Hartley Conglomerate (A)*

The Hartley Corporation is composed of ten autonomous divisions and corporate headquarters as Exhibit 1 indicates. The case focuses on the Bien Works. Bien Works is housed in a building erected in 1904. The building is five stories high. The top two are not used since the floors are too dangerous. The second and third floors have holes and rotted places in them.

The third floor holds the rack shop, lab, and marketing departments. The second floor contains the rack shop, office, some warehousing, and some buffing compound production lines. The first floor contains the warehousing for heavier materials and the rest of the manufacturing lines. The main operation is manufacturing. The rack shop is a support unit to make racks for drying chemicals. The works is nonunion.

Jesse Fuller has been with Hartley for 20 years, all of it in conjunction with the Bien Works. He holds a B.S. in chemistry from City University of New York. He worked his way through college. He's done almost everything at Bien. He started as a foreman in the manufacturing unit. He's run the rack shop, supervised the warehouse for two years, sold the compounds. The office and lab are white-collar or technical jobs so he's not worked there. His employees like him, although they are a bit afraid of him, too. He has a terrible temper which he loses about once a month. When that happens, everyone tries to get out of the way. Jesse is now 53 years old. He's happy with the Bien Works. He likes the town and wouldn't move. Bien is like his own firm since he's isolated geographically from Hartley.

Since Bien makes more money for Hartley than his budget calls for, management lets Jess alone. He has lower turnover than expected. Absenteeism is also low. His safety and health record is about average. All in all, Hartley and Jess are happy with the Bien Works.

Then Occupational Safety and Health Act (OSHA) was passed. For some reason, the OSHA inspector came around Bien often. The local inspector was James Munsey. In April, James came to Bien when Jess was at a meeting at Hartley. He determined that the buffing manufacturing was producing unsafe gases. As is his right, he shut the plant down that day. Jess flew back and modified the gas filters. James passed the filters, and Bien started production again.

In May, James came back and shut the plant again when Jess was at Rotary meeting. Again, the filters were cleaned and modified. This time Jess was really angry. After the plant was reopened and James gone, Jess held a meeting of all employees. At the meeting, he said:

Look, this OSHA guy is killing us. This is an old works. We can't afford to be shut down. At my recent meeting at corporate headquarters, I tried to make the case that we needed a new building here. The sharp pencil boys pointed out that we are profitable now, but not if we have to build a new plant. The industry is overcrowded, and Hartley will close this plant rather than spend money on it. If we get shut down or have to buy a lot of anti-pollution crap, they could shut us down. That OSHA guy is the enemy--just like a traffic cop. We've got to pull together, or we could all sink together.


Hartley Conglomerate (B)

It is July now and James Munsey appeared at the Bien Works office. The office girls saw James coming and headed for the powder room. Melanie Smith, one of the lab technicians, greeted him. Melanie has just been hired in June and didn't know James.

Munsey: I'm the OSHA inspector. I need to talk to Mr. Fuller. He should accompany me on my inspection.

Smith: Just a moment, sir. I'll get him.

Smith (to Fuller): The OSHA inspector is here to see you.

Fuller: Oh my God! (pause) You go out there and tell him I'm too busy to see him today.

Smith (back in office): I'm sorry sir. He's too busy to see you today.

Munsey: Ask your boss if he's too busy tomorrow.

Smith (on the intercom): Mr. Fuller, are you too busy tomorrow to see the inspector?

Fuller (on the intercom): What do you want this time, Munsey?

Munsey: Because of previous violations, you're due for another inspection.

Fuller: Look, I'm busy. But come and inspect first thing in the morning.

Munsey: I'll be here at 8:30.

The rest of the day was a red alert.

No work was done. The whole plant was cleaned up. The lab was put in order. Bottles which leaked were secured. Shelves were straightened. The rack shop was cleaned up. Machine guards were put on--they weren't used otherwise. Machines without guards were moved and covered up as if they were no longer used. Machines too heavy for the third floor were moved.

The filters were cleaned. The water bath was cleaned. The slippery flood made of metal that was supposed to be neutralized and scrubbed daily (though it usually got it monthly) was neutralized and scrubbed. Everyone helped. Even the secretaries and lab technicians helped clean.

The next day, the inspector came back. The prettiest secretary was assigned to get him coffee and "chat him up." James and Jesse toured the plant and the inspector passed Bien Works. But the employees wondered if the inspector didn't have to realize what happened.

Hartley Corporation (C)

On August 15, James Munsey returned to Bien. This time Melanie knew who he was. She got him a cup of coffee and then went to Mr. Fuller's office.

Fuller: Tell him I'm out--that you can't find me. Stall!

Smith: Mr. Fuller seems to be out. As soon as he returns, I'll tell him you're here.

James drank his coffee. While James was drinking coffee, Jess called all departments and told them to clean up in a hurry. They started to.

Forty-five minutes later.

Munsey: Miss, I can't wait any longer. Let me talk to whoever is here.

Melanie got one of the foremen. Together Munsey and the foreman did the inspection. The foreman took the inspector to the warehouse first to give the other areas more time to cleanup. It didn't help. James issued four warnings and gave Bien 24 hours to comply.

Jess was so angry that this time he set up a plan. One of his foreman, Harry Coat, was moving to another division because of his wife's health problems.

Fuller: Harry, I want you to do me a favor. You're moving to Arizona anyway. That SOB inspector is bound to be back before you go. When he comes back, it's worth $500 to me to pick a fight with him and cold cock him. Don't worry, I'll cover for you.

Hartley Conglomerate (D)

On October 13, James appeared for another inspection. Jess called harry Coat.

Fuller: Harry, it's D-Day. Get ready for the assault.

Coat: I'm ready.

As James walked through Coat's work area, Harry came up to him and started a fight and knocked James cold. James went back to OSHA to report the incident.

Fuller (calling OSHA office): This is Jesse Fuller at Bien Works. Let me talk to the boss.

Grubb: This is Mr. Grubb, I'm in charge of this office.

Fuller: Listen this fellow Munsey has been giving us fits. Now he's picked a fight with one of my managers. I fired my manager. I assume you'll do the same.

Hartley Conglomerate (E)

In January, the new OSHA inspector, Pamela Morton, appeared at the Bien Works. After her inspection, she ordered it closed and issued five warnings.

Assignment: Individual assignment

A. Please do a written analysis of how you would have handled this situation if you were Mr. Grubb.

B. How would you have handled the situation if you were Jess Fuller?

C. What was your reaction to the events of the case?

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