THE STATE OF OREGON

                           HEARINGS DIVISION

Oregon Occupational Safety &                                    
  Health Division			)  Docket No:  SH 93202

	Plaintiff,			)

		vs.			)  Citation No:  A8735-003-93

J. L. WARD CO.				)

	Defendant.			)  OPINION AND ORDER

	Pursuant to notice a hearing was held August 3, 1994 in Bend,
Oregon before Referee Howell.  Plaintiff, Oregon Occupational
Safety & Health Division (OR-OSHA), was represented by Norman
Kelly of the Department of Justice.  Defendant, J. L. Ward
Company, was represented by its president, J. L. Ward.  The
hearing was recorded by Business Support Services.  Exhibits 1-9
were received into evidence at hearing.


	The propriety of the penalty imposed upon defendant for
violation of 29 CFR 1926.500(d)(1).1  (In an April 9,
1993 citation, OR-OSHA imposed a $1,200 penalty for violation of
that regulation.)

1Neither the fact of the violation nor the classification of the severity of the violation was at issue.
FINDINGS OF FACT: Defendant operated a business in Bend, Oregon. On March 18, 1993 employees of defendant worked on a steel deck at the top of 30 foot tall cylindrical tanks. A guard rail around the decking on top of the tanks had a top rail, but no mid rail. The employees working on the tank had no fall protection other than the single top rail of the guard railing (Exhibits 2-7). An OR-OSHA inspector observed defendant's employees working without fall protection on the deck on top of the tanks on March 18, 1993. Because the employees did not have fall protection, and because the guard rail on the tank did not comply with 29 CFR 1926.500(f)(1), defendant was found to have violated 29 CFR 1926.500(d)(1).2 The violation was classified as "serious."3 The OR-OSHA inspector considered the probability of an accident to be "low." Before the end of the inspection defendant corrected the violation (Exhibits 1-5).
229 CFR 1926.500 has been adopted by Oregon (the Department of Consumer and Business Services) by OAR 437-03-001(13)(a).
3Violations are rated by severity based upon the degree of injury reasonably predictable. Ratings include "other than serious," "serious physical harm" and "death." The latter two ratings are referred to as serious violations. OAR 437-01-010(53)(a)(A), 437-01-140 and 437-01-145.
On April 9, 1993 Citation A8735-003-93 issued, citing defendant and imposing a penalty of $1,200. The penalty was determined from a penalty schedule at Table 1 of OAR 437-01-145. The penalty amount indicated by the table was reduced by 20 percent because defendant corrected its violation before the end of the OR-OSHA inspection. Other adjustments in penalties were found to be inapplicable to the employer.4 (Exhibit 1).
4Violations are rated by severity based upon the degree of injury reasonably predictable. Ratings include "other than serious," "serious physical harm" and "death." The latter two ratings are referred to as serious violations. OAR 437-01-010(53)(a)(A), 437-01-140 and 437-01-145.
CONCLUSION: OAR 437-01-145(1) provides:
"A penalty shall be assessed for any serious violation by considering the penalty established by the intersection of the probability rating and severity rating on the Penalty Schedule (Table 1). In a case where probability and severity are not appropriate considerations, a penalty may be assessed by considering the facts of the violation."
The OR-OSHA inspector found that the probability of an accident as a result of defendant's violation of 29 CFR 1926.500(b)(1) was "low." That probability rating is the lowest available. OAR 437-01-135. A "low" probability of accident results in the least possible penalty for a given severity classification of a safety violation. See OAR 437-01-145, Table 1. Using a probability of "low" and a severity rating of "death," Table 1 of OAR 437-01-145 prescribes a penalty of $1,500. That amount is reduced 20 percent, or $300, because defendant promptly corrected its violation. See OAR 437-01-145(2)(b). Pursuant to OAR 437-01-145, no other reductions in the penalty are applicable. The correct penalty is $1,200. OR-OSHA correctly computed the amount of the penalty assessed against defendant. Defendant makes several arguments in support of its position that the $1,200 penalty assessed against it was disproportionate to its safety violation. First, it argues that OR-OSHA's determination of the amount of a penalty is arbitrary and capricious. In support of its argument, defendant asserts that a settlement offer was made to it during an informal conference which would have reduced the penalty imposed in this case to $600. The determination of the amount of a penalty for a particular safety violation is not arbitrary. Unless the probability of an accident and the severity of a reasonably anticipated injury are inappropriate considerations, 4 the amount of a penalty is obtained from a table at OAR 437-01-145. The mandatory use of such a table prevents arbitrary or capricious variations between inspectors enforcing a broad range of safety rules.
4See e.g. OAR 437-01-203.
Defendant has offered no argument as to how OAR 437-01-145, in particular, has been applied arbitrarily. The settlement offer made to defendant by an appeals specialist was apparently made on behalf of the Administrator of OR-OSHA, pursuant to OAR 437-01-255(2)(h). The fact that the Administrator has extraordinary authority to resolve disputes by settlement and by reduction of an assessed penalty does not render arbitrary the penalty, imposed, pursuant to OAR 437-01-145. Defendant argues that the three ratings for the probability of an accident provided by OAR 437-01-135 are inadequate to discriminate between varying likelihoods of an accident occurring. In this case, the probability of an accident was determined to be "low," meaning ". . . it would be unlikely that an accident could occur." OAR 437-01-135(3)(a). Defendant argues that an even lower probability should be applicable to its violation. If defendant believes that the administrative rule should be amended to provide for a lower probability than presently exists, it may request such an amendment pursuant to OAR 437-01-045(2). However, the validity of OAR 437-01-135 is unchallenged. That rule was in effect at the time of defendant's violation. That rule controls the determination of the probability of an accident in this case. Defendant's final argument is that in order for justice to be done the referee presiding at hearings such as the present one must have discretion to modify the penalties prescribed by OAR 437-01-145. The Court addressed defendant's argument in Accident Prevention Division v. Asana, 110 Or App 103 (1991). A referee has no authority to impose penalties less than those provided for in the applicable administrative rules.5
5The Administrator of OR-OSHA and the Director of the Department of Consumer and Business Services both have authority to modify a citation when no hearing has been requested. OAR 437-03-265(1) and 437-03-270(2). The Administrator may negotiate a settlement of a contested citation in cases in which a request for hearing has been filed. OAR 437-01-255(1)&(2).
I conclude that the penalty assessed against defendant was correctly computed and must be affirmed. ORDER: IT IS THEREFORE ORDERED that Citation A8735-003-93, issued April 9, 1993, is affirmed in its entirety. Notice to all parties: You are entitled to judicial review of this Order. Proceedings for review are to be instituted by filing a petition in the Court of Appeals, Supreme Court Building, Salem, Oregon 97310, within 60 days following the date this Order is entered and served as shown hereon. The procedure for such judicial review is prescribed by ORS 183.480 and ORS 183.482. Entered at Salem, Oregon, August 29, 1994 Workers' Compensation Board John M. Howell Referee