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+ - INVESTIGATING OSHA'S REGULATORY AGENDA AND ITS IMPACT ON JOB CREATION
+
+[House Hearing, 112 Congress]
+[From the U.S. Government Publishing Office]
+
+
+
+ INVESTIGATING OSHA'S REGULATORY AGENDA AND ITS IMPACT ON JOB CREATION
+
+=======================================================================
+
+ HEARING
+
+ before the
+
+ SUBCOMMITTEE ON WORKFORCE PROTECTIONS
+
+ COMMITTEE ON EDUCATION
+ AND THE WORKFORCE
+
+ U.S. House of Representatives
+
+ ONE HUNDRED TWELFTH CONGRESS
+
+ FIRST SESSION
+
+ __________
+
+ HEARING HELD IN WASHINGTON, DC, FEBRUARY 15, 2011
+
+ __________
+
+ Serial No. 112-5
+
+ __________
+
+ Printed for the use of the Committee on Education and the Workforce
+
+
+ Available via the World Wide Web:
+ http://www.gpoaccess.gov/congress/house/education/index.html
+ or
+ Committee address: http://edworkforce.house.gov
+
+ ----------
+ U.S. GOVERNMENT PRINTING OFFICE
+
+64-532 PDF WASHINGTON : 2011
+
+For sale by the Superintendent of Documents, U.S. Government Printing
+Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800;
+DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC,
+Washington, DC 20402-0001
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+ COMMITTEE ON EDUCATION AND THE WORKFORCE
+
+ JOHN KLINE, Minnesota, Chairman
+
+Thomas E. Petri, Wisconsin George Miller, California,
+Howard P. ``Buck'' McKeon, Senior Democratic Member
+ California Dale E. Kildee, Michigan
+Judy Biggert, Illinois Donald M. Payne, New Jersey
+Todd Russell Platts, Pennsylvania Robert E. Andrews, New Jersey
+Joe Wilson, South Carolina Robert C. ``Bobby'' Scott,
+Virginia Foxx, North Carolina Virginia
+Duncan Hunter, California Lynn C. Woolsey, California
+David P. Roe, Tennessee Ruben Hinojosa, Texas
+Glenn Thompson, Pennsylvania Carolyn McCarthy, New York
+Tim Walberg, Michigan John F. Tierney, Massachusetts
+Scott DesJarlais, Tennessee Dennis J. Kucinich, Ohio
+Richard L. Hanna, New York David Wu, Oregon
+Todd Rokita, Indiana Rush D. Holt, New Jersey
+Larry Bucshon, Indiana Susan A. Davis, California
+Trey Gowdy, South Carolina Raul M. Grijalva, Arizona
+Lou Barletta, Pennsylvania Timothy H. Bishop, New York
+Kristi L. Noem, South Dakota David Loebsack, Iowa
+Martha Roby, Alabama Mazie K. Hirono, Hawaii
+Joseph J. Heck, Nevada
+Dennis A. Ross, Florida
+Mike Kelly, Pennsylvania
+[Vacant]
+
+ Barrett Karr, Staff Director
+ Jody Calemine, Minority Staff Director
+ ------
+
+ SUBCOMMITTEE ON WORKFORCE PROTECTIONS
+
+ TIM WALBERG, Michigan, Chairman
+
+John Kline, Minnesota Lynn C. Woolsey, California,
+Todd Rokita, Indiana Ranking
+Larry Bucshon, Indiana Donald M. Payne, New Jersey
+Trey Gowdy, South Carolina Dennis J. Kucinich, Ohio
+Kristi L. Noem, South Dakota Timothy H. Bishop, New York
+Dennis A. Ross, Florida Mazie K. Hirono, Hawaii
+Mike Kelly, Pennsylvania George Miller, California
+[Vacant]
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+ C O N T E N T S
+
+ ----------
+ Page
+
+Hearing held on February 15, 2011................................ 1
+
+Statement of Members:
+ Hirono, Hon. Mazie K., a Representative in Congress from the
+ State of Hawaii, prepared statement of..................... 54
+ Kucinich, Hon. Dennis J., a Representative in Congress from
+ the State of Ohio, prepared statement of................... 55
+ Walberg, Hon. Tim, Chairman, Subcommittee on Workforce
+ Protections................................................ 1
+ Prepared statement of.................................... 2
+ Additional submissions:
+ Letter, dated Feb. 22, 2011, from Tree Care Industry
+ Association, Inc. [TCIA]........................... 56
+ Letter, dated Oct. 15, 2010, to Hon. Hilda L. Solis,
+ Secretary, U.S. Department of Labor, from U.S.
+ House Members...................................... 57
+ Letter, dated Feb. 4, 2011, to Secretary Solis, from
+ U.S. Senators...................................... 60
+ Letter, dated Aug. 5, 2008, Hon. Elaine L. Chao,
+ former Secretary, U.S. Department of Labor, from
+ U.S. House Members................................. 62
+ Letter, dated Sept. 27, 2007, to former Secretary
+ Chao, from U.S. Senators........................... 64
+ Woolsey, Hon. Lynn, ranking minority member, Subcommittee on
+ Workforce Protections...................................... 3
+ Prepared statement of.................................... 5
+ Additional submission:
+ Slide with photo of Hayes Lemmerze combustible dust
+ explosions and fire................................ 66
+
+Statement of Witnesses:
+ Holmes, Jacqueline M., Esq., of Counsel, Jones Day,
+ testifying on behalf of the U.S. Chamber of Commerce....... 26
+ Prepared statement of.................................... 29
+ Miser, Tammy, founder, United Support and Memorial for
+ Workplace Fatalities....................................... 22
+ Prepared statement of.................................... 23
+ Sessions, Stuart L., president, Environomics, Inc............ 13
+ Prepared statement of.................................... 15
+ Sullivan, Hon. Thomas M., Esq., of Counsel, Nelson Mullins
+ Riley and Scarborough...................................... 7
+ Prepared statement of.................................... 9
+
+
+ INVESTIGATING OSHA'S REGULATORY AGENDA AND ITS IMPACT ON JOB CREATION
+
+ ----------
+
+
+ Tuesday, February 15, 2011
+
+ U.S. House of Representatives
+
+ Subcommittee on Workforce Protections
+
+ Committee on Education and the Workforce
+
+ Washington, DC
+
+ ----------
+
+ The subcommittee met, pursuant to call, at 10:03 a.m., in
+room 2175, Rayburn House Office Building, Hon. Tim Walberg
+[chairman of the subcommittee] presiding.
+ Present: Representatives Walberg, Kline, Bucshon, Noem,
+Ross, Kelly, Woolsey, Payne, Kucinich, and Miller.
+ Staff present: Kirk Boyle, General Counsel; Casey Buboltz,
+Coalitions and Member Services Coordinator; Ed Gilroy, Director
+of Workforce Policy; Ryan Kearney, Legislative Assistant; Brian
+Newell, Press Secretary; Molly McLaughlin Salmi, Deputy
+Director of Workforce Policy; Linda Stevens, Chief Clerk/
+Assistant to the General Counsel; Loren Sweatt, Professional
+Staff Member; Aaron Albright, Minority Deputy Communication
+Director; Tylease Alli, Minority Hearing Clerk; Daniel Brown,
+Minority Staff Assistant; Jody Calemine, Minority Staff
+Director; Brian Levin, Minority New Media Press Assistant; Kara
+Marchione, Minority Senior Education Policy Advisor; Richard
+Miller, Minority Senior Labor Policy Advisor; Megan O'Reilly,
+Minority General Counsel; Julie Peller, Minority Deputy Staff
+Director; and Michele Varnhagen, Minority Chief Policy Advisor
+and Labor Policy Director.
+ Chairman Walberg [presiding]. Well, I am told a quorum is
+present. It is time to begin, so let's begin.
+ The subcommittee will come to order. Good morning. Allow me
+to welcome my colleagues and our guests to our first hearing of
+the Subcommittee on Workforce Protections. The subcommittee
+oversees a number of federal policies and programs that reach
+into America's workplaces. The decisions that we make in this
+subcommittee touch upon the lives of countless workers,
+employers, and their families.
+ I look forward to working with my colleague, Lynn Woolsey,
+the ranking Democrat member of the subcommittee. She has a deep
+passion for these issues, and no one can question her
+commitment to worker safety.
+ I know there will be times when we disagree. We have talked
+about that. But I have pledged to put forward my best efforts
+to find common ground whenever possible. The cause of worker
+safety is best advanced when we work together.
+ And so that is why today's hearing will examine the
+regulatory agenda at the Occupational Safety and Health
+Administration. Since 1970, OSHA has been charged with
+enforcing laws that govern worker safety and health by
+developing rules intended to keep workplaces free from
+recognized hazards. The regulatory agenda speaks to the
+Administration's priorities. Worker safety is a goal we all
+share. However, we have real concerns with the policies and
+process the Administration has recently proposed to reach that
+goal.
+ Over the last 2 years, OSHA has not only attempted to
+implement several policy changes that would have profound
+impact on the workplace; it has become an Administration more
+focused on punishment than prevention. All employers who
+jeopardize the safety of workers should be held accountable to
+the fullest extent of the law.
+ However, punishment is just one piece of enforcing the law.
+Our goal should be to prevent workplace accidents before they
+happen, not simply shame an employer once a tragedy has
+occurred on the job site.
+ And so that is why I am concerned with the recent actions
+that suggest the Administration has shifted the balance toward
+punishment and taken its sights off commonsense rules that
+promote prevention.
+ Worker safety is a priority and so, too, is promoting
+policies that will allow businesses to grow and hire new
+workers. Needless rules and onerous regulations are often
+roadblocks to economic growth and job creation, which we all
+want.
+ The President has called on his Administration to scour the
+books in search of policies that undermine private-sector job
+growth. This subcommittee looks forward to joining that effort
+in the weeks and months ahead.
+ I am particularly aware of the urgency of the task before
+us. My home state of Michigan has been hit hard by recent
+recession. Currently, the unemployment rate in Michigan stands
+at 11.7 percent, and even higher in some counties in my
+congressional district that I represent. We all must be
+partners in an effort to get the American people back to work.
+ Our witnesses today will discuss the potential economic and
+worker safety impact of OSHA's regulatory agenda. We have heard
+the mantra that good jobs are safe jobs. I agree. But let us
+ensure that bad policy does not destroy the good jobs we need
+to create.
+ At this time, I would like to yield to Congresswoman
+Woolsey, the ranking member of the subcommittee, for her
+opening remarks.
+ [The statement of Mr. Walberg follows:]
+
+ Prepared Statement of Hon. Tim Walberg, Chairman,
+ Subcommittee on Workforce Protections
+
+ Good morning. Allow me to welcome my colleagues and our guests to
+our first hearing of the Subcommittee on Workforce Protections. This
+subcommittee oversees a number of federal policies and programs that
+reach into America's workplaces. The decisions we make in this
+subcommittee touch upon the lives of countless workers, employers, and
+their families.
+ I look forward to working with my colleague Lynn Woolsey, the
+ranking Democratic member of the subcommittee. She has a deep passion
+for these issues and no one can question her commitment to worker
+safety. I know there will be times when we disagree but I pledge to put
+forward my best efforts to find common ground whenever possible. The
+cause of worker safety is best advanced when we work together.
+ That is why today's hearing will examine the regulatory agenda at
+the Occupational Safety and Health Administration. Since 1970, OSHA has
+been charged with enforcing laws that govern worker safety and health
+by developing rules intended to keep workplaces free from recognized
+hazards. The regulatory agenda speaks to the administration's
+priorities. Worker safety is a goal we all share, however, we have real
+concerns with the policies and process the administration has recently
+proposed to reach that goal.
+ Over the last two years, OSHA has not only attempted to implement
+several policy changes that would have profound impact on the
+workplace, it has become an administration more focused on punishment
+than prevention. All employers who jeopardize the safety of workers
+should be held accountable to the fullest extent of the law.
+ However, punishment is just one piece of enforcing the law. Our
+goal should be to prevent workplace accidents before they happen, not
+simply shame an employer once a tragedy has occurred on the job site.
+That is why I am concerned with recent actions that suggest the
+administration has shifted the balance toward punishment, and taken its
+sights of commonsense rules that promote prevention.
+ Worker safety is a priority, and so too is promoting policies that
+will allow businesses to grow and hire new workers. Needless rules and
+onerous regulations are often roadblocks to economic growth and job
+creation. The president has called on his administration to scour the
+books in search of policies that undermine private-sector job growth.
+This subcommittee looks forward to joining that effort in the weeks and
+months ahead.
+ I am particularly aware of the urgency of the task before us. My
+home state of Michigan has been hit hard by the recent recession.
+Currently, the unemployment rate in Michigan stands at 11.7 percent and
+even higher in some counties in the congressional district I represent.
+We all must be partners in an effort to get the American people back to
+work.
+ Our witnesses today will discuss the potential economic and worker
+safety impact of OSHA's regulatory agenda. We have heard the mantra
+that ``Good jobs are safe jobs.'' I agree. But let us ensure that bad
+policy does not destroy the good jobs we need to create. At this time,
+I would like to yield to Congresswoman Woolsey, the Ranking Member of
+the Subcommittee, for her opening remarks.
+ ______
+
+ Ms. Woolsey. Thank you, Mr. Chairman. And congratulations
+on your election as chair of this subcommittee.
+ Chairman Walberg. Thank you.
+ Ms. Woolsey. It was a very active subcommittee in the last
+Congress. And I look forward to actually continuing much of the
+work that we started in, moving forward in this Congress. And I
+am certain that we are going to have a good working
+relationship.
+ I applaud today's focus on OSHA's regulatory agenda,
+because over the past 4 years, this panel has explored a number
+of loopholes in OSHA's regulatory safety net. And I am hoping
+that under your leadership, Mr. Chairman, together we can fix
+what is needed and bring OSHA into the 21st century.
+ But first things first. If OSHA comes under assault from
+the new majority, the fact is, the agency may not be able to
+carry out its core missions. For example, the 18 percent
+reduction of OSHA's budget in the Republican Continuing
+Resolution for fiscal year 2011 would eliminate 415 employees,
+bringing OSHA to its lowest staffing levels since 1974, likely
+forcing OSHA to furlough all of its employees for 3 months.
+This would mean 8,000 fewer workplace hazard inspections and
+740 fewer whistleblower discrimination investigations this year
+alone.
+ And the deeper one digs, the worse it appears. The
+Republican funding resolution completely zeroes out OSHA's
+statistics and information division. Mr. Chairman, that means
+no more data collection on workplace health and safety trends,
+which is critical for targeting hazardous work sites. This cut
+even shuts down OSHA's website.
+ The continuing resolution we are currently debating
+includes cuts to state OSHA programs, including California and
+Michigan, both of our states, which are under extreme fiscal
+duress at the moment. It cuts OSHA's safety and health
+standards by 16 percent, blocking long-overdue rules, like the
+one to prevent falls at non-construction sites.
+ In other words, Mr. Chairman, the Republican C.R. doesn't
+just trim OSHA's budget; it absolutely cripples the agency and
+needlessly jeopardizes safety standards and endangers American
+workers.
+ So today's hearing about how OSHA's regulatory agenda
+affects job creation and investment is truly serious. I
+strongly believe it is the lack of regulation that has killed
+workers and their jobs.
+ Take, for example, a deadly 2009 explosion at the ConAgra
+Slim Jim plant in Garner, North Carolina. Contractors purged
+the natural gas line they were connecting to a new industrial
+water heater, but they didn't smell gas, and they kept venting
+the pipe for 2.5 hours, until the gas found a spark. Three
+workers were killed; 71 were injured in that explosion.
+ Rather than rebuild the section of the plant that was
+destroyed, ConAgra is consolidating production elsewhere,
+closing the plant and putting 700 people out of work.
+ Now, I want you to look at this hose.----
+ Chairman Walberg. I will move over, if necessary.
+[Laughter.]
+ Ms. Woolsey. Had there been OSHA regulations banning indoor
+gas purging, the contractors would have simply taken a piece of
+hose like this, a piece of hose like this, and connected it to
+the gas pipe and vented it outside, away from the building. So
+everyone has to agree: Had there been such a rule, there would
+have been no deaths, there would have been no injuries, and 700
+people would still have their prized factory jobs in their same
+area where they live.
+ Red tape has slowed OSHA's efforts to prevent combustible
+dust fires and explosions, like the 2008 tragedy at Imperial
+Sugar and the Indiana dust explosion illustrated at the easel,
+which is to my right over there. That is what that looked like,
+that killed the brother of a witness who is here today.
+ We know the dust explosion problem can be fixed and without
+damaging competitiveness. Following a string of grain elevator
+explosions, OSHA issued a grain-handling standard in 1987.
+Since that rule, there has been a dramatic decline in
+explosions without any negative economic impact on the grain-
+handling industry or related small businesses.
+ So, Mr. Chairman, as we begin our first hearing of the
+112th Congress, we have to challenge some of the long-held
+erroneous assumptions about regulations being bad for profit
+margins and economic growth. OSHA needs the resources to carry
+out its mission to protect its workers and to help businesses
+at the same time.
+ So, again, I want to thank you and I want to thank the
+witnesses who are here today, especially those of you who have
+had to travel long distances to be with us. I look forward to
+your testimony. Thank you.
+ [The statement of Ms. Woolsey follows:]
+
+ Prepared Statement of Hon. Lynn Woolsey, Ranking Minority Member,
+ Subcommittee on Workforce Protections
+
+ Thank you Mr. Chairman, and congratulations on your election as
+Chair of this subcommittee.
