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21–216 PDF 2005

S. HRG. 109–133

OSHA AND SMALL BUSINESS: IMPROVING THE

RELATIONSHIP FOR WORKERS

HEARING

BEFORE THE

SUBCOMMITTEE ON EMPLOYMENT AND WORKPLACE

SAFETY

OF THE

COMMITTEE ON HEALTH, EDUCATION,

LABOR, AND PENSIONS

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

FIRST SESSION

ON

EXAMINING WAYS TO IMPROVE THE RELATIONSHIP BETWEEN OSHA

AND SMALL BUSINESS, FOCUSING ON OSHA RULES AND REGULATIONS TO PROTECT THE HEALTH AND SAFETY OF SMALL BUSINESS

EMPLOYEES

MAY 10, 2005

Printed for the use of the Committee on Health, Education, Labor, and Pensions

(

COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

MICHAEL B. ENZI, Wyoming, Chairman

JUDD GREGG, New Hampshire

BILL FRIST, Tennessee

LAMAR ALEXANDER, Tennessee

RICHARD BURR, North Carolina

JOHNNY ISAKSON, Georgia

MIKE DEWINE, Ohio

JOHN ENSIGN, Nevada

ORRIN G. HATCH, Utah

JEFF SESSIONS, Alabama

PAT ROBERTS, Kansas

EDWARD M. KENNEDY, Massachusetts

CHRISTOPHER J. DODD, Connecticut

TOM HARKIN, Iowa

BARBARA A. MIKULSKI, Maryland

JAMES M. JEFFORDS (I), Vermont

JEFF BINGAMAN, New Mexico

PATTY MURRAY, Washington

JACK REED, Rhode Island

HILLARY RODHAM CLINTON, New York

KATHERINE BRUNETT MCGUIRE, Staff Director

J. MICHAEL MYERS, Minority Staff Director and Chief Counsel

SUBCOMMITTEE ON EMPLOYMENT AND WORKPLACE SAFETY

JOHNNY ISAKSON, Georgia Chairman

LAMAR ALEXANDER, Tennessee

RICHARD BURR, North Carolina

JOHN ENSIGN, Nevada

PAT ROBERTS, Kansas

MICHAEL B. ENZI, Wyoming (ex officio)

PATTY MURRAY, Washington

CHRISTOPHER J. DODD, Connecticut

TOM HARKIN, Iowa

BARBARA A. MIKULSKI, Maryland

JAMES M. JEFFORDS (I), Vermont

EDWARD M. KENNEDY, Massachusetts (ex

officio)

GLEE SMITH, Staff Director

WILLIAM KAMELA, Minority Staff Director

(II)

CONTENTS

STATEMENTS

TUESDAY, MAY 10, 2005

Page

Isakson, Hon. Johnny, Chairman, Subcommittee on Employment and Workplace Safety, opening statement ......................................................................... 1

Enzi, Hon. Michael B., Chairman, Committee on Health, Education, Labor,

and Pensions, opening statement ....................................................................... 3

Murray, Hon. Patty, a U.S. Senator from the State of Washington, opening

statement .............................................................................................................. 4

Norwood, Hon. Charles, a U.S. Congressman from the State of Georgia,

opening statement ................................................................................................ 7

Dodd, Jerrold, General Manager, Dayton United Metal Spinners, Dayton,

OH; Roy Swindall, Masonry Arts, Bessemer, AL; Arthur Sapper, OSHA

Practice Group, McDermott, Will and Emery, Washington, D.C.; and Lynn

Rhinehart, Associate General Counsel, AFL-CIO ............................................. 11

Prepared statement of:

Jerrold Dodd .............................................................................................. 14

Roy Swindall .............................................................................................. 18

Arthur Sapper ............................................................................................ 22

Lynn Rhinehart ......................................................................................... 32

ADDITIONAL MATERIAL

Statements, articles, publications, letters, etc.:

Questions of Senator Enzi to Mr. Sapper ....................................................... 4

Tom Howley, Academy of General Dentistry (AGD) ..................................... 45

(III)

(1)

OSHA AND SMALL BUSINESS: IMPROVING

THE RELATIONSHIP FOR WORKERS

TUESDAY, MAY 10, 2005

U.S. SENATE,

SUBCOMMITTEE ON EMPLOYMENT AND WORKPLACE SAFETY,

COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS,

Washington, DC.

The subcommittee met, pursuant to notice, at 2:08 p.m., in room

SD–430, Dirksen Senate Office Building, Senator Johnny Isakson

(chairman of the subcommittee) presiding.

