Vergona Crane Co., Inc.

Plain-English summary

Vergona Crane supplied a crane, operator, and oiler to a construction contractor under a bare-rental arrangement. The Commission treated Vergona and its closely related affiliate as a single entity and found that Vergona remained the workers' employer because it controlled how the crane was operated and maintained, even though the contractor placed the workers on its payroll. The crane was operated with one of its two boom stops broken. The Commission found that the missing safety device could allow the boom to twist and fall and had to be repaired before continued use. The operator's knowledge of the defect was attributable to Vergona, and the company did not prove that the conduct was unpreventable. The Commission affirmed the serious violation and a $700 penalty, while rejecting the claim that settling with the contractor amounted to selective prosecution.

Decision snapshot

• Cited standard(s): 29 C.F.R. §§ 1926.550(a)(5), 1926.550(a)(7)(i), 1926.550(a)(7)(ii), and 1926.550(b)(2)
• Outcome: Serious broken-boom-stop violation affirmed with a $700 penalty; separate wire-rope rulings were not before the Commission.
• Key point: Payroll and lease labels do not control employer status when the crane lessor retains actual authority over the operator, maintenance, and safety.

Full text (OSHRC public release)

Docket No. 88-1745

SECRETARY OF LABOR,

Complainant,

v.

VERGONA CRANE CO., INC.,

Respondent.

OSHRC Docket No. 88-1745

DECISION

Before: FOULKE, Chairman; WISEMAN and MONTOYA, Commissioners.

BY THE COMMISSION:

At issue in this case is whether the judge erred in finding
that Vergona Crane Co., Inc.("Respondent"), violated the Occupational Safety and
Health Act ("the Act"), 29 U.S.C. �� 651-78, by failing to comply with the
crane safety standard at 29 C.F.R. � 1926.550(a)(5).[[1]] The basis for the judge's
finding was that a crane operated by Respondent's employees was used with a broken boom
stop on a construction project in South Orange, New Jersey, while it was leased to Polites
Construction Co. ("Polites") Respondent contends that it is not responsible for
the violation because it was not the employer of the workers assigned to the crane.
Respondent also contends that operating the crane with a broken boom stop was not proven
to be hazardous, and that it was subjected to impermissible "selective
prosecution." For the reasons set forth below, we affirm the judge's finding that
Respondent is responsible for the violation, and we reject the Respondent's
"selective prosecution" claim.

1. Whether Respondent was properly cited as the
   employer, in light of evidence that Jo-Le-Ron, Inc. actually leased the crane to Polites

Only an "employer" may be cited for a violation of
the Act. See 29 U.S.C � 658(a). See also, e.g., United States v. Doig ,
950 F.2d 411, 415 (7th Cir. 1991) (only an employer is liable for the actions of a worker
under the Act). The terms "employer" and "employee" are defined in
general terms at 29 U.S.C. � 652(5) and (6).[[2]] Respondent argues that it was not the
employer of the crane operator and oiler because, among other things, it was not the
lessor of the crane. The judge found that, although there was some evidence suggesting
that Respondent was the crane's lessor or owner, technically the lessor at the time of the
alleged violation was a closely related firm, Jo-Le-Ron, Inc. However, the judge found
that Respondent nevertheless was properly cited as the employer in the circumstances. We
agree.

Jo-Le-Ron and the Respondent had the same president, Joseph Vergona. The two companies
operated out of the same office, and Jo-Le-Ron had no staff, but rather relied on the
Respondent's staff to perform its paperwork. As Respondent has acknowledged, it is
"owned by a member of the Vergona family," and "shares of Jo-Le-Ron,
Inc...are likewise owned by a member or members of the Vergona family." Jo-Le-Ron's
name is a composite of Mr. Vergona's children's names. To further illustrate how
interrelated the two entities were, the lease on which the Respondent relies to show that
Jo-Le-Ron was the crane's lessor was signed by Joseph Vergona for "Vergona Crane Co.,
Inc." At the top, Jo-Le-Ron's name was typed in as lessor. Another written lease for
the same crane, entered into two days after the alleged violation, was between
"Vergona Crane Co., Inc." and Polites. In addition, the name on the side of the
crane was "Vergona Crane Co."

Under Commission precedent, two related employers are regarded
as a single entity where, as here, they share a common worksite, have interrelated and
integrated operations, and share a common president, management, supervision, or
ownership. E.g., Trinity Indus., Inc., 9 BNA OSHC 1515, 1518-19, 1981 CCH OSHD �
25,297, p. 31,322 (No. 77-3909, 1981). Even if Jo-Le-Ron technically was the crane's
lessor at the time of the alleged violation, it was so closely related to Respondent that
Respondent was a proper entity to cite here. [[3]].

2. Whether the judge erred in finding that Respondent, rather than Polites, was
   the employer of the crane operator and oiler

Respondent contends that Polites, which leased the crane, was the crane operator's and
oiler's actual employer. A key consideration in determining whether Respondent was the
actual employer of particular workers is whether it had the right to control the manner
and means by which they carried out their work. The Commission has considered a number of
factors when making such a determination, including the following:

1) Whom do the workers consider their employer?

2) Who pays the workers' wages?

3) Who has the responsibility to control the workers?

4) Does the alleged employer have the power to control the workers?

5) Does the alleged employer have the power to fire, hire, or modify the employment
condition of the workers?

6) Does the workers' ability to increase their income depend on efficiency rather
than initiative, judgment, and foresight?

7) How are the workers' wages established?

Van Buren-Madawaska Corp., 13 BNA OSHC 2157, 2158, 1989 CCH OSHD � 28,504, p.
37,780 (No. 87-214, 1989). The Supreme Court recently held that the term
"employee" in a federal statute should be interpreted under common law
principles, unless the particular statute specifically indicates otherwise. Nationwide
Mutual Insurance Co. v. Darden, 112 S.Ct. 1344,1348 (1992). See Loomis Cabinet
Co. , 15 BNA OSHC 1635,1637 (No. 88-2012, 1992). The Court noted that all aspects of
the relationship are relevant, but that the central inquiry is as follows:

In determining whether a hired party is an employee under the
general common law of agency, we consider the hiring party's right to control the manner
and means by which the product is accomplished. Among the other factors relevant to this
inquiry are the skill required; the source of the instrumentalities and tools; the
location of the work; the duration of the relationship between the parties; whether the
hiring party has the right to assign additional projects to the hired party; the extent of
the hired party's discretion over when and how long to work; the method of payment; the
hired party's role in hiring and paying assistants; whether the work is part of the
regular business of the hiring party; whether the hiring party is in business; the
provision of employee benefits; and the tax treatment of the hired party.

112 S.Ct. at 1348 ( quoting Community for Creative
Non-Violence v. Reid , 490 U.S. 730, 751-752 (1989) (footnotes omitted)). Thus, the
central inquiry under both tests is the question of whether the alleged employer has the
right to control the work involved. See Loomis , 15 BNA OSHC at 1638.

Most of the specific factors mentioned by the Court in Darden
suggest that Polites was not the employer of the crane operator, Frank Quinn, and
the oiler, Bruce Scavetta. Those workers possessed specialized skill, and Polites gave
them no instructions except what loads to move and where to move them. The leased
equipment came from Respondent. Although the work was at Polites' construction site, it
was performed pursuant to a contract with Respondent and was of temporary duration.
Polites had no right to assign additional projects to Quinn and Scavetta, and Polites gave
them reasonable discretion as to when and how long to work.

By contrast, the evidence in this particular case shows that
Respondent retained the "right to control the manner and means by which the product
is accomplished," and thus is properly considered the employer under the Darden
test. Based on this record, we find that Quinn and Scavetta determined the manner and
means by which Polites' assignments would be accomplished, subject to Mr.Vergona's
supervision.

Both Quinn and Scavetta had a long-term association with
Vergona Crane Co. When Polites rented a crane from Respondent, which it had done numerous
times, Polites normally asked Mr. Vergona to assign Quinn or another operator, Frank
McGuire, to operate it. Scavetta had worked for Vergona Crane for about two years.

As to control over crane operations, the judge correctly found:

Michael Polites [Polites' president] or his supervisors told
Quinn what loads to move and where to lift them, but that was the extent of Polites'
instructions to Quinn. Once Polites ordered a lift, Quinn would determine how to perform
the lift and how to swing the boom. Quinn also had authority to refuse to perform a lift
if he thought it would be unsafe. For instance, when it is too windy to operate safely,
the operator could stop the crane, and Polites would accept the operator's judgment.