+ I applaud today's focus on OSHA's regulatory agenda, because over
+the past four years, this panel has explored a number of loopholes in
+OSHA's regulatory safety net, and i'm hoping that under your
+leadership, together we can fix what is needed and bring OSHA into the
+21st century.
+ But first things first. If OSHA comes under assault from the new
+majority, the fact is, the agency may not be able to carry out its core
+missions.
+ For example, the 18% reduction to OSHA's budget in the
+Republican continuing resolution for fiscal year 2011 would eliminate
+415 employees, bringing OSHA to its lowest staffing level since 1974.
+ Likely forcing OSHA to furlough all of its employees for 3
+months. This would mean 8,000 fewer workplace hazard inspections and
+740 fewer whistleblower discrimination investigations this year.
+ And the deeper one digs, the worse it gets:
+ The Republican funding resolution completely zeroes out
+OSHA's statistics and information division. That means no more data
+collection on workplace health and safety trends, which is critical to
+targeting hazardous work sites. This cut even shuts down OSHA's web
+site.
+ The continuing resolution we are currently debating
+includes cuts to state OSHA programs, including California and
+Michigan--both of which are under extreme fiscal duress.
+ It cuts OSHA's safety and health standards by 16%--
+blocking long overdue rules, like the one to prevent falls at
+construction sites from comint to fruition.
+ In other words, Mr. Chairman, the Republican CR doesn't just trim
+OSHA's budget, it absolutely cripples the agency needlessly
+jeopardizing safety standards and endangering American workers.
+ So today's hearing about how OSHA's regulatory agenda affects job
+creation and investment is truly serious.
+ I strongly believe it's the lack of regulations that has killed
+workers and their jobs.
+ Take, for instance, a deadly 2009 explosion at the Con Agra ``Slim
+Jim'' plant in Garner, North Carolina. Contractors purged a natural gas
+line they were connecting to a new industrial water heater. But they
+didn't smell gas and kept venting the pipe for 2\1/2\ hours--until the
+gas found a spark. Three workers were killed and 71 were injured in the
+explosion.
+ Rather than rebuild the section of the plant that was destroyed,
+Con Agra is consolidating production elsewhere, closing the plant and
+putting 700 people out of work.
+ Had there been OSHA regulations banning in-door gas purging, the
+contractors would have simply taken a piece of hose like this, and
+connected it to the gas pipe, and vented it outside away from the
+building.
+ Everyone agrees: had there been such a rule, there would have been
+no deaths or injuries, and 700 people would still have prized factory
+jobs.\1\
+---------------------------------------------------------------------------
+ \1\ Safety Bulletin, Dangers of Purging Natural Gas into Buildings,
+Chemical Safety Board, September 2009.
+---------------------------------------------------------------------------
+ Red tape has slowed OSHA's efforts to prevent combustible dust
+fires and explosions, like the 2008 tragedy at imperial sugar, and the
+indiana dust explosion illustrated at the easel to my right, that
+killed the brother of a witness here today.
+ We know the dust explosion problem can be fixed * * * and without
+damaging competitiveness. Following a string of grain elevator
+explosions, OSHA issued a grain handling standard in 1987. Since that
+rule, there has been a dramatic decline in explosions without any
+negative economic impact on the grain handling industry or related
+small businesses.
+ Mr. Chairman, as we begin our first hearing of the 112th Congress,
+we must challenge some of these long-held, erroneous assumptions about
+regulations being bad for profit margins and economic growth. OSHA
+needs the resources to carry out its mission, protect workers, and help
+businesses at the same time.
+ I want to thank our witnesses for being here today, especially
+those who had to travel a long distance to be with us, and I look
+forward to their testimony. Thank you.
+ ______
+
+ Chairman Walberg. I thank the gentlelady. And I think we
+are both committed to making sure that these hearings do deal
+with subjects of great interest, concern, and close to your
+heart, as well as the rest of the committee.
+ Pursuant to Committee Rule 7(c), all members will be
+permitted to submit written statements to be included in the
+permanent hearing record. And without objection, the hearing
+record will remain open for 14 days to allow such statements
+and other extraneous material reference during the hearing to
+be submitted for official hearing record.
+ It is now my pleasure to introduce our distinguished panel
+of witnesses, the first being the Honorable Thomas Sullivan,
+works in the law firm of Nelson, Mullins, Riley & Scarborough,
+where he represents clients on a number of regulatory and
+rulemaking matters, while also serving as the head of the Small
+Business Coalition for Regulatory Relief. Prior to joining
+Nelson Mullins, Mr. Sullivan served as the chief counsel for
+advocacy in the Small Business Administration from 2002 to
+2008. Mr. Sullivan earned his JD from Suffolk University Law
+School and a bachelor of arts in English from Boston College.
+ We welcome you.
+ Mr. Stuart Sessions is president of Environomics. Mr.
+Sessions was formally an analyst and manager with the Office of
+Management and Budget and Environmental Protection Agency. Mr.
+Sessions holds a master's of public policy from the Kennedy
+School of Government at Harvard University and a bachelor of
+arts and economics from Amherst College. Mr. Sessions is
+testifying today on behalf of the Coalition for Workplace
+Safety.
+ Thank you, and we welcome you.
+ Ms. Tammy Miser is an advocate for worker safety and
+founder of United Support and Memorial for Workplace
+Fatalities, an organization that serves as an advocacy group
+for individuals affected by workplace-related injury or death,
+and to add to that, has experienced the impact in her own life.
+ We welcome you and thank you for being here.
+ And then, finally, Ms. Jacqueline Holmes works in the law
+firm of Jones Day, where she focused her practice on litigation
+involving federal and state regulatory agencies. Ms. Holmes
+earned a JD from Loyola Law School in Los Angeles, California,
+and a bachelor in science from the California Institute of
+Technology. Ms. Holmes is testifying today on behalf of the
+U.S. Chamber of Commerce.
+ And we welcome you. Thank you.
+ Before I recognize each of you to provide your testimony,
+let me briefly explain our lighting system. You will each have
+5 minutes to present your testimony. When you begin, the light
+in front of you will turn green. When 1 minute is left, the
+light will turn yellow. And when your time is expired, the
+light will turn red, and it doesn't get any redder than that.
+ I promise I won't gavel you down mid-sentence. I probably
+won't gavel you down, either. But we will make it clear that
+your time is expired. But I would ask you that you try to wrap
+up your testimony when your time has expired.
+ After everyone has testified, members will each have 5
+minutes to ask questions of the panel. I won't make the same
+promise to members that I won't gavel them down when their time
+is expired, but I am sure that we can work on that.
+ With that, let me now turn to our distinguished panel, and
+let's begin with Mr. Sullivan.
+
+STATEMENT OF HON. THOMAS M. SULLIVAN, ESQ., OF COUNSEL, NELSON
+ MULLINS RILEY AND SCARBOROUGH
+
+ Mr. Sullivan. Thank you, Mr. Chairman, members of the
+committee. I am pleased to present this testimony on how OSHA
+considers the impact on small entities when developing
+regulatory proposals.
+ The testimony this morning is not being presented on behalf
+of any specific clients at my law firm. Rather, my advice today
+is drawn from my 2 decades of work on small business regulatory
+issues. I would like to briefly summarize my statement, so I
+ask that the full written statement be entered into the record.
+ Thank you.
+ Chairman Walberg. So ordered.
+ Mr. Sullivan. The Regulatory Flexibility Act requires
+agencies to satisfy certain procedural requirements when they
+plan new regulations, including identifying the small entities
+to be affected, analyzing and understanding the economic
+impacts that will be imposed, and considering alternative ways
+to achieve the regulatory goal, while reducing the economic
+burden on those entities.
+ The Reg Flex Act was amended in 1996 by the Small Business
+Regulatory Enforcement Fairness Act--yes, there is an acronym.
+That acronym is SBREFA, and SBREFA requires OSHA, EPA, and the
+newly created Consumer Financial Protection Bureau to convene
+small-business review panels. I refer to those panels as SBREFA
+panels. Whatever their planned rules are likely to have a
+significant economic impact on a substantial number of small
+entities.
+ The panel prepares a report containing constructive
+recommendations for the agency planning the rule, and that
+report is published with the proposed rule.
+ So why are there small-business protections in the
+rulemaking system? Well, there are three basic reasons. One-
+size-fits-all federal mandates don't work when applied to small
+business. Small businesses face higher costs per employee to
+comply with the federal regulations. And small businesses are
+critically important to the American economy.
+ First, prevention of one-size-fits-all federal mandates.
+Many times, federal rules that may work for large corporations
+simply don't work for small firms. The Regulatory Flexibility
+Act is supposed to force federal regulators to think about how
+a small operation would actually comply with a rule and tweak
+the proposal to make sure that it works for the small business,
+in addition to the large corporation.
+ Disproportionate impact that federal rules have on small
+business. Research published last year pegs the total cost of
+complying with federal rules at over $1.75 trillion. That
+burden amounts to a cost of $15,580 per household, which is
+more than 1.5 times what households pay for medical care. Most
+alarming is the fact that in the 4 years studied, the cost of
+complying with federal rules rose faster than the cost of per
+household of providing medical care.
+ Implementation of the Regulatory Flexibility Act at OSHA.
+In three recent regulatory actions, OSHA appears to be ignoring
+both the spirit and the legal requirements of the Reg Flex Act.
+First, OSHA's MSD reporting rule.
+ In January last year, OSHA proposed that businesses record
+work-related MSDs in a new column on their OSHA 300 Log. OSHA
+estimated that the proposed rule would require employers to
+spend roughly 5 minutes to become familiar with the new rule
+and 1 minute to record the MSD injury or illness.
+ This burden estimate is what OSHA used to justify its
+decision not to move forward with a SBREFA panel. Small
+businesses felt that OSHA's cost estimate reflected a
+misunderstanding of how small employers work and the pressure
+that employers feel writing down a number on a form that is
+required by the federal government.
+ The purpose of SBREFA is for OSHA to better understand the
+impacts its regulations will have and how its cost estimates
+play out in the real world. OSHA missed that opportunity by
+deciding to bypass the SBREFA panel process.
+ The second rule that I can talk about is the proposed
+changes to the on-site consultation procedures rule. Last
+September, OSHA proposed changes to the program. And the on-
+site consultation program is a shining example of how OSHA can
+evolve from ``gotcha'' to ``help ya.''
+ When OSHA decided to propose changes, it did not convene a
+SBREFA panel. OSHA, therefore, missed an opportunity to learn
+directly from small businesses about how changes would affect
+their participation in the program.
+ And, finally, OSHA's noise rule. In October, OSHA proposed
+to change the requirements for employers to control noise
+exposures. OSHA's proposal last year was to reverse the
+preference for personal protective equipment and require
+engineering controls without consideration of cost unless it
+would threaten a company's ``ability to remain in business.''
+ OSHA circumvented the SBREFA panel requirement by declaring
+its proposal was just revising an interpretation and therefore
+was not a rule subject to normal rulemaking procedures,
+including the SBREFA panel requirement. That type of rationale
+is unfortunate, because it ignored the value of SBREFA panels.
+ OSHA's policy apparatus suffers--and I will sum up here--
+when the agency treats the SBREFA process as a legal barrier.
+The purpose of the Reg Flex Act and the SBREFA amendments is
+for OSHA to benefit from small-business input, so the agency
+can fulfill its mission to ensure safe workplaces without
+unduly burdening small employers. Constructive input by small
+firms provides OSHA with valuable insight that allows for the
+agency to draft proposals that will work on Main Street, and
+OSHA benefits when it embraces the SBREFA process as a
+constructive dialogue.
+ Thank you.
+ [The statement of Mr. Sullivan follows:]
+
+Prepared Statement of Hon. Thomas M. Sullivan, Esq., of Counsel, Nelson
+ Mullins Riley and Scarborough
+
+ Mr. Chairman and Members of the Committee, I am pleased to present
+this testimony on how the Occupational Safety and Health Administration
+(OSHA) considers the impact on small entities when developing
+regulatory proposals. My name is Tom Sullivan. I am an attorney with
+the law firm of Nelson Mullins Riley & Scarborough, LLP and I run the
+Small Business Coalition for Regulatory Relief.\1\ This testimony is
+not being presented on behalf of any specific clients. Rather, my
+advice to the Committee today is drawn from my two decades of work on
+small business regulatory issues.
+ My first job in Washington was with the U.S. Environmental
+Protection Agency (EPA). I served under both Administrator Bill Reilly
+and Administrator Carol Browner. After learning about regulatory policy
+development from within government, I joined the Washington office of
+the National Federation of Independent Business (NFIB). In February
+2002, I was unanimously confirmed to head the Office of Advocacy at the
+U.S. Small Business Administration (SBA).\2\ The Office of Advocacy is
+responsible for overseeing the Regulatory Flexibility Act.\3\ I served
+as Chief Counsel for Advocacy until October 2008.
+OSHA must consider the impact on small entities prior to issuing a new
+ regulation
+ The Regulatory Flexibility Act requires federal agencies to satisfy
+certain procedural requirements when they plan new regulations,
+including: (1) identifying the small entities that will be affected,
+(2) analyzing and understanding the economic impacts that will be
+imposed on those entities, and (3) considering alternative ways to
+achieve their regulatory goal while reducing the economic burden on
+those entities.\4\ The Regulatory Flexibility Act was amended in 1996
+by the Small Business Regulatory Enforcement Fairness Act (SBREFA).\5\
+SBREFA requires OSHA, EPA, and the Consumer Financial Protection Bureau
+(CFPB) to convene small business review panels (I refer to the panels
+as ``SBREFA panels '') whenever their planned rules are likely to have
+a significant economic impact on a substantial number of small
+entities. SBREFA panels include representatives from SBA's Office of
+Advocacy, the Office of Management and Budget's Office on Information
+and Regulatory Affairs (OIRA) and the agency proposing the rule. The
+panel prepares a report containing constructive recommendations for the
+agency planning the rule and that report is published with the proposed
+rule.
+The need for small business protections in the federal rulemaking
+ system
+ There are three basic reasons for the Regulatory Flexibility Act.
+ one-size-fits-all federal mandates do not work when
+applied to small business; and
+ small businesses face higher costs per employee to comply
+with federal regulation; and
+ small businesses are critically important to the American
+economy.
+Prevention of one-size-fits-all federal mandates
+ Many times federal regulations that may work for large corporations
+simply do not work for small firms. I remember working with Brian
+Landon on the ergonomics regulation when it was being developed in the
+late 1990's. Brian owned and operated a carwash in Canton,
+Pennsylvania. Parts of the ergonomics regulation distinguished between
+the employees who worked on equipment and employees who were in charge
+of paperwork and accounting. As is the case in many small businesses,
+Brian did all the jobs. And, his most trusted employees also performed
+multiple tasks, some clerical and some operational. The ergonomics
+regulation spelled out duties for equipment maintenance employees that
+were very different from those responsibilities for employees in charge
+of paperwork. Brian continually asked OSHA for help to figure out which
+classification would apply to him--and never really got an answer.
+Sometimes we forget that our country has millions of small enterprises
+that are at various stages of automation. For instance, when there is a
+new labeling requirement, a tendency is to naively think that
+compliance with a regulation mandating changes to labels can be
+accomplished with little effort through a computer program. The
+Regulatory Flexibility Act is supposed to force federal regulators to
+think about how a small operation would actually comply, realizing that
+it may not be as simple as entering information into a computer.
+The disproportionate impact federal regulations have on small business
+ Research published in September by Nicole Crain and W. Mark Crain
+of Lafayette College updates three previous studies on the impact of
+federal regulations on small business.\6\ The report is entitled, ``The
+Impact of Regulatory Costs on Small Firms,'' and it provides a look at
+the regulatory burden in 2008. The total cost of complying with federal
+regulations was over $1.75 trillion. The burden amounts to a cost of
+$15,586 per household which is more than 1\1/2\ times what households
+pay for medical care. Most alarming, is the fact that in the four years
+studied, the cost of complying with federal regulations rose faster
+than the per-household cost of medical care.
+ The Crain study found that small businesses shoulder costs that are
+36% more than their larger business competitors. Firms with fewer than
+20 employees pay $10,585 per employee per year and firms with 500 or
+more employees pay $7,755 per employee to comply with federal
+regulations. The cost difference is most severe when looking at
+compliance with environmental regulations, with the smallest firms
+paying 4 times the amount per employee than the largest businesses.
+ The research provides data for a common sense reality in a small
+business owner's world. Small businesses generally do not have vice
+presidents for safety and health to figure out OSHA rules. They do not
+have accounting departments to navigate changes to the tax code. Even
+if small businesses hire accountants to prepare their taxes, the owners
+take hours sweating the details because it is their signature on the
+IRS forms. Nor do small firms usually employ occupational health
+experts and safety engineers to keep up with OSHA rules and the more
+than 22,000 national consensus standards that exist in the United
+States. The task of figuring out volumes of federal requirements often
+falls on the small business owners themselves, taking more time for
+them than it would for regulatory experts. Since time is money--it
+costs the small businesses more.
+ The intention of the Regulatory Flexibility Act and, in particular
+the SBREFA panel process, is to bring small entities directly into an
+advisory role with agencies so that final regulations reflect an
+accurate understanding of how compliance can cost small firms more.
