 6432 subdivision (b)(1) contains the
(b) (1) Before issuing a citation alleging that a violation is serious,
the division shall make a reasonable attempt to determine and
consider, among other things, all of the following:
(A) Training for employees and supervisors relevant to preventing
employee exposure to the hazard or to similar hazards.
(B) Procedures for discovering, controlling access to, and
correcting the hazard or similar hazards.
(C) Supervision of employees exposed or potentially exposed to
(D) Procedures for communicating to employees about the
employer's health and safety rules and programs.
(E) Information that the employer wishes to provide, at any time
before citations are issued, including, any of the following:
(i) The employer's explanation of the circumstances
surrounding the alleged violative events.
(ii) Why the employer believes a serious violation does not
(iii) Why the employer believes its actions related to the
alleged violative events were reasonable and responsible so
as to rebut, pursuant to subdivision (c), any presumption
established pursuant to subdivision (a).
(iv) Any other information that the employer wishes to
(2) The division shall satisfy its requirement to determine and
consider the facts specified in paragraph (1) if, not less than 15
days prior to issuing a citation for a serious violation, the division
delivers to the employer a standardized form containing the alleged
violation descriptions ("AVD") it intends to cite as serious and
clearly soliciting the information specified in this subdivision. The
director shall prescribe the form for the alleged violation
descriptions and solicitation of information. Any forms issued
pursuant to this section shall be exempt from the rulemaking
provisions of the Administrative Procedure Act (Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title 2
of the Government Code).
In sum, the Labor Code instructs the Division to consider the factors listed in
subdivision (b)(1) prior to issuing a citation as serious; this provides an
employer with the opportunity to furnish information to the Division that may
militate in favor of issuance of a less than serious citation. The Labor Code in
subdivision (b)(2) also allows the Division to create and issue a standardized
form to collect the information listed in subdivision (b)(1).
In this case, the Division opted to send to Employer its standardized
form, referred to as a 1BY. However, Employer notes that while the 1BY it
received referenced the IIPP standard, the alleged violative description is
labeled “Instance 1” and discusses blood and other potentially infectious
material, rather than the general IIPP issues that were ultimately litigated in
Instance 2. No separate 1BY form was issued for Citation 2, Instance 2. The
Division’s inspector agreed in testimony that he issued a 1BY form for Citation
2, but per his usual practice, did not issue a separate 1BY form for each
Instance cited therein, as they all related to the same general IIPP violation
described in the “charging language”. While this may be the Inspector’s usual
practice, section 6432 subdivision (b)(2) requires that the Division provide the
“alleged violative description” on the 1BY. The Division’s completion of the
form unquestionably fell short. For Citation 2, Instance 2, the Division cannot
rely on its issuance of a related, but factually distinct, 1BY as proof that it
solicited the information required by section 6432 subdivision (b)(1).
Labor Code section 6432 subdivision (d) provides the following remedy
for those instances where the Division makes an error of this kind:
(d) If the employer does not provide information in response to a
division inquiry made pursuant to subdivision (b), the employer
shall not be barred from presenting that information at the hearing
and no negative inference shall be drawn. The employer may offer
different information at the hearing than what was provided to the
division and may explain any inconsistency, but the trier of fact
may draw a negative inference from the prior inconsistent factual
information. The trier of fact may also draw a negative inference
from factual information offered at the hearing by the division that
is inconsistent with factual information provided to the employer
pursuant to subdivision (b), or from a failure by the division to
provide the form setting forth the descriptions of the alleged
violation and soliciting information pursuant to subdivision (b).
The Board has the ability to draw a negative inference from the Division’s
failure to provide an appropriate 1BY form; drawing a negative inference at the
discretion of the fact finder under Labor Code 6432 subdivision (d). The Board
declines to make a negative inference, given the evidence demonstrating that
the Division made good faith attempts to collect information required by the
Labor Code prior to issuance of the serious citation, despite having made errors
in its issuance of the 1BY. (See, Overnite Transp. Co. v. NLRB (D.C. Cir. 1998)
140 F. 3d 259, 267. “[T]he decision of whether to draw an adverse inference
has generally been held to be within the discretion of the fact finder.”)