Michael Polites also testified that he does not know anything
about cranes or how to maintain them, has never operated or performed maintenance on a
crane, and is not familiar with OSHA crane standards. While Polites would pay for routine
maintenance and lubrication of the crane as well as for replacement of some parts, he
relied on Vergona to perform necessary maintenance. Joseph Vergona testified that all
matters relating to maintenance and safe operation of the crane are the responsibility of
the crane operator and oiler.

(Citations to record omitted.) Mr. Vergona took responsibility
for compliance with OSHA standards regarding the crane's cable. He testified, "I
don't wait till we meet or exceed OSHA standards [before changing the cable]." To his
credit, Mr. Vergona kept in touch with Scavetta concerning safety matters affecting the
crane. He told Scavetta to examine the cable for signs of wear. Scavetta kept him advised
of attempts to schedule the replacement of the cable. Concerned about the delays, Mr.
Vergona instructed his maintenance employee, John Kvilesz, to double-check the cable's
condition. Mr. Vergona told Scavetta that if the cable needed to be replaced more quickly
than Polites wanted, Scavetta should replace it regardless of Polites' wishes.

Safety was not the only area in which Mr. Vergona supervised
the workers. For example, after the accident and after learning that Quinn had gone home,
Mr. Vergona ordered Quinn to return to the jobsite. The evidence indicates that Mr.
Vergona had an active concern for safety and responsibility in the operation of the crane.
It also indicates that he exercised control over the manner and means by which Quinn and
Scavetta carried out the crane operations. Polites did not. [[4]]

Respondent stresses the nature of its rental agreement with
Polites. The judge accurately described that agreement as follows:

The crane was rented to Polites under what is known in the
trade as a "bare rental" agreement. Such an agreement provides that the lessee,
in this case Polites, pays the lessor, here [Respondent], a flat fee for use of the crane
alone. The lessee may then obtain the necessary crane operating employees, usually an
operator and oiler, from the union hiring hall or, if the crane comes from another
jobsite, may elect to use the operator and oiler already assigned to the crane. In either
event, the crane workers are on the lessee's payroll, Polites, however, has never gone to
the union hiring hall for an operator when renting a crane from [Respondent].

(Citations to record omitted.) Respondent further relies on the
specific terms of a written lease that it prepared, and that Polites signed, regarding a
previous job. Respondent asserts that it had an oral agreement with Polites by which all
of the same lease terms were extended to the job at issue here. [[5]] We need not
determine whether that assertion is correct, because we find that Respondent was the crane
operator's and oiler's actual employer, regardless of whether the terms of the written
lease were actually in effect.

The written lease contained an indemnity clause. According to
its terms, Polites agreed to assume responsibility for "any and all claims for injury
to persons, and all loss, damage or injury to property ... arising in any manner out of
[Polites'] operation," and Polites agreed that all persons operating the crane were
under its exclusive jurisdiction and control. Another provision of the lease stated that
Polites would declare the crane operator and oiler as its employees for tax purposes, and
pay their withholding, workers' compensation and union fees [[6]]

However, Michael Polites testified that Respondent and another
crane company told him simply that they wanted him to take the crane operator and oiler on
his payroll for insurance purposes. He testified that he had rented cranes from various
companies for different projects, and that they all required that the renter take the
operator and oiler on its payroll when the crane is rented by the month, as here. He
testified that as a result, he had "no choice" about whether to take the
operator and oiler on his payroll. He further testified that the crane operator and oiler
"might have been under my payroll but they were working for Joe Vergona and I had no
control over them without Joe Vergona." Mr. Vergona testified that a company which
signed its written lease would obtain the crane at a discount rate. Thus, we find that
there was no agreement that Polites would have the right to control the manner and means
by which the workers carried out their assignments. We further find that Polites did not
assume responsibility for regulatory compliance in the operation of the crane, including
compliance with the Act.

As mentioned above, the fundamental issue under Darden
is whether the alleged employer actually had the "right to control the manner and
means by which the product is accomplished." The specific testimony in this case
indicates that, in reality, Polites did not possess that general right. Rather, Respondent
retained the right of control over the manner and means by which the crane operator and
oiler accomplished their assignments. Quinn and Scavetta were employees, not independent
contractors. They did not exercise independent business judgment. Their role was to carry
out assigned crane tasks efficiently. Based on this record, we find that Quinn and
Scavetta were Respondent's employees under the Darden test.[[7]]

Turning to the Commission's test of whether a Respondent is an
"employer," the primary consideration under that test has been whether the
Respondent "has control over the work environment such that abatement of hazards can
be obtained." Van Buren, 13 BNA OSHC at 2159, 1989 CCH OSHD at p. 37,781. As
the judge found, Respondent would be considered the employer here, under the Commission's
test, based on its retention of control over safety aspects of the crane operations.

None of the additional considerations specifically mentioned in
the Commission's test suggest that Respondent was not Quinn's and Scavetta's employer. As
to whom the employees considered to be their employer, the judge correctly found Quinn's
and Scavetta's testimony on this point to be "equivocal and therefore
inconclusive." Polites did not have the authority to hire, fire or modify the
employment conditions of the employees directly. To do so, it would have to go through
Respondent or terminate the entire lease. Further, Polites did not establish the
operator's wage, which was set according to the union pay scale. Thus, Respondent is
properly considered the employer of the crane operator and oiler under the Commission's
test, as well as under the Darden test. [[8]]

Our decision is based on the particular evidence in this case.
It is not to be construed as a general holding concerning the respective responsibilities
of crane leasing companies and the construction firms to whom they lease cranes.

3. Whether the judge erred in finding a violation of
   section 1926.550(a)(5)

Section 1926.550(a)(5) ( supra n.1) requires that a
competent person, designated by the employer, shall inspect all machinery for safety
"prior to each use, and during use," and shall replace any defective parts
before the machine is operated again. Based on Quinn's operation of the crane with one of
its two boom stops broken, the judge found a violation of the cited standard. Respondent
argues that no violation was shown because operating the crane with a broken boom stop was
not proven to be hazardous. The judge found:

There is no question that the absence of a boom stop is a
safety defect within the meaning of this standard. Both [OSHA compliance officer] Ricca
and Scavetta testified that with only one boom stop in place the boom can twist as it is
raised and if it is raised too far while twisting it can fall over. Joseph Vergona also
[testified] that he would not permit a crane to operate with only one boom stop.

(Citations to record omitted.) In arguing that a hazard was not
shown, Respondent notes that Scavetta gave a statement to OSHA after the accident,
referring to the broken boom stop and saying that he did not "think it was
hazardous." However, Scavetta later testified under oath that the boom could twist
and fall over, if only one boom stop is used. Thus, even if Scavetta did not think that
operating the crane with a broken stop was hazardous, the judge properly found that it
was.

Respondent also asserts that Scavetta testified that the
"boom kick out" would prevent twisting and collapse of the boom in these
circumstances. Scavetta did not so testify, however. The testimony by Scavetta that
Respondent cites indicates only that Quinn had told Polites on the jobsite that the
"boom kick out" would prevent those problems. Scavetta did not testify that he
agreed with Quinn. Nor was there other evidence explaining how the "boom kick
out" would eliminate those problems. Quinn testified that he told Polites that he
could work the crane with only one boom stop:

He said could you work the crane, I said I could work the crane
with the one stop but I said you have to go very slow and you've got to be real careful,
no fast work. You can't go fast. He said that's good enough, so we went to work.

However, that testimony shows that normal operation of the
crane would be hazardous with the broken boom stop. Further, as the judge found, the
record does not show the basis for Quinn's belief that working very slowly would be
acceptable. By contrast, the record shows that if the boom stop was working, it could
prevent twisting and collapse of the crane's boom in the event of human error, and that
operating without it was unacceptable in the opinion of Mr. Vergona as well as the
compliance officer. The preponderance of the evidence clearly shows that a broken safety
device like a boom stop was a defective part under the cited standard. Thus, it was
necessary to correct the defect before the crane was operated again.

We further find, as the judge did, that Respondent is properly
charged with knowledge of the broken boom stop, because Quinn was aware of it. A
supervisor's knowledge may be imputed to the employer, unless the employer presents
sufficient rebuttal evidence that the supervisor's failure to follow proper procedures was
unpreventable. E.g., Tampa Shipyards, Inc., 15 BNA OSHC 1533, 1537, 1992 CCH OSHD
� 29,617, p. 40,100 (No. 86-360, 1992). Scavetta considered Quinn to be his supervisor,
and both Quinn and Scavetta knew that one of the two boom stops was missing. Respondent's
only argument against imputing this knowledge is that it was not their employer. As
discussed above, we reject that argument. [[9]]

Thus, the Secretary has established all the elements of a
violation. Respondent had a duty to comply with the cited standard because it was Quinn's
and Scavetta's employer. Respondent, through its supervisor Quinn, failed to comply, and
employees who worked near the crane, including Scavetta and Quinn, had access to the
hazards. Finally, Respondent could have known, with the exercise of reasonable diligence,
that the crane was being operated in violation of the cited standard. E.g., Pace
Constr. Corp., 14 BNA OSHC 2216, 2220, 1991 CCH OSHD � 29,333, p. 39,429 (No.
86-758, 1991).