+The importance of small business to the U.S. economy
+ Recent figures show there are more than 27.3 million small
+businesses in the United States.\7\ They represent over 99% of the
+employer firms in the United States, employ half of the private sector
+employees, and produce 13 times more patents per employee than large
+research & development firms.\8\ Of particular importance is the job-
+creation aspect of entrepreneurship. Small firms accounted for 65% of
+the 15 million net new jobs created between 1993 and 2009. Data show
+that since the 1970's small businesses hire two out of every three jobs
+and the Ewing Marion Kauffman Foundation likes to point out that in the
+last 30 years, literally all net job creation in the United States took
+place in firms less than five years old.\9\
+History of the Regulatory Flexibility Act
+ One of the top five recommendations from the 1980 White House
+Conference on Small Business was for a law requiring regulatory impact
+analysis and a regular review of regulations. That recommendation
+became reality when President Jimmy Carter signed the Regulatory
+Flexibility Act into law on September 19, 1980. The Regulatory
+Flexibility Act directed all agencies that use notice and comment
+rulemaking to publicly disclose the impact of their regulatory actions
+on small entities and to consider less burdensome alternatives if a
+proposal was likely to impose a significant impact. The law authorized
+SBA's Chief Counsel for Advocacy to appear as amicus curiae in
+Regulatory Flexibility Act challenges to rulemakings and it required
+SBA's Office of Advocacy to report annually on agencies' compliance
+with the Regulatory Flexibility Act.
+ In 1996, Congress considered changes to the Regulatory Flexibility
+Act. Again, there was a White House Conference--and that conference's
+top recommendation was to strengthen the Regulatory Flexibility Act by
+directing small business participation in rulemakings and to allow for
+judicial review of agency compliance. President Clinton signed SBREFA
+in March of 1996.\10\ Those amendments to the Regulatory Flexibility
+Act established formal procedures for the EPA and for OSHA to receive
+input from small entities prior to the agencies proposing rules.\11\
+ In August of 2002, President Bush signed Executive Order 13272,
+Proper Consideration of Small Entities in Agency Rulemaking.\12\ The
+Executive Order directed SBA's Office of Advocacy to train regulatory
+agencies on how to comply with the RFA and further instructed agencies
+to consider the Office of Advocacy's comments on proposed rules. The
+Small Business Jobs Act signed five months ago codified the Executive
+Order's requirements for agencies to respond to the Office of
+Advocacy's comments in final rules.\13\
+ There was one recent additional amendment to the Regulatory
+Flexibility Act. An amendment authored by Senators Olympia Snowe and
+Mark Pryor was adopted as part of the Dodd-Frank financial regulatory
+reform law. That amendment requires the newly created Consumer
+Financial Protection Bureau (CFPB) to undergo a SBREFA panel process
+when issuing rules, the same requirement that has applied to EPA and
+OSHA since 1996.\14\
+What is required by the Regulatory Flexibility Act
+ The basic spirit of the RFA is for government agencies to analyze
+the effects of their regulatory actions on small entities and for those
+agencies to consider alternatives that would allow agencies to achieve
+their regulatory objectives without unduly burdening small entities.
+ The RFA covers all agencies that issue rules subject to the
+Administrative Procedure Act (APA). The RFA requires agencies to
+publish an initial regulatory flexibility analysis (IRFA) unless the
+promulgating agency certifies that the rule will not have a significant
+impact on a substantial number of small entities.\15\ The IRFA is
+supposed to be a transparent small business impact analysis that
+includes discussion of alternatives that can accomplish the stated
+objectives of the rule while minimizing impact on small entities. In
+the case of EPA, OSHA, and the CFPB, a SBREFA panel aids the agency's
+analysis and discussion of alternatives. This transparent analysis and
+exchange of information with small entities is published with the
+agency's proposed rule, educating stakeholders who participate in the
+notice and comment process.
+ The availability of an IRFA allows for a more informed notice and
+comment process that can guide an agency's formulation of its final
+rule. Under the RFA, an agency's final rule must contain a final
+regulatory flexibility analysis (FRFA) if it published an IRFA with its
+proposal. The FRFA is basically a public response to issues raised in
+the IRFA.
+Implementation of the Regulatory Flexibility Act at OSHA
+ Under the Regulatory Flexibility Act, an agency either certifies
+that a proposed rule has no significant economic impact on a
+substantial number of small entities or the agency prepares an IRFA on
+the proposal. When OSHA decides to prepare an IRFA, the agency convenes
+a SBREFA panel to obtain pre-proposal input from small entities. In
+three recent regulatory actions, OSHA appears to be ignoring both the
+spirit and the legal requirements of the Regulatory Flexibility Act.
+Even if OSHA is able to certify that a regulation will not have
+sufficient impact to warrant a SBREFA panel, the agency always has the
+option to voluntarily use the SBREFA panel process to gain insight from
+the small business community.
+ 1. Proposed Occupational Injury and Illness Recording and Reporting
+Requirements Rule (MSD Reporting Rule):\16\
+ In January of last year, OSHA proposed that businesses record work-
+related musculoskeletal disorders (MSDs) in a new column on their OSHA
+300 Log. When OSHA proposed the rule, it certified under the Regulatory
+Flexibility Act that the rule, if promulgated, would not have a
+significant economic impact on a substantial number of small
+entities.\17\ OSHA estimated that the proposed rule would require
+employers to spend roughly 5 minutes to become familiar with the new
+rule and one minute pre MSD injury or illness to record the MSD in the
+new column on the OSHA 300 Log. This burden estimate is what OSHA used
+to justify its decision to move forward with the rule without a SBREFA
+panel.
+ Small businesses strongly disagreed with OSHA on its estimate of
+how much the rule would cost. Recording an MSD in a column is not as
+simple as just transcribing a number. Under the rule, employers would
+be required to diagnose whether the injury or illness is a MSD and
+whether it is work-related. Keep in mind that after several years of
+study and research, experts are unable to reach consensus over the
+definition of an MSD, yet small business owners would be expected to
+make a diagnosis of the injury or illness and determine whether it is
+work related--in less than 5 minutes. That burden estimate reflected a
+clear misunderstanding of how small employers work and the pressure of
+legal liability employers feel when writing down a number on a form
+required by the federal government.
+ The purpose of SBREFA panels is for OSHA to better understand the
+impacts its regulations will have and how its cost estimates play out
+in the real small business world. OSHA missed that opportunity by
+deciding to bypass the SBREFA panel process.
+ 2. Proposed changes to On-Site Consultation Procedures rule:\18\
+ Last September, OSHA proposed changes to the criteria under which
+participants in the agency's On-site Consultation program could be
+subject to enforcement action by OSHA inspectors. The On-site
+Consultation program is a shining example of how OSHA can evolve from
+``gotcha'' to ``help ya.'' Under the program, small businesses can
+request a free consultation with a state-certified consultant. The
+consultant identifies hazards and provides advice on how to address
+them.
+ Part of the program's success is derived from the understanding
+that information uncovered by the voluntary inspection is not shared
+with OSHA enforcement if the identified hazards are corrected. OSHA's
+proposal last September threatened to break down the barrier between
+the On-site Consultation program and OSHA's enforcement program. I
+doubt OSHA wanted to push small firms out of its On-Site Consultation
+program, but the agency lacked an appreciation for how the changes
+would impact small business's willingness to participate. OSHA did not
+convene a SBREFA panel prior to proposing the changes to its
+consultation agreements program despite the On-site Consultation
+program's focus on small business. OSHA, therefore, missed an
+opportunity to learn directly from small businesses about how changes
+would affect their participation in the program. Through a SBREFA
+panel, OSHA would have heard how the agency could achieve its goal,
+without scaring away small businesses from a program that has improved
+workplace safety in thousands of small businesses.
+ 3. Proposed Interpretation of OSHA's Provisions for Feasible
+Administrative or Engineering Controls of Occupational Noise:\19\
+ In October, OSHA proposed to change the requirements for employers
+to control noise exposures. Currently, OSHA requires engineering and
+administrative controls to prevent hearing loss if personal protective
+equipment (PPE) such as earplugs is ineffective in reducing workplace
+noise to acceptable levels or if such controls can be implemented for
+less cost than PPE. OSHA's proposal last year was to reverse the
+preference for PPE and require engineering controls without
+consideration of cost unless it would threaten a company's ``ability to
+remain in business.'' \20\
+ OSHA circumvented the SBREFA panel requirement by declaring its
+proposal was just revising an interpretation and, therefore, was not a
+new rulemaking subject to normal rulemaking procedures, including the
+SBREFA panel requirement. That type of rationale was unfortunate
+because it ignored the value of SBREFA panels. A SBREFA panel could
+have informed OSHA that PPE has proven effective in reducing harmful
+exposure to noise in the workplace and that driving employers away from
+the preference for PPE could actually increase danger. Also, a SBREFA
+panel could have informed OSHA about the cost considerations of
+engineering controls. Maybe OSHA wanted to see what engineering
+controls were ``feasible'' for small manufacturers. The way to find out
+was to convene a SBREFA panel, not to declare that ``feasible'' is
+anything short of causing a business to close its doors and go out of
+business.
+Conclusion
+ In the examples of OSHA's proposed MSD reporting rule and OSHA's
+proposed changes to its On-site Consultation program, SBA's Office of
+Advocacy wrote to the agency and shared the concerns voiced by the
+small business community.\21\ In both letters, the Office of Advocacy
+publicly criticized the failure by OSHA to incorporate flexibility for
+small business in their proposals. Even though OSHA recently pulled
+back its plans to go ahead with the noise rule and the MSD reporting
+rule, the Committee is justified in its concern that OSHA is moving
+forward with regulatory policy that will impact the small business
+community in a way that ignores their input. OSHA's policy apparatus
+suffers when the agency treats the SBREFA process as a legal barrier.
+The purpose of the Regulatory Flexibility Act and the SBREFA amendments
+is for OSHA to benefit from small business input so the agency can
+fulfill its mission to ensure safe workplaces without unduly burdening
+small employers. Constructive input by small firms provides OSHA with
+valuable insight that allows for the agency to draft proposals that
+will work on Main Street. OSHA benefits when it embraces the SBREFA
+process as a constructive dialogue.
+ endnotes
+ \1\ See http://www.SBCRR.com.
+ \2\ See http://www.sba.gov/advocacy.
+ \3\ Regulatory Flexibility Act, Pub. L. No. 96-354, 94 Stat. 1164
+(1980), amended by the Small Business Regulatory Enforcement Fairness
+Act of 1996, Pub. L. No. 104-121, 110 Stat. 857 (1996) (codified as
+amended at 5 U.S.C. Sec. Sec. 601-612), also amended by Sec. 1100 G
+of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub.
+L. No. 111-203, 124 Stat. 2112 (July 21, 2010).
+ \4\ Keith W. Holman, The Regulatory Flexibility Act at 25: Is the
+Law Achieving Its Goal?, 33 Fordham Urban Law Journal 1119 (2006).
+ \5\ Small Business Regulatory Enforcement Fairness Act of 1996,
+Pub. L. No. 104-121, 110 Stat. 857 (1996).
+ \6\ Nicole V. Crain and W. Mark Crain, The Impact of Regulatory
+Costs on Small Firms, written for the Office of Advocacy, U.S. Small
+Business Administration (September 2010), available at http://
+www.sba.gov/advocacy/853/2016.
+ \7\ Office of Advocacy, U.S. Small Business Administration,
+Frequently Asked Questions (January 2011), available at http://
+www.sba.gov/advocacy/7495.
+ \8\ Id.
+ \9\ John Haltiwanger, Business Dynamics Statistics Briefing: Jobs
+Created from Business Startups in the United States, Ewing Marion
+Kauffman Foundation (January 2009), available at: http://
+www.kauffman.org/research-and-policy/bds-jobs-created.aspx.
+ \10\ Small Business Regulatory Enforcement Fairness Act of 1996,
+Pub. L. No. 104-121, 110 Stat. 857 (1996).
+ \11\ See, 5 U.S.C. Sec. 609.
+ \12\ Executive Order 13272, Proper Consideration of Small Entities
+in Agency Rulemaking, 67 Fed. Reg. 53461 (August 16, 2002).
+ \13\ Small Business Jobs Act of 2010, Pub. L. No. 111-240,
+Sec. 1601 (September 27, 2010).
+ \14\ Dodd-Frank Wall Street Reform and Consumer Protection Act,
+Pub. L. No. 111-203, Sec. 1100G (July 21, 2010).
+ \15\ See, 5 U.S.C. Sec. 605(b).
+ \16\ 75 Fed. Reg. 4728 (January 29, 2010).
+ \17\ 75 Fed. 4736.
+ \18\ 75 Fed. Reg. 54064 (September 3, 2010).
+ \19\ 75 Fed. Reg. 64216 (October 19, 2010).
+ \20\ 75 Fed. Reg. at 64217.
+ \21\ Susan M. Walthall, Acting Chief Counsel for Advocacy, letter
+to OSHA Assistant Secretary David Michaels, (March 30, 2010). Available
+at: http://www.sba.gov/content/letter-dated-033010-department-labor-
+occupational-safety-and-health-administration. Winslow Sargeant, Chief
+Counsel for Advocacy, letter to OSHA Assistant Secretary David
+Michaels, (November 2, 2010). Available at: http://www.sba.gov/content/
+letter-dated-110210-department-labor-occupational-safety-and-health-
+administration.
+ ______
+
+ Chairman Walberg. Thank you, Mr. Sullivan.
+ Moving on to Mr. Sessions?
+
+ STATEMENT OF STUART SESSIONS, PRESIDENT, ENVIRONOMICS, INC.,
+ TESTIFYING ON BEHALF OF THE COALITION FOR WORKPLACE SAFETY
+
+ Mr. Sessions. Good morning, Mr. Chairman and members of the
+Subcommittee on Workforce Protections. Thank you for inviting
+me here to testify specifically on OSHA's recent proposal
+regarding the noise exposure standard and the potential impact
+of this proposal on job creation. This is one of OSHA's three
+actions that Tom Sullivan just referred to.
+ I am here on behalf of the Coalition for Workplace Safety.
+The coalition has retained me to analyze the potential cost and
+economic impacts if OSHA were to finalize this proposed new
+reinterpretation of the term ``feasible'' as it applies to the
+noise standard.
+ I want to share with the subcommittee today some initial
+results from two recent analyses of this new reinterpretation
+by OSHA that have been conducted by the coalition and its
+members. The two analyses are, number one, a series of case
+studies.
+ I have been working with a number--about a dozen different
+companies to evaluate what the impact of OSHA's proposal would
+be on their operations. How much would it cost each of these
+companies? How much would the new interpretation revise what
+they need to do in terms of meeting the noise standard? And
+what would these compliance costs mean to these businesses in
+terms of their competitive position and in terms of jobs?
+ The second piece of research is a large survey that has
+been done by the National Association of Manufacturers, in
+which they asked their manufacturing members what the impact of
+OSHA's proposal would be on their operations and on their
+competitive position. And NAM obtained more than 315 lengthy
+responses to this questionnaire on the impact of the OSHA
+proposal.
+ I have combined data from these two sources, my case
+studies and the NAM survey, along with other data to attempt to
+estimate what the overall impact on the national economy would
+be if OSHA's proposal were finalized, the impact in particular
+in terms of costs and in terms of jobs.
+ I draw four conclusions from these analyses, and I would
+like to share these conclusions with the subcommittee. First,
+the proposed OSHA noise reinterpretation would affect a large
+number and very broad range of American businesses and their
+employees. Most companies involved in manufacturing, most
+involved in construction, and many involved in transportation
+have employees exposed to noise levels at which the OSHA
+reinterpretation would apply.
+ In addition, there are many other businesses that do
+various other activities, including lawn care, tree service,
+automobile repair, warehousing, anything involving maintenance
+and repair of large, noisy equipment that would also be
+affected by OSHA's proposal. In total, I estimate that
+somewhere between 2 million and 7 million workers would be
+affected by OSHA's proposal, and their employers would
+similarly be affected.
+ Second conclusion: The costs for American business to
+comply with OSHA's proposed new policy would be very high. OSHA
+estimated long ago that the average highly exposed worker who
+is exposed to a level of noise at which this proposal would
+have an impact, OSHA estimated that the average cost per
+engineering controls--engineering controls alone to protect
+that worker would average about $4,000 per worker per year.
+ The NAM survey provides more recent information than OSHA's
+old estimate on the cost per worker. And the NAM survey
+estimates costs for engineering controls alone as a protective
+approach of somewhere between $2,000 and $10,000 per year per
+highly exposed worker.
+ Under the current policy, employers are allowed to protect
+workers via a combination of engineering controls,
+administrative controls, and hearing protection--earmuffs,
+earplugs, and the like--and typically earmuffs and earplugs are
+far less expensive than engineering controls.
+ So OSHA's policy essentially requires employees to spend on
+the order of this $2,000 to $10,000 per employee, rather than
+the much lesser sums that they can spend to protect employees
+via hearing protection alone.
+ If we put these costs of $2,000 to $10,000 per worker per
+year together with the number of exposed workers, the total
+cost for OSHA's proposal, as I estimate it, is somewhere
+between $1 billion and $27 billion per year. This amount, if it
+were to be a cost of a regulation, would trigger the
+requirements for Executive Order 12866 and economic analysis of
+significant regulations, and it would trigger the SBREFA
+requirements that Mr. Sullivan referred to for small-business
+panels, et cetera. OSHA essentially sidestepped these
+procedural safeguards by issuing this as an administrative
+interpretation rather than a regulation.
+ Conclusion number three: OSHA's proposed new interpretation
+and these costs would have a substantial negative impact on
+U.S. jobs and competitiveness. We have done a little bit of
+work to run the estimated compliance costs through a national
+model that predicts the macroeconomic impacts of compliance
+costs. Actually, we haven't run them through the model; we have
+analogized from a recent run of the model on it, a different,
+similar regulation.
+ And we estimate that the impact on the nation's employment,
+if OSHA's proposal were to be finalized, would be a loss of
+somewhere between 10,000 and 220,000 jobs.