On February 4, 2014, the Division noticed Employer with three 1BY
forms. Employer was not required to respond to any of these notices, and
chose not to. Furthermore, on August 23, 2013, Associate Safety Engineer
Brandon Hart (Hart) served the Employer with a subpoena duces tecum,
requesting all records of Employer’s health and safety training, health and
safety inspections, written health and safety programs and policies, as well as
Employer’s IIPP and Exposure Control Plan. (Ex. 9.) While the IIPP and
Bloodborne Pathogen Exposure Control Program were provided in a response
several months later, none of the other listed documents were forthcoming, as
the Employer had no records to produce.
This document request from the Division, made well before the issuance
of Citation 2, shows the Division’s good faith attempt to meet the requirements
of Labor Code section 6432 subdivision (b)(1), through its attempt to gather
documents generally related to training for employees and supervisors relevant
to preventing employee exposure to hazards; procedures for discovery and
correction of hazards; supervision of employees exposed to hazards; as well as
procedures for communication to employees regarding safety rules and
procedures. (Labor Code section 6432 subdivision (b)(1)(A)-(D).) The Division
substantially complied with four of the five provisions of subdivision (b)(1), as
We do observe that the Division’s failure to properly complete the 1BY
left Employer without an opportunity to respond to the specific charges, as
provided by section 6432 subdivision (b)(1)(E), which in some instances might
support drawing a negative inference. However, on this particular set of facts
this failure does not support drawing a negative inference against the Division.
Here, while imperfect, the Division’s conduct evinced a good faith attempt to
comply with section 6432. We note that the Division’s use of a subpoena duces
tecum, issued only days after the inspection, was an unusual effort by the
Division to seek out a variety of pertinent information. Furthermore, no
representative of Employer testified to suggest that Employer’s response to the
1BYs would have been different had additional or more specific charging
language been included. We therefore decline to draw a negative inference in
Violation and Classification of Citation 2, Instance 2
The single remaining citation alleges a violation of section 3203
subdivision (a) for failure to correct unsafe work practices. Section 3203
subdivision (a) reads as follows below:
(a) Effective July 1, 1991, every employer shall establish,
implement and maintain an effective Injury and Illness Prevention
Program (Program). The Program shall be in writing and, shall, at
(1) Identify the person or persons with authority and responsibility
for implementing the Program.
(2) Include a system for ensuring that employees comply with safe
and healthy work practices. Substantial compliance with this
provision includes recognition of employees who follow safe and
healthful work practices, training and retraining programs,
disciplinary actions, or any other such means that ensures
employee compliance with safe and healthful work practices.
(3) Include a system for communicating with employees in a form
readily understandable by all affected employees on matters
relating to occupational safety and health, including provisions
designed to encourage employees to inform the employer of
hazards at the worksite without fear of reprisal. Substantial
compliance with this provision includes meetings, training
programs, posting, written communications, a system of
anonymous notification by employees about hazards,
labor/management safety and health committees, or any other
means that ensures communication with employees.
Exception: Employers having fewer than 10 employees shall be
permitted to communicate to and instruct employees orally in
general safe work practices with specific instructions with respect
to hazards unique to the employees' job assignments as
compliance with subsection (a)(3).
The Division’s alleged violative description states:
The employer failed to implement and maintain all the required
elements of their Injury and Illness Prevention Program including,
but not limited to correcting unsafe work condition(s) and/or work
practices, which are essential to their overall program.
