Kohler Company

Plain-English summary

Kohler used a computerized injury log at its Wisconsin manufacturing plant but coded 277 recordable injuries as first-aid cases. Most errors resulted from failing to track later medical treatment, while others occurred because nurses or safety staff overlooked information already available. The Commission held that the errors were not de minimis because they hid the plant's true recordable-injury picture and forced OSHA to investigate underlying medical records for several weeks. It agreed with the judge that the violations were not willful because the flawed procedures and training reflected inadvertence rather than conscious disregard, and Kohler otherwise had a comprehensive safety program. The Commission affirmed all 277 other-than-serious instances but increased the combined penalty from $1,000 to $29,430.

Decision snapshot

• Cited standard(s): 29 C.F.R. § 1904.2(a).
• Outcome: Modified. The Commission affirmed 277 other-than-serious recordkeeping violations and increased the total penalty to $29,430.
• Key point: Miscoding recordable injuries as first aid is not de minimis when it obscures the injury history, but systemic negligence does not establish willfulness without conscious disregard or plain indifference.

Full text (OSHRC public release)

UNITED STATES OF AMERICA
OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION
One Lafayette Centre
1120 20th Street, N.W. — 9th Floor
Washington, DC 20036-3419

FAX:
COM (202) 606-5050
FTS (202) 606-5050

SECRETARY OF LABOR,

Complainant,
v.
KOHLER COMPANY,
OSHRC DOCKET NO. 88-237
Respondent,

UNITED AUTOMOBILE, AEROSPACE AND
AGRICULTURAL IMPLEMENT WORKERS
OF AMERICA (“UAW”), LOCAL 833,

Authorized Employee
Representative.

DECISION
BEFORE: FOULKE and MONTOYA, Commissioners.1

BY THE COMMISSION:

At issue in this case are whether the judge erred in: (1) affirming 277 nonserious
instances of violation of recordkeeping requirements of the Occupational Safety and Health
Act of 1970 (“the Act”), 29 U.S.C. §§ 651-678; (2) rejecting Kohler Co.’s claim that those

1 Chairman Weisberg did not participate in the decision of this case. While he is troubled
by his colleagues’ finding that these recordkeeping violations resulted from “simple
inadvertence,” it would serve no meaningful purpose to further delay issuance of a decision
in this case which was voted on before he joined the Commission. The Secretary issued the
citation in 1988 and this case is the oldest case pending before the Commission. May 4,
1994 marked four years that it has been at the Commission awaiting decision. Under these
circumstances and since his vote will not change the result, Chairman Weisberg has chosen
not to participate in this case.

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instances were de minimis; (3) rejecting the Secretary of Labor’s claim that they were willful;
and (4) assessing a combined penalty of $1000. For the reasons that follow, we find 277
instances of violation but find that a total penalty of $29,430 is appropriate.

Kohler is a large manufacturer of plumbing fixtures. It also engages in pottery
making, brass manufacture, die casting, and engine and generator manufacture. The
Secretary of Labor’s Occupational Safety and Health Administration (“OSHA”) conducted
an extensive investigation of Kohler’s OSHA-required injury and illness records at its plant
in Kohler, Wisconsin, starting on July 14, 1987.

As a result of the investigation, the Secretary issued a citation alleging 466 instances
of incomplete or inaccurate entries in Kohler’s required injury records, in violation of 29
C.F.R. § 1904.2(a). The Secretary deemed each instance to be “egregious willful,” and
accordingly proposed a penalty of $3,000 for each. Prior to the hearing, the Secretary
withdrew 176 instances. Of the 290 remaining instances, the judge affirmed 277.

1. Whether the instances of violation were established

The judge affirmed each instance on the ground that, although the injuries concerned
were listed on Kohler’s required log and summary of occupational injuries and illnesses for
1986 (its “OSHA 200” equivalent), they were erroneously described as first aid cases rather
than recordable cases. Section 1904.2(a) requires each employer to list accurately each
recordable injury and illness on the log and summary.2 Recordable injuries consist of

fatalities, cases involving lost work days, and “[n]onfatal cases without lost workdays which

2 That section provides:

Each employer shall . . . (1) maintain in each establishment a log and
summary of all recordable occupational injuries and illnesses for that establishment; and (2) enter each recordable injury and illness on the log and summary
as early as practicable but no later than 6 working days after receiving
information that a recordable injury or illness has occurred. For this purpose
form OSHA No. 200 or an equivalent which is as readable and comprehensible to a person not familiar with it shall be used. The log and summary shall
be completed in the detail provided in the form and instructions on form
OSHA No. 200.