+ Final conclusion number four. All of this would be for
+relatively little benefit in terms of improved hearing
+protection for workers. Two points.
+ One, currently the number of reportable work-related
+hearing losses for highly exposed workers is very low. The
+current system of--the current regulation and OSHA's previous
+interpretation of the noise standard are working, less than
+0.6----
+ Chairman Walberg. I would ask you to wrap up.
+ Mr. Sessions. Fifteen seconds. Less than 0.6 percent of
+workers are currently--have evidence of a work-related hearing
+loss. Under the current system, that is less than the number
+of--the percentage of the general population that has such
+hearing losses.
+ So there isn't a problem in the first place that the
+regulation would be addressing. And, secondly, the regulation
+would have minimal impacts in reducing--or the proposal would
+have minimal impacts in reducing this already low rate of
+hearing loss.
+ Thank you, sir.
+ [The statement of Mr. Sessions follows:]
+
+Prepared Statement of Stuart L. Sessions, President, Environomics, Inc.
+
+ Good morning, Mr. Chairman and Members of the Subcommittee on
+Workforce Protections. Thank you for inviting me today to testify on
+OSHA's recent proposal regarding the noise exposure standard and the
+potential impact of the proposal on job creation.
+ I am Stuart Sessions, President of the consulting firm
+Environomics, Inc. I am here today representing the Coalition for
+Workplace Safety (CWS). The Coalition for Workplace Safety is a group
+of associations and employers who seek to cost-effectively improve
+workplace safety. The Coalition has retained me to analyze the
+potential costs and economic impacts if OSHA were to finalize their
+proposed new interpretation of the term ``feasible'' as it applies to
+the Agency's standards for occupational exposure to noise.
+ As an economist, I have worked for more than 30 years in analyzing
+how a wide variety of environmental, health and safety regulations and
+administrative actions may affect the U.S. economy. Roughly half of my
+work in analyzing the economic impact of environmental, health and
+safety requirements has been as a Federal government employee or
+contractor, and about half has been as a consultant to private
+industry.
+ OSHA proposed its reinterpretation of the noise standard as a
+policy interpretation and not specifically as a regulation.
+Nevertheless, this proposed action is typical of how a new government
+requirement, whether achieved by formal regulation or simply as a
+declaration of policy by the agency that enforces the regulations, can
+affect the U.S. economy and jobs.
+ I want to share with the Subcommittee today some initial results
+from two recent analyses of OSHA's proposed noise reinterpretation by
+CWS and its members. These analyses have not yet been completed, and
+they may well not be completed, since OSHA has withdrawn its proposed
+new interpretation. These analyses, however, focus directly on the
+Subcommittee's concern about how OSHA's requirements may affect job
+creation I expect that our preliminary findings from these analyses
+will be of interest and I have no expectation that the thrust of these
+analyses will change in a material way. The two analyses are:
+ 1. Case studies. I have been working with about a dozen different
+companies on case studies of what the OSHA proposal would mean to their
+operations. The case studies examine how each of these employers
+complies with the OSHA noise standard now, what they would have to do
+differently if the proposed interpretation were finalized, and how much
+compliance with the new interpretation would cost them. And then, the
+case studies proceed to analyzing the impacts of these compliance
+costs: what would these compliance costs mean to these businesses and
+their competitive position, and what would the costs mean in terms of
+jobs? Would some of the current employees of these companies lose their
+jobs because the companies become less competitive and lose business,
+or might the noise compliance measures open new opportunities for these
+businesses and perhaps result in increasing numbers of jobs in the
+future?
+ 2. NAM survey. The National Association of Manufacturers (NAM) has
+conducted a large survey of its member companies with regard to the
+companies' hearing protection programs for their employees and the
+potential impact of the OSHA noise proposal. NAM asked a broad set of
+questions of the companies, including similar questions as in my case
+studies about the costs and economic consequences of OSHA's proposed
+new interpretation. NAM has obtained more than 315 responses to their
+survey from manufacturing companies.
+ In addition to reporting today on some of the results from my case
+studies and the NAM survey, I have combined data from these and other
+sources and have estimated the overall potential impact on the national
+economy of OSHA's noise reinterpretation in terms of costs and in terms
+of jobs. While I readily admit that my estimates are rough and
+uncertain, they contrast with the complete absence of any economic
+analysis conducted by, or at least made public by, OSHA.
+ I draw four conclusions from this set of analyses--from the
+combination of my case studies, the NAM survey, and the national
+aggregate analysis:
+ 1. The proposed OSHA noise interpretation would affect a large
+number and very broad range of American businesses and their employees.
+ 2. The costs for American businesses to comply with OSHA's proposed
+new policy would be very high.
+ 3. OSHA's proposed new interpretation would have substantial
+negative impacts on U.S. jobs and competitiveness.
+ 4. All this would be for relatively little benefit in terms of
+improved hearing protection for workers.
+ Before I explain these conclusions in more detail, I would like to
+summarize what OSHA's proposed noise reinterpretation would have
+required.
+ OSHA has long had a standard that prescribes 90 decibels as the
+maximum average noise level to which a worker may be exposed over an 8-
+hour work shift. OSHA has for several decades maintained the policy
+that an employer can comply with this 90 decibel standard through
+whatever combination of three noise-limiting approaches that the
+employer finds is cost-effective. The three noise-limiting approaches
+include what are known as: 1) Engineering controls; 2) Administrative
+controls; and 3) Personal protective equipment. ``Engineering
+controls'' include measures to reduce noise by engineered means such as
+mufflers on noisy equipment, sound-deadening enclosures for noisy
+equipment, redesigning or changing equipment or processes so as to make
+them less noisy, and so forth. ``Administrative controls'' include
+measures such as rotating a worker's tasks so as to limit the fraction
+of his work shift that the worker spends performing activities with
+high noise levels. ``Personal protective equipment'', or PPE, includes
+such things as ear plugs or ear muffs that reduce the amount of noise
+exposure the individual worker receives despite whatever level of
+ambient noise surrounds the worker. In general, reducing a worker's
+noise level is substantially less costly through use of personal
+protective equipment than through engineering controls or
+administrative controls.
+ OSHA's noise standard does not treat these three means of reducing
+a worker's noise exposure equivalently. The standard requires an
+employer to limit exposure to 90 decibels first by implementing all
+feasible engineering and administrative controls. Only then, after all
+feasible engineering and administrative controls have been implemented,
+can an employer add personal protective equipment in order to get below
+the 90 decibel limit. The key in how OSHA has sensibly implemented for
+many years this preference for engineering and administrative controls
+lies in how OSHA has interpreted the term ``feasible'' as a limitation
+on the engineering and administrative controls that will be required.
+OSHA has long interpreted the word ``feasible'' as meaning ``cost-
+effective relative to PPE''. Those engineering and administrative
+controls that are defined as feasible and required to be implemented
+first consist only of those that are cost-effective relative to PPE.
+Or, said in a different way, if PPE is effective in limiting workers'
+noise exposure to less than 90 decibels and is less costly than
+engineering and administrative controls, the employer can choose to
+implement PPE rather than more costly engineering and administrative
+controls.
+ In the fall of last year, though, OSHA proposed to reinterpret the
+term ``feasible'' as it applies in the noise standard. OSHA proposed to
+reinterpret ``feasible'' to mean ``capable of being done'' instead of
+meaning ``cost-effective''. Under OSHA's proposed new interpretation,
+then, in seeking to limit noise exposures to below 90 decibels, an
+employer would need to implement all possible engineering and
+administrative controls without regard to cost unless the employer can
+show that the engineering and administrative controls would threaten
+the employer's ability to remain in business. Under the proposed new
+interpretation, the limit on required engineering and administrative
+controls would change from only those that are cost-effective to all
+such controls that are available short of putting the employer out of
+business.
+ Obviously OSHA's proposed new interpretation of the term
+``feasible'' would greatly increase the required use of engineering and
+administrative controls relative to PPE in reducing noise exposures. I
+and the Coalition for Workplace Safety have been working to estimate
+the costs and economic impacts that would result from OSHA's proposed
+new policy. I would like to summarize the four conclusions that I have
+drawn from our analyses thus far.
+ 1. The proposed OSHA noise interpretation would affect a large
+number and very broad range of American businesses and their employees.
+ There are a wide variety of tools, machines, vehicles and processes
+that can generate noise exceeding 90 decibels: saws, hammers, punches,
+presses, sanders, burners, boilers, blowers, crushers, generators,
+compressors, aircraft, trucks, busses, locomotives, boats, compressed
+air, combustion, abrasive blasting, welding and many, many more.
+Workers operating or maintaining these items, or performing other tasks
+in the vicinity of these items, can be exposed to noise that may exceed
+an average of 90 decibels across an 8-hour work shift.
+ I have reviewed various data sources in order to develop a rough
+estimate for the number of employees that are exposed above 90 decibels
+and that therefore could be affected by OSHA's proposed
+reinterpretation. I have organized these estimates by industry:
+ Manufacturing. In regulatory impact analyses that OSHA
+developed in the late 1970s/early 1980s to support potential changes to
+the noise standard, the Agency estimated that 19.4% of all production
+employees in manufacturing industries (SIC codes 20 through 37, plus
+SIC 49, utilities) work in settings with average ambient noise
+exceeding 90 decibels. This estimate is rather old, but is apparently
+the most recent comprehensive estimate that OSHA has developed. Noise
+exposures in manufacturing have likely been reduced since OSHA's
+estimate. I will assume in my calculations that the fraction of
+manufacturing production workers now exposed above 90 decibels is
+somewhere between the roughly 20% that OSHA estimated 30 years ago and
+2%, a level one-tenth as high.
+ Construction (SIC 15-17). A large recent noise survey for
+residential construction trades found for virtually every job category
+that at least 10% of full-shift samples exceeded 90 decibels (roofer,
+framing carpenter, finish carpenter, excavator, drywall installer,
+brick mason and helpers, landscaper, miscellaneous trades). Exposures
+among commercial construction workers are higher than among residential
+workers, while exposures among heavy/public works construction workers
+are likely also to be higher. Any particular construction worker's
+noise exposure can vary significantly from shift to shift as a function
+of how much of the shift he spends using or near a noisy tool. A brick
+mason, for example, may spend a large share of one shift using a noisy
+brick saw, but may not use the saw at all on the next shift. The result
+is that the fraction of construction workers who are occasionally
+exposed above 90 decibels for a shift substantially exceeds the
+fraction of all full-shift samples that exceed 90 decibels. I will
+assume that somewhere between 20% and 50% of all construction workers
+are occasionally exposed above 90 decibels, in contrast to the roughly
+10% or so of all construction worker samples that exceed 90 decibels.
+ Transportation (SIC 40-49). Workers around concentrations
+of transportation vehicles, particularly aircraft, can be exposed to
+noise levels exceeding 90 decibels. I will assume that the fraction of
+non-office transportation workers exposed above 90 decibels is similar
+to that for manufacturing production workers; somewhere between 2% and
+20%.
+ Other industries. There are many additional industries
+where workers can often be exposed at average levels exceeding 90
+decibels, such as lawn care, tree service, automobile repair,
+maintenance and repair of large, noisy equipment, and warehousing.
+These other industries likely account for many fewer highly exposed
+workers than manufacturing, construction and transportation. I have not
+sought to estimate the likely much smaller numbers of highly exposed
+workers in additional industries.
+ Combining recent employment figures for manufacturing, construction
+and transportation with estimates of the percentages of each industry's
+workers that are exposed to average noise levels exceeding 90 decibels,
+I estimate that there are some 2 to 7 million workers currently exposed
+at such levels. These workers and their employers would be directly
+affected by OSHA's proposed new interpretation.
+ I have provided a table at the end of this testimony that shows
+these estimates and summarizes how I proceed further to calculate the
+costs and job impacts of OSHA's proposed policy.
+ 2. The costs for American businesses to comply with OSHA's proposed
+new policy would be very high.
+ OSHA has not estimated what the costs would be for the additional
+engineering and administrative controls that would be necessitated by
+the policy. The most recent nationwide cost estimates that OSHA has
+developed involving additional noise controls can be found in the
+regulatory impact analyses in the late 1970's/early 1980's that I
+referred to earlier. At that time, OSHA estimated the costs for
+additional technologically feasible engineering and administrative
+controls sufficient to reduce ambient noise to 90 decibels or less as
+the equivalent of $4,037 per affected employee per year in 2010
+dollars. Said another way, OSHA estimated for each employee exposed to
+ambient noise levels exceeding 90 decibels that the cost of engineering
+and administrative controls to reduce these levels to 90 decibels or
+below would average $4,037 per year. This cost estimate is OSHA's most
+recent, but it is still roughly 30 years old.
+ A much more current estimate for the costs of the engineering and
+administrative controls necessitated by OSHA's proposed
+reinterpretation can be developed from the NAM survey results and my
+case studies. Across these two data sources, 45 companies or facilities
+have estimated both the number of their employees exposed to average
+ambient noise levels exceeding 90 decibels and the costs of available
+engineering and administrative controls to reduce these exposures. The
+resulting estimates for the cost of the proposed OSHA policy per
+affected employee span a very wide range, all the way from less than $1
+per employee per year to more than $200,000 per employee per year. The
+median estimate from the case studies and NAM's survey is $2,950 per
+affected employee per year, while the average across the 45 companies
+or facilities is $18,137 per employee per year. I believe that this
+average figure is skewed by several very high estimates of cost per
+employee that represent situations where costly controls would reduce
+noise exposures for very few workers, and that these controls might not
+actually be implemented in practice. I will assume that the controls
+more likely to be implemented in practice might average somewhere
+between about $3,000 and about $10,000 per employee per year. This
+range brackets the figure that OSHA derived previously of about $4,000
+per affected employee per year.
+ These represent my estimated costs per affected worker of OSHA's
+proposed new policy for manufacturing industries specifically. (Both
+OSHA's estimate and the NAM survey that provided most of my cost data
+addressed manufacturers only.)
+ I would expect that the cost per affected worker for transportation
+industries would be roughly similar to these estimated costs for
+manufacturing industries. I thus will assume an identical range of
+between $3,000 and $10,000 per affected employee per year.
+ For construction industries, I believe that these costs for
+engineering and administrative controls would be much lower than for
+manufacturing, perhaps only one-tenth as much. Most of the engineering
+controls for construction involve changes to small equipment--less
+noisy saws, compressors, jackhammers, etc., in contrast to
+manufacturing where the noise-reducing measures would often involve
+changes to large machines, entire process lines or significant portions
+of a shop floor. For my very rough total national cost estimate for
+OSHA's proposed policy, I estimate the cost per affected worker in
+construction industries at one-tenth that for manufacturing, and thus
+roughly $300 to $1,000 per worker per year.
+ To develop an estimate for the total national cost of OSHA's
+proposed policy, we can multiply each of these figures on the cost per
+affected employee by the estimates I discussed earlier for the number
+of employees in different industries that are exposed to ambient
+workplace noise exceeding 90 decibels. In total, we get a national cost
+estimate for OSHA's proposed noise reinterpretation that is somewhere
+in the range from $1.2 billion dollars per year to $27 billion dollars
+per year. The total national cost is nearer the higher end of this
+range if we assume OSHA's figure to the effect that nearly 20% of
+manufacturing production workers are in work settings with ambient
+noise levels exceeding 90 decibels, while the figure is near the lower
+end of this range if we assume conservatively that only one-tenth as
+many workers are exposed to high noise levels as OSHA estimated.
+ An annual cost of somewhere between $1.2 and $27 billion is quite
+large relative to most other new requirements that the Federal
+government imposes on private industry. Only a few Federal regulations,
+typically fewer than five per year over the several decades that OMB
+has been keeping records, impose a burden of this magnitude on the
+economy. This figure reflects all Federal regulations for all
+purposes--environmental protection, homeland security, transportation
+safety, consumer protection, etc., as well as occupational health and
+safety. OSHA's proposed new policy on noise would be among the most
+expensive new requirements that the Federal government considers each
+year.
+ This is a very large cost for a policy that OSHA proposed to adopt
+by simply declaring it, without meeting the due process sorts of
+requirements that would apply if the policy reinterpretation were
+instead to be a regulation. If OSHA's reinterpretation were to have
+been proposed as a regulation, as many would say it should have been,
+at a cost of more than a billion dollars per year this initiative would
+have been subject to the following important requirements:
+ Executive Order 12866. The Executive Order requires any
+agency proposing a regulation that would cost more than $100 million to
+prepare a regulatory impact analysis (RIA). In the RIA, OSHA would need
+to: 1) Provide a clear and thorough explanation of the need for the
+proposed action; 2) Explicitly estimate the benefits and costs and
+economic impacts of the proposal; and 3) Fairly consider alternatives
+to the proposal.
+ The Small Business Regulatory and Enforcement Fairness Act
+(SBREFA). OSHA's proposal would undoubtedly have a significant impact
+on a substantial number of small businesses. As such, pursuant to the
+requirements of SBREFA, OSHA would need to: 1) Analyze the impact of
+the proposed policy on small businesses specifically; 2) Convene a
+panel of small business representatives that would provide the Agency
+with advice on how potentially to reduce the impact of the proposal on
+small businesses; and 3) Consider a range of alternatives that would
+reduce the economic burden on small businesses.
+ By attempting to issue the noise standard interpretation as a
+policy declaration instead of a regulation, OSHA avoided all these
+procedural safeguards. OSHA avoided the need for analyzing costs and
+benefits and considering alternatives under Executive Order 12866.
