Before the state of california occupational safety and health

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In the Matter of the Appeal of: 





14141 Covello Street, Unit 8C 

Van Nuys, CA  91405 




  Dockets. 14-R3D1-0802 

                  through 0804 









The Occupational Safety and Health Appeals Board (Board), acting 

pursuant to authority vested in it by the California Labor Code  and having 

taken the petition for reconsideration filed by Echo Alpha Inc. (Employer) under 

submission, renders the following decision after reconsideration. 





Beginning on August 20, 2013, the Division of Occupational Safety and 

Health (Division) conducted a complaint-initiated  inspection at a place of 

employment in Van Nuys,  California  maintained by Employer.  On  February 

19, 2014, the Division issued three citations to Employer alleging violations of 

workplace safety and health standards codified in  California Code of 

Regulations, Title 8, and proposing civil penalties.


  All citations were settled 

except for Citation 2, and at hearing the Division withdrew Instance  1 of 

Citation 2. 



Citation  2, Instance  2  alleged  a  serious  violation of section 3203(a) 

[failure to correct unsafe work practices].




Employer filed a timely appeal of the citation. 



Administrative proceedings were held, including a contested evidentiary 

hearing before an Administrative Law Judge (ALJ) of the Board.  After taking 

testimony and considering the evidence and arguments of counsel, the ALJ 



 Unless otherwise specified, all references are to California Code of Regulations, Title 8. 


 The Division withdrew Instance 1 of Citation 2 at hearing.  (Decision, 1.) 


issued a Decision on March 11, 2015.  The Decision denied Employer’s appeal, 

imposing a total civil penalty of $9000. 


Employer timely filed a petition for reconsideration of the ALJ’s Decision. 


The Division filed an answer to the petition. 






Was the Employer properly provided notice of the Division’s intention to 

cite Citation 2, Instance  2 as serious via the procedures described in 

Labor Code section 6432(b)(1)? 




Did the ALJ correctly calculate the penalty? 






The Division served an administrative subpoena duces tecum to 

Employer’s representative, Christian Mann, on August 23, 2013, 

requesting various records related to Employer’s business.  (Ex. 9.) 



Employer issued a written IIPP that included procedures for ensuring 

that employees comply with safe and healthy work practices.  (Ex. 5.) 



Despite having an IIPP that included systems that met the 

requirements of section 3203(a) as written, Employer failed to 

implement this program in its workplace. 



Employer did not have a system for recognition for employees who 

followed safe work practices. 



Employer did not have formal on the job training or retraining  in 

matters related to safety. 



Employer had a written progressive discipline policy for violations of 

safety rules, but this disciplinary policy was never enforced. 



No system of communication for health and safety issues, such as 

meetings or other methods, was in place at Employer’s worksite. 



Four employees and a supervisor were employed in Employer’s 





In making this decision, the Board relies upon its independent review of 

the entire evidentiary record in the proceeding.  The Board has taken no new 

evidence.  The Board has also reviewed and considered Employer’s petition for 

reconsideration and the Division’s answer to it. 


Labor Code section 6617 sets forth five grounds upon which a petition 

for reconsideration may be based: 




That by such order or decision made and filed by the appeals 

board or hearing officer, the appeals board acted without or 

in excess of its powers. 



That the order or decision was procured by fraud. 



That the evidence does not justify the findings of fact. 



That the petitioner has discovered new evidence material to 

him, which he could not, with reasonable diligence, have 

discovered and produced at the hearing. 



That the findings of fact do not support the order or decision. 


Employer petitioned for reconsideration on the basis of Labor Code section 

6617(a), (c) and (e). 



Employer makes several  arguments in its petition  for reconsideration: 

that the ALJ’s decision relies upon unreliable hearsay, that the Division did not 

prove a violation of section 3203, that the serious classification of the violation 

was improper, that appellant was not provided adequate notice that the 

Division intended to issue the citation as serious, that there was no employee 

exposure, and that the penalty was improperly calculated.  The Board finds the 

majority of these arguments to be unavailing, and to have been thoroughly and 

properly addressed in the ALJ’s Decision.  However, the issue regarding notice 

of intent to issue a serious citation is one of first impression for the Board, and 

merits closer inspection. 