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result in transfer to another job or termination of employment, or require medical treatment
(other than first aid) or involve: loss of consciousness or restriction of work or motion.”
Section 1904.12(c)(3) (emphasis added).

The judge found the 277 injuries to be recordable because they received medical
treatment other than first aid. The judge relied on the definitions of recordable medical
treatment in a document published in 1978 by the Secretary’s Bureau of Labor Statistics
(“BLS”), entitled What Every Employer Needs to Know About Recordkeeping. BLS Report
412-3.

Kohler argued before the judge that reliance on the BLS report was unjustified
because it had not been promulgated as a regulation or incorporated by reference in the
Secretary’s recordkeeping standards. However, the Commission has resolved this issue in
a case issued subsequent to the judge’s decision. Caterpillar Inc., 15 BNA OSHC 2153,
1991-93 CCH OSHD ¶ 29,962 (No. 87-922, 1993). The Commission held there that “the
Secretary’s interpretation of what constitutes medical treatment in BLS Report 412-3 is a
reasonable interpretation of the regulation, which is grounded in the language of the
regulation.” 15 BNA OSHC at 2161, 1991-93 CCH OSHD at p. 40,994. The Commission
stated further that it would accord BLS Report 412-3 “great weight in determining which
injuries cited by the Secretary are required to be recorded on the OSHA 200.” Id. It also
held that “taken as a whole, the cited regulation, the definitions accompanying the
regulation, the OSHA 200, and the copromulgating agency’s [BLS’s] view of what the
regulation means embodied in BLS Report 412-3, provide a fair and reasonable warning of
what injuries and illnesses must be recorded on the OSHA 200.” Id.

Kohler acknowledges that it had full knowledge of BLS Report 412-3 and that Safety
Manager George Henle instructed his assistant for OSHA recordkeeping, Kathy Mertes, to
follow that report. Thus, it is fair to hold Kohler legally responsible for compliance with the
instructions in BLS Report 412-3. See id., 15 BNA OSHC at 2161-62, 1991-93 CCH OSHD
at pp. 40,994-95 (where it was employer’s practice to follow guidance of BLS Report 412-3,

employer had sufficient notice of Secretary’s interpretation of recordable medical treatment).

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On review, Kohler does not dispute that the 277 injuries at issue were recordable
under BLS Report 412-3. It merely argues that certain instructions in the report are
ambiguous, negating any claim that its noncompliance with them was willful.3 We find, as
did the judge, that Kohler failed to make the 277 entries at issue consistently with BLS
Report 412-3, because it termed those injuries first aid cases rather than recordable injuries.

Kohler argues, however, that the mere failure to list the injuries involved as
recordable is not a violation, because it included all first aid cases as well as recordable cases
on its log. The log, which was computerized, had been approved as an OSHA 200
equivalent by OSHA’s area director, Robert Hanna, in 1974. Henle, who was in charge of
Kohler’s recordkeeping for OSHA and worker’s compensation, testified that he discussed
the computerized log in depth with Hanna in 1974. Henle specifically testified that he told
Hanna he intended to enter both the first aid cases and the recordable cases on the
computerized log, and that Hanna stated that was “an excellent idea.” However, Henle
acknowledged that he understood that Kohler would be subject to citation if a recordable
case were incorrectly listed as a mere first aid case on the log.4

Kohler distinguished between recordable injuries, recordable illnesses and first aid
cases on the log by means of a notation in the column “OSHA CODE.” The number “7”

3Kohler has effectively abandoned its arguments that BLS Report 412-3 is unenforceable or
unauthoritative in this case, because Kohler did not address those questions in its review
brief, although both parties were invited to do so.

4 When OSHA area director Hanna approved Kohler’s computerized format in 1974, Henle
did not tell him that only the first day’s treatment was going to be entered. (The record
does not indicate what Kohler’s policy was at that time.) The instructions to the OSHA 200
state:

If, during the 5-year period the log must be retained, there is a change in an
extent and outcome of an injury or illness which affects entries in columns 1,
2, 6, 8, 9, or 13, the first entry should be lined out and a new entry made.

Medical treatment given after the first day for injuries that originally were treated with first
aid would specifically affect entries in columns 6 and 13 of the OSHA 200. Those columns
require a check if the event (1) is recordable, and (2) does not involve death, lost work days,
or work restrictions.

