519 F. 2d 84 - Lake Butler Apparel Company v. Secretary of Labor

Lake Butler Apparel Company (Lake Butler) petitions this Court to review the penalties assessed against it under the Occupational Safety and Health Act (OSHA),1 asserting that this statute violates Article III and the Fourth, Fifth and Sixth Amendments to the Constitution. We have considered and rejected some of these arguments in Atlas Roofing Company v. Brennan, 5 Cir., 1975, and today we reject as well the further challenges raised by Lake Butler. Since the petitioner could not reasonably contend that the findings of violations by the Occupational Safety Health Review Commission (OSHRECOM) were not supported by substantial evidence, we highlight here only the facts that affect our disposition of the constitutional arguments.

Briefly, Lake Butler is a clothing manufacturer employing over 100 sewing machine operators. On March 23, 1972 an OSHA compliance officer, while accompanied by the President of Lake Butler on a routine inspection through the plant, found several violations of the statute2 including the failure to post the standard OSHA poster informing the employees of their safety rights under the Act.3 After the company was cited, it filed a timely notice of contest,4 initiating the administrative hearing. This effectively stayed the abatement date for the duration of any review proceedings before OSHRECOM.5 At the hearing the Administrative Law Judge (ALJ) upheld the cited violations. Thereafter at the further initiation of Lake Butler, OSHRECOM on its discretionary review affirmed the findings of the ALJ.6 On September 26, 1973 Lake Butler moved to have the commission order stayed and OSHRECOM responded by staying the penalty portion of its order, leaving the abatement date requirements in effect.

In Atlas we analyzed and rejected two of the Lake Butler arguments: (i) the due process issue penalties that become final absent employer initiated review are in violation of due process, citing Snidach v. Family Finance Corp., 1969, 395 U.S. 337, 89 S.Ct. 1820, 23 L.Ed.2d 349; and (ii) the Sixth Amendment argument civil penalties under OSHA are essentially criminal in nature invoking the protections of the Sixth Amendment. There remains to be considered Lake Butler's arguments that (iii) the OSHA provisions for nonabatement penalties have the effect of "chilling" the employer's right to seek review; (iv) the Fourth Amendment is violated by the OSHA provisions allowing warrantless administrative searches without probable cause; (v) the authority vested in the Secretary of Labor to assess penalties usurps the powers of the Judiciary under Article III.

Although we noted the importance of this argument in Atlas, we concluded there that the petitioner lacked standing to raise the point because the abatement date was stayed by the Commission and no nonabatement penalties were therefore possible. Unlike Atlas Roofing Company, Lake Butler has not received such a plenary stay. Instead, OSHRECOM ordered only the penalties assessed be stayed.7 According to Lake Butler, such a selective stay leaves the company vulnerable to a later determination by OSHRECOM that the review proceeding was not initiated in "good faith" after which the abatement period could be considered to have retroactively commenced on the date originally specified in the citation.8 Thus, if such a determination were made, Lake Butler might be assessed a nonabatement per day penalty running retroactively from the original abatement deadline.9 Although no Court has yet so held, Lake Butler argues that such a possible penalty operates to "chill" the exercise of the employer's right to seek review proceedings. Lance Roofing Company v. Hodgson, N.D.Ga., 1972, 343 F.Supp. 685, 689-90, aff'd, 409 U.S. 1070, 93 S.Ct. 679, 34 L.Ed.2d 659.

However, in order to challenge these specific provisions, Lake Butler must present this Court with a realistic case or controversy. U.S. Const. art. III § 2. We do not judge the hypothetical. DeFunis v. Odegaard, 1974, 416 U.S. 312, 94 S.Ct. 1704, 40 L.Ed.2d 164; General Electric Co. v. Electrical Workers (IUE) Local 191, 5 Cir. 1971, 443 F.2d 608, 610. To put those statutory provisions at issue10 Petitioner must show a demonstrable threat of future citations by the Secretary and that an employer would reasonably be dissuaded from invoking the elaborate review procedures of the Act by the possibility of cumulative fines. By our consideration at length of this case the Secretary could not possibly conclude this to be a bad faith appeal. The record contains no indication that the Secretary would intend to exercise these nonabatement sanctions. In any event, the possibility does not exist until after our affirmation of this case. If then the Secretary sought to invoke these retroactive penalties, they would as we read the statute be subject to the same administrative proceedings as might any original violation. 29 U.S.C.A. § 666(d). However, if there is any question that these employers would have a right of review in the Court of Appeals, over such nonabatement penalties it certainly is a sanction as to which the APA 5 U.S.C.A. § 704 affords judicial review. We would not hold the provisions unconstitutional "in advance of its immediate adverse effect in the context of a concrete case."11