As background, Labor Code section 6432 subdivision (b)(1) contains the 

following language: 


(b) (1) Before issuing a citation alleging that a violation is serious

the division shall make a reasonable attempt to determine and 

consider, among other things, all of the following: 

   (A) Training for employees and supervisors relevant to preventing 

employee exposure to the hazard or to similar hazards. 

   (B) Procedures for discovering, controlling access to, and 

correcting the hazard or similar hazards. 

   (C) Supervision of employees exposed or potentially exposed to 

the hazard. 

   (D) Procedures for communicating to employees about the 

employer's health and safety rules and programs. 

   (E) Information that the employer wishes to provide, at any time 

before citations are issued, including, any of the following: 

(i) The employer's  explanation of the circumstances 

surrounding the alleged violative events. 

(ii) Why the employer believes a serious violation does not 


(iii) Why the employer believes its actions related to the 

alleged violative events were reasonable and responsible so 


as to rebut, pursuant to subdivision (c), any presumption 

established pursuant to subdivision (a). 

(iv) Any other information that the employer wishes to 



(2) The division shall satisfy its requirement to determine and 

consider the facts specified in paragraph (1) if, not less than 15 

days prior to issuing a citation for a serious violation, the division 

delivers to the employer a standardized form containing the alleged 

violation descriptions ("AVD") it intends to cite as serious and 

clearly soliciting the information specified in this subdivision.  The 

director shall prescribe the form for the alleged violation 

descriptions and solicitation of information.    Any forms issued 

pursuant to this section shall be exempt from the rulemaking 

provisions of the Administrative Procedure Act (Chapter 3.5 

(commencing with Section 11340) of Part 1 of Division 3 of Title 2 

of the Government Code). 


In sum, the Labor Code instructs the Division to consider the factors listed in 

subdivision (b)(1) prior to issuing a citation as  serious; this provides an 

employer with the opportunity to furnish information to the Division that may 

militate in favor of issuance of a less than serious citation.  The Labor Code in 

subdivision (b)(2) also allows the Division to create and issue a standardized 

form to collect the information listed in subdivision (b)(1). 


In this case, the Division opted to send to Employer its standardized 

form, referred to as a 1BY.  However, Employer notes that while the 1BY it 

received  referenced  the IIPP standard, the alleged violative description is 

labeled “Instance 1” and discusses  blood  and other potentially infectious 

material, rather than the general IIPP issues that were ultimately litigated  in 

Instance 2.  No separate 1BY form was issued for Citation 2, Instance 2.  The 

Division’s inspector agreed in testimony that he issued a 1BY form for Citation 

2, but per his usual practice, did not issue a separate 1BY form for each 

Instance cited therein, as they all related to the same general IIPP violation 

described in the “charging language”.  While this may be the Inspector’s usual 

practice, section 6432 subdivision (b)(2) requires that the Division provide the 

“alleged violative description”  on the 1BY.  The Division’s  completion of the 

form unquestionably fell short.  For Citation 2, Instance 2, the Division cannot 

rely on its issuance of a related, but factually distinct,  1BY as proof that it 

solicited the information required by section 6432 subdivision (b)(1). 


Labor Code section 6432  subdivision  (d)  provides the following  remedy 

for those instances where the Division makes an error of this kind: 


(d) If the employer does not provide information in response to a 

division inquiry made pursuant to subdivision (b), the employer 


shall not be barred from presenting that information at the hearing 

and no negative inference shall be drawn.  The employer may offer 

different information at the hearing than what was provided to the 

division and may explain any inconsistency, but the trier of fact 

may draw a negative inference from the prior inconsistent factual 

information.  The trier of fact may also draw a negative inference 

from factual information offered at the hearing by the division that 

is inconsistent with factual information provided to the  employer 

pursuant to subdivision (b), or from a failure by the division to 

provide the form setting forth the descriptions of the alleged 

violation and soliciting information pursuant to subdivision (b). 