Present: Senators Isakson, Enzi, and Murray.

Senator ISAKSON. The committee will come to order.

Ranking Member Murray is on the way and, in the interest of

your time, we will make our opening statements as chairman, subcommittee chairman and full committee chairman. And as soon as

Ms. Murray comes we will recognize her for her opening statement.

I will begin.

OPENING STATEMENT OF SENATOR ISAKSON

Senator ISAKSON. I wish everybody a good afternoon. I would like

to welcome everyone to the first hearing of the Subcommittee on

Employment and Workplace Safety. I look forward to working with

Senator Murray, Chairman Enzi, ranking member Kennedy on all

the important issues under our jurisdiction.

Today specifically, we are looking at the Occupational Safety and

Health Administration and its relationship with small businesses.

I want to welcome Representative Congressman Charlie Norwood

from the State of Georgia, my home State, and a gentleman with

whom I served in the United States House of Representatives on

the same committee dealing with this issue. I appreciate his leadership that he has provided and we will hear from him shortly.

Having run a business for 22 years before coming to the Congress of the United States, I am familiar with a myriad of government regulations that small businesses, unquestionably the biggest

employer of economic growth in this country, face daily.

Among those regulatory burdens are those imposed by OSHA.

Fortunately for small businesses and their employees, Secretary

Elaine Chao has consistently adopted an effective proactive approach to workplace safety emphasizing compliance, assistance and

cooperative approaches to small employers in addition to strong,

fair and effective enforcement. This approach has indisputably produced results as both the rates of workplace fatalities, four deaths

2

per 100,000 workers, and the injury and illness rate, five per

100,000 workers, are the lowest level in OSHA’s 32 year history.

In light of these successes, we in Congress must continue to work

with OSHA and small employers to find ways for them to cooperate

to keep the workplace safe.

To this effect I anticipate hearing from Mr. Swindal who will discuss his thoughts on how workplace safety can be improved

through voluntary cross-training and education, especially if OSHA

personnel have a better understanding of the businesses they are

regulating and inspecting.

Accordingly, small employers tell me they are often unable to

fight a questionable case that is brought before them because of

time and cost, and too often are forced to settle questionable cases

with OSHA. Mr. Dodd will testify to cases such as that.

The appeals process for questionable citations goes like this: A

small business’s case will first be heard before an administrative

law judge. If unsuccessful, the case can be taken to the Occupational Safety and Health Review Commission, a supposedly independent agency created by Congress. The sole function of the commission is to carry out adjudicative functions under the OSH Act.

Unfortunately, frequent absences on the commission make timely

adjudication of citations rare.

If still dissatisfied, an employer can appeal an OSHRC decision

to an appropriate U.S. Court of Appeals by any person adversely

affected or aggrieved. However, once in the Appeals Court, the

courts must defer to OSHA’s judgment, making OSHA the judge

and jury on its own actions. Essentially, the courts must defer to

OSHA interpretations of its own regulations, which as Mr. Sapper

will describe, is inconsistent with legislative history of the act.

All of this litigation is extremely costly, but let us suppose that

a small employer actually fights and is victorious over OSHA in

court. Under current law, that company may recoup its attorney’s

fee if and only if OSHA cannot show that the action was ‘‘substantially justified.’’

This threshold is far too low. If a smaller employer is able to go

through a process heavily slanted against him or her and prevail

against OSHA he or she could receive full reimbursement of attorney’s fees, backed by the Solicitor of Labor’s office—a group of lawyers so large that if it were a private law firm it would rank as

one of the largest law firms in the country.

On a personal note, I would like to add this. I have toured lots

of companies. And to mention a few specifically, in recent years in

my own district, the Coca-Cola Company and UPS. The thing that

impressed me on the tours of both of those were the first thing I

saw after the corporate logo were signs that focused on safety in

the workplace.

The investment that I have seen by those companies in their

company and in their employees is always safety-oriented, whether

it is loading, whether it is ergonomics, whether it is awareness,

whether it is hard hat requirements, whatever it might be.

The American workplace that is not safe is the most expensive

thing an employer can have. All of us want a safe workplace and

all of us want a regulatory environment that induces safety but

does not overly burden a company that otherwise would try its

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dead level best anyway to be sure it had the safest workplace possible.

With that said, I would like to introduce our distinguished chairman for his opening statement, Chairman Enzi.

OPENING STATEMENT OF SENATOR ENZI

The CHAIRMAN. Thank you, Mr. Chairman. I appreciate your

holding this as your first hearing of the subcommittee covering

small business and OSHA. I want to express my appreciation for

all of the hard work and leadership that you provide on the committee as a whole and your diligence in attending everything.