+Indeed, the Office of Information and Regulatory Affairs was not even
+informed of this proposal. OSHA avoided the need to examine impacts on
+small businesses and the need to consider alternatives that might
+reduce these impacts. In my view, avoiding these requirements for
+analysis, disclosure and transparency makes for poor public policy.
+ 3. OSHA's proposed new interpretation would have substantial
+negative impacts on U.S. jobs and competitiveness.
+ The companies responding to the NAM survey and those involved in
+the case studies have offered a variety of comments on what OSHA's
+proposed new interpretation would mean for their businesses. I will
+quote some responses to the question of whether OSHA's proposal would
+affect the company's competitive position:
+ Foreign imports (even from Canada) are coming in at lower
+delivered cost. Labor content is already more than 25% of each sales
+dollar. More labor inefficiency [from administrative controls] will
+push us far higher.
+ I would shut down.
+ Most of our facilities agreed that given the estimated
+costs required to comply, they would in many cases either contract the
+work to outside suppliers (who would have to meet the same
+requirements) or consider moving the work out of the U.S.
+ Cost increases would significantly increase cost for two
+processes where there is already significant and growing competition
+from China.
+ Added costs with no commensurate increase in efficiency or
+output make us even less competitive than we are against the Chinese
+who have no such requirements to hamper them.
+ The changes would have to be paid for. With already slim
+margins it would almost certainly require an increase in our product
+cost. It is already difficult to compete with foreign competitors on a
+cost basis. We can't and won't produce product for free or at a
+negative margin.
+ Negative impact. We would have to invest precious assets
+in equipment that actually negatively affects productivity.
+ We would shift more of our production overseas.
+ We would attempt to fully automate the noisy process so it
+would not need an operator who would be exposed to the noise.
+ As we continue to spend money on new and existing
+compliance requirements the cost to do business goes up each year. It
+gets tougher to stay competitive especially with the overseas markets
+because you can't pass these costs on to the customers.
+ It would cost us a lot of unnecessary money. We are a
+small company and it would be a hit to our bottom line for sure, but
+our competitors would have the same issues so we'd all lose money
+together at least.
+ There is no return on that investment. We don't see
+hearing loss now, so why invest any money in it?
+ Our competition would be investing their money into
+projects that make them lower cost producers.
+ Significant distraction from what we need to do to stay
+competitive in a globalized manufacturing economy.
+ Implementing all feasible engineering and administrative
+controls would be a very expensive exercise that would have significant
+safety and financial consequences.
+ The great majority of the responses forecast an important negative
+impact on the responding company's competitiveness.
+ In answer to another question on whether OSHA's proposed new
+approach would cause the company to reduce its number of employees in
+the U.S., 70% of the respondents said ``yes'' and 30% said ``no''.
+ In my view, the best way to quantitatively estimate the ultimate
+economic impact from a broad new requirement such as OSHA's noise
+reinterpretation is to use a national economic forecasting and policy
+simulation model. The estimated industry-by-industry compliance costs
+from the new requirement are loaded into the model, and the model then
+predicts the particular industries that will be winners and losers and
+the overall impacts on GNP, employment and other economic variables of
+interest. We have not yet run such a model to estimate the impacts that
+would ensue from OSHA's proposed noise reinterpretation, but I believe
+that we can reasonably extrapolate from the recent results when such a
+model was run for a comparable potential new requirement.
+ The REMI Policy Insight Model is one of the most respected national
+economic forecasting models that is used to estimate the aggregate
+economic impacts from significant new spending initiatives, whether the
+initiatives involve private industry compliance spending such as may be
+required by a regulation, or investment spending such as might be
+associated with a governmental stimulus program. The REMI model was
+recently run to estimate the impact of EPA's proposed national
+regulation to tighten the air quality standard for ozone. EPA's
+potential requirement regarding ozone and OSHA's potential requirement
+regarding noise are qualitatively similar: both affect primarily the
+manufacturing and transportation industries, both will have broad
+national impact, and both have costs estimated to exceed a billion
+dollars per year. The recent REMI run for EPA's proposed ozone standard
+found that a net of about 8 U.S. jobs would be lost for every million
+dollars per year in compliance costs. Applying this factor to the
+compliance costs that we estimate for the proposed OSHA noise
+reinterpretation, we project a net loss of somewhere between about
+10,000 and 220,000 U.S. jobs if OSHA's noise proposal were to be
+finalized.
+ 4. All this would be for relatively little benefit in terms of
+improved hearing protection for workers
+ I would like to make two points here:
+ First, it does not appear that work-related hearing loss
+is a frequent problem now, under OSHA's existing and long-standing
+noise regulation and enforcement policies.
+ Second, it seems unlikely that OSHA's proposed policy
+shift would significantly reduce the already low rate of work-related
+hearing loss.
+The current rate of work-related hearing loss is low
+ OSHA's noise standard requires an employer to operate a hearing
+conservation program if any employees are exposed to an average noise
+level exceeding 85 decibels. A hearing conservation program must
+include monitoring of ambient noise levels and employee noise
+exposures, provision of hearing protectors, annual audiometric testing
+of employees, specific follow-up activities if the annual audiogram
+shows indication of hearing loss, and more. The employer must provide
+hearing protection devices to all employees exposed above 85 decibels,
+and must both provide and require the use of hearing protection devices
+for all employees exposed above 90 decibels. And, as I discussed
+previously, the employer must also implement all feasible engineering
+and administrative controls to reduce exposures exceeding 90 decibels.
+ Among the companies responding to NAM's survey, more than 90% have
+employee exposures exceeding 85 decibels and operate a hearing
+conservation program as they are required to do under the noise
+standard. I want to emphasize these two important characteristics of
+the vast majority of the companies that have responded to the NAM
+survey. These companies: a) Have relatively high noise exposures
+(employees exposed over 85 decibels); and b) Take measures to protect
+their employees by operating the hearing conservation programs that
+OSHA requires. These companies provide an ideal test for how well
+OSHA's longstanding approaches are performing in protecting workers'
+hearing. These companies have the relatively high noise levels that
+OSHA is concerned about, and they have been implementing the programs
+that OSHA mandates. What is the result in terms of hearing loss among
+the exposed workers at these companies?
+ The answer from the NAM survey is that these companies show very
+low rates of worker hearing loss. For the year 2010, 132 companies
+provided information on both the number of their employees exposed
+above 85 decibels and the number of employees that showed evidence of
+work-related hearing loss (a ``Standard Threshold Shift'' or STS). The
+percentage of these relatively highly exposed workers that had a
+recordable STS was only 0.59% (184 with STS out of 31,074 employees
+exposed above 85 decibels among the 132 companies that responded). This
+incidence of STS is very low.
+This already low rate of work-related hearing loss is unlikely to
+ decline much further with OSHA's proposed policy shift
+ Most companies in my case studies (and additional companies in the
+NAM survey) reported that the feasible engineering and administrative
+controls they would implement under the proposed OSHA policy shift
+would not be sufficient to reduce current exposures exceeding 90
+decibels to below 90 decibels. PPE would continue to be required for
+these employees, despite the additional engineering and administrative
+controls. Under current OSHA requirements and policy the rate of work-
+related hearing loss among highly exposed workers is low and depends
+substantially on the efficacy of PPE--this situation would change
+little if OSHA changed its policy as proposed.
+Summary of Conclusions
+ 1. The proposed OSHA noise interpretation would affect a large
+number and very broad range of American businesses and their employees.
+ 2. The costs for American businesses to comply with OSHA's proposed
+new policy would be very high.
+ 3. OSHA's proposed new interpretation would have substantial
+negative impacts on U.S. jobs and competitiveness.
+ 4. All this would be for relatively little benefit in terms of
+improved hearing protection for workers.
+ Thank you for the opportunity to participate in this hearing.
+
+ ESTIMATED COST/YR OF OSHA'S PROPOSED NEW INTERPRETATION OF FEASIBILITY FOR NOISE STANDARD
+--------------------------------------------------------------------------------------------------------------------------------------------------------
+ Percent of ``line'' Cost/yr of engr/ Estimated total Estimated jobs impact
+ workers needing admin controls per cost for OSHA of OSHA policy
+ Percent in controls because of worker exposed >90 policy (in ----------------------
+ Current or ``line,'' ambient exposures >90 dBA $billions/yr)
+ Sector typical # non-office dBA ----------------------------------------
+ of workers jobs ------------------------ High Low
+ High Low High Low High Low estimate estimate
+ estimate estimate estimate estimate estimate estimate
+--------------------------------------------------------------------------------------------------------------------------------------------------------
+Manfacturing.......................... 14,000,000 60% 19% 2% $10,000 $3,000 $16 $0.5 -130,368 -3,911
+Construction.......................... 10,000,000 90% 50% 20% $1,000 $200 $5 $0.4 -36,000 -2,880
+Transportation........................ 6,500,000 50% 19% 2% $10,000 $3,000 $6 $0.2 -50,440 -1,513
+--------------------------------------------------------------------------------------------------------------------------------------------------------
+ Total............................... ........... ............ 6,760,100 2,026,010 ........ ........ $27 $1 -216,808 -8,304
+--------------------------------------------------------------------------------------------------------------------------------------------------------
+
+ ______
+
+ Chairman Walberg. Thank you, Mr. Sessions. I apologize for
+not catching the red light sooner. Since this is my first
+chairman duties, I am more used to listening and enjoying what
+I am hearing or reacting to what I am hearing. But that won't
+continue long, and the next two witnesses I certainly will give
+some latitude, but my--you know, I am from a red state, so it
+looks just normal. But we will try to keep the time here. Thank
+you.
+ Moving on to Ms. Miser?
+
+ STATEMENT OF TAMMY MISER, EXECUTIVE DIRECTOR, UNITED SUPPORT
+ AND MEMORIAL FOR WORKPLACE FATALITIES
+
+ Ms. Miser. Chairman Walberg and members of the
+subcommittee, thank you very much for asking me to be here
+today. My name is Tammy Miser, and I have traveled from
+Lexington, Kentucky, to give you a very personal story of why
+OSHA regulations are needed.
+ In 2003, my brother Shawn Boone, was 33 years old, and he
+was killed in an aluminum dust explosion. The company, Hayes
+Lemmerz, they produced aluminum wheels. They had had fires on a
+regular basis, and protocol was that they let the fires burn
+down and then they go back in and re-light the chip melt
+furnace. And they were also instructed not to call the fire
+department, because it was costing them too much money to do
+this.
+ So that is what they did. And my brother went back in to
+collect his tools in the furnace room, and there was an
+explosion. This explosion caused aluminum dust to rain down
+from the rafters and the equipment, and there was a second,
+more intense explosion.
+ This explosion actually left my brother blind with third-
+degree burns over most of his--at least 90 percent of his body,
+is what they were saying. Shawn was still conscious. He was
+still aware of what was going on. And some say that in between
+his cries for help he was joking about a fishing trip. It was
+just the kind of guy he was. He was a really wonderful guy.
+ So when we were able to actually--he had no clue what
+condition his body was in, because he couldn't see. And we
+think that that is probably why he was able to get through it
+and he was conscious in knowing what was going on.
+ But when we finally were able to see him, his face was
+splitting, he was swollen, his body was raw, and they refused
+to bandage his body. And I had been with him for a lifetime. He
+was my brother. And I could only recognize him by a few
+freckles on his face and--and this is the hardest thing that a
+family can face, truly.
+ And many can't take this. And in 2007, my youngest brother
+drove halfway across the United States with a few photos of
+Shawn and the phone records of the night he was killed tucked
+in his Bible. He proceeded to shoot himself in the head. And I
+can't say that this incident alone caused my brother to take
+his life, but I know that he was not able to handle it, and
+that was what was on his mind.
+ The argument that the regulations kill jobs, and I just
+really feel that it is just nonsense. There have only been two
+OSHA regulations in the past 10 years, crane and derricks and
+chromium. Both only affect a fraction of the U.S. businesses.
+As I talk to families around the country, I don't see this huge
+avalanche of regulations. It is more like a drought.
+ Rules that protect construction workers from dying in
+confined spaces has been on the regulatory agenda for 15 years.
+This little guy here, Steven Lillicrap, he was only 21 years
+old when he was pulled in to the cables of 100-ton crane. OSHA
+had been working on revising outdated crane standards for 10
+years.
+ But this rule came too late for Steven. It was finally
+issued in July and is expected to prevent 22 deaths and 175
+injuries and millions of dollars in property damage per year.
+The benefits far outweigh the costs of this rule.
+ The U.S. Chemical Safety Board warned OSHA in 2006 about
+combustible dust handlers. And it is not well known--but in
+2002, the year before my brother was killed, they had also let
+OSHA know that this was an issue. So if just the National Fire
+Protection Association consensus standards were mandatory, my
+brother would still be here, and others would still be here
+today.
+ In 2008, the Imperial Sugar refinery dust explosion killed
+14 workers and injured 36. And some of these were severely
+injured, severe burns. And the means to prevent this was well-
+known. Some companies choose to gamble with workers' lives
+because there are no OSHA standards.
+ When preventable disasters strike in the workplace, they
+not only take a huge toll on the injured and their families,
+but workers can lose their jobs and communities suffer. In
+2009, the Sunoco refinery in Pennsylvania, the company decided
+not to rebuild after their explosion. Fifty workers were laid
+off. That same year, ConAgra's Slim Jim plant exploded. Three
+workers were killed, and 71 were injured. Before the disaster,
+700 people were employed there. Now the place is closing.
+ A contractor working for ConAgra using a dangerous blowout
+procedure that purged natural gas in the indoor work
+environment is what had caused this. It was well known, that if
+OSHA had prevented--if OSHA could have prevented this with
+governing and rulemaking, this would have never happened.
+ There is no price tag that can be put on seeing your
+husband walk your daughter down the aisle or seeing your baby
+born. I have talked to family members that have had children
+and their husbands are gone. Their babies are never going to
+know their father. It is nothing like seeing your child
+graduate from college or holding your grandbaby.
+ I respectfully ask this subcommittee to not just look on
+one side of the ledger of the costs, but remember the benefits
+of the OSHA rules for workers, responsible employers, and
+families and communities.
+ Thank you.
+ [The statement of Ms. Miser follows:]
+
+ Prepared Statement of Tammy Miser, United Support and Memorial for
+ Workplace Fatalities
+
+ Chairman Wahlberg, Ranking Member Woolsey and Members of the
+Subcommittee: My name is Tammy Miser. I am the founder of United
+Support and Memorial for Workplace Fatalities (USMWF). Our not-for-
+profit organization offers support, guidance, resources, and advocacy
+to empower family members who have lost a loved one from work-related
+injuries or illnesses. We work with other organizations, government
+agencies, and businesses as a catalyst for positive change to ensure
+safe and healthy working conditions for all.
+ My brother Shawn Boone worked at the Hayes Lemmerz plant in
+Huntington, Indiana where they made aluminum wheels. The plant had a
+history of fires, but workers were told not to call the fire
+department. My brother and a couple coworkers went in to relight a chip
+melt furnace. They decided to stick around a few minutes to make sure
+everything was ok and then went back to gather tools. Shawn's back was
+toward the furnace when the first explosion occurred. Someone said that
+Shawn got up and started walking toward the doors when there was a
+second and more intense blast. The heat from that blast was hot enough
+to melt copper piping. Shawn did not die instantly. He laid on floor
+smoldering while the aluminum dust continued to burn through his flesh
+and muscle tissue. The breaths that he took burned his internal organs
+and the blast took his eyesight. Shawn was still conscious and asking
+for help when the ambulance took him.
+ Hayes Lemmerz never bothered to call any of my family members to
+let us know that there was an explosion, or that Shawn was injured. The
+only call we received was from a friend of my husband, Mark, who told
+them that Shawn was in route to a Ft. Wayne burn unit. (Mark also
+worked at the plant.) When Mark asked the hospital staff where Shawn
+was, we found that no one even bothered to identify him. We were told
+that there was a ``white, unidentified male'' admitted to the unit.
+When Mark tried to describe Shawn, the nurse stopped him to say that
+there was an unidentified male with no body hair and no physical
+markings to identify. So my Shawn was ultimately identified only by his
+body weight and type.
+ We drove five hours to Indiana wondering if it really was Shawn,
+hoping and praying that it wasn't. This still brings about guilt
+because I would not wish this feeling on anyone. We arrived only to be
+told that Shawn was being kept alive for us. The onsite pastor stopped
+us and told us to prepare ourselves, adding he had not seen anything
+like this since the war. The doctors refused to treat Shawn, saying
+even if they took his limbs, his internal organs were burned beyond
+repair. This was apparent by the black sludge they were pumping from
+his body.
+ I went into the burn unit to see my brother. Maybe someone who
+didn't know Shawn wouldn't recognize him, but he was still my brother.
+You can't spend a lifetime with someone and not know who they are.
+Shawn's face had been cleaned up and it was very swollen and splitting,
+but he was still my Bub. My family immediately started talking about
+taking Shawn off of life support. If we did all agree, I would be
+ultimately giving up on Shawn. I would have taken his last breath, even
+if there was no hope and we weren't to blame. I still had to make that
+decision. To watch them stop the machines and watch my little brother
+die before my eyes.
+ But we did take him off and we did stay to see his last breath. The
+two things I remember most are Shawn's last words, ``I'm in a world of
+hurt.'' And his last breath.
+ This has been the hardest thing my family has had to deal with
+until 2007. My youngest brother drove half way across the United States
+with a few photo's and phone records of the night Shawn was killed that
+he had tucked into his bible. Tommy then proceeded to shoot himself in
+the head. I can't say that Shawn's death alone caused my brother to
+take his own life, but I know for a fact he couldn't deal with it and
+that was what was on his mind.