4. Whether Respondent was subjected to impermissible
   "selective prosecution"

The basis for Respondent's "selective prosecution"
claim is that, although the Secretary originally cited Polites for the same violations for
which she cited Respondent, she withdrew those citations against Polites before the
hearing, under a settlement agreement in which Polites admitted to certain other, less
serious violations. Respondent argues that it was incumbent upon the Secretary to
prosecute Polites as the employer.

The Secretary has "broad prosecutorial discretion" in
deciding whom to prosecute for violations of the Act. DeKalb Forge Co., 13 BNA
OSHC 1146, 1153, 1986-87 CCH OSHD � 27,842 p. 36,451 (No. 83-299, 1987), citing Cuyahoga
Valley Ry. v. United Transportation Union, 474 U.S. 3 (1985).

Moreover, the conscious exercise of some selectivity in
enforcement by itself is not a constitutional violation. . . . Rather, a claim of
selective prosecution is judged by ordinary equal protection standards, under which it
must be shown that the alleged selective enforcement had a discriminatory effect and was
motivated by a discriminatory purpose. . . . In particular, the decision to
prosecute may not be "deliberately based upon an unjustifiable standard such as
race, religion or other arbitrary classification [.] "

Id. (emphasis added, citations and footnote omitted),
quoting Wayne v. United States , 470 U.S. 598, 608 (1985). Our finding above that
the Secretary correctly believed, and that the judge correctly found, that Polites was not
the employer of the crane operator and oiler, disposes of Respondent's argument.
Respondent had a full opportunity to show that Polites was in fact their employer, and
failed to do so. The evidence provides us with no basis for questioning the propriety of
the Secretary's decision to dismiss the crane safety items at issue here against Polites.
We reject Respondent's contention that it was subjected to impermissible "selective
prosecution."

5. Penalty

The judge assessed a $700 penalty for the violation. In
assessing penalties, the Commission considers the gravity of the violation, the size and
violation history of the employer, and the employer's good faith. 29 U.S.C. � 666(j). As
the judge noted, the result of a crane boom collapse could be death or severe injury to
any employees in the area. In fact, two fatalities resulted when the crane's cable
snapped, which initially led to OSHA's inspection. (The issues surrounding the failure of
the crane's cable were not directed for review.) On the other hand, Respondent is a small
employer and had no history of OSHA violations. Also, its president showed some good faith
by checking on safety matters affecting the crane while at Polites' worksite, including
the condition of the cable. Considering all these factors, the $700 penalty assessed by
the judge is appropriate, and we affirm it.

6. Order

In summary, we affirm the judge's finding of a serious
violation by Respondent of section 1926.550(a)(5). We also affirm the $700 penalty
assessed by the judge for that violation.

Edwin G. Foulke, Jr.

Chairman

Donald G. Wiseman

Commissioner

Velma Montoya

Commissioner

Dated: July 22, 1992

SECRETARY OF LABOR,

Complainant,

v.

VERGONA CRANE CO., INC.,

Respondent.

OSHRC Docket No. 88-1745

Appearances:

Harry W. Scott. Jr., Esquire

U.S. Department of Labor

Office of the Solicitor

For the Complainant

Edward S. Rosen, Esquire

Rosen & Berman

For the Respondent

BEFORE: MICHAEL H. SCHOENFELD

Judge, OSHRC

DECISION AND ORDER

Background and Procedural History

On January 19, 1988, two workers at a construction site in
South Orange, New Jersey were fatally injured when the boom of a crane collapsed. The
Secretary issued two citations alleging that Vergona Crane Company ("Vergona")
committed one serious and two willful serious [[1/]] violations of the Occupational Safety
and Health Act of 1970, 29 U.S.C. � 651-78 ("the Act"). The serious citation
alleged that the crane, which had been leased to Polites Construction Company
("Polites"), was being operated by an unlicensed operator. The willful serious
citation alleged that the crane was defective because it was missing one of two boom stops
and because of excessive wear and broken strands in the boom hoist cable. [[2/]] Vergona
timely contested both citations, a complaint and answer were filed, and a hearing was held
in New York City from June 27 to June 30, 1989, at which no affected employees or
representatives of affected employees sought party status.

Both parties filed post-hearing briefs. The Secretary, however,
did not file her brief within the scheduled briefing time but rather requested an
extension of time, which I denied because the Secretary did not state good cause for
additional time. The Secretary has filed a motion for reconsideration of my order. That
motion states no new grounds to justify an extension of time and therefore also is denied.
Accordingly, the post hearing brief the Secretary sought to file was returned without
being considered.

Jurisdiction

Vergona's answer admits that it filed a notice of content
according to the provisions of section 10(c) [[3/]] of the Act and that that notice of
contest was duly transmitted to the Commission. Nevertheless, Vergona denied the
jurisdictional allegations of the complaint. Since Vergona filed a timely and properly
transmitted notice of contest, the Commission has jurisdiction under section 10(c). It is
also undisputed that the crane involved in the citations was manufactured in Minnesota
(Tr. 44). That is sufficient evidence to show that Vergona is engaged in a business
affecting commerce under section 3(5) of the Act. [[4/]] Atlanta Forming Co., 11
BNA OSHC 1667 (No. 80-6925, 1983).

Proper Identification of the Cited Employer

The citations and complaint named Vergona as the Respondent.
The evidence shows that the crane in question was in fact owned and leased to Polites by
"Jo-Le-Ron, Inc.," a company affiliated with Vergona (Tr. 262-63, 268, 715-23,
1063, 1075; Ex. R-8, R-9). Vergona contends that this action must be dismissed because the
Secretary named the wrong party. I reject that argument.

Joseph Vergona is president of both the respondent named here
and Jo-Le-Ron, as well as president of a third related company, Vergona and Sons, Inc. All
three companies own cranes and are engaged in the same business of renting cranes to
construction contractors. Vergona Crane, the named respondent, has three or four office
employees who do the paperwork for both that company and Jo-Le-Ron. Both companies are
family businesses, and the office employees are Joseph Vergona's relations. [[5/]] Vergona
Crane also has a full-time maintenance employee, John Kvilesz, whereas Jo-Le-Ron has no
employees. If a crane rented by Jo-Le-Ron needs to be inspected or examined, Vergona
Crane's employee Kvilesz will perform that task, and an "interoffice billing"
will be issued between Vergona Crane and Jo-Le-Ron (Tr. 1052-53, 1125-28).

I conclude that the circumstances do not warrant dismissing
this action on the ground Vergona urges. Vergona Crane and Jo-Le-Ron are closely related
not only in their management but also in their business operations. Institution of the
action against Vergona clearly provided notice to Jo-Le-Ron. In fact, Vergona's counsel
sent a copy of its notice of contest to Jo-Le-Ron. As the Commission held in CMH Co.,
9 BNA OSHC 1048, 1054 (No. 78-5954, 1980), a reasonable person test is to be applied in
determining whether a party not charged should have known that the action was intended to
be brought against it.

Based on the facts here, I find that Jo-Le-Ron must have known that were it not for
the Secretary's erroneous belief that Vergona Crane owned the crane in question, Jo-Le-Ron
would have been the named employer. See John Hill , 7 BNA OSHC 1485 (No. 78-47,
1979). Furthermore, the issues in this case were fully litigated, and a full defense was
put in as to the merits of the citations. Plainly, Jo-Le-Ron has not been prejudiced by
the issuance of the citations and complaint to Vergona. P & Z Co., 7 BNA OSHC
1589, 1593 (No. 14822, 1979).

The preferred method of handling this type of situation is an
amendment under Fed. R. Civ. P. 15(c) changing the party against whom the claims are
asserted. However, the Secretary has not moved to amend. In the absence of such a motion,
I will continue to refer to the respondent as Vergona, since in view of the close
relationship between Vergona and Jo-Le-Ron the correct identification of the cited
employer is merely a technicality.

Employment Issue

Vergona's primary contention is that it was not the employer of
the crane operator and oiler and that all matters relating to the safe operation of the
crane were exclusively within Polites' control. Therefore, Vergona asserts that the
citations must be dismissed for failure of the Secretary to prove either that Vergona had
exposed employees or that it exercised any authority over the conditions at the site.