I know that you have been working in these areas of employment

and workplace safety for a long time and have a real grasp of the

information, besides the diligence that you have done in doing the

tours.

I reflect back on my start on this. I am an accountant. And I had

a client that was an oil well servicing company and I did some

numbers on it. And I went to the boss and I said you know, you

could really save a lot of money if you had a safety program here.

And he said okay, do it.

And I looked like the telephone guy. I said no, no, I do not do

safety, I just recommend safety. He said well, you already know

more about it than anybody in my company, so go ahead and do

it.

So I did some safety programs and built quite an interest in it

and know that safety programs do make a difference. I also know

that businessmen recognize that safety programs make a difference

and the only way they can work this thing harder is if they had

better information, more understandable information. That is one

of the difficulties that we have.

Improving workplace safety and the way the procedures and regulations under the Occupational Safety and Health Act have been

administered are issues of longstanding concern. The relationship

between OSHA employers and employees should be one of mutual

assistance, guidance and support. OSHA, the business community

and employees should not be adversaries. All sides want the same

thing and that is a safe workplace. That common goal should bring

them together, not push them apart.

That is why OSHA must recognize that small businesses have

unique safety and health issues and they need to be helped not

hindered in an effort to make their workplace safer. OSHA has already begun to address the needs of small businesses.

I look forward to the additional efforts they can make to increase

the level of dialogue and ensure the lines of communication and

trust and understanding are kept open between them and the employers of this country.

Workplace safety is just as important for the small employer as

it is for the large employer. The importance of a worker’s health

and safety has nothing to do with the size of an employer’s workplace or the annual payroll.

Still, as we examine these issues, we must keep in mind the fact

that all government regulations, no matter how necessary or useful, do impose a burden on those businesses that are regulated.

And the weight of that burden is often directly proportional to the

4

size of the business. This is a reality we have to consider whenever

we assess the fairness and practical effect of any system of regulation and enforcement.

Employers have to read through and implement over 1,000 pages

of highly technical safety regulations. Too often employers are left

on their own to try and understand and comply with all of these

regulations. It is hard enough for large employers who have an inhouse staff of safety experts. For the small employer, whose safety

expert is also the human resources manager, accountant and systems administrator—and probably waits on customers, too—the

task is nearly impossible. We are talking about employers who

want to do the right thing, who want to comply with the law and

protect their workers. They just need help doing so, more help than

OSHA can currently give them.

We need a system that encourages these good faith employers to

find out how to achieve safety voluntarily. The fact is that enforcement alone cannot ensure the safety of America’s workforce. I want

to prevent the accident in the first place. Although inspection and

enforcement must be a part of any comprehensive regulatory system, we understand that we will never be able to rely on them

alone. Inspections and fines by themselves will never lead the way

to a safer workplace. The overwhelming majority of employers who

are committed to ensuring the health and safety of their employees

need more help not more headaches.

That is why we must continue to encourage cooperation, foster

the exchange of ideas and increase the level of trust between the

regulators and the regulated community. If we do, we will advance

the cause of workplace safety.

Today’s hearing continues that discussion about what is involved

in achieving greater safety and health for our most important resource, our great American workers.

Thank you Mr. Chairman.

QUESTIONS OF SENATOR ENZI TO ARTHUR SAPPER

Question 1. Currently, under the Equal Access to Justice Act, small businesses

can’t recover costs of litigation if OSHA can show the action it brought was substantially justified even when the company successfully challenged the citation. In your

experience, is it difficult for the agency to be able to show substantial justification?

Should this standard be changed? If so, how should it be changed?

If an employer that believes he was incorrectly cited nonetheless does not contest

the citation for financial reasons what are the potential future effects of that citation?

Question 2. As you may be aware, there have been legislative proposals to exempt

employers that are cited for non-willful violations from any monetary fine if they

correct the violation within 72 hours. Do you believe such a proposal, if enacted,

would have any positive effects on improving workplace safety?

Senator ISAKSON. Thank you, Mr. Chairman. Senator Murray.

OPENING STATEMENT OF SENATOR MURRAY

Senator MURRAY. Mr. Chairman, let me personally welcome you

to the HELP Committee. I am looking forward to working with you

on a bipartisan basis to strengthen the safety and health protections that America’s workers depend on.

As the Ranking Member of the Subcommittee on Employment

and Workplace Safety, I worked closely with our chairman, Senator

5

Enzi, who is here as well. I look forward to working with you to

develop an equally productive partnership.