The Board has the ability to draw a negative inference from the Division’s 

failure to provide an appropriate 1BY form; drawing a negative inference at the 

discretion of the fact finder under Labor Code 6432 subdivision (d).  The Board 

declines to make a negative  inference,  given the evidence demonstrating that 

the Division made good faith attempts  to collect information required by the 

Labor Code prior to issuance of the serious citation, despite having made errors 

in its issuance of the 1BY.  (See, Overnite Transp. Co. v. NLRB (D.C. Cir. 1998) 

140 F. 3d 259, 267.  “[T]he decision of whether to draw an adverse inference 

has generally been held to be within the discretion of the fact finder.”) 



On February 4, 2014, the Division noticed Employer with three 1BY 

forms.  Employer was not required to respond to any of these notices, and 

chose not to.  Furthermore, on August 23, 2013, Associate Safety Engineer 

Brandon  Hart  (Hart)  served the Employer  with a subpoena duces tecum, 

requesting  all records  of Employer’s health and safety training, health and 

safety inspections, written health and safety programs and policies, as well as 

Employer’s IIPP and Exposure Control Plan.  (Ex. 9.)  While the IIPP and 

Bloodborne Pathogen Exposure Control Program were provided  in a response 

several months later, none of the other listed documents were forthcoming, as 

the Employer had no records to produce. 


This document request from the Division, made well before the issuance 

of Citation 2, shows the Division’s good faith attempt to meet the requirements 

of Labor Code section 6432 subdivision (b)(1), through its attempt to gather 

documents generally related to training for employees and supervisors relevant 

to preventing employee exposure to hazards; procedures for discovery and 

correction of hazards; supervision of employees exposed to hazards; as well as 

procedures for communication to employees regarding safety rules and 

procedures.  (Labor Code section 6432 subdivision (b)(1)(A)-(D).)  The Division 

substantially complied with four of the five provisions of subdivision (b)(1), as 

discussed above. 


We do observe that the  Division’s failure to properly complete the 1BY 

left Employer without an opportunity to respond to the specific charges, as 


provided by section 6432 subdivision (b)(1)(E), which in some instances might 

support drawing a negative inference.  However, on this particular set of facts

this failure does not support drawing a negative inference against the Division.  

Here, while imperfect, the Division’s conduct evinced  a good faith attempt to 

comply with section 6432.  We note that the Division’s use of a subpoena duces 

tecum, issued only days after the inspection, was an unusual effort by the 

Division to seek out a variety of pertinent information.    Furthermore, no 

representative of Employer testified to suggest that Employer’s response to the 

1BYs would have been different  had additional or more specific  charging 

language been included.  We therefore decline to draw a negative inference in 

this instance. 


Violation and Classification of Citation 2, Instance 2 



The single remaining citation alleges a violation of section  3203 

subdivision (a) for failure  to correct unsafe work practices.  Section 3203 

subdivision (a) reads as follows below: 


(a) Effective July 1, 1991, every employer shall establish, 

implement and maintain an effective Injury and Illness Prevention 

Program (Program).  The Program shall be in writing and, shall, at 

a minimum: 

(1) Identify the person or persons with authority and responsibility 

for implementing the Program. 

(2) Include a system for ensuring that employees comply with safe 

and healthy work practices. Substantial compliance with this 

provision includes recognition of employees who follow safe and 

healthful work practices, training and retraining programs, 

disciplinary actions, or any other such means that ensures 

employee compliance with safe and healthful work practices. 

(3) Include a system for communicating with employees in a form 

readily understandable by all affected employees on matters 

relating to occupational safety and health, including provisions 

designed to encourage employees to inform the employer of 

hazards at the worksite without fear of reprisal.    Substantial 

compliance with this provision includes meetings, training 

programs, posting, written communications, a system of 

anonymous notification by employees about hazards, 

labor/management safety and health committees, or any other 

means that ensures communication with employees. 

Exception: Employers having fewer than 10 employees shall be 

permitted to communicate to and instruct employees orally in 

general safe work practices with specific instructions with respect 

to hazards unique to the employees'  job assignments as 

compliance with subsection (a)(3). 



The Division’s alleged violative description states: 


The employer failed to implement and maintain all the required 

elements of their Injury and Illness Prevention Program including, 

but not limited to correcting unsafe work condition(s) and/or work 

practices, which are essential to their overall program. 


Instance 2:  The employer failed to enforce the safety and health 

practices fairly and uniformly and failed to ensure employees used 

safe work practices, and followed directives, policies and 

procedures to maintain a safe work program, as required by their 

written program. 