+ The U.S. Chemical Safety and Hazard Investigation Board (CSB) said
+the explosion that killed Shawn probably originated in a dust collector
+that was not adequately vented or cleaned. The dust collector was also
+too close to the aluminum scrap processing area. Hayes Lemmerz
+management allowed dust to accumulate on overhead beams and structures
+which caused a second, more massive explosion. The CSB concluded that
+had the company adhered to the National Fire Protection Association's
+standard for combustible metal dust, the explosion would have been
+minimized or prevented altogether.\1\
+---------------------------------------------------------------------------
+ \1\ U.S. Chemical Safety and Hazard Investigation Board.
+Investigation Report Aluminum Dust Explosion, Hayes Lemmerz
+International, Huntington, Indiana, October 29, 2003. Report No. 2004-
+04-I-IN, September 2005.
+---------------------------------------------------------------------------
+ During my own struggle for information about the OSHA investigative
+process, it became clear that family member victims of workplace
+fatalities needed a place to get information and support. That's how
+USMWF was formed. We are a virtual community of individuals with the
+shared experience of losing a loved one from a work-related injury or
+disease. Thousands of family members across the U.S. suffer profoundly
+because of our nation's inadequate regulatory system and its failure to
+protect workers' fundamental right to a safe and healthy worksite.
+ The buzz is that OSHA regulations are bad for business and kill
+jobs. This is nonsense. There have only been 2 new OSHA regulations in
+the last 10 years: crane and derricks, and hexavalent chromium. Both
+only affect a fraction of U.S. businesses. As I talked to families from
+around the country who have lost loved ones from workplace hazards, I
+don't see an avalanche of new OSHA regulations. It's more like a
+drought. For example, a rule to protect construction workers from dying
+in confined spaces has been on OSHA's regulatory agenda for 15 years.
+ Steven Lillicrap was only 21 years old in February 2009 when he was
+fatally pulled into the cables of a 100-ton crane. OSHA had been
+working to revise its outdated crane safety standard for 10 years, but
+the new rule came too late for Steven. It was finally issued last July
+and is expected to prevent 22 deaths, 175 injuries, and millions of
+dollars in property damage per year. The benefits far outweigh the $154
+million cost. When you look at the few standards that OSHA has issued
+over its 40 year history, the benefits always exceed the costs. And
+those are only the benefits you can quantify.
+ The CSB warned OSHA in 2006 about combustible dust hazards. Had the
+National Fire Protection Association (NFPA) standard been implemented,
+as a mandatory regulation instead of a voluntary consensus code, my
+brother Shawn and many others would still be here today. In 2008 the
+Imperial Sugar refinery explosion killed 14 workers and 36 were burned.
+The means to prevent these deadly explosions is well known. And
+preventing dust explosions has been done before, such as in grain
+handling facilities. Prior to OSHA's 1978 safety standard, there were
+about 20 explosions per year in grain elevators. Today, there are only
+about six. Yet some companies choose to gamble with workers' lives
+because there is no OSHA standard and failing to act gives them a
+competitive advantage over more responsible companies.
+ When preventable disasters strike in the workplace, they not only
+take a huge toll on the injured and their families, but workers can
+lose their jobs and the community suffers.
+ Some disasters occur because employers fail to comply with safety
+regulations. After the 2009 explosion at the Sunoco refinery in
+Pennsylvania, the company decided not to rebuild its ethylene unit.
+Fifty workers were laid off.\2\ Had there been better compliance with
+OSHA's process safety management requirements, it would never have
+happened.
+---------------------------------------------------------------------------
+ \2\ Logue T. Sunoco to lay off 40-50, close ethylene complex. Daily
+(Delaware) Times. July 7, 2009.
+---------------------------------------------------------------------------
+ Some disasters occur because of inadequate regulations. In 2009,
+Con Agra's Slim Jim plant exploded, 3 workers were killed and 71 were
+injured. A contractor was using a procedure that purged natural gas
+into the indoor work environment, instead of purging the gas out of
+doors and using an explosivity detection meter. This disaster could
+have been prevented if OSHA had regulations requiring natural gas to be
+purged out of doors. The CSB found that OSHA doesn't have specific
+rules for natural gas purging, nor are there voluntary codes.\3\
+Because there is no OSHA regulation, there have been too many
+explosions of this nature in commercial and industrial facilities.
+---------------------------------------------------------------------------
+ \3\ U.S. Chemical Safety and Hazard Investigation Board. Urgent
+Recommendations on Gas Purging. August 2010.
+---------------------------------------------------------------------------
+ The lack of regulations not only killed 3 workers at the ConAgra
+plant, it also killed jobs. Before the disaster 700 people worked at
+the factory. Now the factory is closing. Rather than rebuild the
+damaged portion of the plant, the company is consolidating production
+elsewhere.\4\
+---------------------------------------------------------------------------
+ \4\ Nagem S, Wolf AM. Slim Jim plant's demise to put 450 out of
+work. NewsObserver.com. March 4, 2010.
+---------------------------------------------------------------------------
+ The T-2 gasoline additive factory near Jacksonville, Florida had a
+runaway reaction in December 2007 involving highly reactive sodium
+metal. The explosion killed 4 and injured 32, including 28 at
+surrounding businesses. Pieces of the building were found a mile away.
+An investigation by the CSB found that the reactions could have been
+prevented if OSHA's process safety management standard covered reactive
+hazards. Sadly, the owner of the T-2 factory was among those killed by
+the explosion. Three adjacent businesses had to relocate from the
+industrial area, and a fourth business--a trucking company--was put out
+of business due to the damage.
+ There's no price tag that can be put on seeing your husband walk
+your daughter down her wedding aisle, or seeing your son graduate from
+college, or holding a grandchild. The economic disruption to a family
+who loses a breadwinner is never offset by workers' compensation
+benefits. Workplace safety regulations and even-handed enforcement help
+level the playing field for employers who do the right thing versus
+those who take the low road.
+ A one-sided look at the costs of OSHA rules, but excluding the
+benefits, does a disservice to workers, responsible employers, families
+and communities.
+ ______
+
+ Chairman Walberg. Thank you, Ms. Miser. And thank you for
+your courage. And thank you for sharing this with us. I think
+it certainly punctuates the purpose of this subcommittee and
+the importance that we have as we carefully look at all the
+surrounding issues. Thank you.
+ Ms. Holmes, thank you for being here.
+
+STATEMENT OF JACQUELINE M. HOLMES, ESQ., OF COUNSEL, JONES DAY,
+ TESTIFYING ON BEHALF OF THE U.S. CHAMBER OF COMMERCE
+
+ Ms. Holmes. Thank you, Chairman Walberg, Ranking Member
+Woolsey, and members of the subcommittee. I appreciate you
+inviting me to testify today.
+ Before I summarize my own testimony, I would like to say
+that I was very touched, as I am sure we all were, by Ms.
+Miser's statement. And I, too, appreciate her being here. It is
+always a tragedy when someone loses their life in the
+workplace.
+ And I refer in my statement, as I believe you did, as well,
+Chairman Walberg, in your opening statement, to the shared goal
+of worker safety that is shared by businesses and workers, and
+it really is a shared goal. The question, really, that we want
+to look at is, what is the best way to achieve that goal in the
+most cost-effective way?
+ By way of background, for purposes of my own testimony, I
+am an attorney with the Washington, D.C., office of Jones Day,
+where I have practiced in the OSHA area since 1994. I am
+pleased to be here today on behalf of the United States Chamber
+of Commerce, which represents the interests of over 3 million
+businesses of all sizes and in all sectors; 96 percent of the
+chamber's members are small businesses who employ 100 or fewer
+employees.
+ It may seem surprising to some members of the subcommittee
+that we are here--that many of us are here testifying today
+about proposals that OSHA has withdrawn, such as, for example,
+the noise standard reinterpretation. But we believe it is
+important to do so, because these proposals reflect a troubling
+pattern of efforts by the agency to impose substantial burdens
+on American business without regard to the cost of those
+efforts or their efficacy in improving worker health and safety
+or, indeed, in the case of the noise standard, whether there is
+a problem that requires solving in the first place. This is
+contrary to OSHA's own interpretation of its statutory
+mandates.
+ Understanding that OSHA regulations can be very costly, the
+courts and--itself impose very substantial burdens on OSHA when
+it chooses to regulate. OSHA must first identify a problem that
+creates a significant risk of harm in the workplace. It must,
+second, establish that its proposal will substantially reduce
+that risk. It must, third, show that its proposal is
+economically and technologically feasible. And it must, fourth,
+show that it selected the most cost-effective means of
+achieving the health and safety objective that the standard
+sets. The act, of course, does not require a formal cost-
+benefit analysis, but that does not mean that costs can be
+ignored.
+ I would like to focus briefly on the last requirement that
+I mentioned, which is the requirement of cost-effectiveness, in
+other words, that OSHA select the most cost-effective means to
+achieve its regulatory goals. This is echoed by President
+Obama's recent executive order, which suggests that agencies
+should use the least burdensome means to achieve its regulatory
+ends. Those two concepts are really quite similar.
+ OSHA has embraced this interpretation of the act. It did so
+in the early 1990s to assure the federal courts that the OSH
+ACT did not represent an unconstitutional delegation of
+authority to the agency.
+ But OSHA completely ignored this requirement for purposes
+of its reinterpretation of the noise standard. Instead, it
+charged ahead with its reinterpretation without any effort to
+consider whether what it was proposing was the most cost-
+effective means of achieving its objectives. And given the
+information that Mr. Sessions has presented to the subcommittee
+a few moments ago, it seems quite clear that the methods that
+OSHA selected are not the most cost-effective.
+ The problem with OSHA's reinterpretation of the noise
+standard, however, runs even deeper than its failure to select
+the most cost-effective alternative. Indeed, its failure to
+study the cost is only the beginning.
+ In proposing its reinterpretation, OSHA also made no effort
+whatsoever even to identify that there was a problem that
+required solving. To be sure, it pointed to hearing loss
+generally as a workplace health and safety issue, which we
+would all agree that it is, but it failed to examine the scope
+of the problem or whether current efforts are reducing it. Had
+it done so, it would have seen occupational hearing loss cases
+have consistently declined since they have been separately
+reported on employer injury and on the logs.
+ You can see on the charts that are up on the screen that we
+have a declining trend since 2003 when OSHA mandated that
+employers separately report these types of injuries and
+illnesses.
+ These results suggest employers are doing quite well in
+reducing occupational exposure to noise. Noise, like some
+other--noise like other--some other exposures occurs both in
+the workplace and out of the workplace. And over the same
+period, noise exposures have--outside the workplace have
+exploded, the advent of iPods, Bluetooth headsets. People are
+constantly wired for sound. And the fact that we still are
+seeing a decrease in occupational exposure suggests that
+employers are doing a pretty good job.
+ Thus, the data suggests employers are really working--and
+employer efforts are working to reduce hearing loss cases. ``If
+it ain't broke, don't fix it'' is not an enforceable maxim of
+administrative law, but it is not a bad place to start.
+ So here we are. OSHA hasn't demonstrated any obvious
+problem that requires solving, gave no examination whatsoever
+to the costs of this proposal. On top of that, the agency made
+the proposal at a time of substantial unemployment.
+ It is, in effect, telling American industry that it has to
+expend resources retrofitting its factories rather than hire
+new employees and increase production. And because OSHA didn't
+propose to change the exposure levels that are acceptable under
+the noise standard, but simply to require engineering controls
+rather than personal protective equipment in the first
+instance, it was doing so to achieve exactly the same noise
+exposure levels as are currently achieved through less
+expensive means.
+ Even if OSHA came up with a legal basis to support its
+actions--and it hasn't done so yet--that doesn't mean it should
+take these actions now without any consideration for how it may
+impact the U.S. economy.
+ While we appreciate that OSHA has withdrawn this proposal
+and committed to a number of steps, such as increased outreach,
+a lack of outreach was not the problem with the proposal. The
+problem is the lack of common sense and an overabundance of
+arrogance. There is no evidence that OSHA even believed it
+necessary to assess seriously whether there was a problem that
+required fixing, to study the cost, or to consult with the
+business community before making this change, and these
+failures led them to propose something that was bad policy,
+plain and simple.
+ If the law allows OSHA to take such steps--and I am
+skeptical that it does--that law should be changed. And if this
+is how the agency intends to use the agency that it has, it
+should not be given any more.
+ Thank you very much.
+ [The statement of Ms. Holmes follows:]
+
+ [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
+
+ ------
+
+ Chairman Walberg. Thank you, Ms. Holmes. Appreciate the
+testimony of the witnesses and look forward to further
+statements and developing the concepts during the course of the
+questioning.
+ And those questions will have 5-minute time span. And I
+will be much more attentive to that now, since we are starting
+fresh at this point, and so let me begin.
+ Mr. Sullivan, in your testimony, you discussed OSHA's on-
+site consultation program and the changes the agency proposed
+that could compromise this proactive safety program run by
+OSHA. Can you explain how the changes OSHA proposed would be
+detrimental to small businesses?
+ Mr. Sullivan. Thank you, Mr. Chairman. I am happy to.
+ It is actually very simple. And my impression of the
+changes is mostly gained from my work when I was at the
+National Federation of Independent Business. The success of
+OSHA's on-site consultation program largely is due to the
+understanding by the small-business community that violations
+and problems that are found will not be shared with the
+enforcement side of the shop, especially if those problems are
+solved.
+ And, I mean, isn't that the reason that we are here and
+talking about this, is that we want solutions to these problems
+to fix the different problems? And that barrier between the on-
+site consultation and enforcement encouraged small businesses
+to come in and say, ``You know, I am not sure if we have it
+quite right. Can you help me?''
+ And the proposed changes break down that barrier between
+the on-site consultation program and the enforcement program.
+OSHA wants to share--now share information between those two
+programs. And in my experience working with small businesses,
+that will have an absolutely awful effect on the program,
+because small businesses will no longer want to participate in
+a program where they may be subject to enforcement without
+having the chance to fix the problem.
+ Chairman Walberg. Thank you.
+ Mr. Sessions, the noise proposal takes issue with the way
+economists undertake cost-benefit analysis. One of your
+conclusions suggests that, had this proposal gone forward,
+there would have been--and I quote--``relatively little
+benefit'' in terms of improved hearing protection for workers.
+ Can you explain how you reached your cost-benefit analysis
+conclusion?
+ Mr. Sessions. There are two halves to that conversation.
+The first half is essentially the point that Ms. Holmes was
+talking about, also, which is that the problem is--the problem
+of work-related hearing loss is relatively well managed and
+further declining. The rate of reported work-related hearing
+loss incidents is very low and declining.
+ So the problem in the first place isn't all that large. The
+particular approach OSHA proposed for further reducing that low
+level of hearing loss will not significantly further reduce it.
+Under current policy, employers use hearing protection for a
+very large share of the hearing--personal hearing protection
+devices for a very large share of the protection that workers
+get. And under OSHA's proposal, the engineering controls that
+would be required would still not typically reduce noise levels
+sufficiently to eliminate the need for hearing protection.
+ So currently, hearing protectors are a large share of the
+protection. And even after OSHA's proposal, they would continue
+to be a large share of the protection. So the problem isn't all
+that large in the first place. And the reduction that would be
+achieved by OSHA's proposal is not particularly substantial.
+ Chairman Walberg. Okay. Going on from that, several of your
+answers, Mr. Sessions, you received in your survey of
+manufacturers would give anyone cause for concern. The idea
+that a proposal would cause manufacturers to shut down or move,
+work offshore as a result of the proposed reinterpretation
+would further exacerbate the problems in the economy.
+ Are there other proposals that you can point to that would
+have a similar negative impact? And please be brief.
+ Mr. Sessions. I think that the jury is out on that. OSHA
+has additional proposals in the works. One is certainly that I
+am following is the proposal to reduce the worker exposure
+level to crystalline silica. But we don't know what the
+specific reduced--tighter standard is that OSHA is going to
+propose.
+ And particularly importantly for this and other standards
+that OSHA has in the works, assuming that OSHA is treating them
+as regulations, OSHA will accompany the proposed regulation
+with a full study of, how big is the problem in the first
+place? What are the costs? What are the benefits? And what are
+the economic impacts?
+ And it is essentially those requirements for analysis, for
+transparency, for disclosure, for estimating the impacts on the
+economy that give the regulator community and the public the
+chance to make a reasoned decision on OSHA's regulation and----
+ Chairman Walberg. Thank you, Mr. Sessions. I am going to
+have to break it there to hold myself to the 5-minute time
+limit.
+ I will turn it to the ranking member, Ms. Woolsey?
+ Ms. Woolsey. And, Mr. Chairman, I would like to step aside
+for the ranking member of the full committee.
+ Oh, we thought you had to leave. Oh, well, thank you.
+ Tammy, thank you for your testimony. It is nice to have you
+here again. You are a brave woman.
+ I want everybody else to realize--that following three
+combustible dust accidents in 2003, which killed 14 workers--
+one of them was Tammy's brother--the U.S. Chemical Safety Board
+investigated. They found that in the 25 years between 1980 and
+2005, there had been 281 combustible dust explosions and fires,
+resulting in 119 fatalities and 718 injuries.
+ So in 2006, they urged OSHA to issue a comprehensive
+standard. Yet the recommendation gathered dust until the Obama
+Administration put it on their regulatory agenda in 2009.
+ OSHA faces another 4 to 5 years of rulemaking before this
+can become a standard. At best, it will have a rule 13 years
+after Tammy's brother was killed. How is this system working
+for new worker protection rules? And how does it keep employees
+out of danger, large employers, small employers?