I want to thank you for calling this hearing today to discuss how

OSHA can do a better job of working with small businesses to protect the health and safety of their workers.

Like you, Mr. Chairman, I do recognize that small businesses are

engines for our economy. They create jobs and economic development and we want them to be strong, productive and safe. We need

to ensure that health and safety standards do not unfairly burden

small businesses while at the same time ensure that all workers

are safe, no matter how many people their company employs. We

all recognize that there are costs to these regulations. But when

workers are killed or injured on the job, there is also a high cost

to businesses, to communities and families and we need to be

mindful of that.

Several Members of Congress have suggested changes to OSHA

and before Congress looks at those changes we need to understand

the context today. We need to examine how safe America’s workers

are and how effective OSHA is.

And frankly, the statistics are troubling. Each day more than

12,800 workers are killed or injured on the job. Think about that.

More than 12,000 are killed or injured every day. Those are not

just numbers. That is someone’s mom or dad. It is the family

breadwinner. It is someone whose life will never be the same.

To me, that really says we need to do a much better job of protecting workers and enforcing our laws on workplace health and

safety.

So how is OSHA doing today? As I look at the staff levels and

enforcement history and penalty assessments, frankly the picture

is not very encouraging. First, OSHA does not have enough inspectors to protect American workers. At its current staffing and inspection levels it would take OSHA 108 years to inspect each job

site in America just once. Think about that. We have got more than

12,000 Americans being killed or injured every day. And at this

rate OSHA will not even reach every workplace until the year

2113.

That inadequate level of staffing does not give me a lot of confidence that American workers are adequately protected. I would

hope that any OSHA reform proposal would increase the number

of inspectors to catch up on this tremendous backlog because it is

killing and crippling American workers every day.

Beyond staffing, OSHA has among the weakest enforcement capabilities of any Government Agency. For the past few years, I

have worked on legislation relating to asbestos so I have looked

closely at how OSHA has enforced asbestos regulations. As you

may know, exposure to asbestos in the workplace skills some

10,000 Americans every year. Over the last 30 years OSHA has

had a very poor track record of enforcing asbestos regulations in

the workplace.

Auto repair workers, particularly our brake mechanics, are extremely vulnerable. The EPA is in the process of reexamining its

Gold Book Guidance for brake mechanics. If the EPA decides to

change or eliminate that guidance, then OSHA will need to issue

and promote new guidelines quickly so that auto mechanics are

6

alerted to the dangers of asbestos exposure and can take the appropriate precautions.

OSHA’s history of enforcement is not encouraging so it would not

make sense to further weaken OSHA’s ability to protect America’s

workers.

Beyond staffing and enforcement, OSHA financial penalties are

often much smaller than similar penalties at comparable Government Agencies such as the Employment Standards Administration,

the Equal Employment Opportunity Commission and the Mine

Safety and Health Administration. For example, OSHA’s penalty

for a serious violation, one that poses a substantial risk of death

or serious harm, is less than $900. I would expect that any OSHA

reform bill would revise the penalty formula so it truly serves as

a deterrent rather than just the cost of doing business.

So when I look at today’s context, more than 12,000 workers

killed or injured on the job every day, an agency that has too few

inspectors, inadequate enforcement and weak penalties, it is not

hard for me to suggest new ways to improve the agency so we can

better protect America’s workers.

I am troubled by some of the proposals I have seen so far because

to me they appear to move in the wrong direction. I realize the purpose of today’s hearing is not to review any particular piece of legislation, but I do want to take this opportunity to raise some serious concerns about some of the bills I have seen because I think

we all agree with their stated goal to alleviate some real-time burdens without sacrificing health and safety.

But when I look at these bills, it is clear to me they would seriously undermine and weaken enforcement of the job safety law and

will drain resources away from OSHA, an agency that is chronically underfunded.

For instance, requiring OSHA to pay the legal costs for most

small private sector employers, regardless of whether the action

was substantially justified, will have a very chilling effect on both

OSHA enforcement and OSHA standard setting.

Today small businesses can already recover litigation costs if the

Government position was not substantially justified. That protection is already available through the Equal Access to Justice Act.

Changing the law only as it applies to OSHA treats the enforcement of work and safety protections differently than the enforcement of all other laws. That sends the wrong message in our country where, as I said, 12,000 workers are killed or injured every day.