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(which sometimes was followed by a letter) denoted a recordable illness, “10” denoted a
recordable injury, and “FA” denoted a first aid case. All of the alleged instances of violation
in this case were based on entries that were coded as first aid cases, but which the Secretary
believes should have been coded “10,” for a recordable injury. There was no description of
the injury on the log other than the code.

Kohler argues that the mere erroneous notation of “FA” beside an entry in its log
is no violation, because each entry in question here “was recorded on the same log and in
the same detail as were . . . the other 1,625 ‘FA’ marked cases[.]” However, the entries at
issue contained no description of the type of injury involved except for the incorrect code,
and the code was the only basis on the log from which OSHA could evaluate whether those
injuries were recordable. The instructions on the OSHA Form 200 have consistently
provided that first aid cases are not to be included on that Form.5 Thus, the designation
“FA” on Kohler’s OSHA 200 equivalent indicated to OSHA that it could ignore the entry.6
By failing to include injuries coded “FA” on the annual summary of recordable injuries part
of the OSHA 200 form, Kohler also misstated the total of recordable injuries for the year.

As a result, Kohler’s computerized log was not a full report, and the codings were not
mere margin notes, as it claims. These 277 miscodings prevented OSHA from learning the
true injury picture at the plant from the log. We therefore conclude, as did the judge, that
the erroneous first aid designations made the entries inaccurate under the OSHA 200 form

and instructions, and thus violated the cited standard.

5 Those instructions state:

The entire entry for an injury or illness should be lined out if later found to
be nonrecordable. For example, an injury which is later determined not to be
work related, or which was initially thought to involve medical treatment but
later was determined to have involved only first aid.

6 The evidence indicates that OSHA did not ultimately rely on Kohler’s first aid designations,
because OSHA suspected errors and ultimately investigated the underlying records.
However, the miscoding clearly impeded OSHA’s ability to learn the history of recordable
injuries in the workplace.

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Il. Characterization of the instances of violation

A. De minimis issue

We next consider Kohler’s argument that the judge erred in concluding that the
instances of violation were not de minimis. “A de minimis violation is one having no ‘direct
or immediate’ relationship to employee safety; normally, that classification is limited to
situations in which the hazard is so trifling that an abatement order would not significantly
promote the objectives of the Act.” Dover Elevator Co., 15 BNA OSHC 1378, 1382, 1991-93
CCH OSHD ¶ 29,524, p. 39,850 (No. 88-2642, 1991). In rejecting Kohler’s argument, the
judge stated: |

Just as the prevention of illness and injury is a vital part of any safety
program, so too is a thorough recording system, founded upon appropriate
emphasis on accuracy and detail, to enable the employer to track a history of
injury or illness; to recognize and correct areas of accident or illness repetition
within the industry. Recordkeeping [is a] vital function. Periodic review of
the procedures employed must be on-going.

Kohler bases its argument that any violation was de minimis on its position that all
the injuries were fully recorded. It notes that OSHA did not rely on the log entries, but
rather reviewed the underlying injury records, and argues that the union never looked at the
log or discussed it in bargaining. It argues that the classification of a violation “relates to
the impact of a particular violation on safety or health conditions within a particular
workplace.” (Emphasis in original.) Thus, in Kohler’s view, all 277 entries were de minimis,
because of their minimal impact on safety and health, even though it does not question the
general importance of recordkeeping. It argues that its computerized format was superior
to what other employers were using.

The judge properly rejected Kohler’s arguments. We recently reaffirmed that “[t]he
Act’s recordkeeping requirements ‘play a crucial role in providing the information necessary
to make workplaces safer and healthier.”” General Motors Corp., Electro-Motive Div., 14
BNA OSHC 2064, 2070, 1991-93 CCH OSHD ¶ 29,240, p. 39,170 (No. 82-630, 1991),
(quoting General Motors Corp., Inland Div., 8 BNA OSHC 2036, 2040-41, 1980 CCH OSHD
¶ 24,743, p. 30,470 (No. 76-5033, 1980)). As mentioned above, the miscoding of recordable

injuries as nonrecordable first aid cases on Kohler’s computerized log inevitably impeded

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OSHA’s efforts to identify the true nature and extent of injury problems at the plant.
OSHA was able to discover the necessary facts only through a six-to-seven week investigation
of underlying records such as Kohler’s OSHA 101 equivalents, medical case cards and X-rays. Thus, the miscodings were related to safety and health.