Instance 2: The employer failed to enforce the safety and health
practices fairly and uniformly and failed to ensure employees used
safe work practices, and followed directives, policies and
procedures to maintain a safe work program, as required by their
The Division does not allege that Employer failed to have an Illness and Injury
Prevention Program (IIPP); rather, it contends that Employer failed to
implement and maintain its IIPP by correcting unsafe working conditions and
practices. (See, Contra Costa Electric, Inc., Cal/OSHA App. 09-3271, Decision
After Reconsideration (May 13, 2014).) Employers are responsible for meeting
all three prongs of section 3203 subdivision (a).
The Division’s Associate Safety Engineer, Brandon Hart, testified for the
Division. Based on his initial walkthrough with a management representative,
he concluded that the IIPP had not been implemented. The owner of Echo
Alpha, Inc., John Stagliano (Stagliano), and Adam Greyson (Greyson),
Employer’s Chief Financial Officer, testified on behalf of Employer. Stagliano is
listed as the person responsible for implementing Employer’s IIPP in its
Employer’s IIPP describes a program of formal recognition, including
written acknowledgement of employees who make “significant contributions to
maintenance of a safe workplace”, with those written acknowledgments being
placed in the employees’ personnel file. (Ex. 5.) Hart testified that records
were not provided in response to the Division’s subpoena, leading him to
believe that the Employer’s IIPP was not implemented. When questioned
regarding employee recognition for following safe and healthy work practices,
as described in section 3203 subdivision (a)(2), Stagliano testified that he
supposed employees received a smile for recognition of safe work practices.
Employer failed to provide any evidence to demonstrate that it had
implemented its written program to recognize employees who engage in safe
and healthy work practices.
The safety order also requires training and retraining of employees
where required. (Section 3203(a)(2).) The Employer’s IIPP describes providing
training to workers whose safety performance is deficient, to all new workers,
to workers when given new job assignments or when new processes or
procedures are introduced, and when new hazards are identified. (Ex. 5.)
During his initial walkthrough, Hart testified that he learned that new
employees were not provided training. Hart requested training records, but did
not receive any, leading him to believe that the IIPP was not implemented in
Stagliano testified that he did not believe any special training was needed
for working in Employer’s warehouse. He believed there may have been some
special training for certain pieces of equipment, but was unable to elaborate.
Employer’s CFO, Greyson, was aware that there was a company policy in the
employee handbook that prohibited open-toed shoes in the warehouse, and
that this policy was enforced. He also noted that the forklift certifications for
the warehouse forklift drivers were framed on a warehouse wall, and that
Employer had not realized that they were documents that would constitute
training documents that should be turned over to the Division. Employer failed
to provide training as required by the safety order.
Employer was similarly unable to demonstrate that it implements an
effective disciplinary program related to health and safety violations.
Employer’s IIPP describes a progressive disciplinary policy beginning with
verbal warnings for minor incidents, written warnings, suspensions, and
ending with termination for those who repeatedly jeopardize the safety of
themselves and their coworkers. (Ex. 5.) No documents related to disciplinary
actions were provided to the Division, and neither Greyson nor Stagliano were
able to testify to a specific instance of discipline related to employee health or
safety. (Section 3203(a)(2).)
The Employer’s IIPP also describes a system of communication designed
to meet the requirements of section 3203 subdivision (a)(3). The system
described in the plan includes safety meetings on a monthly or more frequent
basis, distribution of safety information in the workplace, training, and a
system for workers to anonymously report workplace hazards. (Ex. 5.)
Stagliano testified that he was not aware of any safety meetings occurring at
the worksite, or safety inspections. Hart testified that employees appeared
unaware of the IIPP provisions and were not following safe work practices
during his inspection.
The Board upholds the ALJ’s finding that a violation of section 3203
subdivision (a) has been established.
In order to demonstrate a serious violation of a safety order, the Division
must demonstrate that there is “a realistic possibility that death or serious
physical harm could result from the actual hazard created by the violation.”