It is also worth remembering that smaller businesses have a

higher rate of deadly job injuries than businesses with more than

100 workers. In fact, according to the Congressional Budget Office,

employers with fewer than 100 employees constitute 70 percent of

OSHA’s case load. Most of the small employers cited are construction-related terms—half of all occupational deaths in the construction industry occur in small employer companies. Hampering

OSHA’s enforcement ability in these establishments would be devastating to workers, resulting in even higher rates of worker fatalities and injuries and illness.

In addition, these bills would undermine the power of the Secretary of Labor to interpret and enforce our Nation’s job safety law.

We should not be expanding the size of the role of an outside comVerDate 11-MAY-2000 09:39 Oct 06, 2005 Jkt 000000 PO 00000 Frm 00010 Fmt 6633 Sfmt 6601 21216.TXT SLABOR2 PsN: SLABOR2
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mission that hears only a small portion of the enforcement cases

brought by the Secretary and really lacks the comparable knowledge, experience and expertise.

So if we are going to reform OSHA, we need to understand the

facts today and make sure any legislation moves us in the right direction to a safer and healthier workplace.

Mr. Chairman, you have my commitment to work with you on a

bipartisan basis to adopt solutions to worker health and safety that

experts around the years have spent years developing. One example is the global system for classifying and labeling chemicals. We

have a real opportunity to forge a bipartisan consensus on those

kinds of health and safety issues, and I hope this subcommittee

will move quickly to adopt a uniform approach on chemical safety

and to correct the current failings of the Material Safety Data

Sheets.

This approach will be crucial to the ongoing economic success of

any business or industry, especially small businesses, that are becoming increasingly frustrated with the confusing and misleading

safety information that they receive.

So again, Mr. Chairman, I look forward to working with you as

we move forward on the critical issue of workplace health and safety.

Thank you, Mr. Chairman.

Senator ISAKSON. Thank you very much, Senator Murray.

Senator ISAKSON. Before I introduce the witnesses, it is a real

personal pleasure for me to introduce Congressman Charlie Norwood, with whom I worked in the United States House for 6 years

and for years before that in the State of Georgia. He has been a

tireless worker on behalf of workplace safety issues, issues directly

engaged in dealing with OSHA, and has been a real leader on the

Committee on Education and the Workforce in the House of Representatives.

Congressman Norwood, we are delighted to have you today and

we would recognize you for any remarks you would like to make.

STATEMENT OF THE HON. CHARLES NORWOOD, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF GEORGIA

Mr. NORWOOD. Thank you, Mr. Chairman.

Mr. Chairman and Ranking Member Senator Murray, we really

appreciate the opportunity to come and spend a few minutes with

you on this what I consider a very important issue.

My background in this is pretty simple. I have had to deal with

OSHA most of my adult life, as a dentist. And I have had to deal

with OSHA the last 11 years as being a member of the Education

and Workforce Committee, the last 6 years being the chairman who

had authorization over OSHA. So I am pleased to be here to be

part of this gathering.

I do thank you, Mr. Chairman, for holding this hearing to explore

a relationship between American small businesses and OSHA. As

you all know, it is critically important, this relationship, in order

to enhance workplace safety and health, and to allow the American

small businesses to grow and prosper. That is really what this is

all about.

8

To me, that is what these bills are all about, the relationship between the worker and their safety and health and the relationship

between the small business owner and OSHA itself just simply

have to be improved in order to solve the problem, for example, of

not having enough inspectors. You will never have enough inspectors to inspect every small business. The only hope we have is

being a consultant with small businesses, having small businesses

come to us and seeking help in how to have a safer and healthier

workplace.

This is part of what I see these bills doing. These are twin goals

that I have sought to achieve for the past 4 years as Chairman of

the Workforce Protection Subcommittee in the other body. And I

am pleased to report to you that indeed I believe we are making

progress on both fronts.

Mr. Chairman, the GAO reported to Congress last year that the

American workforce is safer today than any other period in modern

times. Workplace related injuries and fatalities are on the decline

and employer cooperation with OSHA is on the rise. That is, in my

view, what this is all about. That is what we should shoot for.

As the GAO study suggests, this is in large part due to the expansion of the voluntary compliance strategy that the administration has fought hard to strengthen and expand. And Secretary

Chao is to be commended, in my mind, for her hard work in this

regard.

While the administration has taken strides to reverse the old

gotcha enforcement policies of the past—and I know about those

gotcha programs enforcement firsthand—I believe that American

small businesses deserve additional protection in order to level the

playing field when they are dealing with this Federal Agency.

Gotcha enforcement does not increase workplace safety and health

and it does not promote economic growth.

However, I believe that the gotcha enforcement strategy is still

alive and well in too many OSHA field offices across this country.