In arguing that the instances of violation should be termed de minimis, Kohler also
relies on Anoplate Corp., 12 BNA OSHC 1678, 1986-87 CCH OSHD ¶ 27,519 (No. 80-4109,
1986). There, the Commission held that the employer’s failure to record the job title and
regular department of certain injured employees, as required by OSHA Form 200, was de
minimis. However, the Commission concluded that “it appears that the purposes of the
form were achieved,” based on testimony that all the employees knew what jobs the other
employees did, and that OSHA’s representative was unhindered in conducting his investigation by the missing information. 12 BNA OSHC at 1688, 1986-87 CCH OSHD at p. 35,686.
Here, by contrast, the miscoding of injuries clearly hindered the Secretary’s investigation.7

Kohler further relies on an affidavit signed and sent to the judge by UAW local vice
president Ron Platz, regarding the adequacy of Kohler’s recordkeeping from his perspective.
However, Kohler did not offer the affidavit in evidence at any time. UAW Local 833, the
authorized employee representative, opposed consideration of the affidavit and moved to
withdraw it. The Secretary objected to Kohler’s reference to the affidavit in its post-hearing

brief below.8 We conclude that it would be inappropriate to consider such an affidavit on

7 Kohler argues that the 277 instances of violation found by the judge comprised only 11
percent of its total injuries and illnesses for the period in question (including first-aid cases).
However, inaccurate entries on an OSHA 200 or equivalent are not de minimis unless they
truly do not hinder OSHA’s investigation, as in Anoplate. The Secretary points out that
those 277 instances constituted about 37 percent of the total number of recordable injuries
for 1986 (277 out of 750). Those 277 cases also represented more than a 100 percent
increase in the number of recordable “injuries without lost workdays” on Kohler’s annual
summary for 1986. Kohler had reported 216 such cases.

8 So far as the record shows, the judge did not rule on the union’s motion to withdraw the
affidavit or the Secretary’s objections to it. Nor did he refer to it in his decision.

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review where the matters asserted therein were not offered in evidence below at the hearing

on the merits, despite a full opportunity to do so.9

B. Alleged willfulness
We next consider whether the judge erred in finding that the instances of violation
were not willful.

A willful violation is one committed with intentional, knowing or
voluntary disregard for the requirements of the Act, or with plain indifference
to employee safety. [It] is differentiated by a heightened awareness -- of the
illegality of the conduct or conditions -- and by a state of mind -- conscious
disregard or plain indifference. There must be evidence that an employer
knew of an applicable standard or provision prohibiting the conduct or
condition and consciously disregarded the standard[.] It is therefore not
enough for the Secretary to show carelessness or lack of diligence in
discovering a violation.

Williams Enterp., Inc., 13 BNA OSHC 1249, 1256-57, 1986-87 CCH OSHD ¶ 27,893,
p. 36,589 (No. 85-355, 1987). See, e.g. Caterpillar, 15 BNA OSHC at 2173-74, 1991-93 CCH
OSHD at pp. 41,007-09. The alleged willfulness of the instances of violation is based on the
circumstances in which the miscodings took place and the way Kohler trained its employees.

1. Kohler’s recordkeeping procedures and training

Kohler’s injury and illness log was in an advanced, computerized format. It had been
approved as an acceptable equivalent to the OSHA 200 form by OSHA’s area director in
1974. When an employee went to Kohler’s medical department to report an injury,
occupational health nurses prepared detailed records for each injury. From those records,
the nurses prepared an Accident Investigation Report (“AIR”) which summarized the first
day’s treatment. The AIR’s were Kohler’s equivalent of OSHA Form 101 -- the required
supplementary record containing the specifics of each recordable injury. Mertes, a clerk-

typist in the safety department, filled out other information on the AIR, such as the

9 Furthermore, a hearsay document such as an affidavit would not be admissible in evidence
in these circumstances. Fed. R. Evid. 802, 803, which apply to Commission proceedings
under Commission Rule 71. Cf. Fed. R. Civ. P. 56(c) (affidavits generally may be used for
purposes of motions for summary judgment).

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employee’s social security number and job title. Mertes then entered the injury on Kohler’s
computerized log, and she made the decision whether to code it as a recordable injury or
illness or a first aid case, based on the first day’s treatment reflected on the AIR.

