[Federal Register Volume 63, Number 40 (Monday, March 2, 1998)]
[Proposed Rules]
[Pages 10166-10168]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-5248]


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OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION

29 CFR Part 2200


Rules of Procedure

AGENCY: Occupational Safety and Health Review Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Occupational Safety and Health Review Commission proposes 
to supplement its existing rule establishing a Settlement Judge 
procedure, with a new procedure to be known as the Settlement Part 
which is intended to facilitate the settlement process in large and 
complex cases. This procedure would be instituted as a pilot program 
for a one-year trial period.

DATES: Comments must be received by April 16, 1998.

ADDRESSES: All comments concerning these proposed rules should be 
addressed to Earl R. Ohman, Jr., General Counsel, One Lafayette Center, 
1120 20th St., NW., 9th Floor, Washington, DC 20036-3419.

FOR FURTHER INFORMATION CONTACT:
Earl R. Ohman, Jr., General Counsel, 202-606-5410.

SUPPLEMENTARY INFORMATION: The Occupational Safety and Health Review 
Commission proposes to supplement its existing rule establishing a 
Settlement Judge procedure, 29 CFR Sec. 2200.101, with a new procedure 
to be known as the Settlement Part which is intended to facilitate the 
settlement process in large and complex cases. This procedure would be 
instituted as a pilot program for a one year trial period. However, as 
the Commission currently is without a quorum, it will wait for a second 
Commission member before acting to put the pilot program into effect. 
Before commencing the pilot program, the Commission also intends to 
give several judges specialized training in settlement negotiation 
techniques and procedures. After the trial period, the Commission would 
evaluate the results and determine whether it should continue the 
Settlement Part procedure and, if so, what modifications should be 
made. The Settlement Part process is intended to provide a more 
structured and formal setting in which the possibility of settlement 
would be enhanced by requiring the parties at a preliminary stage in 
the proceedings to meet and confer with a judge who has full authority 
both to guide and assist the parties to a complete or partial 
resolution of the case and to assure the parties the confidentiality 
which is a necessary component of any successful settlement procedure. 
Unlike the existing Settlement Judge procedure, which requires the 
consent of the parties, proceedings under the Settlement Part will be 
compulsory in certain cases. For purposes of the pilot program, the 
Settlement Part procedure will be mandated for cases where the amount 
of the proposed penalties is at least $200,000 and in other cases where 
the Chief Administrative Law Judge deems the Settlement Part procedure 
to be appropriate. A settlement process which may be prescribed for the 
parties without a requirement for their prior consent has ample 
precedent. For example, the Courts of Appeals for the Third Circuit and 
the Eleventh Circuit have, respectively, an ``Appellate Mediation 
Program'' and an ``Appellate Conference Program'' under which the 
selection of cases for settlement negotiations is controlled by the 
court. An independent unit of the court in the Ninth Circuit staffed by 
mediators conducts settlement conferences as directed by the court (9th 
Cir. R. 33-1). In the Fourth (4th Cir. R. 33) Sixth (6th Cir. R. 18), 
and Tenth (10th Cir. R. 33.1) Circuits, the court determines whether a 
pre-argument settlement conference should be conducted. In the Eighth 
Circuit, such conferences are mandatory in most civil appeals (8th Cir. 
R. 33A). The Federal Energy Regulatory Commission or its Chief 
Administrative Law Judge may mandatorily assign a settlement judge even 
absent the consent of or a motion by any of the parties. 18 CFR 
Sec. 385.603. The provisions of the Settlement Part are set forth here 
as a separate and distinct rule for purposes of clarity in the notice 
and comment process. The Commission will consider combining these 
provisions with those of the existing settlement rule so as to create a 
single rule governing settlement practice.

Development of the Proposed Rules

    The Commission's experience has shown that, generally speaking, 
parties have not been able to agree to use the existing consensual 
Settlement Judge procedure except in relatively simple cases which do 
not raise novel or complex issues of law or fact. While the Commission 
appreciates that the parties in such cases may have found the 
Settlement Judge system to be helpful in resolving their dispute, the 
Commission is concerned about the increasing volume of cases which for 
complexity or other reasons demand a great deal of trial time and 
impose an appreciable burden on Commission resources. The proposed 
Settlement Part is designed to make available to the parties a 
mechanism for addressing the potential for settlement, either in full 
or in part, of issues arising under these cases.
    Since this procedure is to be a pilot program, the number of cases 
processed under the Settlement Part must be controlled so as to provide 
a sample large enough for an accurate and thorough evaluation of the 
program but not so large as to overtax the number of judges that can be 
made available to serve in the Settlement Part. Based on the 
Commission's analysis of its existing and anticipated docket, the 
Commission

[[Page 10167]]

has concluded that mandating the Settlement Part procedure in all cases 
where the potential penalty liability is $200,000 or greater should be 
adequate to provide most of the cases needed for a successful test of 
the Settlement Part during this trial period.