At no other time is this more evident than when a hard-working

small business owner attempts to appeal an OSHA citation.

Mr. Chairman, for too many employers, the systems for appealing an OSHA citation is simply unfair and unjust. Fairness is all

the American small businessman is asking for but fairness is not

what the Government promotes due to burdensome regulatory policy for the appeal of OSHA citations.

In the 109th Congress I introduced four bills that will level this

playing field and restore fairness for small American businesses.

And I believe fully in my heart, and our committee in the House

believes, that this will in no way hurt the employer in terms of

health and safety.

These four bills make commonsense reforms to OSHA and they

do not reduce health and safety standards in any way, shape or

form. In any forum I would debate that.

My first bill resolves the conflict between OSHA and Federal

Rules of Civil Procedure rule 60(b) as it pertains to the unfairly enforced 15-day contest of citation period. It simply provides that a

small employer gets his day in court when a response to a citation

is delayed for a mistake or good reason.

9

As Chairman Enzi pointed out, not every small business can

have a safety director on their payroll. Sometimes the same guy is

at the front desk or on the counter selling a product is the same

guy who is the safety inspector. And maybe they get a citation. And

maybe it drops in the back seat of their car and they do not find

it for 3 weeks later. But they ought to have, if for good reason or

for a mistake, they ought to have their day in court.

The second bill increases the Occupational Safety and Health

Commission from three to five members. This is not hard. We hope

to solve the quorum problem that has left this commission unable

to function almost two-thirds of its entire existence. That is not satisfactory if you have a citation laid on you by the Federal Government that it can be very destructive if you cannot come to a end.

Sometimes you simply pay the fine rather than having that hang

over your head. This problem effectively denies an employer or can

deny an employer a day in court.

The third measures ensures that legal deference is given to

OSHRC. This simply restores congressional intent. Look at the history. OSHA was signed by Richard Nixon. It almost did not get

through until they came up with this independent commission that

was truly an arbitrator and independent of OSHA citations. It

would never have passed and been signed had that not been put

in there. Now what we have done is we have simply taken that

way.

Finally, the last bill provides attorneys’ fees to small employers

who prevail in litigation against OSHA. In testimony before my

subcommittee, we repeatedly heard that small businesses settled

with OSHA rather than challenging an unjust citation. They do

this because it is cheaper to settle than pay an attorney to fight,

no matter how strong you may believe that you are innocent.

Mr. Chairman, that is simply an unfair choice for a small businessman or a small businesswoman. The owner should not have to

make these kind of choices.

By introducing this legislation, I hope to put an end to the loose

conundrum for small employers and force OSHA to think very, very

carefully, to think twice before they issue a frivolous citation or an

unjust citation or issue a citation by an incompetent inspector.

They need to think about that. We are not trying to not get the citations issued. What we are trying to do is make them think twice

before they force a small business owner into this kind of situation.

Mr. Chairman, it really comes down to this. These four OSHA

bills will prevent small employers from deciding to pay an unfair

OSHA fine or making an investment in his company. It comes

down to that. They are modest. They are simple. They are straightforward. They will improve the relationship between employers and

the Federal Government, which is what we must have if we want

a healthier, safer workplace. And very likely, in my belief at least,

it will lead to that.

I thank my friend from Georgia, Chairman Isakson, for exploring

these policies today and let us start thinking about them. I have

thought about them so long I am tired of thinking about them. I

would like to get this done.

10

I especially appreciate this opportunity to testify before this distinguished committee. I actually look forward to the testimony of

some of the other witnesses.

Mr. Chairman, with that I yield back the balance of my time.

Senator ISAKSON. Thank you very much, Dr. Norwood. And on a

personal note, I personally, and I am sure the members of the committee commend you on your miraculous recovery. You are doing

great and we are very proud of you and proud that you are here

today.

Mr. NORWOOD. Thank you, sir. So am I.

Senator ISAKSON. If the witnesses will assume their place at the

table, I will introduce them all at once and then we will hear the

testimony in the order of the introduction.

First with us today is Mr. Jerrold Dodd. Mr. Dodd has been General Manager and Chief Operating Officer of Dayton United Metal

Spinners in Dayton, OH for the last 12 years. Mr. Dodd has been

in manufacturing for over 35 years. Before that he served his country from 1964 to 1970 in the United States Marine Corps as an E5 platoon sergeant.

After his service he started out as a welder while attending college at night, eventually earning a bachelors of science degree in

manufacturing engineering. Most importantly, he did all this while

raising three children with his wife of 39 years.