+ See, as far as I am concerned, if you are an employee, you
+need to be kept safe. It doesn't matter if you work for a large
+or small--and, actually, large employers have fewer accidents
+than the small employers do.
+ So, Tammy, do you want to respond to--do you have any
+idea--do any of you have any idea what should be done to speed
+the process along, other than not having a process?
+ Ms. Miser. Well, as of right now, they do have--National
+Fire Protection Association has an actual standard. And that
+would actually cover a lot of the issues that they are having,
+because of right now, I mean, we know it is an issue.
+ And some--I firmly believe that there are some issues that
+are more urgent, and this would be one of them. I mean, people
+are dying. There are explosions. People are losing their
+businesses. In the House, there is a bill for combustible dust.
+And if that was to be applied now, at least that would be taken
+care of. And that would be a start.
+ Because I think a lot of it is, is there is just--there was
+just so must buzz and so much going on about what needed to be
+done and what couldn't be done. And you have seen where people
+have kind of dropped off, because at first I thought there was
+going to be a regulation. Well, now there is not.
+ And I am not saying every company is that way. I had a
+small business. I had two small businesses. Some people really
+try, but there are other companies that try to cut corners, and
+this is one of them.
+ Mr. Sullivan. Congresswoman, you had asked if any of us had
+suggestions on how to speed the process. I do. And it has to do
+with OSHA's recent MSD rulemaking.
+ You know, it is great that OSHA decided to withdraw the
+rule and say, we would like to talk more with small businesses
+before we actually move forward. That is great. But 16 months
+ago, if they had done what the law requires, and that was to
+have a small-business panel made up of small businesses, then
+they would be much longer down the process.
+ Ms. Woolsey. Mr. Sullivan, you have already told us that. I
+mean, let's go to something beyond what should have happened.
+What can happen, is what I want to know. What can be done now?
+ Mr. Sullivan. OSHA can listen to small businesses at the
+front end of the process, not 16 months later when it says,
+okay, we will start over again. I think that that would speed
+the process, Congresswoman.
+ Ms. Woolsey. Ms. Holmes, I appreciate that you acknowledge
+that these standards have been withdrawn, and we are sort of
+beating a dead horse here, the three of you talking about
+something that has already been stopped. I mean, we are not
+going to do it that way.
+ A mistake? Possibly. But let's go forward. Where can we go
+forward? And what is our next best step so that everybody
+benefits?
+ Ms. Holmes. Well, I think--first of all, I think that there
+is a reason we are talking about things that have been
+withdrawn, and that is because they reflect a fundamentally
+troubling allocation of resources. The notion that OSHA spent
+resources on the noise reinterpretation when there is--without
+even looking to see whether there was an issue----
+ Ms. Woolsey. Well, then that was back then. Would you agree
+that employees of small businesses have the same right to a
+safe workplace as a large business?
+ Ms. Holmes. I certainly agree that worker safety is
+something that should be of concern to all businesses----
+ Ms. Woolsey. Thank you.
+ Ms. Holmes [continuing]. Of all sizes. And I believe that
+it is of concern to all businesses of all sizes.
+ Chairman Walberg. Thank you for your response. The time has
+expired.
+ We will move on now to the gentlelady from South Dakota,
+Ms. Noem.
+ Ms. Noem. Thank you, Mr. Chairman.
+ Well, I would like to follow up on that discussion with Mr.
+Sullivan in a little bit more of a proactive approach then,
+since that is where the discussion is going. So does the Small
+Business Administration ever partner with other agencies, such
+as OSHA, on regulations in order to better understand the
+implications or impact of regulations or proposals before they
+are issued?
+ Mr. Sullivan. Yes. Congresswoman, SBA's Office of Advocacy
+does just that. A pre-proposal in a dialogue between agencies
+that is not a public dialogue--it is a helpful, constructive
+dialogue--the SBA's Office of Advocacy works with agencies,
+EPA, OSHA, the new Consumer Financial Protection Bureau, in
+fact, all agencies, to try to make sure that what an agency's
+going forward with actually makes sense when it comes to a Main
+Street small business.
+ When an agency actually takes the advice of SBA's Office of
+Advocacy, it is a much smoother process. And I think that
+Congresswoman Woolsey is right. Looking forward, about how you
+get the process down is where we should be devoting our
+attention. And if these agencies actually do listen to SBA's
+Office of Advocacy, it would be a much smoother regulatory
+process.
+ Ms. Noem. So in your opinion, do you feel that these
+agencies look favorably about that process and they are willing
+to cooperate as it goes forward?
+ Mr. Sullivan. No, I don't view agencies looking at the
+process as a constructive dialogue, although there is some
+hope. Professor Elizabeth Warren, who is in charge of staffing
+up this new Consumer Financial Protection Bureau, actually has
+traveled with Senator Snowe up to Maine and said, you know,
+Senator, even if I wasn't required to consult with small
+businesses, I would do it, because it makes sense, the type of
+analysis that should be public makes sense, and she is
+committed to doing that moving forward with an entirely new
+regulatory agency.
+ So if other agencies adopted that approach, I think we
+would have a much smoother process.
+ Ms. Noem. Okay. I have one more follow-up question for Ms.
+Holmes, if that is possible, real quick. OSHA has several
+proposals pending that the agency suggested would not be
+significant regulations and the fact these proposals should
+have been certified as significant.
+ So what do you believe would be the outcome, will be on
+your clients and on their businesses?
+ Ms. Holmes. You know, I think that OSHA does, as you
+suggested, create a number of proposals that they prefer to
+characterize as insignificant, because that allows them to--
+they believe, I think--short-cut a lot of the processes. But as
+Mr. Sullivan has pointed out, that really creates a great deal
+of trouble at the back side.
+ If we could have, you know, an honest assessment of what a
+regulation purports to do, what it is going to require, and how
+much it is going to cost at the front end, that would, I think,
+reduce challenges at the back end and would allow those
+regulations to be put in place, you know, more quickly and more
+effectively, and that they would be more effective for
+everyone.
+ Businesses certainly have a lot to say about what works and
+what doesn't and what is cost-effective and what isn't, in
+terms of regulation, and I think that is an area that OSHA
+would do well to consult about at the front end.
+ Ms. Noem. Okay. Thank you.
+ Thank you, Mr. Chairman.
+ Chairman Walberg. Thank you. We will move on to the
+gentleman from New Jersey, Mr. Payne?
+ Mr. Payne. Thank you very much.
+ Let me--Mr. Sullivan, Ms. Holmes, there has been a--you
+know, the dead horse has been beaten. But isn't it sort of the
+American way to try to use technology, try to use our advance
+that we have over other nations, by and large, at least in the
+past, to try to deal with the problem? I mean, it seems like
+you are saying it is so absurd that there might be some notion
+on a part of OSHA to use some technological way to try to
+improve the problem.
+ I can't understand--and maybe it was--the cost was
+prohibitive and they decided to withdraw it. But what is so
+wrong about trying to use technology? That is what we are all
+about, isn't it?
+ Mr. Sullivan. Congressman, there is nothing wrong with
+using technology. What I have been trying to impress upon the
+committee is the need to force a dialogue between the small-
+business community who may be using that technology and OSHA,
+in order to come up with a solution.
+ I will give as an example the SBREFA panel that was
+convened for the hexavalent chrome rule. And at one point, OSHA
+was thinking of requiring a venting operation over the chrome
+plating operation. So, basically, you would have chrome plating
+and a flow of air directly above the plating to prevent the
+fumes from reaching the workers.
+ Well, because of this small-business panel process, a small
+manufacturer who met with OSHA explained, if you require that,
+then you put me out of compliance with Environmental Protection
+Agency rules. And because of that dialogue, they actually
+worked towards a successful solution.
+ So it is bringing in the realities of the workplace,
+sometimes, many times involving advanced technologies that
+helps OSHA come up with a better rulemaking.
+ Mr. Payne. Okay, let me ask. There has been an affirmative,
+I think, Ms. Holmes and you, too, Mr. Sullivan, that there has
+been a reduction in the complaints about hearing. You know,
+that doesn't necessarily mean that the problem isn't as bad as
+it was.
+ I think when you find employees and when you find an
+unemployment rate of 10 percent, many times employees will
+forego their own safety, as for reporting noise violations, in
+order to keep a job. I mean, in other words, what I am saying
+is that because you say statistically you have empirical data
+that says that there is less of a problem today does not
+necessarily mean that the problem isn't as great.
+ And I will tell you, I worked in a place where there was--I
+was personnel director where there was noise. It is very
+difficult to keep compliance. Hard hats will wear hard hats,
+because they are out in the public and people can see them, if
+the hat is on or not. However, in a place where you have over
+85 decibels is where you need to have ear protection.
+ It is very difficult to keep those earplugs on, because,
+one, they are uncomfortable; two, they are hot when it is in
+the summertime. Workers really don't like to use them. So you
+have to really stay on top of them. So I am just simply saying
+that, because they are less reported numbers don't necessarily
+mean that the problem isn't as great as it was.
+ Let me just ask you, Ms. Miser, there has been a request in
+the new C.R. that the Republicans put forth to cut 15 percent
+from the OSHA in one area and another really slashes. What do
+you think this is going to do, the impact on occupational
+safety, when you don't have inspectors, et cetera?
+ Ms. Miser. Well, of course, I am not an expert. But it does
+concern me, because as of right now, it is going to take 100
+years to--if they were to inspect every single employer. And
+the fellow over here was saying, you know, there can't be any
+communication there. If they do want to get the information,
+they won't even be able to get it because of that.
+ And then on top of that, my real concern is the fact that
+this may affect the state plans. I mean, I don't know. I don't
+know what the budget is. Kentucky does a pretty good job. They
+really do. And if their budget is cut, they aren't going to be
+able to do that. And they are the only plans that cover
+government employees, these state plans.
+ And if--I mean, it is a shame. I think every government
+employee should be--everybody should have the same rights to
+health and safety in the workplace. But they don't. And I am
+just really afraid that it is going to cut that back and harm
+the state plans, who are really doing a good job out there.
+ Mr. Payne. Thank you very much.
+ Chairman Walberg. The time has ended. We will move on to
+the gentleman from Florida, Mr. Ross?
+ Mr. Ross. Thank you, Mr. Chairman.
+ I want to take a little different tact here. I know we are
+talking about the regulatory impact of OSHA, but I have a
+concern--and I want to talk about specifically--and to you, Mr.
+Sullivan, with regard to the muscular skeletal disorders. And
+the reason I want to do that is because it appears to me that
+trying to define repetitive trauma and putting the burden on
+the employer would result in the creation of new causes of
+action for which an employer could be sued.
+ For example, ADA. Now that they are made aware of a
+particular incident or condition that the employee may have,
+does reasonable accommodation now have to be made? Is there an
+onus on the employer now to investigate that? Is there an onus
+on the employer now to investigate a causal relationship?
+ For example, just because a repetitive trauma condition may
+occur either as a result of a bad knee or carpal tunnel or
+something, would that then require the employer to invest in a
+medical diagnosis of his condition and take a patient history
+to determine whether such a condition could be causally related
+to the job requirements or to something else, just maybe even
+degenerative changes?
+ And also, when you look at retaliatory terminations, causes
+of actions for retaliatory terminations--in other words, as an
+employee, I have been let go for cause, but I don't believe so.
+I believe it is because I have put on my Log 300 now that I
+have, you know, a constant pain in my back and, therefore, they
+are letting me go because they don't want to have to invest
+further.
+ So I would appreciate your opinion with regard to the MSDs
+and the likelihood of a new cause of action may ensue.
+ Mr. Sullivan. Well, Congressman, the thought process you
+just went through is similar to the thought process a small-
+business owner would go through when they are looking at
+whether or not to put an injury or illness onto a log. And to
+say that that calculation in your mind, even without any type
+of diagnostics, would take under 5 minutes really gets at a
+disagreement between small businesses and OSHA over their
+proposal.
+ I would actually elevate your concerns even higher, because
+when you talk about the diagnosis of an injury, you are
+actually putting the employer potentially in the place of a
+doctor to make a diagnosis. And so they have to really go
+through two things. One is to determine whether or not it is an
+MSD, which sometimes requires a doctor, and it wouldn't be fair
+to be put that----
+ Mr. Ross. It would require a doctor. I mean----
+ Mr. Sullivan [continuing]. Onus on an employer. The other
+is whether or not it is work-related. And you get into some
+really sticky situations not only to see if it was part of a
+weekend touch football game, but, really, whether or not that
+is any of the employer's business. And so navigating all those
+sensitivities under the cloud of potential legal liability is a
+very real concern to small businesses on this proposal.
+ Mr. Ross. And, for example, if they left employment and
+later filed suit for a work-related accident under the workers'
+compensation rules for carpal tunnel, but they fail to disclose
+it on their Log 30, then couldn't the employer not be availed
+to an affirmative defense of a misrepresentation of a physical
+condition?
+ Mr. Sullivan. All very good concerns that are echoed by the
+small-business community.
+ Mr. Ross. Mr. Sessions, you commented about the noise
+protection ruling. And more importantly, you indicated that it
+was done by way of an administrative interpretation, rather
+than by regulation. Is that something that is normally
+delivered or promulgated by OSHA, with disregard to the
+regulatory process?
+ Mr. Sessions. It has been a grey area, both for OSHA and
+other regulatory agencies, sort of, what is done by regulation
+and what is done by administrative interpretation, by guidance
+documents, or by other means that aren't subjected to----
+ Mr. Ross. Or by regulatory fiat, as I would say.
+ Mr. Sessions. You know, there are procedural safeguards if
+an agency is going to do something by formal regulation. SBREFA
+applies, the executive order for analysis applies, but they
+don't apply if the agency somehow takes the action under a
+different guise. And that has been a very difficult issue for a
+number of years across all regulatory agencies.
+ Mr. Ross. Thank you.
+ Ms. Holmes, just real quickly, because I am running out of
+time here, I think the greatest balance that we could afford is
+to make sure that the regulatory environment is as stringent
+and necessary as possible to maintain a good business
+environment and also to protect against the incidents which
+occurred that cost Ms. Miser her brother.
+ But I--my concern at this point--and I address this to you
+for your members and dealing with the chamber--have not we lost
+sight in this regulatory process of the foundation upon which
+we rely, and that is logic and reason?
+ Ms. Holmes. You know, I think we have in many respects,
+Congressman, because we have, you know, an agency that, again,
+I said and I meant, what we--what OSHA did in connection with
+the noise standard is really unbridled arrogance. They did not
+feel the need to look to see whether there was a problem,
+whether what they were proposing would fix the problem, or how
+much it would cost.
+ We simply can't have that. And they did, in fact, by
+regulatory fiat, as you suggested, rather than going through a
+rulemaking process where there would have been----
+ Mr. Ross. Thank you. I believe my time is up. Thank you.
+ Ms. Holmes. And now I will be quiet.
+ Chairman Walberg. Thank you.
+ We will move on to the gentleman from Indiana, Mr. Bucshon?
+ Mr. Bucshon. Thank you, Mr. Chairman. And thanks to the
+panel.
+ Just to give you a little background on me, I am a
+physician, cardiovascular surgeon. I see a lot of patients with
+their lung problems that have a history of workplace exposure,
+so I understand that concept. And also, my father was a United
+Mine Worker and a coalminer underground for many years, so I
+have also seen that--it from that side.
+ And my question is from a budgetary standpoint. And would--
+and anyone on the panel can address this. I mean, in 2008,
+would anyone say that OSHA was having difficulty with what they
+were trying to do based on their budget in 2008?
+ Ms. Holmes?
+ Ms. Holmes. From my perspective, Congressman, I don't think
+they were. I think it is a matter of setting regulatory
+priorities, as well as, to the extent possible, deferring
+resources to compliance. The vast, vast, vast majority of
+employers want very much to do the right thing by their
+employees. It does not serve any business to lose employees or
+have employees become injured on the job. It is--in addition to
+the human factor, which is very important, it is
+extraordinarily costly. Workers compensation costs are very
+high. It is good business to work safely.
+ And in businesses of--the vast, vast majority--and
+certainly everyone I have had the privilege to represent in my
+16 years--has taken that tack, that they want to do the right
+thing. And I think OSHA has the resources to--I think it is a
+matter of smart use of resources, candidly.
+ Mr. Bucshon. Okay. Thank you.
+ I yield back.
+ Chairman Walberg. He will be right here. I am looking
+forward to calling on the gentleman who was my chairman the
+last time I served here before coming back this term, and now
+the ranking member of the full committee, Mr. Miller?
+ Mr. Miller. Thank you very much, Mr. Chairman. My
+apologies. I am unfortunately having to duck in and out.
+ Let me just, if I might, see if I can get some
+clarification. Mr. Sullivan, in your testimony, you are not
+arguing that the Regulatory Flexibility Act at OSHA is not
+working? You don't like the way it is being handled in this
+particular case?
+ Mr. Sullivan. I believe that the attitude of trying to
+avoid SBREFA instead of embracing it is cause for concern.
+ Mr. Miller. See, that--you are talking about--but it has
+been in one iteration since the 1980s. You are not arguing that
+the underlying law is somehow not working? I mean----
+ Mr. Sullivan. I believe that there is an attitudinal
+problem----
+ Mr. Miller. I understand that. I understand that.
+ Mr. Sullivan. There is----
+ Mr. Miller. I am asking about the generic law. Apparently
+you were happy with it 2 years ago.
+ Mr. Sullivan. Actually, I testified last week on measures
+that should be adopted to----
+ Mr. Miller. That is different. I understand that.
+ Mr. Sullivan [continuing]. Improve the law, so----
+ Mr. Miller. So what is your testimony?