The crane was rented to Polites under what is known in the
trade as a "bare rental" agreement. Such an agreement provides that the lessee,
in this case Polites, pays the lessor, here Vergona, a flat fee for use of the crane
alone. The lessee may then obtain the necessary crane operating employees, usually an
operator and oiler, from the union hiring hall or, if the crane comes from another
jobsite, may elect to use the operator and oiler already assigned to the crane. In either
event, the crane workers are on the lessee's payroll (Tr. 656-64, 1059-61). Polites,
however, has never gone to the union hiring hall for an operator when renting a crane from
Vergona. Normally, he asks Vergona to assign either Frank Quinn or another operator, Frank
McGuire, because he is familiar with those two individuals and knows that they are good
operators (Tr. 698, 745-46, 1069, 1073).

In this case, Polites' job at the South Orange site commenced
shortly after Polites finished a construction job in Hasbrouck Heights, New Jersey, where
it was using a crane rented from Vergona operated by Quinn with Bruce Scavetta as oiler.
At Polites' request, Vergona sent the crane, together with Quinn and Scavetta, from
Hasbrouck Heights to South Orange (Tr. 406-07, 666, 745-46, 1067-73; Ex. R-15). In
accordance with the agreement, Polites put Quinn and Scavetta on its payroll; declared
them as its employees for tax purposes; and paid their withholding, workmen's
compensation, and union fees (Tr. 687-88). With the exception of Kvilesz, who went to the
site on one occasion to inspect the crane (Tr. 1153-54), Quinn and Scavetta were the only
workers Vergona sent to the site.

The elements to be considered in determining whether an
employment relationship exists include such criteria as who the workers regard as their
employer, who pays their wages, who has the responsibility to control the workers, and who
has the power to hire, fire, or modify the employment condition of the workers. Van
Buren-Madawaska-Corp. , 13 BNA OSHC 2157, 2158 (No. 87-214, 1989). Quinn and Scavetta
testified that in this instance they considered Polites their employer, whereas in a
written statement to the Secretary's compliance officer some months after the accident,
Scavetta stated that he has been employed by Vergona Crane for about two years and that
his supervisor is Joseph Vergona (Tr. 399-400; Ex. G-10). Although Scavetta was not asked
to explain his written statement in light of his testimony, his testimony and that of
Quinn indicates that they viewed Polites as their employer solely because Polites was
paying their wages (Tr. 328, 402). However, the purpose of the lease provision that
Polites would pay the workers' wages was not to establish an employment relationship but
was merely a concession to Vergona to allow Vergona to reduce its insurance costs (Tr.
676, 721-23, 1075-76; Ex. R-7, R-9). Since payment of wages in just one of many aspects of
an employment relationship, and here is relatively insignificant, I am not inclined to
assign dispositive weight to Quinn's and Scavetta's testimony that they believed Polites
to be their employer. I also find their testimony to be equivocal and therefore
inconclusive because neither witness clearly distinguished between crane rental companies
and construction companies who rent cranes. For instance, when asked to describe their
work experience, Quinn testified that he had worked for both crane rental companies and
contractors (Tr. 351-52), while Scavetta stated that he had worked both for Vergona and
for construction contractors including Polites (Tr. 377).

Another factor is the right to hire, fire, or modify the
employment condition. Michael Polites, president of Polites Construction, testified that
he could not fire Quinn or Scavetta; if he wanted to get rid of the operator or oiler, he
would either have to ask Vergona for different workers or terminate the entire lease.
Polites also did not establish the operator's wage; it was set according to the union pay
scale (Tr. 678, 691).

The primary factor in determining an employment relationship,
however, is "who has control over the work environment such that abatement of the
hazards can be obtained." Van Buren-Madawaska, 13 BNA OSHC at 2159. The record
here shows that ultimate authority over the worksite for purposes of safety of operation
of the crane was vested in Vergona.

Michael Polites or his supervisors told Quinn what loads to move and where to lift them,
but that was the extent of Polites' instructions to Quinn. Once Polites ordered a lift,
Quinn would determine how to perform the lift and how to swing the boom. Quinn also had
authority to refuse to perform a lift if he thought it would be unsafe. For instance, when
it is too windy to operate safely, the operator could stop the crane, and Polites would
accept the operator's judgement (Tr. 330, 678, 725-27).

Michael Polites also testified that he does not know anything
about cranes or how to maintain them, has never operated or performed maintenance on a
crane, and is not familiar with OSHA crane standards (Tr. 723). While Polites would pay
for routine maintenance and lubrication of the crane as well as for replacement of some
parts, he relied on Vergona to perform necessary maintenance (Tr. 659-60, 723). Joseph
Vergona testified that all matters relating to maintenance and safe operation of the crane
are the responsibility of the crane operator and oiler (Tr. 1078-79). That Vergona rather
than Polites exercised authority over the site with respect to the safety of crane
operations is aptly demonstrated by the circumstances surrounding the allegations that the
crane was not in a safe operating condition.

When the crane was sent to Polites' worksite, it had been
operating for about six months on other sites. Because the lifespan of a boom cable
normally is not much greater than six months, Joseph Vergona told Scavetta to examine the
cable for signs of wear. Both Scavetta and Quinn inspected the cable daily while standing
on top of the crane cab, and Quinn performed a more thorough inspection on the Monday
before the accident (January 18) when he lowered the crane boom to the ground and walked
along it. Both Quinn and Scavetta found that the cable was somewhat worn and had a few
broken strands, indicating nothing more than normal wear and tear. It was Scavetta,
however, who assumed the role of liaison between Vergona and Polites. Because the cable
had been in use for at least six months, Scavetta informed Polites' superintendents that
it should be changed. Since replacing the cable would take the crane out of service,
Scavetta attempted to arrange with Polites a mutually convenient date for the cable
change. He was unsuccessful. Over a two-week period before the accident, the cable change
was scheduled and rescheduled several times (Tr. 326-31, 336-38, 341- 43, 367, 373-75,
379-83, 388, 412-16, 422-26, 1081-92).

Scavetta kept Vergona advised of the reschedulings (Tr.
435-36). Vergona, who was beginning to get concerned about the age of the cable,
instructed Kvilesz to check the cable so that Vergona could have another opinion as to its
condition. He told Kvilesz that Polites was procrastinating and that if Kvilesz concluded
that the cable needed to be changed "we'll take further steps and do it quicker than
what they're [Polites] trying to schedule" (Tr. 1109). He made essentially the same
statement to Scavetta as well, telling him that if the cable had to be changed, Scavetta
should go ahead and change it without regard to Polites' preferences (Tr. 390, 1088).

Kvilesz went to the site one or two weeks before the accident.
As did Quinn and Scavetta, Kvilesz found some broken wires which he did not consider
serious, but he felt that the cable should be replaced within the next couple of weeks
(Tr. 1083, 1086-87, 1154, 1170). The cable change was eventually scheduled for the Monday
before the accident, was cancelled, and then rescheduled that day for the following
Wednesday, which turned out to be the day after the accident (Tr. 1091-92). [[6/]] Vergona
specifically testified that if he thought the cable had become hazardous, he would have
seen to it that the cable was changed (Tr. 1111). Scavetta also testified that so long as
he was paid for the work, he would change the cable if Vergona instructed his to do so
(Tr. 403).

The other crane safety matter that demonstrates Vergona's
ultimate control relates to the boom stop. A boom stop is an attachment to the boom that
works along the principle of a shock absorber. Its purpose is to prevent the boom from
going over backwards by keeping it from rising higher than its center of gravity (Tr.
55-56). About one week before the accident one of the crane's two boom stops became bent,
forcing Quinn to stop the crane. Michael Polites, who came over to find out why the crane
was not operating, asked if the stop could be repaired or if he should arrange for another
crane. Quinn and Scavetta replied that they could fix the stop and another crane would not
be necessary. A few days later the stop bent again, and again Polites or his
superintendent asked if it was repairable. On the Friday before the accident the other
stop bent but Quinn could not straighten it. Quinn then told Polites that the crane could
be operated with only one boom stop and also explained that the crane had an additional
safety device called a "kick out" that would help prevent the boom from going
over backwards. [[7/]] However, Quinn did advise Polites that he would have to move the
boom slowly and carefully and would not be able to work fast. Polites agreed that that
would be satisfactory (Tr. 332-35, 392-95, 418, 669-70). Polites testified that he did not
know anything about boom stops and relied on what Quinn told him (Tr. 728, 732-34).