Mr. Dodd will discuss his experiences with OSHA and any suggestion he has to improve OSHA’s inspection and adjudication process.

Second, we have Mr. Roy Swindal. Mr. Swindal is President of

Masonry Arts, Inc., a specialty contractor company which installs

exterior brick skin components. Mr. Swindal apprenticed as a

bricklayer in high school and college and later worked with his father as a journeyman bricklayer and foreman. He opened his own

shop, Masonry Arts, in 1979 and has seen it grow into a nationally

recognized company.

He will discuss his own experience with OSHA regulations and

inspections and suggest methods to encourage trust and cooperation between a small business and OSHA to ultimately make the

workforce safer in a joint effort between both parties.

Third, we are pleased to welcome Mr. Arthur Sapper, a graduate

of Georgetown University Law Center and the State University of

New York at Buffalo. Mr. Sapper is a partner in the law firm

McDermott, Will and Emery. Mr. Sapper’s practice focuses on all

areas of occupational safety and health law, including inspections,

litigation, rulemaking, counseling and lobbying.

He litigates regularly before the Occupational Safety and Health

Review Commission, the Federal Appellate Courts and various administrative bodies. Prior to joining the firm, Mr. Sapper held the

position of Deputy General Counsel of the Occupational Safety and

Health Review Commission.

We are also very happy to have Ms. Lynn Rhinehart with us

today. Ms. Rhinehart is an Associate General Counsel for the AFLCIO, a position she has held since 1996. Ms. Rhinehart is a former

staff member of this subcommittee, serving as a staffer to former

Senator Howard Metzenbaum.

11

Among her current responsibilities is the coordination of the Federation’s legal work on occupational safety and health issues. Ms.

Rhinehart graduated magna cum laude from Georgetown University Law Center in 1994, which means she is a whole lot smarter

than I am. Following graduation, she clerked for 2 years in the

Honorable Joyce Hens Green of the United Sates District Court for

the District of Columbia.

She is here today to share her views of the AFL-CIO and proposed OSHA reform legislation.

Finally, I would like to add that we asked Mr. Earl Ohman,

former general counsel of the Occupational Safety Health Review

Commission to testify today but he was unable to do so due to a

family commitment. He has agreed to submit testimony for the

record, for which we thank him very much for his cooperation and

for his willingness.

[The statement of Mr. Ohman not available at time of print:]

Senator ISAKSON. I would ask each of the members to try and

stay as close to 5 minutes as they can so we can get in the testimony and all the questions for the panel.

I recognize Mr. Dodd.

STATEMENTS OF JERROLD DODD, GENERAL MANAGER, DAYTON UNITED METAL SPINNERS, DAYTON, OH; ROY SWINDAL,

MASONRY ARTS, BESSEMER, AL; ARTHUR SAPPER, OSHA

PRACTICE GROUP, McDERMOTT, WILL AND EMERY, WASHINGTON, DC; AND LYNN RHINEHART, ASSOCIATE GENERAL

COUNSEL, AFL-CIO

Mr. DODD. Thank you and good afternoon, Mr. Chairman, members of the subcommittee.

I am Jerrold Dodd, General Manager, Chief Operating Officer,

Human Resources Manager. I am all of those above, as you have

heard before. I am the safety officer of Dayton United Metal Spinners Company.

I am pleased to have the opportunity to testify on behalf of the

National Association of Manufacturers on ways to improve the relationship between OSHA and small businesses that benefit not only

employees but their employers and their workers.

As you are aware, the NAM is the Nation’s largest industrial

trade association, representing large and small manufacturers in

every industrial sector and in all 50 States.

NAM’s mission is to enhance the competitiveness of manufacturers and improve American living standards by shaping legislative

and regulatory environment conducive to U.S. economic growth.

In light of our dedication to that mission, the NAM commends

the chairman and ranking Democrat for your efforts on this subcommittee to improve this relationship between small business and

OSHA.

Thank you for allowing me the time to tell you about what is unfortunately a very troublesome episode from my company’s own history with OSHA.

First off, Dayton United Metal Spinners has been in business for

57 years. My brother and his wife bought the company back in

1993, but they left the running of the business in my hands. We

are a manufacturer of quality metal spun products in a safe and

12

family atmosphere. We are small, under 20 workers, but each of

the jobs in our plant is a good job which is valuable to the workers

and their families.

The reason I am here today is to relate a firsthand experience

of what I believe to be an OSHA injustice. I think the small business OSHA due process reforms, when passed, will certainly be a

step in the right direction to correct some of the unfavorable OSHA

conditions small businesses confront and maybe even prevent what

I experienced from happening in the future.