+ Mr. Sullivan. My testimony is before the committee----
+ Mr. Miller. You don't like the way this Administration of
+OSHA is administering the law?
+ Mr. Sullivan. I have been critical of OSHA's implementation
+of the Regulatory Flexibility Act past this Administration,
+when I was working----
+ Mr. Miller. Okay, that is--I am trying to figure this out.
+ Mr. Sullivan. Okay. Well, I believe that OSHA has been able
+to do a better job and continues to be able to do a better job
+in complying with the Regulatory Flexibility Act.
+ Mr. Miller. Mr. Sullivan, in this discussion of the cost of
+regulation--now, you have obviously chosen to and it is right
+in your testimony, just to talk about the cost. Are you
+suggesting there are no benefits of OSHA regulations? There
+have been no benefits throughout the various administrations of
+OSHA here?
+ Mr. Sullivan. I am not suggesting that there are no
+benefits. The reason I focused on cost is because, in that way,
+it is very clear that small businesses are disproportionately
+impacted by costs. And the Regulatory Flexibility Act----
+ Mr. Miller. Small businesses----
+ Mr. Sullivan [continuing]. Tries to--tries----
+ Mr. Miller. Don't small businesses also generate a somewhat
+higher percentage of the accidents, given--to the small-
+business employee population?
+ Mr. Sullivan. Congressman, I don't know what the comparison
+of small-business accidents are compared to large-business. I
+do know that there is a disproportionate cost on small business
+when it comes to regulation, and the idea of the--Congressman,
+could I actually just finish my answer?
+ Mr. Miller. I am running out of time. As you know, the
+chair is being----
+ Mr. Sullivan. I would like to just answer your question,
+Congressman.
+ Mr. Miller. I would like to ask you another question.
+ Mr. Sullivan. Thank you.
+ Mr. Miller. Because it goes to the point you are about to
+make. If they generate 45 percent of the fatalities with 14
+percent of the workforce, you might want to check in with them
+to see what is going on.
+ Mr. Sullivan. I think OSHA wants to issue rules that work
+on Main Street small business. And in order for it to work,
+they have to consider the impact and the constructive impact by
+small business before moving forward with rules.
+ Mr. Miller. I would make the point that when you decide you
+are only going to talk about cost, one, the question is whether
+or not small business is a generator of fatalities that
+justifies their consideration by OSHA for rules and, two, that
+when you talk only about the cost of regulation, somewhere in
+the testimony there has to be some understanding of what the
+benefits are, of whether we can arrive at that mutually or not.
+ There has to be some understanding of that, because you get
+studies all the time from various insurance companies and
+others who cover various sectors of our economy about the cost
+of fatalities, about the cost of the injuries, of the
+retraining, of the rehabilitation that go on with this.
+ And so I think--I don't get the----
+ Mr. Sullivan. I think we actually both want the same end
+point, and that is a smarter regulation at the end of the
+process. And how they get there----
+ Mr. Miller [continuing]. If I only talk about the benefits
+of the regulation and suggest we start from that basis and you
+only talk about the costs and suggest that we start from that
+basis.
+ Mr. Sullivan. Well, actually, I think we get to the same
+place when OSHA not only asks small business how a rule can be
+written better to reduce costs, but also to ask----
+ Mr. Miller. I understand that.
+ Mr. Sullivan [continuing]. Ask the small employer, hey,
+this is what we are looking at. Do you think it increases
+benefits more from a small-business perspective----
+ Mr. Miller. So you do give some recognition to the fact
+that there are benefits to many of these regulations and have
+been, in terms of saving lives or reducing injuries or cost of
+businesses?
+ Mr. Sullivan. Of course I do.
+ Mr. Miller. Okay.
+ Mr. Sullivan. And I also recognize that the small
+businesses, in engaging in that dialogue with OSHA, would like
+to come up with those solutions.
+ Mr. Miller. I understand. Okay. Thank you.
+ Chairman Walberg. Thank you.
+ Mr. Miller. I yield back my time, Mr. Chairman.
+ Chairman Walberg. Appreciate that. We have the Chairman of
+the full committee here, the gentleman from Minnesota, Mr.
+Kline.
+ Mr. Kline. Thank you, Mr. Chairman. I apologize for coming
+in late. You have probably noticed that--how this place works.
+It is a bit confusing, as Members are moving back and forth
+between competing hearings and competing commitments.
+ I do want to thank all of you for being here today and for
+your testimony. And I want to give Mr. Sullivan the opportunity
+to pick up--he was trying to complete an answer to Mr. Miller's
+question having to do with cost-benefit analysis and assessing
+the costs of regulations, which fall disproportionately on
+small businesses.
+ And I know you were starting to finish that thought, and I
+would like to give you the opportunity to do that.
+ Mr. Sullivan. Well, thank you, Congressman. There has been
+a great deal of attention to figures that have to do with the
+cost of regulation on small firms. And from my opinion, that
+actually is a separate conversation than what I tried to bring
+across in my testimony, which is that small businesses are
+disproportionately impacted.
+ And that really gets at that federal rules just aren't--
+they should not be encouraged to be one-size-fits-all. And if
+OSHA sits down with small business and says, ``We would like to
+solve a problem. How do you, small business, propose that we
+try to solve this problem?''
+ Forcing that dialogue is what makes for a better final
+regulation. And in my opinion, OSHA is not doing a good enough
+job in having that dialogue.
+ Mr. Kline. Thank you. I yield back, Mr. Chairman.
+ Chairman Walberg. Thank you, Mr. Kline.
+ Now we moved to the gentleman from Ohio, Mr. Kucinich.
+ Mr. Kucinich. Thank you, Mr. Chairman.
+ To Ms. Miser--and welcome to you and to all the witnesses--
+Ms. Miser, your testimony talked about the OSHA crane standard,
+which will provide a net benefit of $55 million a year, based
+on lives saves and injuries avoided, yet the Mercatus
+Institute, a think-tank funded by corporate interests, gives
+this rule a low score on its regulatory report card.
+ Now, given the deaths from crane accidents, should OSHA
+have simply ignored this problem? And isn't it the case that
+industry also wanted the standard updated?
+ Ms. Miser. Well, in that particular case, all they would
+have needed is a spotter, and he would be here today. So, I
+mean, absolutely not, I don't think that they should. It is a
+simple solution, and it should have, you know, been done way
+before that.
+ And I guess, to me, what you need to do is look at
+standards that work, standards that are working now. For
+instance, the grain standard. We know for a fact that it saves
+lives. You know, it saves--I have the figures here. It says
+that--and this was by the National Grain and Feed Association.
+They say that explosions declined 71 percent, injuries by 90
+percent, and fatalities by 95 percent.
+ So, no, I don't. I think that there are times when you have
+to--standards, and I think that they are very important. And I
+don't think that they should be given up. I think we should
+keep pushing until we get it done. And if it takes a little
+work, if it takes a little talk, that is fine, but let's get to
+it and let's get it done.
+ Mr. Kucinich. Mr. Sullivan, let's discuss fatality rates in
+small business. The Kauffman-RAND Institute Center for the
+Study of Small Business and Regulation found that firms with 1
+to 19 employees had the highest fatality rate in all sectors,
+except wholesale trade. They found that firms with more than
+1,000 employees had the lowest fatality rates in all
+industries.
+ The Census of Fatal Occupational Injuries, which is
+published by the Bureau of Labor Statistics, reports that 45
+percent of all workplace fatalities occur at small businesses
+which employ between 1 and 9 employees, even though these
+establishments only employ 14 percent of the workforce.
+ So, Mr. Sullivan, do you agree that that small-business
+establishments have on average higher fatality rates than
+larger establishments? And if not, is the Labor Department data
+in error?
+ Mr. Sullivan. Congressman Kucinich, I don't disagree with
+the data. I would be interested in having a subsequent
+conversation and drilling into that data. I remember when I was
+working at the Small Business Administration and hearing those
+statistics and asking, why are they so high? And I believe that
+the answer uniformly was because of traffic fatalities, which,
+you know, ironically are outside of the scope of OSHA.
+ But I think a very serious set of statistics that point out
+a problem--and I will go back to kind of my--the whole purpose
+of my testimony, which is to encourage OSHA to sit down with
+small employers to hammer out rules that work. And when you
+look at those types of fatality rates, I think it only elevates
+that type of approach, because they do want to finalize rules
+that work on Main Street and not have to redo these regulations
+when fatalities go up.
+ Chairman Walberg. Time is expired. I will say thank you to
+each of the witnesses for taking the time to be here today to
+share your expertise, your experience, your data, and your
+heart, as well, on this issue.
+ And there will be other opportunities that we will
+aggressively continue to look. And I agree with my ranking
+member that we want to have an aggressive hearing schedule, as
+well, to plum the depths of what is involved here. And even the
+fact with the grain standard, took 7 years to develop that, and
+we want to encourage more rapid, but we certainly want to
+encourage vital and useful standards, as well.
+ Having said that, I would like to recognize Ms. Woolsey,
+the ranking member, gentlelady from California, to close with
+her comments.
+ Ms. Woolsey. Thank you, Mr. Chairman.
+ And it is obvious we have--both sides of this debate are
+interested and active in participating today. I give you a lot
+of credit for that. And my subcommittee has been really active
+for the last 4 years. They want to keep on going.
+ I really believe that, unless the goal is to underfund and
+undermine in the long run OSHA, we really can work together,
+because we have to bring OSHA into the 21st century, period,
+because all of our workers are depending on us. So thank you
+very much.
+ Chairman Walberg. Thank you, Ms. Woolsey.
+ Again, thank you to the witnesses for sharing with us
+today. We will approach these issues differently, I am certain,
+as we work on this subcommittee. And all of the issues
+pertinent to that mix, that creative tension of having jobs,
+which people need, and an expanded economy, which that can
+produce, the prosperity, the lifestyle, the happiness, and the
+safety in carrying out all of these functions in a society that
+works well together.
+ But that is a creative tension. And at each time in our
+history, there are approaches that must be flexible in how we
+approach it in order to keep the movement forward, as opposed
+to stopping, which, as we all know, once you stop, you move
+backwards.
+ So thank you again for participating. I thank the
+subcommittee for your involvement, as well. We will have
+opportunities to continue to explore. I look forward to doing
+that. We will certainly have OSHA and its representatives in
+front of us. We look forward to hearing the Secretary tomorrow
+in hearing, in the full committee, and then moving from that
+with further testimony from business and industry, from
+workers, and from the regulators themselves.
+ So there being no further business, the subcommittee stands
+adjourned.
+ [The statement of Ms. Hirono follows:]
+
+ Prepared Statement of Hon. Mazie K. Hirono, a Representative in
+ Congress From the State of Hawaii
+
+ Today Republicans have called a hearing to argue that the
+Occupational Safety and Health Agency (OSHA) costs too much and burdens
+businesses with too much regulation.
+ The workers in my district and I know better!
+ I have heard from workers in Hawaii about how OSHA regulations and
+enforcement reduce injuries and save lives.
+ One worker at an electric utility company told me of the hazardous
+conditions she and her team are exposed to every day: electricity,
+chemicals, high pressure steam and water lines, and high temperature
+fuel. OSHA's rules and guidelines require regular safety trainings and
+updates, and ensure that workers wear safety glasses, steel-toed shoes,
+flame-retardant clothing, chemical hoods, and safety gloves. The goal
+is NO injuries.
+ Despite these precautions and wearing the proper equipment, she was
+burned by sulfuric acid in an accident 15 years ago. When reviewing the
+work area she was in when the burn occurred, the company's safety
+department--following OSHA guidelines--determined that additional
+engineering measures were necessary to prevent future injuries.
+Fortunately, no future injuries have occurred at this workplace.
+ Safety guidelines and regulations can help save lives, and so can
+enforcement.
+ In another story in Hawaii, lack of sufficient enforcement led to
+tragic results. In May 2009, an 800-foot tower collapsed at the
+Hawaiian Cement facility, killing worker Juan Navarro. Subcontractor AG
+Transport did not have a license, engineering survey, or evacuation
+plan for the demolition project. The company was fined a paltry $750.
+This accident could have been prevented, but Hawaii only had 11 state
+OSHA staffers to inspect and enforce worker safety on construction
+projects across all 7 of our inhabited islands.
+ In September of 2010, the U.S. Department of Labor (DOL) found that
+under former Governor Linda Lingle, Hawaii had under-funded and
+systematically neglected its state Occupational Safety and Health Act
+plan (OSHA state plan). As a result, Hawaii did not have enough
+workplace inspections or on-site consultations to keep workers safe.
+Hawaii was the only state in the nation found breaking its state plan
+obligations.
+ Unfortunately, for Hawaii and the 27 states/territories with
+approved state plans, DOL is extremely limited in its authority to help
+state plans improve. DOL's only option under current law is to
+completely end the state plan's local control and step in with federal
+control.
+ My Ensuring Worker Safety Act (H.R. 571) would allow federal OSHA
+more flexibility to collaborate with states and improve underperforming
+state plans, such as Hawaii's. I urge my colleagues to support it.
+ On the U.S. House floor today, the Republican job-slashing
+resolution would decimate federal OSHA's budget by $99 billion this
+year, requiring 3-month furloughs of OSHA employees, then layoffs next
+year. This is not the way to ensure worker safety.
+ In reviewing today's witness testimony, I note that those who
+question OSHA's programs focus on OSHA's costs without discussing the
+benefits. I would point out the following:
+ According to the latest ``Death on the Job'' report, OSHA
+regulations and enforcement have saved an estimated 410,000 lives in
+the 40 years since the Act was passed in 1970.
+ Liberty Mutual insurance estimated that the annual direct
+cost to businesses of work-related injuries and illnesses were $53.4
+billion per year, more than $1 billion per week!
+ Since 2000, OSHA has reviewed the costs and benefits of
+its rules 8 times, finding its regulations to reduce accidents and
+injuries. For example, the review found that OSHA's grain handling
+standards reduced explosions by 42% and reduced deaths by 70%; sharps
+injuries were reduced by 88%; and excavation fatalities were reduced by
+40%.
+ Beyond these measurable economic and safety benefits, what value do
+we place on reducing worker injury, illness, and death? OSHA
+protections must be upheld and enforced properly to keep our workers
+safe.
+ ______
+
+ [The statement of Mr. Kucinich follows:]
+
+ Prepared Statement of Hon. Dennis J. Kucinich, a
+ Representative in Congress From the State of Ohio
+
+ Today's hearing is presented as an examination of the impact of the
+actions of the Occupational Safety and Health Administration (OSHA) and
+the alleged negative effect on job creation. Despite having issued only
+2 new health and safety standards in the past ten years, OSHA is being
+cast as a villain that has our economy in its clutches. OSHA is being
+asked to be more responsive to the needs of small business, while
+facing $99 million in cuts in the continuing resolution (CR) we are
+expected to vote on this week.
+ The unemployment rate is still at record levels. The labor force
+participation rate is nearly at its lowest level in a generation. There
+are nearly 5 unemployed workers for every job opening in this country.
+Millions of Americans are under water on their homes, and so they
+cannot sell them and they cannot move to pursue better economic
+opportunities in other parts of this country. Meanwhile, American
+corporations are sitting on $2 trillion in cash. Much of that $2
+trillion it appears is being spent on high-priced industry lobbyists,
+instead of workers. And we know that worker productivity--the output
+per worker per hour--has steadily increased over the years, especially
+in manufacturing and service industries, but the average worker's
+income has not kept pace. This tells us that employers have the upper
+hand right now. So this Subcommittee should be focused on the matters
+under its jurisdiction: are the regulations designed to protect
+American workers being followed? Can they be improved?
+ Instead, we have heard examples of the supposed heavy financial and
+paperwork burden that OSHA regulations impose on small businesses. It
+is true that American businesses large and small deserve clear
+workplace safety regulations from their government. But the evidence
+cannot be ignored that such regulations are absolutely vital to the
+safety of the American worker. Every year in this country, hundreds of
+workplace accidents continue to occur, some of which are playing out
+before our eyes in gruesome detail. But as the fires are put out or the
+toxic spill cleaned or the toll in human lives is counted, the
+opponents of workplace safety laws once again take up their call of
+``overly burdensome regulations.''
+ No price tag can be put on the life of a healthy, living American.
+We cannot credibly demand that OSHA should rededicate itself to more
+quickly and efficiently serving American businesses while at the same
+time, extolling the virtues of the complex and time-consuming process
+OSHA undertakes before any new workplace safety and health standard can
+be established.
+ Last year, the Office of Management and Budget performed a cost-
+benefit analysis of Federal regulations which showed that the benefits
+of regulations far outweigh their costs. Between 1999 and 2009, the
+estimated costs of regulations were between $43 billion and $55
+billion, while the estimated economic benefits were between $128
+billion and $616 billion. That means, during that ten year period, the
+cost-to-benefit ratio of regulations was one-to-two based on OMB's
+lowest estimations, and one-to-fourteen based on OMB's highest
+estimations.
+ The data from the Bureau of Labor Statistics shows that in 2008,
+5,214 workers were killed on the job in this country--an average of 14
+workers per day. If the CR passes with the proposed cuts to OSHA, , it
+will have to furlough all employees for the last three months of the
+fiscal year, and then lay off 415 of its 2335 employees. It will cut
+OSHA's funding so drastically that it will cripple its ability to
+function. I intend to do all I can to prevent this from happening.
+ ______
+
+ [Additional submissions of Mr. Walberg follow:]
+
+ [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
+
+ ------
+
+
+ [Additional submission of Ms. Woolsey follows:]
+
+ [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
+
+ ------
+
+ [Whereupon, at 11:25 a.m., the subcommittee was adjourned.]
+
+
+
+