Structure of the Settlement Part Procedure

    With a few differences, proceedings under the Settlement Part 
parallel those prescribed by section 2200.101 for proceedings before 
settlement judges. During the settlement period, which is 60 days with 
one enlargement of 30 days permitted, parties and their representatives 
may meet privately with the Judge, and they or their agents with 
authority to settle on their behalf will be required to attend a 
settlement conference. If a full settlement is not achieved within the 
60-day period or 30-day enlargement, the Settlement Part Judge will so 
inform the Chief Administrative Law Judge and will include in the case 
file any partial settlement that the parties may have been able to 
achieve. At this point, the Chief Administrative Law Judge will assign 
the case to a different Administrative Law Judge for further 
proceedings on all remaining issues. Unions, other representatives of 
employees, or employees who have elected party status are considered to 
be parties for purposes of proceedings under the Settlement Part.

Authority of the Settlement Part Judge

    The Settlement Part Judge shall have full authority over the 
processing of the case including discovery and consideration of any 
motions which may be filed. All settlement negotiations and meetings 
with the parties, both jointly and individually, will be at the 
discretion of the Settlement Part Judge. The Settlement Part Judge will 
determine the best manner in which to facilitate settlement of the 
case, except for the settlement conference itself, which is mandatory.

Confidentiality

    The Commission is aware that in order for settlement discussions to 
be fruitful, the parties must be assured of confidentiality with regard 
to matters that may be disclosed during settlement negotiations. The 
existing Settlement Judge rule, section 2200.101(c)(2), incorporates 
the requirement of Rule 408 of the Federal Rules of Evidence that 
evidence of conduct or statements made in settlement negotiations is 
not admissible and also prohibits the use in litigation of documents 
disclosed in the settlement process unless obtained by appropriate 
discovery or subpoena. It also precludes the Settlement Judge from 
discussing the merits of the case and being called as a witness. 
Paragraph (d)(3) of the proposed Settlement Judge Part contains an even 
stronger and more comprehensive confidentiality provision. Not only are 
evidence of conduct or statements and documents revealed during 
settlement negotiations protected from subsequent disclosure except 
with the consent of the parties, but the confidentiality provision also 
extends to any information which the parties wish to protect including 
information revealed during private meetings with the Settlement Part 
Judge as well as any material prepared by the Judge or in his 
possession and communications between the Settlement Part Judge and the 
Chief Administrative Law Judge. Furthermore, in addition to prohibiting 
the Settlement Part Judge from discussing the merits of the case 
outside of the settlement negotiations and appearing as a witness, the 
proposed Settlement Part rule would also protect from disclosure the 
final report of the Settlement Part Judge to the Chief Administrative 
Law Judge. The only exception to nondisclosure absent the consent of 
the parties is any settlement agreement, full or partial, which the 
parties achieve, which will be embodied in an appropriate order entered 
upon the record by the Settlement Part Judge.

Record of Proceedings

    Consistent with the broad confidentiality and nondisclosure 
provisions, the Settlement Part rule further provides that no material 
protected from disclosure will be entered in the official case file 
maintained by the Executive Secretary and therefore will not be 
available for public inspection. The only exception to this requirement 
is that any order approving a full or partial settlement agreement will 
be considered part of the official case record.

Non-reviewability

    Paragraph (g) of the proposed rule generally provides that 
interlocutory review will not be available in proceedings under this 
section.

List of Subject in 29 CFR Part 2200

    Administrative practice and procedure, Hearing and appeal 
procedures.
    For the reasons set forth in the preamble, the Occupational Safety 
and Health Review Commission proposes to amend Title 29, Chapter XX, 
Part 2200, Subpart M of the Code of Federal Regulations as follows:

PART 2200--RULES OF PROCEDURE

    1. The authority citation continues to read as follows:

    Authority: 29 U.S.C. 661(g)

    2. Subpart G--Miscellaneous Provisions is amended by adding section 
2200.109 to read as follows:


Sec. 2200.109  Settlement Part.

    (a) Applicability. This section applies only to notices of contest 
by employers in which the aggregate amount of the penalties sought by 
the Secretary is $200,000 or greater and notices of contest by 
employers which are determined to be suitable for assignment under this 
section for reasons deemed appropriate by the Chief Administrative Law 
Judge.
    (b) Proceedings under this Part. (1) Notwithstanding any other 
provision of these rules, following the filing of the pleadings the 
Chief Administrative Law Judge shall assign to the Settlement Part any 
case which satisfies the criteria set forth in paragraph (a) of this 
section. The Chief Administrative Law Judge shall either act as or 
appoint a Settlement Part Judge, who shall be a Judge other than the 
one assigned to hear and decide the case, to conduct proceedings under 
the Settlement Part as set forth in this section.
    (2) The proceedings under the Settlement Part shall be for an 
initial period not to exceed 60 days but may be extended in accordance 
with paragraph (f)(1) of this section.
    (c) Powers and duties of Settlement Part Judges. (1) The Judge 
shall confer with the parties on subjects and issues of whole or 
partial settlement of the case.
    (2) The Judge shall seek resolution of as many of the issues in the 
case as is feasible.
    (3) The Judge may require the parties to provide statements of the 
issues in controversy and the factual predicate for each party's 
position on each issue or may enter other orders as appropriate to 
facilitate the proceedings.
    (4) The Judge may allow or suspend discovery during the time of 
assignment.
    (5) The Judge may suggest privately to each attorney or other 
representative of a party what concessions his or her client should 
consider, and assess privately with each attorney or other 
representative the reasonableness of the party's case or settlement 
position.
    (d) Settlement conference--(1) General. The Settlement Part Judge 
shall convene and preside over conferences between the parties. All 
settlement conferences shall be held in person. The