When the accident occurred, Quinn telephoned Vergona's office
to report that Vergona equipment had been damaged. He was not able to speak to Joseph
Vergona directly and went home. Thereafter Joseph Vergona called Quinn at his home and
instructed him to go back to the site (Tr. 347-49).

These facts show that Polites had some operational control over
the crane. However, mere operational control of a crane is the not sole factor in
determining whether an employment relationship exists. Acchione & Canuso Inc. ,
7 BNA OSHC 2128, 2129-30 (No. 16180, 1980). The record clearly demonstrates that with
respect to the question of whether the crane was in safe operating condition, Polites did
not exercise control over Quinn and Scavetta. Joseph Vergona and not Michael Polites
informed Scavetta that the cable should be inspected for wear and replaced if necessary.
Vergona also instructed Scavetta that if a safety hazard existed, the cable would be
changed without regard to Polites' scheduling preferences, and Scavetta's testimony
indicates that he would have complied with such a directive from Vergona. Similarly,
Polites asked Quinn and Scavetta for their opinion regarding the boom stops, leaving the
decision whether to operate the crane entirely within their discretion. I find that
Polites relied on Quinn and Scavetta to advise him of any matters pertaining to the safety
of the crane and that he gave them no instructions in that regard. See Sasser Electric
& Manufacturing Co., 11 BNA OSHC 2133 (No. 82-178, 1984), aff'd, 12 BNA
OSHC 1445 (4th Cir. 1985) (unpublished) (discussion of employer's right to rely on
expertise of another). I also find that Vergona was responsible to insure that the crane
was properly maintained and in safe operating condition and that Vergona had ultimate
authority to direct Quinn and Scavetta on safety matters. The control exercised by Vergona
with respect to safety matters at the site establishes that Vergona and not Polites is the
employer of Quinn and Scavetta. Acchione & Canuso, supra . [[8/]]

Citation No. 1, Item 1

Alleged Serious Violation of 29 C.F.R. � 1926.550(b)(2)

The Secretary alleged that Quinn did not have a current New
Jersey crane operator's license and therefore had failed to pass an examination as
required by ANSI standard B30.5-1968. [[9/]]

Quinn had received a license in 1963 when the New Jersey state
licensing program began, but his license lapsed in 1980 or 1981. He testified, however,
that he currently has a license. At the time of the inspection he also informed the
Secretary's inspector, Louis Ricca, that he had a license, but was unable to produce it.
Ricca also testified that the state, which keeps licensing records for no longer than six
years, had no record of a license issued to Quinn over the six years preceding the
accident (Tr. 60-61, 274, 322, 350).

Proof that an employer has knowledge of conditions that fail to
comply with a standard is a necessary element of the Secretary's case. Continental
Electric Co., 13 BNA OSHC 2153, 2154 n.4 (No. 83-921, 1989). The Secretary may
satisfy this burden by showing either that the employer had actual knowledge of the
violative condition or that the employer could have known of the violative with the
exercise of reasonable diligence. Chapman Construction Co. , 9 BNA OSHC 1175, 1177
(No. 76-2677, 1980). Quinn testified that none of his employers were aware that his
license had lapsed (Tr. 322). Joseph Vergona had known Quinn from at least 1975, when
Quinn was working for Hoffman Crane. He regarded Quinn as a qualified operator. Ricca also
testified that he found nothing during his investigation to indicate that Quinn was not
experienced (Tr. 274). Vergona did not ask Quinn whether he had a valid license but
believed that Quinn did because it is the operator's obligation to maintain his license in
good standing. Vergona also felt that the union hall would not send out someone who was
unlicensed (Tr. 323, 351, 1077-78, 1119).

I find that the preponderance of the evidence shows that Quinn
did not have a valid license at the time of the accident and inspection, although he may
have had one by the time of the hearing in this case. I also find, though, that Vergona
was not obligated to specifically inquire whether an experienced operator sent from the
union had a valid license. Therefore, Vergona could not reasonably have known that Quinn's
license had lapsed.

The issue presented here, however, is not whether Quinn had a
valid license but whether he had passed an examination as required by the standard. When
he applied for his license Quinn was only given some questions to answer; he was not
required to operate a crane as part of his examination (Tr. 350). That does not comply
with the cited section of the ANSI standard, which calls for a "practical operating
examination" that is "limited to the specific type equipment" that will be
operated. The only reasonable interpretation of this language is that the operator must
prove by an actual physical demonstration that he is competent to operate the equipment in
question. However, I find that no violation was established because the Secretary has
failed to present any evidence to show that Vergona knew or reasonably could have known
that Quinn had not been given the type of examination required by the standard.

In addition to the lack of proof of employer knowledge, I
vacate this item as de minimis. Quinn has been operating cranes since 1960 (Tr. 321). The
fact that he was not required to show his competence to operate a crane when he first
received his license in 1963 has a negligible, if any, relationship to the safety of the
crane operations 25 years later at the worksite in question here. Cleveland
Consolidated, Inc., 13 BNA OSHC 1114, 1118 (No. 84-696, 1987).

Citation No. 2, Item 1

Alleged Willful Serious Violation of 29 C.F.R. � 1926,550(a)(5)

The Secretary alleged that Vergona violated this standard by allowing the crane to operate
without replacing the broken boom stop.[[10/]] There is no question that the absence of a
boom stop is a safety defect within the meaning of this standard. Both Ricca and Scavetta
testified that with only one boom stop in place the boom can twist as it is raised and if
it is raised too far while twisting it can fall over (Tr. 303, 417). Joseph Vergona also
stated that he would not permit a crane to operate with only one boom stop (Tr.
1080).[[11/]]

However, Vergona further testified that although Scavetta
notified him when the boom stops bent and were restraightened, neither Quinn nor Scavetta
ever told him that a stop had broken and that the crane was being operated with only one
boom stop (Tr. 1080, 1093-94). His testimony is consistent with that of Quinn, who stated
that he never spoke to Vergona about the missing stop and that Scavetta informed Vergona
on the first two occasions when the stop bent (Tr. 335, 346). Scavetta, for his part,
testified that he could not recall whether he advised Vergona that they were using only
the one stop (Tr. 394-95). On the other hand, Michael Polites testified that he asked
Joseph Vergona whether he should make arrangements to get another crane, and that Vergona
told him the crane could be operated with one stop if Quinn took it easy. He also
testified that at Quinn's suggestion he had one of his drivers take the broken stop to
Vergona's yard (Tr. 669-71, 729-32). Vergona expressly denied that Polites ever asked him
about operating the crane with only one stop and that no one brought the boom stop from
the Polites site to the Vergona yard (Tr. 1080).

I have carefully weighed the conflicting evidence as to whether
Joseph Vergona himself was aware that the boom stop had broken. [[12/]] In evaluating this
testimony, I have taken into account the undisputed evidence that when Vergona realized
that the cable was approaching the end of its useful life, he instructed his employees to
inspect and change the cable if they found it to be excessively worn. Those facts
demonstrate that Vergona is a safety-conscious individual who was concerned that the crane
be in safe operating condition. To conclude that Vergona know about the broken boom stop
but took no measures whatever to correct that condition would be completely inconsistent
with his actions regarding the hoist cable. It is more a reasonable inference that Vergona
allowed the crane to continue to operate with only one stop because he did not know that
the other stop had broken. Accordingly, I find Vergona's testimony that he was unaware of
the broken stop to be credible. [[13/]]

However, while I find that the Secretary failed to show that Joseph Vergona personally had
knowledge that the boom stop had broken, Vergona as the employer must be charged with
Quinn's knowledge. After Quinn conferred with Polites' personnel regarding the lifts to be
made with the crane, he would instruct Scavetta where to move the crane and give Scavetta
directions for backing up the crane. Scavetta considered Quinn his supervisor for this
purpose Quinn also had authority to instruct Scavetta to inspect the crane and its cable
and could direct Scavetta to make arrangements to get a new boom stop (Tr. 405-06). These
facts are sufficient to show that Quinn was a supervisory employee whose knowledge is
imputable to his employer. Iowa Southern Utilities Co. , 5 BNA OSHC 1138 (No.
9295, 1977). Because Quinn obviously knew that the stop had broken and that the crane was
being operated in that condition, Vergona as Quinn's employer is charged with knowledge of
the violative conditions under the imputation principle. See Wander Iron Works, Inc. ,
8 BNA OSHC 1354, 1357 (No. 76-3105, 1980).