Ramona Maala, another clerk in the safety department, checked back with the
medical department daily, for two to five days, to determine whether any injuries logged in
by Mertes resulted in three days of lost time or restricted duty. If they did, they were listed
on Kohler’s worker’s compensation records and were coded as recordable injuries on its
computerized log. If an injury did not involve at least three days of lost time or restricted
duty, Kohler recorded no information on follow-up treatment on its log. This failure to track
follow-up treatment for non-worker’s compensation cases accounts for most of the instances
of violation in this case. In thirty instances (by our count), nurses failed to enter treatment
on the AIR’s that made the injury recordable on the first day. In forty-five other instances
(again by our count), the safety department failed to code injuries as recordable despite
sufficient information on the AIR’s. OSHA did not challenge the way Kohler coded the
remainder of the 2,475 injuries and illnesses that occurred in 1986.

Henle, Kohler’s safety manager, was responsible for Kohler’s OSHA 200. Although
he was familiar with OSHA’s recordkeeping regulations and BLS Report 412-3, he testified
that it never occurred to him that Kohler’s system lacked an adequate means of tracking
subsequent treatment of cases that initially were treated only with first aid. Henle gave his
assistant Mertes a copy of BLS Report 412-3 and instructed her to follow it. Mertes testified
in her deposition, which was received in evidence, that she was not sure exactly what any of
the “medical treatment” categories in BLS Report 412-3 meant. Henle disagreed with the
suggestion that he considered recordkeeping not to be “worthwhile or valuable or important.” However, he testified that it “was not one of my prime concerns because I had
other duties to perform which to me were more important ....” Henle’s supervisor,
Kenneth Conger, testified that “[r]ecord keeping in my own humble opinion was a very small
part of [Henle’s] responsibilities.” Conger noted that Henle’s responsibilities included

Kohler’s entire safety and health program, not only at its main plant, where it had as many

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as 7,000 employees, but at its “major branch factories in South Carolina and Texas.”10
Conger testified that OSHA-required injury records were not critical to knowing how many
serious injuries were occurring, because “we have absolutely independent information of
everything” that those records would reveal. Conger testified that Henle contacted him
promptly if he had a safety or health problem that the safety department alone could not
correct. Conger added that the union “was a very assertive group,” and that he received a
monthly report of all injuries independent of the OSHA-required records.

The Secretary investigated Kohler’s OSHA recordkeeping procedures in 1983-84. A
citation issued following that inspection alleged that “[i]n 1981, 1982 and 1983 recordable
cases were listed as first aid and not included in the recordable case summaries.”11 The
citation was based on a random sample of 40 injuries for which OSHA reviewed supplemental records furnished by Henle. OSHA’s compliance officer (“CO”) Gordon Krohn, who
conducted the 1983-84 investigation as well as the 1987 investigation, testified that he gave
Henle further information about those entries at the closing conference in 1984. “I
identified recordkeeping violations in the area of restricted work activity and fractures .. . .”

As explained by Krohn to Henle, the 1984 citations were based on two specific
problems. One was a failure to record three injuries that resulted in work restrictions for
an employee. The other was a failure to record three finger fractures. Henle testified that
no one from OSHA mentioned any systemic problem with the records, such as failure to
track follow-up treatment of injuries, at any time. When asked why he did not develop a
system for tracking subsequent treatment of cases other than worker’s compensation cases,

he testified that it “[n]ever occurred to me.” Krohn did not determine why the company

10 The judge’s finding is undisputed that Kohler’s “comprehensive safety program
demonstrates an active concern with safety and hygiene in general.” The Secretary argues
that the 1987 citation, based on a wall-to-wall inspection, shows a lack of compliance.
However, there is no evidence as to which of those items were affirmed or vacated. The
evidence shows that Kohler had a conscientious safety program overall.

11 Kohler entered into a settlement agreement with the Secretary regarding the 1984 citations.
Kohler waived its right to contest the recordkeeping item, in return for a penalty reduction
from $100 to $50. Henle signed the settlement agreement for Kohler.

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failed to record the injuries and illnesses he considered recordable. He explained that it was
not the Secretary’s policy to go into depth in recordkeeping in 1984.

2. Discussion

The Secretary contends that four factors establish that Kohler’s failure to properly
code injuries on its OSHA 200 form was the result of Kohler’s plain indifference to its
recordkeeping responsibilities under the Act. The Secretary relies on the failure of Kohler’s
safety director Henle to properly oversee the recording of injuries and train those charged
with recording, on Henle’s and Kohler’s failure to follow up on problems in Kohler’s
recordkeeping that were brought to their attention during OSHA’s 1983-84 inspection of
Kohler’s OSHA 200, on Kohler’s attitude toward OSHA recordkeeping, and on Kohler’s
contrasting strong interest in ensuring that its workers’ compensation records were correct.