The Division does not allege that Employer failed to have an Illness and Injury 

Prevention Program (IIPP); rather, it contends that Employer failed to 

implement and maintain its IIPP by correcting unsafe working conditions and 

practices.  (See, Contra Costa Electric, Inc., Cal/OSHA App. 09-3271, Decision 

After Reconsideration (May 13, 2014).)  Employers are responsible for meeting 

all three prongs of section 3203 subdivision (a). 



The Division’s Associate Safety Engineer, Brandon Hart, testified for the 

Division.  Based on his initial walkthrough with a management representative, 

he concluded that the IIPP had not been implemented.    The owner of Echo 

Alpha, Inc., John Stagliano (Stagliano),  and Adam Greyson (Greyson), 

Employer’s Chief Financial Officer, testified on behalf of Employer.  Stagliano is 

listed as the person responsible for implementing Employer’s IIPP in its 



Employer’s IIPP describes a program of formal recognition, including 

written acknowledgement of employees who make “significant contributions to 

maintenance of a safe workplace”, with those written acknowledgments being 

placed in the employees’ personnel file.  (Ex. 5.)  Hart testified that records 

were not provided in response to the Division’s subpoena, leading him to 

believe that the Employer’s IIPP was not implemented.  When questioned 

regarding employee recognition for following safe and  healthy work  practices, 

as described in section 3203 subdivision (a)(2),  Stagliano  testified  that he 

supposed employees received a smile for recognition of safe work practices.  

Employer failed to provide any evidence to  demonstrate that it had 

implemented its written  program to recognize employees who engage in safe 

and healthy work practices. 



The safety order also requires training and retraining of employees

where required.  (Section 3203(a)(2).)  The Employer’s IIPP describes providing 

training to workers whose safety performance is deficient, to all new workers, 

to workers when given new job assignments or when new processes or 

procedures are introduced, and when new hazards are identified.  (Ex. 5.)  


During his initial walkthrough, Hart testified that he learned that new 

employees were not provided training.  Hart requested training records, but did 

not receive any, leading him to believe that the IIPP was not implemented  in 

this aspect. 


Stagliano testified that he did not believe any special training was needed 

for working in Employer’s warehouse.  He believed there may have been some 

special training for certain pieces of equipment, but was unable to elaborate.  

Employer’s CFO, Greyson, was aware that there was a company policy in the 

employee handbook that prohibited open-toed shoes in the warehouse, and 

that this policy was enforced.  He also noted that the forklift certifications for 

the warehouse forklift drivers were framed on a warehouse wall, and that 

Employer had not realized that they were documents that would constitute 

training documents that should be turned over to the Division.  Employer failed 

to provide training as required by the safety order. 


Employer was similarly unable to demonstrate that it implements an 

effective disciplinary program related to health and safety violations.  

Employer’s IIPP describes a progressive disciplinary policy beginning with 

verbal warnings for minor incidents, written warnings, suspensions, and 

ending with termination for those who repeatedly jeopardize the safety of 

themselves and their coworkers.  (Ex. 5.)  No documents related to disciplinary 

actions were provided to the Division, and neither Greyson nor Stagliano were 

able to testify to a specific instance of discipline related to employee health or 

safety.  (Section 3203(a)(2).) 



The Employer’s IIPP also describes a system of communication designed 

to meet the requirements of section 3203 subdivision (a)(3).  The system 

described in the plan includes safety meetings on a monthly or more frequent 

basis, distribution of safety information in the workplace, training, and a 

system for workers to anonymously report workplace hazards.  (Ex.  5.)  

Stagliano testified that he was not aware of any safety meetings occurring at 

the worksite, or safety inspections.  Hart  testified that employees appeared 

unaware of the IIPP provisions  and were not following safe work practices 

during his inspection. 



The Board upholds the ALJ’s finding that a violation of section 3203 

subdivision (a) has been established. 



In order to demonstrate a serious violation of a safety order, the Division 

must demonstrate that there is “a realistic possibility that death or serious 

physical harm could result from the actual hazard created by the violation.” 

