The decision, which the Steel Institute of New York (SINY) may appeal, outlines the extent to which individual US states and municipalities may regulate the use of cranes. Most importantly, presiding judge Colleen McMahon rules that where local regulations are designed to protect public safety, it is hard to argue that they can be pre-empted by federal workplace safety regulations.
SINY launched its case against New York City’s department of buildings (DOB) in July 2009. SINY argued that the city’s crane statues, then recently revised after two fatal tower crane accidents, were pre-empted by the US federal Occupational Health and Safety Act, violated the dormant commerce clause, and due process rights of SINY members. SINY asked the US District Court for the Southern District of New York to rule the regulations were pre-empted by federal law, blocking their application.
Sovereignty and pre-emption
The key claim in the case was that of pre-emption, or the extent to which federal regulations supersede state regulations. Neither SINY or the DOB disputed the facts on this question, agreeing it was a pure issue of law.
The Supremacy Clause of the US constitution, the court explains, provides that the laws of the United States “shall be the supreme law of the land, anything in the laws of constitution or laws of any state to the contrary notwithstanding.” This means, the court says, that when the US Congress decides federal law should control an issue, state law is pre-empted and must give way. However, the court says, this power is not limitless, granting Congress all governmental powers, but only discrete, enumerated ones.
One area where states have historically not been superseded by federal law is in regulation of matters of health and safety. The state and city of New York have historically regulated building in the city. The court offers as background an 1882 Act making the city’s fire department responsible for enforcement of building regulations, and an 1892 statute creating the DOB.
Until Congress passed the Occupational Safety and Health (OSH) Act in 1970, regulation of workplace safety had traditionally been conducted by the states. One of the limits on the OSH Act was that jurisdiction under the act extends only to the employer-employee relationship within the workplace: that is, not to general questions of public safety.
Section 18 of the OSH Act makes clear Congress intends the act to pre-empt state laws that have a direct and substantial affect on worker safety in areas regulated by the Occupational Safety and Health Administration (OSHA). However, it also makes clear where states do have the power to regulate: either over issues to which no OSHA standard is in effect, or if they propose a state plan, approved by the US Secretary of Labor, that wholly displaces the federal OSHA regulatory scheme. One example of this is Cal/OSHA, the state of California’s plan for occupational health and safety, developed in the 1970s.
Three types of pre-emption
The question of when a state law is pre-empted has been considered by US courts a number of times. One key case was Gade v National Solid Wastes Management Association, considered by the US Supreme Court in 1992. The association had asked the courts to rule that two Illinois statutes, passed in 1988, were pre-empted by the OSH Act. After a series of appeals, the case was taken up by the Supreme Court.
As these statutes sought both ‘to promote job safety’ and ‘to protect life, limb and property’, the Supreme Court referred to them as dual purpose: seeking to protect workers, and to protect the public. It was the importance of deciding the pre-emptive effect of the OSH Act and OSHA regulations on this type of dual-purpose law that prompted the court to take the case.
The court ultimately decided that dual-purpose laws were pre-empted by section 18(b) of the OSH Act, which lays out the requirement for states to develop a full plan for occupational health and safety, and have it approved by the secretary of labour, if they want to run their own regulations.
In considering the case, the court considered three ways Congress can pre-empt state laws. Pre-emption is compelled, the Supreme Court said, whether Congress’ command is explicitly stated in the statute’s language or implicitly contained in its structure and purpose. In the first type of pre-emption recognized by the Supreme Court, express pre-emption, a federal statute contains ‘explicit pre-emptive language’. In the other two, inter-related, types, pre-emption is implied. Under field pre-emption, the ‘scheme of federal regulation is so pervasive as to make reasonable the inference that Congress left no room for the states to supplement it’. Under conflict pre-emption, ‘compliance with both federal and state regulations is a physical impossibility’.
A majority of the Supreme court decided that the Illinois Statutes were pre-empted by the OSH Act, although the justices disagreed whether this was because the Act impliedly pre-empted state laws, or did so explicitly. All of the five judge majority agreed that ‘it would defeat the purpose of section 18, if a state could enact measures stricter than OSHA’s and largely accomplished through regulation of worker health and safety simply by asserting a non-occupational purpose for the legislation’.