I do not, however, find the violation willful as alleged. The
evidence fails to show that Vergona's failure to replace the boom stop or to prevent the
crane from being operated with only one stop was due to an intentional disregard for the
requirements of the Act or plain indifference to employee safety. Keco Industries,
Inc., 13 BNA OSHC 1161, 1163 (No. 81-263, 1987). As I have found, Joseph Vergona
credibly testified that he would have taken appropriate action had he known of the
condition of the boom stop. Quinn's belief that one boom stop was not unsafe if he
operated the crane slowly and that the "kick out" would compensate for the
missing boom stop does not establish willfulness. The Secretary did not present any
evidence to show that there could be no rational basis for Quinn's belief that slow
operation and the kick out would alleviate any hazard. See Wright & Lopez, Inc.,
10 BNA OSHC 1108, 1114 (No. 76-256, 1981) and cases cited therein (good faith belief
negates willfulness). Nor has the Secretary presented any other facts from which I could
conclude that Quinn's state of mind was one of disregard or indifference to the
requirements of the standard. Accordingly, the Secretary has not established a willful
violation on the facts here. Brock v. Morello Brothers Construction , 809 F.2d 161,
164 (1st Cir. 1987).

Citation No. 2, Item 2

Alleged Willful Serious Violation of 29 C.F.R. � 1926.550(a) (7)(i) and �
1926.550(a)(7)(ii)

This item is a grouping of three subitems alleging that the
crane hoist cable was defective and should have been taken out of service. [[14/]] The
Secretary claimed that the cable contained an excessive number of randomly distributed
broken wires in one lay (subitem 2(a)) and broken wires in one strand in one lay (subitem
2(b)) and also had numerous flat spots, exhibiting excessive wear (subitem 2(c)) [[15/]]

According to Ricca, wire rope consists of individual wires
formed into strands, which in turn are wrapped around a center core. A rope of the size in
question here has six strands. A "lay" refers to the lateral distance along one
twist of a strand. At Ricca's request, Joseph Vergona cut a piece of cable about two feet
long from the crane. This piece or cable is shown in photographic exhibits G-1A, 1B, and
1C, and was itself admitted as exhibit G-1. It had been coated with a dressing that was
black in color which Ricca thereafter removed with pressurized hot water (Tr. 48-51, 96,
272-73, 300-01, 362). Based on an examination of this cut section of the cable, Ricca
observed numerous breaks in individual wires, both randomly throughout all the strands in
a given lay as well as multiple breaks in one strand in one lay. He counted 23 randomly
distributed broken wires and 13 broken wires on one strand in one lay (Tr. 52, 71). I have
examined G-1, the actual piece of cable cut from the crane. It has a large number of
broken wires within one or two-inch areas, clearly in excess of the maximum permitted
under the standard. Next to a strand containing a number of obvious large breaks is a
strand with some smaller breaks.

Charles Savko, Ricca's supervisor, accompanied Ricca on the
inspection. He testified that he wiped off a portion of the cable and looked at the broken
strands at several locations on the crane gantry where the pulleys that operate the boom
are located. Even where the cable still had grease on it he was able to count more than
six broken wires in one lay and more than three in one strand (Tr. 765-69; Ex. G-14).
Savko also testified that the cut section of the cable shows uniform wear from one end to
the other. After Ricca cleaned the cut section, Savko used a calipers to measure the
diameter of the wires. Based on that measurement, he estimated that individual wires had
been worn down to 50 percent of their original diameter. In his opinion, a cable should be
changed when wires are worn beyond one-third of their diameter (Tr. 777-78, 1025-26).

Quinn testified that when he examined the cable, he did so by
lightly and slowly running his hand along it (Tr. 361-62). Scavetta did the same, except
that Scavetta wore gloves. Although he had a rag with him, Scavetta did not clean off the
cable but rather felt for broken wires as he moved his hand along the wire. He found no
more than one break in the wire every one to three feet (Tr. 380, 412, 424). Kvilesz, who
did run a rag along the cable, testified that in his experience, the rag will pickup any
"burrs" that are present, which will indicate whether there is a problem in the
cable. While he did not see an excessive number of broken wires, he observed smaller
breaks similar to those appearing on exhibit G-1 but did not count them and therefore did
not know how many there may have been. He has been inspecting cables for about three
years, and Vergona has given him some instruction in conducting such inspections. However,
he is not familiar with the OSHA requirements as to the maximum number of breaks
permitted, nor does he know what a "lay" is (Tr. 1155-56, 1159, 1164-68). Quinn
also had not been given specific training in, and was not aware of, the OSHA standards but
followed procedures operators have established over the years (Tr. 357). Scavetta, who has
been an oiler for three years, had been taught that a cable should be changed if it has a
"group" of wires broken within a 6-inch to 1-foot area (Tr. 377-79, 425).
Neither Quinn, Scavetta, nor Kvilesz testified regarding wear or thinning of the wires as
opposed to broken wires.

Savko gave his opinion that Quinn and Scavetta had performed an
inadequate inspection. Because the cable can easily cut a person's hand, one should never
run his bare hand along a wire. According to Savko, once Quinn and Scavetta encountered
some broken wires, they should have wiped the wire with a rag and specifically looked for
any additional breaks. He also felt that a rag would detect more broken wires than would a
bare hand because the rag would catch on breaks where as a person rubbing his hand lightly
over a cable would be likely to miss some breaks (Tr. 786-87, 1015-18). Savko did not
testify regarding Kvilesz's inspection..

Quinn, Scavetta, and Kvilesz agreed that a cable in the
condition of exhibit G-1 shows damage and should be taken out of service (Tr. 367, 414-16,
1157-58). However, there is a dispute as to whether the cut section accurately represents
the condition of the cable before the accident or whether the wires in this sample were
broken as a result of the accident. Some of the testimony centered on the cable pulleys,
which were severely bent, distorted, and scratched after the accident (Ex. R-2, R-3, R-4).
Various witnesses agree that the damage to the pulleys indicates what was happening to the
cable at the time of the accident, but there is some disagreement as to specifically what
conclusions should be drawn from the condition of the pulleys or from the fact that
exhibit G-1 has a curve or twist in it.

It is undisputed that the hoist cable parted at one location.
Exhibit R-1 is a photograph of a torn, frayed cable end. Savko concluded that the pulleys
were damaged when the flared-out broken end shown in exhibit R-1 traveled through the
pulleys at a high rate of speed. Savko believed that if exhibit G-1 had jumped out of the
pulley it would have received nicks and gouges, which it did not have. Savko stated that
exhibit G-1 was bent simply from running through the sheave and that the cable did not
leave the sheave after it broke because he saw the cable still in the flange of the
pulley.

Savko further distinguished an "abrasion" or
"fatigue" break from a "tension" break, stating that the first type of
break is caused by metal-to-metal wear that develops over a period of time. It is
characterized by a flattening in the shape of individual wires. A tension break, on the
other hand, has a distinctive "cup" and "cone" appearance reflecting a
wire that has been pulled on in two different directions. When the tension is released,
the broken wire ends spring up and back. The wires in exhibit G-1 have the flattened
appearance of a fatigue break rather than the cup and cone characteristic of a tension
break and also are in line rather than "flipped back" (Tr. 778-87, 795-806,
1008-11).

Joseph Vergona's view was that the damage to the pulleys was
caused by the cable running outside the flange of the pulleys. He felt that the breaks
shown in exhibit G-1 could have been caused by wear or could have resulted from the cable
jumping off the pulley, but he also stated that the corkscrew shape of exhibit G-1
indicates that the cable ran over a sharp edge, such as a pulley housing. On the other
hand, Vergona conceded that the rope crossing over the sheaves and being dragged across
the sharp points of the housing could have caused the frayed out cable ends shown in
exhibit R-1 (Tr. 1095-05, 1150-51).

Quinn likewise testified that the cable jumped out of a sheave
and shredded, with exhibit R-1 showing the shredded area and G-1 showing where the cable
jumped the sheave. He also stated that the curl in the exhibit G-1 cable section could
only be caused by jumping and that running within the sheave would not be capable of
causing the conditions shown in exhibit G-1. He did not explain why (Tr. 339-40, 367-68,
376).

In my view, all the witnesses were about equally qualified--or,
for that matter, equally unqualified--to give an opinion as to whether the damage
contained in exhibit G-1 existed prior to or resulted from the accident. Savko has been an
OSHA inspector and supervisor since 1975, and has conducted well over 200 inspections of
cranes. Previously, he worked for over 15 years in the mining industry performing daily
inspections of the cables, clamps, and pulleys on a personnel hoist. He had experience
investigating accidents where a boom lifting cable had broken. On the other hand, he has
no college education and in particular is not a trained metallurgist. He also does not
know whether the technology and methodology of wire ropes has changed over the years (Tr.
750-60, 770-71, 792, 1031). Savko's level of expertise is not appreciably different from
that of Vergona, who has 20 years experience with cranes in different capacities,
including mechanic, oiler, and operator (Tr. 1054-58), or that of Quinn, who has been a
crane operator since 1960 (Tr. 321).