(Labor Code section 6432(a).)  “The term “realistic possibility” means that that 

it is within the bounds of reason, and not purely speculative.”  (International 

Paper Company, Cal/OSHA App. 14-1189, Decision After Reconsideration (May 

29, 2015), citing (Langer Farms, LLC, Cal/OSHA App. 13-0231, Decision After 


Reconsideration (Apr. 24, 2015).)  In support of the serious classification, Hart 

testified regarding the actual hazards created by Employer’s violation of the 

safety order.  He concluded that there was both a fall hazard and a hazard of 

collapse due to the Employer storing materials on the mezzanine level in the 

warehouse.  Employees accessed the unguarded mezzanine with a portable 

ladder, and were exposed to a  fall onto concrete of approximately nine feet.  

Because the mezzanine was not built for storage, there was a hazard of 

employees either falling or being hurt by falling materials in a collapse due to 

the mezzanine exceeding its live load capacity. 


Hart also described the hazard of fire due to inaccessible fire 

extinguishers, extension cords that were daisy chained, and blocked electrical 

panels.  He explained the hazard of electrocution created by  an exposed bus 

bar.  Hart further testified  that these and  other hazards he identified in the 

warehouse were the result of Employer’s failure to identify, correct and train 

employees on hazards as required by the IIPP safety order. 



An employer may rebut the presumption of a serious violation by 

demonstrating that it did not know, and could not know, of the violation.  

(Labor Code section 6432 subdivision (c).)


  Employer  failed to rebut the 

presumption.  The violation is properly classified as serious. 


Calculation of Penalty 



The Division’s Proposed Penalty Worksheet (Ex. 8) shows severity for 

Citation 2 as $18,000, or the base penalty for a serious violation.


  The final 

penalty, after all adjustments and credits, was $7,200.  The ALJ adjusted this 

penalty based on her finding that “Extent” should be rated high, due to 

Employer having 40 employees total, and 22 workers in the warehouse.  We 

find this to be in error. 



  Specifically,  section  6432(c) reads as follows: If the division establishes a presumption 

pursuant to subdivision (a) that a violation is serious, the employer may rebut the presumption 

and establish that a violation is not serious by demonstrating that the employer did not know 

and could not, with the exercise of reasonable diligence, have known of the presence of the 

violation. The employer may accomplish this by demonstrating both of the following: 

   (1) The employer took all the steps a reasonable and responsible employer in like 

circumstances should be expected to take, before the violation occurred, to anticipate and 

prevent the violation, taking into consideration the severity of the harm that could be expected 

to occur and the likelihood of that harm occurring in connection with the work activity during 

which the violation occurred. Factors relevant to this determination include, but are not limited 

to, those listed in subdivision (b). 

   (2) The employer took effective action to eliminate employee exposure to the hazard created 

by the violation as soon as the violation was discovered. 


 Section 336(c)(1) In General - Any employer who violates any occupational safety and health 

standard, order, or special order, and such violation is determined to be a Serious violation (as 

provided in section 334(c)(1) of this article) shall be assessed a civil penalty of up to $25,000 for 

each such violation. Because of the extreme gravity of a Serious violation an initial base 

penalty of $18,000 shall be assessed. 




Greyson, Employer’s CFO, testified that four employees and one 

supervisor worked in the warehouse at the time of the inspection.  This 

comports with Hart’s recollection, which was that he saw about four employees 

working in the warehouse, who regularly access the mezzanine, the electrical 

panels and cords, and use the ladders cited by Hart.  The Division failed to 

rebut this testimony, and it is credited.


  We return the “Extent” to “Medium”, 

and reinstate the $7200 penalty, as initially proposed by the Division. 


Therefore, we affirm the result of Decision sustaining the citation but for 

the different reasons stated above. 




ART CARTER, Chairman 




ED LOWRY, Board Member  

JUDITH S. FREYMAN, Board Member 



FILED ON:  DEC 24, 2015 



 Greyson also testified that Employer had around 30 employees total at the time.  His estimate 

was similar to Stagliano’s, who believed that Employer had around 25 to 30 at the time of the 

inspection.  The Division failed to rebut the testimony of Greyson and Stagliano in regard to the 

number of employees; our calculating the penalty based on Employer having 30 versus 40 

employees makes no difference in the penalty, and so we set the matter aside.   

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