Lake Butler contends that OSHA authorizes warrantless inspections by its compliance officers in violation of the Fourth Amendment.12 Citing Camara v. Municipal Court, 1967, 387 U.S. 523, 87 S.Ct. 1727, 18 L.Ed.2d 930; and See v. Seattle, 1967, 387 U.S. 541, 87 S.Ct. 1737, 18 L.Ed.2d 943, Lake Butler would have this Court void the administrative hearing because the violations were discovered pursuant to an illegal search. In response, the government argues that business enterprises subject to OSHA inspections should fall under the "implied consent" exception to the Fourth Amendment.13 United States v. Biswell, 1972, 406 U.S. 311, 92 S.Ct. 1593, 32 L.Ed.2d 87. In the past this exception has been limited to businesses the government has had "historically broad authority" to regulate, e. g., the liquor industry, Colonade Catering Corp. v. United States, 1970, 397 U.S. 72, 90 S.Ct. 774, 25 L.Ed.2d 60; Boyd v. United States, 1886, 116 U.S. 616, 6 S.Ct. 524, 29 L.Ed. 746, and any attempt to expand the concept must be cautiously analyzed.

But here we need not reach the issue because, looking at the total circumstances of the search, we find that it was purely consensual. In fact, Lake Butler has never contended that the compliance officer did not have the fullest permission of Mr. Stephenson, the President of Lake Butler. Schneckloth v. Bustamonte, 1973, 412 U.S. 218, 93 S.Ct. 2041, 36 L.Ed.2d 854; United States v. Garcia, 5 Cir., 1974, 496 F.2d 670; United States v. Carollo, 5 Cir., 1975, 507 F.2d 50, petition for rehearing en banc denied, 510 F.2d 1407. The OSHA officer, on a routine inspection of plants in the Lake Butler area, presented himself to Stephenson who then accompanied him through the plant.14 The violations that were discovered during that walking tour ungrounded machines, lack of color coating on the fire extinguishers, etc. were in plain, obvious view. There was no search here of drawers or other sequestered areas. For that reason Lake Butler may not rely on the Camara/See precedent. In each of those instances appellants sought to avoid criminal punishment for the assertion of their Fourth Amendment rights. Lake Butler cannot obtain a ruling on constitutionality when it did not assert its rights at the time of the inspection.

Lake Butler argues that the provision of OSHA that permits the Commission to assess civil penalties for violation of the Act, 29 U.S.C.A. § 666, usurps the powers of the judiciary under Article III by making the compliance officer "investigator, legislator, factfinder, prosecutor and judge." 29 CFR §§ 1903.7 and 1903.14. This argument is closely akin to an argument raised by the appellant in Atlas that the absence of a jury in OSHA proceedings makes it violative of the Seventh Amendment. We reject the argument now for similar reasons.

It has long been recognized that it is well within the powers of Congress to entrust the enforcement of statutory rights to an administrative process and limit the participation of the Courts by the substantial evidence standard. NLRB v. Jones & Laughlin Steel Corp., 1937, 301 U.S. 1, 57 S.Ct. 615, 81 L.Ed. 893. Most recently, the Supreme Court reiterated this in Curtis v. Loether, 1974, 415 U.S. 189, 94 S.Ct. 1005, 39 L.Ed.2d 260. The administrative proceedings under OSHA present no unusual features that would cause us to deviate from this rule.

Lastly, Lake Butler argues that the OSHA requirement that the information sign be posted at its clothing factory violates its First Amendment rights to freedom of speech. 29 CFR § 1903.2(a). However, Lake Butler does not cite us to any cases on the issue and we are hard put to find any. The argument is seemingly nonsensical for if the government has a right to promulgate these regulations it seems obvious that they have a right to statutorily require that they be posted in a place that would be obvious to the intended beneficiaries of the statute Lake Butler's employees. The posting of the notice does not by any stretch of the imagination reflect one way or the other on the views of the employer. It merely states what the law requires. The employer may differ with the wisdom of the law and this requirement even to the point as done here, of challenging its validity. He may as we once said " take his views to a McGahey marked grave." NLRB v. McGahey, 5 Cir., 1956,233 F.2d 406, 409. But the First Amendment which gives him the full right to contest validity to the bitter end cannot justify his refusal to post a notice Congress thought to be essential.

Affirmed.