(Labor Code section 6432(a).) “The term “realistic possibility” means that that
it is within the bounds of reason, and not purely speculative.” (International
Paper Company, Cal/OSHA App. 14-1189, Decision After Reconsideration (May
29, 2015), citing (Langer Farms, LLC, Cal/OSHA App. 13-0231, Decision After
Reconsideration (Apr. 24, 2015).) In support of the serious classification, Hart
testified regarding the actual hazards created by Employer’s violation of the
safety order. He concluded that there was both a fall hazard and a hazard of
collapse due to the Employer storing materials on the mezzanine level in the
warehouse. Employees accessed the unguarded mezzanine with a portable
ladder, and were exposed to a fall onto concrete of approximately nine feet.
Because the mezzanine was not built for storage, there was a hazard of
employees either falling or being hurt by falling materials in a collapse due to
the mezzanine exceeding its live load capacity.
Hart also described the hazard of fire due to inaccessible fire
extinguishers, extension cords that were daisy chained, and blocked electrical
panels. He explained the hazard of electrocution created by an exposed bus
bar. Hart further testified that these and other hazards he identified in the
warehouse were the result of Employer’s failure to identify, correct and train
employees on hazards as required by the IIPP safety order.
An employer may rebut the presumption of a serious violation by
demonstrating that it did not know, and could not know, of the violation.
(Labor Code section 6432 subdivision (c).)
Employer failed to rebut the
presumption. The violation is properly classified as serious.
Calculation of Penalty
The Division’s Proposed Penalty Worksheet (Ex. 8) shows severity for
Citation 2 as $18,000, or the base penalty for a serious violation.
penalty, after all adjustments and credits
, was $7,200. The ALJ adjusted this
penalty based on her finding that “Extent” should be rated high, due to
Employer having 40 employees total, and 22 workers in the warehouse. We
find this to be in error.
Specifically, section 6432(c) reads as follows: If the division establishes a presumption
pursuant to subdivision (a) that a violation is serious, the employer may rebut the presumption
and establish that a violation is not serious by demonstrating that the employer did not know
and could not, with the exercise of reasonable diligence, have known of the presence of the
violation. The employer may accomplish this by demonstrating both of the following:
(1) The employer took all the steps a reasonable and responsible employer in like
circumstances should be expected to take, before the violation occurred, to anticipate and
prevent the violation, taking into consideration the severity of the harm that could be expected
to occur and the likelihood of that harm occurring in connection with the work activity during
which the violation occurred. Factors relevant to this determination include, but are not limited
to, those listed in subdivision (b).
(2) The employer took effective action to eliminate employee exposure to the hazard created
by the violation as soon as the violation was discovered.
Section 336(c)(1) In General - Any employer who violates any occupational safety and health
standard, order, or special order, and such violation is determined to be a Serious violation (as
provided in section 334(c)(1) of this article) shall be assessed a civil penalty of up to $25,000 for
each such violation. Because of the extreme gravity of a Serious violation an initial base
penalty of $18,000 shall be assessed.
Greyson, Employer’s CFO, testified that four employees and one
supervisor worked in the warehouse at the time of the inspection. This
comports with Hart’s recollection, which was that he saw about four employees
working in the warehouse, who regularly access the mezzanine, the electrical
panels and cords, and use the ladders cited by Hart. The Division failed to
rebut this testimony, and it is credited.
We return the “Extent” to “Medium”,
and reinstate the $7200 penalty, as initially proposed by the Division.
Therefore, we affirm the result of Decision sustaining the citation but for
the different reasons stated above.
ART CARTER, Chairman
ED LOWRY, Board Member
JUDITH S. FREYMAN, Board Member
OCCUPATIONAL SAFETY AND HEALTH APPEALS BOARD
FILED ON: DEC 24, 2015
Greyson also testified that Employer had around 30 employees total at the time. His estimate
was similar to Stagliano’s, who believed that Employer had around 25 to 30 at the time of the
inspection. The Division failed to rebut the testimony of Greyson and Stagliano in regard to the
number of employees; our calculating the penalty based on Employer having 30 versus 40
employees makes no difference in the penalty, and so we set the matter aside.
- DECISION AFTER RECONSIDERATION
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