Although we conclude that Kohler’s failures to properly code the injuries stemmed
from Henle’s failure to properly supervise and train those charged with filling out Kohler’s
OSHA 200 equivalent, we find that the evidence does not establish that those failures
resulted from either intentional disregard of the Act’s recordkeeping requirements or plain
indifference to them. Henle’s knowledge of OSHA recordkeeping requirements and
Kohler’s recordkeeping format should have enabled Kohler to keep the OSHA 200 log.
However, we accept as credible, as did the judge, Henle’s explanation that it did not occur
to him to track injuries to see whether subsequent treatment made them recordable on the
OSHA 200. Nor is there any evidence that Maala, or other safety department personnel
who tracked subsequent treatment for worker’s compensation cases, were aware that other
injuries initially treated with only first aid had subsequently become recordable for OSHA
purposes.

Furthermore, there was no showing that Kohler’s OSHA recordkeeping procedures,
initially devised in the early 1970’s, were reviewed in conjunction with its worker’s
compensation procedures. Kohler’s tracking of subsequent treatment was done pursuant to

a different statute -- the State of Wisconsin’s worker’s compensation law.12 We cannot

12 Kohler was subject to penalties and possible loss of its self-insured status under that law
(continued...)

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conclude that Kohler’s failure to track follow-up treatment of injuries for OSHA purposes
was willful merely because its procedures for worker’s compensation cases were different.
As to Kohler’s training of recordkeepers, Henle testified that there had been a two-hour training session on recordkeeping for all the nurses, held to the best of his recollection
in the early 1980’s. There is no evidence that Henle knew that the two-hour training session
was inadequate to inform the nurses of their OSHA recordkeeping duties.13 The Secretary
notes that Sandra Bawden, Kohler’s supervisor of nurses since 1980, testified that she never
saw a copy of BLS Report 412-3 or the OSHA recordkeeping regulations before 1987.
However, there is no indication that that fact was brought to Henle’s attention before the
citation was issued. Moreover, it is not clear from Mertes’ testimony whether her confusion
was attributable to lack of training, as the Secretary argues, or to lack of precision in the
guidelines, as Kohler argues. Nor does the evidence show that Kohler was aware that
Mertes was misapplying BLS Report 412-3 and ignored the situation. Thus, we agree with
the judge that Kohler’s failure to provide additional training for the nurses and for Safety
Department recordkeeping personnel in the BLS criteria does not establish willfulness.
The judge found that the 1984 citation did not provide clear enough notice to Kohler
of the systemic nature of its errors to justify finding the 1986 instances of violation willful.
Like the judge, we find that the information conveyed to Kohler by the compliance officer
in 1983-84 and in the 1984 citation did not inform Kohler that its OSHA recordkeeping
program had a systemic problem. Without a showing that Kohler had a “heightened
awareness -- of the illegality of the conduct,” Williams Enterp., we cannot conclude that

Kohler’s failure to discover that its recordkeeping procedures were inadequate is deserving

12 (...continued)

if it did not report such cases. Under that law, Kohler also had to submit its annual
summary of recordable OSHA injuries to the State, but accuracy in the summary was not
a factor in Kohler’s self-insured status. Henle testified that the lack of state penalties for
inaccurate annual summaries of OSHA-recordable injuries never occurred to him while
thinking about his worker’s compensation reporting system.

13 Henle did not know how a nurse would have been trained to fill out the AIR forms, if
hired after that training session. However, there was no evidence that any nurses were hired
after that training session.

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of the opprobrium associated with a willful classification. If, as the Secretary suggests,
Kohler’s inability to discover its recordkeeping flaws was due in part to its poor attitude
toward OSHA recordkeeping, we cannot ignore the fact that keeping the OSHA log also had
been a low priority for the Secretary, at least before 1986. For example, compliance officer
Krohn testified that it was the Secretary’s policy not to go into recordkeeping in depth in
1984.15

Having considered Kohler’s recordkeeping program, we find that while parts of

Kohler’s system of recordkeeping were flawed, other parts were excellent. Kohler’s failure

14 As mentioned above, the 1984 citation was based on two specific problems: failure to
record three work restriction cases and three finger fractures. There is no claim that Kohler
did not promptly correct those specific errors. Further, the Secretary has not presented
evidence in this case that Kohler consciously ignored cases involving work restrictions or lost
time during 1986, or that it failed to respond in good faith to the 1984 citation regarding
such cases.