[[Page 10168]]

Judge shall designate a place and time of conference.
    (2) Participation in conference. The Settlement Part Judge shall 
require that any attorney or other representative who is expected to 
try the case for each party be present. The Settlement Part Judge shall 
also require that the party's representative be accompanied by an 
official of the party having full settlement authority on behalf of the 
party. The parties and their representatives or attorneys are expected 
to be completely candid with the Settlement Judge so that he may 
properly guide settlement discussions. The failure to be present at a 
settlement conference or otherwise to comply with the orders of the 
Settlement Part Judge or the refusal to cooperate fully within the 
spirit of this rule may result in the imposition of sanctions under 
Sec. 2200.41.
    (3) Confidentiality. All statements made, and all information 
presented, during the course of proceedings under this section shall be 
regarded as confidential and shall not be divulged outside of these 
proceedings except with the consent of the parties. The Settlement Part 
Judge shall if necessary issue appropriate orders in accordance with 
Sec. 2200.11 to protect confidentiality. The Settlement Part Judge 
shall not divulge any statements or information presented during 
private negotiations with a party or his representative except with the 
consent of that party. No evidence of statements or conduct in 
proceedings under this section within the scope of Federal Rule of 
Evidence 408, no notes or other material prepared by or maintained by 
the Settlement Part Judge, and no communications between the Settlement 
Part Judge and the Chief Administrative Law Judge including the report 
of the Settlement Part Judge under paragraph (e) of this section, will 
be admissible in any subsequent hearing except by stipulation of the 
parties. Documents disclosed in the settlement process may not be used 
in litigation unless obtained through appropriate discovery or 
subpoena. The Settlement Part Judge shall not discuss the merits of the 
case with any other person, nor appear as a witness in any hearing of 
the case.
    (e) Record of proceedings. No material of any form required to be 
held confidential under paragraph (d)(3) of this section shall be 
considered part of the official case record required to be maintained 
under 29 U.S.C. Sec. 661(g), nor shall any such material be open to 
public inspection as required by section 661(g), unless the parties 
otherwise stipulate. With the exception of an order approving the terms 
of any partial settlement agreed to between the parties as set forth in 
paragraph (f)(2) of this section, the Settlement Part Judge shall not 
file or cause to be filed in the official case record any material in 
his possession relating to these proceedings, including but not limited 
to communications with the Chief Administrative Law Judge and his 
report under paragraph (f) of this section, unless the parties 
otherwise stipulate.
    (f) Report of Settlement Part Judge. (1) The Settlement Part Judge 
may request from the Chief Administrative Law Judge one enlargement of 
the time of the settlement period not exceeding 30 days if the 
Settlement Part Judge finds that the additional time may be helpful in 
achieving a settlement of all or part of the issues in the case. This 
request, and any action of the Chief Administrative Law Judge in 
response thereto, may be written or oral.
    (2) The Settlement Part Judge, following the expiration of the 
settlement period or at such earlier date that he determines further 
negotiations would be fruitless, shall promptly notify the Chief 
Administrative Law Judge in writing of the status of the case. If the 
Settlement Judge has not approved a full settlement pursuant to 
Sec. 2200.100, such report shall include copies of any written 
stipulations and orders embodying the terms of such partial settlement 
as has been achieved during the assignment.
    (3) At the termination of the settlement period without a full 
settlement, the Chief Administrative Law Judge shall promptly assign 
the case to an Administrative Law Judge other than the Settlement Part 
Judge or Chief Administrative Law Judge for appropriate action on the 
remaining issues.
    (g) Non-reviewability. Notwithstanding the provisions of 
Sec. 2200.73 regarding interlocutory review, any decision concerning 
the assignment of a Settlement Part Judge or a particular Judge, any 
decision to request or to grant an enlargement of time under paragraph 
(e)(1) of this section, and any decision by the Settlement Part Judge 
to terminate proceedings under this section is not subject to review 
by, appeal to, or rehearing by any subsequent presiding officer, the 
Chief Administrative Law Judge, or the Commission.

    Dated: February 24, 1998.
Stuart E. Weisberg,
Chairman.
[FR Doc. 98-5248 Filed 2-27-98; 8:45 am]
BILLING CODE 7600-01-M