However, the majority made an exception for those laws that while having a direct and substantial effect on worker safety issues, are laws of general applicability and cannot be characterized as occupational standards. This would include state laws such as those regarding traffic safety or fire safety that do not conflict with OSHA standards and regulate the conduct of workers and non-workers alike.
So, McMahon says that a court needs to consider three questions when deciding whether the OSH Act pre-empts local regulation. First, whether the state or local law touches an issue already regulated by the OSH Act or OSHA regulations. Next, whether OSHA has ‘occupied the field’. If it has, the court should decide if it is a law of ‘general applicability’ as laid out within the Gade decision. Finally, the court needs to consider if there are specific provisions of the state law that actually conflict with federal regulations on the same issues.
Are the NYC crane rules pre-empted?
McMahon considered whether the New York rules were field pre-empted. While the city statutes regulate issues also addressed by OSHA’s cranes and derricks regulations, they are of ‘general applicability’. As the statutes regulate cranes as structures capable of falling onto members of the public outside of worksites, they are explicitly excepted from pre-emption under Gade.
McMahon describes SINY’s position as one of ‘manifest absurdity’, saying “There is hardly a regulatory task the DOB performs, that does not ‘constitute in a direct, clear and substantial way, regulations of worker health and safety’, so finding that the OSH Act pre-empts the City Crane Statutes would effectively wipe out much of the city building code
“It simply cannot be the case that DOB’s power to keep buildings from falling on people and other buildings—via rules that also help keep construction workers and crane operators safe—is superseded by the existence of OSHA regulations governing safety on a construction site.”
McMahon continues, “If the DOB can enforce regulations to ensure that a skyscraper is built so that it does no fall over onto other buildings and hapless bystanders, then it stands to reason that it can do the same thing with cranes and derricks.
“If DOB cannot regulate cranes qua potentially collapsing structures, then it would seem DOB also cannot regulate the planning, construction and inspection of skyscrapers, or five-storey walk-ups, or elevator repairs, or anything else that having to do with buildings that requires an OSHA-regulated worked to do something potentially dangerous”
The sponsors of the OSH Act clearly had potential overlaps between the act and building codes in mind, McMahon says, and chose not to expressly pre-empt the codes.
The New York statutes, McMahon says, are analogous to fire and traffic safety laws expressly saved from pre-emption in Gade. On one hand, the codes impose obligations on owners and lessors of cranes, even when they have no workers on a site and are, therefore, not subject to OSHA regulations as employers. On the other hand, cranes on sites where there is no foreseeable impact outside of the construction site, are not subject to New York City building codes. So, these are not dual purpose laws, but sole purpose laws, aimed exclusively at protection of the people and property endangered by falling cranes.
The crowded nature of a city like New York plays a role in this decision. SINY had raised a summary order from the Eleventh Circuit, in 2010. In this case, the Associated Builders and Contractors Florida East Chapter had successfully complained that a Miami-Dade County ordinance on windloads for cranes was pre-empted by OSHA regulations. The county had adopted the ordinance after concern over the risks posed by cranes during hurricanes.
However, the Eleventh Circuit had said that ‘construction sites are closed to the public. The county failed to identify a single incident in which a crane injured a member of the general public during a hurricane’.
In New York City, McMahon points out, construction sites may be closed to the public, but are not off limits in any meaningful sense, adding “If a crane falls in New York City, someone is almost always there to hear it—and be hit by it.”
McMahon then considers if the New York rules actually conflict with OSHA’s regulations, and says that SINY did not identify a single instance where compliance with the City Crane Statutes conflicts with any specific worker provisions in the OSHA regulations. Where it is possible to comply with both sets of regulations, merely by obeying the stricter one, then, McMahon says, it is generally assumed the federal regulations merely set a ‘floor’ over which states are free to impose additional regulations.
McMahon also rejected SINY’s claims that the crane rules conflicted with the Commerce Clause or the Due Process Clause.
The ruling was welcomed by New York City commissioner of buildings Robert LiMandri, who said, “Local oversight of the crane industry is essential to making sure construction sites are safe for all New Yorker. Our crane inspectors performed more than 4,500 inspections last year, and as a result of new laws, strict enforcement and more industry cooperation, construction operations are safer than ever before. This decision is the right decision because it means a safer job site-and a safer city-for everyone.”
SINY says it hasn’t decided whether to appeal the ruling.