The problem of failing to record fracture injuries was not completely cured following the
1984 citation. However, the problem affected a much lower percentage of the entries that
OSHA reviewed in its 1987 inspection. In 1984, of the cases reviewed by Krohn that had
been coded “first aid” by Kohler, 7.5 percent (3 out of 40) were found to be recordable
fractures. By contrast, only about 1 percent (20 out of 1902) of the cases reviewed during
the 1987 inspection involved recordable fractures. That is an indication that Kohler made
a good faith effort to correct the problem following the 1984 citation.

15 The Secretary analogizes this case to a trenching case in which the Commission found two
willful violations. Calang Corp., 14 BNA OSHC 1789, 1791, 1987-90 CCH OSHD ¶ 29,080,
p. 38,870 (No. 85-319, 1990). There, the Commission found willfulness because the
company’s president chose to ignore a compliance officer’s observation that a trench was not
properly sloped and a spoils pile was too close to the edge of the trench. The warnings,
which were explicit, came on the morning of the inspection. When the compliance officer
returned in the afternoon, his observations had been ignored.

This case is very different from Calang. As noted above, Supra note 14, there is no claim
that Kohler did not promptly correct the specific errors pointed out to it in 1984. The
Secretary argues that Kohler should have investigated the underlying reasons for those errors
and discovered the flaws in its procedures and training that caused them. That would have
been ideal, but the evidence is lacking that its failure to do so was other than inadvertent.
Again, OSHA’s compliance officer did not discover those underlying problems and did not
suggest to Kohler what they might be.

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to discover the shortcomings in its program reflects some lack of diligence. E.g. Williams
Enterp. However, the Secretary has failed to establish by a preponderance of the evidence
that Kohler’s failures to correctly enter the recordable injuries cited here was the result of
conscious disregard of, or plain indifference to, the Act’s recordkeeping requirements. On
this record, we conclude that simple inadvertence is a more plausible explanation for the
instances of violation that we have found today.
III. Assessment of Penalties

We next consider the final issues directed for review--whether the judge erred in
failing to assess instance-by-instance penalties and in assessing a combined penalty of $1000.
In his decision, the judge found that the Secretary’s proposed penalties were not justified,
because the instances of violation were not proven willful, and because:

[I]nstance-by-instance penalties need not be assessed in order to provide an
incentive for Kohler’s compliance with the Act. The record establishes that
Kohler has already instituted follow-up procedures which will eliminate the
flaw in its system.

Both Kohler and amicus Phillips 66 Company argue that the Commission has no authority
to assess instance-by-instance penalties. However, in Caterpillar, the Commission held that
it has the authority to assess instance-by-instance penalties in appropriate circumstances, for
failures to record injuries on the OSHA 200 as required by section 1904.2(a). 15 BNA
OSHC at 2172-73, 1991-93 CCH OSHD at p. 41,005-07.

The Secretary argues that his proposed penalties are appropriate in light of the high
number of instances, the willful nature of the noncompliance, and the fact that Kohler took
corrective steps only after it became aware that OSHA might impose megafines on it. The
Secretary states that the combined penalty of $1000 “makes a mockery of the Act, and
‘reflect[s] more of a license than a penalty.” (quoting Olin Constr. Co. v. OSHRC, 525 F.2d
464, 467 (2d Cir. 1975)). The Secretary also argues that the contrast between Kohler’s
careful tracking of follow-up treatment in worker’s compensation cases, and its complete lack
of tracking in other cases, shows that Kohler’s actions are strongly related to the threat of
penalties. Thus, the Secretary argues, his proposed penalty is more appropriate. Kohler

argues that if the Secretary wants to penalize erroneous recordkeeping entries on a per

15

instance basis, the Commission must assess the significance of each individual instance, which
it believes is de minimis.

Generally, the Commission will evaluate a penalty recommendation of one of its
judges based on the judge’s underlying findings of fact and consideration of the statutory
criteria under section 17(j) of the Act. See, e.g., J.A. Jones Constr. Co., 15 BNA OSHC 2201,
2213-14, 1991-93 CCH OSHD ¶ 29,964, p. 41,033 (No. 87-2059, 1993). The Commission has
wide discretion in penalty assessment. E.g., Hern Iron Works, Inc., 16 BNA OSHC 1619,
1621-23, 1994 CCH OSHD ¶ 30,363, pp. 41,881-83 (No. 88-1962, 1994). See generally 2 Am
Jur 2d Administrative Law § 672 (1962). .