Savko's testimony, though, is consistent with the appearance of
exhibit G-1, on which areas where wires have been flattened are quite visible. It is
reasonable and logical to conclude that this flattening indicates that the cable wires
have worn down over a period of time, and that conclusion also is consonant with Vergona's
concern for the length of time the cable had been in use. Savko's judgment that the cable
strands were broken before the accident also is corroborated by Kvilesz's testimony that
he found some broken wires when he inspected the cable one or two weeks prior to the
accident. Vergona's testimony, on the other hand, was equivocal in that he testified that
either wear or movement outside of the pulley could have caused the conditions in exhibit
G-1. Furthermore, Vergona's admission that the torn cable ends shown in exhibit R-1 could
have resulted from the cable moving across the pulley housing area supports Savko's view
that movement outside of the pulley was not a factor in the condition of exhibit
G-1.[[16/]] Finally, I discount Quinn's testimony on this subject because he stated no
reasons to support his opinion.

Accordingly, I find that the cable had an excessive number of
broken wires before the accident. [[17/]] The evidence also shows that visually inspecting
the cable after wiping it with a rag is an appropriate and reasonable method for detecting
broken wires. In fact, that is the technique Kvilesz himself used, except that Kvilesz did
not count all the broken wires he saw. I therefore, find that with the exercise of
reasonable diligence Vergona could have known of the number of broken wires. Accordingly,
Vergona is in violation as alleged in subitems 2(a) and 2(b).

However, I do not find the violation willful as alleged. The
Secretary established that Vergona's employees had not been instructed in the proper
method for inspecting a cable for breaks and had not been made aware of the requirements
of the OSHA standard pertaining to the maximum permissible number of broken wires.
However, the Secretary has not presented any evidence to show that Vergona acted out of
disregard or indifference to the requirements of the standard. In fact, as indicated
above, Joseph Vergona was concerned that the cable was becoming excessively worn and
needed replacement. Simple lack of diligence or relessness in failing to discover a
violation does not constitute willfulness. Marmon Group, Inc. , 11 BNA OSHC 2090,
2092 (No. 79-5363, 1984).

Savko's testimony about the wires having become worn down is
unrebutted. Additionally, as indicated above, flattened wires are clearly visible in
exhibit G-1. However, Savko's observations and conclusions about the amount of wear were
based on his examination of the cable after it had been removed from the site and
thoroughly cleaned with pressurized water. There is no evidence from which I can conclude
that wear or flattening of the wires would have been evident when the cable was covered
with grease, nor did the Secretary show that wiping the cable with a rag would be
sufficient to reveal this type of wear. Accordingly, the allegation in subitem 2(c) has
not been proven due to the Secretary's failure to show that Vergona knew or reasonably
could have known of the violative condition.

Penalty Assessment

There is no record of a prior history of violations by Vergona. [[18/]] Vergona also
is a small employer, and it demonstrated some good faith in its concern for the condition
of the cable. However, violations for having defective crane components are of high
gravity, as exemplified by the fact that two fatalities occurred in this case. I assess a
penalty of $700 each for items 1 and 2 of citation no. 2.

FINDINGS OF FACT

Findings of fact relevant and necessary to a determination of
all issues have been made above. Fed. R. Civ. P. 52(a). All proposed findings of fact and
conclusions of law inconsistent with this decision are denied.

CONCLUSIONS OF LAW

1) Vergona Crane Company, Inc. was at all times pertinent
hereto an employer engaged in a business affecting commerce within section 3(5) of the
Act, and the Commission has jurisdiction of the parties and the subject matter.

2) Vergona was at all times pertinent hereto required to comply with the requirements of
the Act and the regulations issued pursuant to the Act.

3) Vergona did not violate 29 C.F.R. � 1926.550(b)(2) (citation no. 1, item 1).

4) Vergona was in serious violation of 29 C.F.R. � 1926.550 (a)(5) (citation no. 2, item
1) but the violation was not willful.

5) Vergona was in serious violation of 29 C.F.R. � 1926.550 (a)(7)(i) (citation no. 2,
subitems 2(a) and 2(b)) but the violation was not willful.

6) Vergona was not in violation of 29 C.F.R. � 1926.550(a) (7)(ii) (citation no. 2,
subitem 2(c).

7) Pursuant to section 17(j) of the Act, the following penalizes are appropriate:

a. Citation no. 2, item 1. . . .$700

b. Citation no. 2, subitems 2(a) and 2(b). $700

ORDER

1. Item 1 of citation no. 1 for violation of 29 C.F.R. �
   1926.550(b)(2) is VACATED.

2. Item 1 of citation no. 2 for violation of 29 C.F.R. � 1926.550(a) (5) is AFFIRMED and
   a penalty of $700 is assessed therefor.

3. Subitems 2(a) and 2(b) of citation no. 2 for violation of 29 C.F.R. �
   1926.550(a)(7)(i) are AFFIRMED and a penalty of $700 is assessed therefor.

4. Subitem 2(c) of citation no. 2 for violation of 29 C.F.R. � 1926.550(a)(7)(ii) is
   VACATED

MICHAEL H. SCHOENFELD

Judge, OSHRC

FOOTNOTES:

[[1]] That standard, promulgated by the Secretary of Labor's
Occupational Safety and Health Administration ("OSHA"), provides:

The employer shall designate a competent person who shall
inspect all machinery and equipment prior to each use, and during use, to make sure it is
in safe operating condition. Any deficiencies shall be repaired, or defective parts
replaced, before continued use.

[[2]] Those definitions state:

(5) The term "employer" means a person engaged in a
business affecting commerce, who has employees, but does not include the United States or
any State or political subdivision of a State.

(6) The term "employee" means an employee of an
employer who is employed in a business of his employer which affects commerce.

[[3]] As the judge mentioned, even if Jo-Le-Ron had been the
only appropriate entity to cite, an amendment of the pleadings to name it as the employer
would be permissible under the principles of Federal Rule of Civil Procedure 15(c). That
rule applies to Commission proceedings under 29 C.F.R. � 2200.2(b). Amendment of the
pleadings to change the name of the party sued is permitted under Fed. R. Civ. P. 15(c)
when the same claim is involved and the party to be bought in by the amendment: (1)
received timely notice of the institution of the action, so that it would not be
prejudiced in defending its position on the merits; and (2) knew or should have known
that, but for a mistake concerning the identity of the proper party, the action would have
been brought against it. The 1991 amendment to Fed. R. Civ. P. 15(c) extends the
"relation-back period" for such an amendment to at least 120 days after the
limitations period for bringing the action. Pub.L. 102-198, � 11(a), 105 Stat. 1626
(1991). See generally 6A C. Wright, et al., Federal Practice and Procedure,
� 1498(1992 Supp.).

The Rule 15(c) criteria have been met here. Jo-Le-Ron's
responsibility would be based on the same conduct, transaction and occurrences as
Respondent's responsibility. Jo-Le-Ron received full and timely notice of the institution
of the action when Mr. Vergona received the citation. Furthermore, it knew or should have
known that the action would have been brought against it except for the alleged mistake as
to which Vergona entity leased the crane. (A citation is not a "summons" or
"complaint" within the meaning of the Federal Rules. See, e.g., P & Z
Co., 7 BNA OSHC 1589, 1591, 1979 CCH OSHD � 23,777, p. 28,829 (No. 14822, 1979).
However, no stricter rule for "relation back" of an amendment is warranted for a
citation. See, e.g., CMH Co., 9 BNA OSHC 1048, 1052-54, 1980 CCH OSHD � 24,967,
p. 30,826 (No. 78-5954, 1980) (dealing with former version of Fed. R. Civ. P. 15(c)).

[[4]] The fact that Respondent did not interrupt Polites'
construction job to change the cable does not indicate that Respondent lacked control over
the crane, operator or oiler. Mr. Vergona's testimony shows that he was concerned about
finding a time convenient to Polites to change the cable. His concern for Polites'
convenience is understandable in light of the companies' business relationship and the
lack of urgency that Vergona's personnel conveyed to him about changing the cable. Thus,
based on this record, Respondent retained the authority to replace the crane's cable at
its discretion.

[[5]] Polites and Respondent did sign a written lease
concerning the jobsite in question here, but not until after the alleged violation
occurred. That lease contained essentially the same terms as the previous written lease.
There was no evidence that the subsequent lease was effective retroactively.

[[6]] In Respondent's behalf, it also bears noting that
Polites' regular business was construction, and it had hired cranes from Respondent, or
companies related, to Respondent, on numerous prior occasions.

[[7]] Respondent argues that this case is indistinguishable
from a recent case in which a Commission judge found that the crane leasing company was
not the crane operator's employer. United Crane & Shovel Serv. , 88 OSAHRC
20/A12 (No, 87-1331, 1988) However, the situation there was actually quite different. A
contractor leased a crane from United on a bare rental lease, but hired the crane operator
entirely independent from United. No relationship was shown between United and the crane
operator. By contrast, in this case there was a long-term employment relationship between
Respondent and the crane operator and oiler, and Respondent retained control over the
manner and means by which they performed their assignments.

[[8]] There is no need in this case to permit this as a further
opportunity to present evidence or argument on the employment issue, in light of Darden
and his  parties have had a full opportunity to present evidence on any factors that
relate to that issue, including whether Respondent had a right of control over the manner
and means by which the crane operator and oiler performed their work. The extensive
hearing produced substantial evidence on each of the factors specifically mentioned in Darden
and Van Buren . Further, the briefs on the issue have been comprehensive.

[[9]] It can be argued that Respondent also reasonably could
have known that the crane was being operated in violation of the cited standard because of
a frayed cable. Respondent was aware that the crane's cable was fraying, and intended to
replace it. Before it was replaced, however, the cable snapped, resulting in a fatal
accident. Because of our disposition of the knowledge issue, we need not and do not
address this issue.

[[1/]] Originally, citation no. 2 alleged only willful violations. The complaint amended
that citation to allege that the willful violations were serious as well.

[[2/]]The boom hoist cable, also referred to as the "boom
cable" or the "hoist cable," is a wire rope that raises and lowers the
crane's boom. It is a different cable than the line that lifts the load itself (Tr. 373).
The latter is not at issue.

[[3/]] Section 10(c) of the Act provides that if an employer
files a timely notice of contest, "the Secretary shall immediately advise the
Commission of such notification, and the Commission shall afford an opportunity for a
hearing...."

[[4/]] This section provides: "The term
"employer" means a person engaged in a business affecting commerce who has
employees, but does not include the United States or any State or political subdivision of
a State."

Joseph Vergona, Vergona's president, testified that Vergona has
employees (Tr. 1125-26). There is a dispute, however, as to whether Vergona was the
employer of the crane operator and oiler on the jobsite in question here and whether it
was responsible for their actions. That issue is discussed later in this decision.

[[5/]] The name "Jo-Le-Ron" is an amalgam of Joseph
Vergona's children's names (Tr. 716).

[[6/]] Vergona explained that on Friday, January 15 Pete Cronk,
Polites' ironworker superintendent, called to cancel the cable change that had been
scheduled for the following Monday. Consequently, Vergona told Scavetta not to bother
picking the replacement cable, which had been loaded on a truck at Vergona's yard. Then on
Monday morning Cronk called Vergona to ask if the cable could be changed that afternoon.
Vergona told Cronk that he did have anyone to take the cable to the worksite but that
Cronk could pick up the cable himself (Tr. 1088-91). Polites' view of these events is that
Vergona prevented the scheduled change because he refused to bring the cable to the site
(Tr. 743).

The parties dispute whether Polites or Vergona was responsible
for the cancellations and postponements that eventually resulted in the cable not being
changed. I express no opinion on this question because it is irrelevant to the issue
here--which company, Vergona or Polites, had ultimate authority and control over the crane
with regard to safety matters.

[[7/]] A "kickout" is an arm alongside the operator's
cab that precludes the boom from being raised above a certain point (Tr. 418).

[[8/]] Polites cites a decision in United Crane & Shovel
Service Co., 88 OSAHRC 20/A12 (No. 87-1331, 1988) (ALJ), in which Judge DeBenedetto
held that United Crane, which leased a crane to a contractor, Eastern Steel Erectors, on a
"bare rental" agreement was not the employer of the crane operator. That case is
factually distinguishable. United Crane did not exercise any control over the operator; in
fact, Steel Erectors hired the operator directly without any involvement by United Crane,
and there is no evidence to indicate that the lessor had any contact whatever with the
operator.

[[9/]] The Secretary's standard, 29 C.F.R. � 1926.550(b)(2),
in pertinent part, requires as follows:

All crawler, truck, or locomotive cranes in use shall meet the
applicable requirements for design, inspection, construction, testing, maintenance, and
operation as prescribed in the ANSI B30.5-1968, Safety Code for Crawler, Locomotive and
Truck Cranes. . . .

The referenced ANSI standard provides, in pertinent part, as
follows:

5-3.1.2 Qualifications for Operators

a. Operators shall be required to pass a practical operating examination. Examination
shall be limited to the specific type equipment which he will operate.

[[10/]] The cited standard requires as follows:

The employer shall designate a competent person who shall
inspect all machinery and equipment prior to each use, and during use, to make sure it is
in safe operating condition. Any deficiencies shall be repaired, or defective parts
replaced, before continued use.

[[11/]] Quinn evidently believed that the crane could be
operated safely with only one boom stop if it was operated slowly and that the "kick
out" would compensate for the missing boom stop. The record does not show the basis
for Quinn's belief. The preponderance of the evidence establishes that operating with only
boom stop in place is not safe.

[[12/]] Although Quinn testified that he had never discussed a
boom stop with Vergona, he gave a contrary statement to Ricca during the inspection. In
his written statement (Ex. G-9), Quinn told Ricca that he had advised Vergona of the
broken boom stop and that Vergona instructed him to continue working while Vergona made
arrangements to bring a new stop to the site.

At the hearing Vergona's counsel questioned Quinn about this
statement. Quinn expressly testified that the statement was incorrect and that he had
never spoken to Vergona about the boom stop. He explained that what he had meant to say
was that all messages to Vergona were relayed through Scavetta, who placed all phone calls
to Vergona (Tr. 345-46).

Quinn's explanation is not implausible. As previously
indicated, Scavetta and not Quinn was the contact between Polites and Vergona with respect
to the cable. Therefore, it is not inconceivable that Scavetta would have been assigned
the responsibility to keep Vergona informed about the condition of the boom stops as well.
Furthermore, Scavetta did in fact talk to Vergona about the boom stops insofar as he told
Vergona when the stops became bent. The Secretary has failed to present any evidence from
which I can reasonably conclude that Quinn's explanation of his written statement is not
credible.

[[13/]] During his inspection, compliance officer Ricca noticed
one boom stop lying on the ground next to the crane (Tr. 43). If that had been the only
boom stop present at the site, Ricca's observations would have supported Polites testimony
that he took the other boom stop to Vergona's yard. Unfortunately, Ricca was not asked
whether the other boom stop was still on the crane or whether he saw only one stop. Ricca
also testified that Quinn told him during the inspection that the boom stop he saw had
been removed before the accident and placed against the crane outrigger where Ricca
observed it (Tr. 46). That statement supports a conclusion that the broken boom stop had
not been removed from the site.

[[14/]] Although the complaint amended the citation to allege
that item 2 is serious as well as willful, the allegation of seriousness explicitly
appears in the complaint only as to subitems 2(a) and 2(b) . That portion of the complaint
dealing with subitem 2(c) does not include an allegation that the violation is serious. I
conclude that the omission of such an allegation with respect to subitem 2(c) is an
oversight and that the Secretary intended to allege that all three subitems are serious as
well as willful in nature.

[[15/]] The cited standard provides, in pertinent part:

Wire rope shall be taken out of service when any of the
following conditions exist:

(i) In running ropes, six randomly distributed broken wires in
one lay or three broken wires in one strand of one lay;

(ii) Wear of one-third the original diameter of outside individual wires. Kinking,
crushing, bird caging, or any other damage resulting in distortion of the rope
structure....

[[16/]] However, Savko's testimony is not totally credible. His
statement that he observed the cable still in the flange of the pulley cannot be
reconciled with his opinion that the pulleys were damaged when the broken end of the cable
traveled through them.

[[17/]] I base this finding not only on the physical evidence
of Exhibit G-1 but also on Savko's testimony of his examination of the cable on the crane
and on Kvilesz's testimony of the breaks he saw when he inspected the cable one or two
weeks before the accident. However, Ricca stated that the citation subitems relating to
the broken wires were based solely on Exhibit G-1 (Tr. 96).

[[18/]] Although Vergona was previously cited for an alleged
violation of the crane standards (Tr. 761- 2; Ex. G-5), there is no evidence as to the
final disposition of that citation.