Because we have found that the judge’s finding that the instances of violation in
question were not willful is supported by the record, we agree that the Secretary’s proposed
penalty is not appropriate. On the other hand, considering the large number of errors and
the notice that Kohler had of their existence, we agree with the Secretary that their
cumulative gravity renders a total penalty of $1000 inappropriate as insufficient.16 For the
more specific reasons that follow, we find that this record supports a more appropriate
combined penalty of $29,430.

As noted previously, the factors for the Commission’s assessment of penalties are set
forth in section 17(j) of the Act, 29 U.S.C. § 666(j). This section requires that when
assessing penalties, the Commission must give “due consideration” to four criteria: the
gravity of the violation, the employer’s size, good faith and history of violations. See Kaspar
Electroplating Corp., 16 BNA OSHC 1517, 1525, 1993 CCH OSHD ¶ 30,303, p. 41,762 (No.
90-2866, 1993). These factors are not necessarily, however, afforded equal weight. The
chief factor in penalty assessment generally is the gravity of the violation. Nacirema
Operating Co., 1 BNA OSHC 1001, 1971-73 CCH OSHD ¶ 15,032 (No. 4, 1972).

16 For example, such a penalty is out of line with the instance-by-instance penalties assessed
for unrecorded injuries in Caterpillar, which ranged from $75 to $550.

17 This combined assessment could be broken down into an assessment of $90 for each of the
202 instances of violation which (by our count) were due solely to failure to track follow-up
treatment, and $150 for each of the 75 other instances of violation.

16
This case is largely similar to Caterpillar regarding penalty factors. Both employers

were large in size. Kohler had at least 5,500 employees during the relevant time period.
Both had a good overall OSHA history, based on the evidence. As to Kohler’s history of
violations, the only ones shown by the record to have been affirmed were based on the 1984
citation.

The next specific penalty factor under 29 U.S.C. § 666(j) is good faith. Both here and
in Caterpillar, the Commission found the instances of violation nonwillful. In both cases, the
employers cooperated with the inspection, but their neglect in handling OSHA
recordkeeping responsibilities contrasted with their meticulous compliance with other
recordkeeping procedures. See 15 BNA OSHC at 2177-78, 1991-93 CCH OSHD at
p. 41,011. Also touching upon Kohler’s good faith, it is well established that the company
had a comprehensive overall safety program. Additionally, as the judge observed, Kohler
demonstrated some good faith in curing the flaws in its recordkeeping system before the
hearing.

The remaining criterion, the gravity of the violation, has traditionally been given
greater weight by the Commission. In Caterpillar, the Commission noted that a
determination of gravity is generally guided by evidence in the record relating to: (1) the
number of employees exposed; (2) the duration of the exposure to the hazard; (3) whether
any precautions have been taken against injury; and (4) the degree of probability that an
accident would occur. 15 BNA OSHC at 2178, 1991-93 CCH OSHD at p. 41,012. Applying
these factors to the case before us, we find, as in Caterpillar, that each instance of this type
of violation is of low gravity because recordkeeping violations generally “only bear on these
factors in the most tangential way[.]” Id.

This case is somewhat different from Caterpillar, however, because there the employer
failed to record numerous lost workday cases and other cases that greatly exceeded the
definition of nonrecordable first aid in section 1904.12(e). Those cases were the most highly
penalized in Caterpillar. Here, the Secretary does not argue that high penalties are
warranted based on cases that clearly were recordable based on the regulations alone. Most

of the injuries at issue here had received only first aid on the initial day of treatment, and

17

the Secretary’s basis for showing recordability was the detailed definitions of “medical
treatment other than first aid” in the BLS Guidelines.

Thus, the instances of violation here generally would fall toward the lower end of the
penalty scale in Caterpillar. Furthermore, the majority of the instances resulted from a single
policy -- failure to track follow-up treatment for injuries treated with only first aid on the
first day. In view of that fact, a reduction of the per instance penalty is warranted.

While the gravity of each instance may be low, however, it is clear that 277 individual
instances compound this factor. In this case, 202 instances of violation were based on failure
to track follow-up treatment. In addition, 75 instances of violation involved individual
failures by nurses or safety department personnel to note readily available information that
made injuries recordable under BLS Report 412-3. We consider those 75 instances to be
of somewhat higher individual gravity than the other 202, but the cumulative effect of all 277
instances is higher still.

Thus, we affirm the judge’s finding of 277 instances of an other than serious violation
of section 1904.2(a), and assess a total penalty of $29,430.

Edwin G. Foulke, Jr.
Commissioner

Velma Montoya
Commissioner

Dated: May 23, 1994