On or about September 10th of 2004, one of my punch press employees severed the tips of two fingers. We packed the fingers on

ice, called the emergency squad and had him flown to an amputee

specialist at the Jewish Hospital in Louisville, Kentucky. The fingers were saved, reattached. He came back to work for light duty

within 3 months.

Approximately 1 week after the accident an investigator for the

Cincinnati, OH OSHA office stopped in. She started asking a few

questions about what happened, when by sheer coincidence the injured worker stopped with his girlfriend. He came into my office so

I told the investigator that she was welcome to ask him what happened.

It was at this moment that the injured worker told the OSHA

investigator in front of me, his girlfriend, and my administrative

assistant, that the accident was his fault. He told the investigator

he was trying to set the punch press up while it was still running

and he knew better. He told the investigator—he admitted his mistake, his mistake, and he said he was trained otherwise.

The investigator took him out in the parking lot and spoke with

him. A little while later she came back in and said she wanted to

take some pictures and talk to some more employees.

The injured worker came back to my office and told me that

while outside alone with the investigator she told him never to

admit wrongdoing in front of your employer and that he had

grounds for a major lawsuit. The investigator also told him that he

may not have a worker’s compensation claim if he admitted wrongdoing and he would have to pay for all of the medical expenses

himself.

I asked the injured worker if he would sign an affidavit to that

effect and he later did just that. He also stated again he told the

investigator the accident was his own fault. The machine should

have been locked out. He failed to do that. He was also upset that

an OSHA investigator would even tell him to sue the company and

he should never admit to wrongdoing.

My story does not stop there. The OSHA investigator also spoke

outside to an employee who was working at a machine behind the

injured worker at the time of the accident. The repeated investigation of this employee was just short of harassment. The employee,

after being repeatedly asked the same questions with the tape recorder being selectively turned off and on, said the investigator

made her feel like she was lying and that the company was being

attacked for wrongdoing. The investigator asked the second employee for her home phone number and address so she could contact her away from the plant. I also have a signed affidavit from

13

this employee stating exactly what happened during the OSHA

interview.

Needless to say, the manner and scope of questioning by the

OSHA investigator left not only my employees but me very upset.

I wrote a letter to the regional director of OSHA in Chicago expressing my displeasure. To my chagrin, this letter seemed to provoke the agency even further and resulted in another visit from the

first investigator with her superior, an OSHA Area Director.

In the meantime I had to hire an attorney from Dunlevey,

Mahan and Fury to represent me. Remember, this entire chain of

events was caused by an employee forgetting to follow safe operational procedures.

When the second visit occurred, it became more an interrogation

of me than an investigation of what happened with the worker and

the severed finger. The OSHA investigator was vindicated by her

superior and all of a sudden then I was the bad guy.

I explained that I wanted no part of an interrogation, called my

attorney, put him on the phone with the Area Director and they

left.

Some time passed, but when I next heard from OSHA, it was in

the form of a notice that I had been fined $17,000. Of course, small

companies such as mine have little option but to pay an attorney

to try to negotiate a lesser fine, despite having to pay the eventual

fine and the attorney’s fees. This is less than having an attorney

fight the charges which would cost even more. To date I have paid

over $8,000 in attorney’s fees which got my fine reduced to $3,500.

The incident gets worse. In addition to the above, this injury got

me kicked out of my BWC group, which I was in for having a good

safety record. My projected BWC premiums are now going to run

between $45,000 and $50,000 a year, compared to the $15,000 I

pay now.

All of this expense is for something that an employee admitted

was his fault. With the shrinking manufacturing work my company

sees each year, this is all money that I cannot afford to pay.

Instead of understanding and help from OSHA, I get fined,

thrown out of a group, and faced with possibly closing my doors if

the money keeps flowing out for the wrong reasons.

We have worked very hard at writing safety and operational procedures that have allowed us to be audited and found compliant to

AS9000 standards, necessary in our industry. We train all of our

employees in these safety and operational procedures and spend

large sums of money to keep our equipment safe.

If I were to make a recommendation or two, I would first suggest

that OSHA investigators be retrained to get out of the employer always guilty first, then the employee mindset. They should be more

of a help in showing employers what needs fixing and give the employer time to make the repairs. Fines should be a last option.

There should be absolutely—they should be absolutely prohibited

from giving legal advice or suggesting legal remedies to any employees that they interview.

It is next to impossible for a person running a small business to

know everything there is to know in the OSHA standards manual.

Investigators need to recognize that, look at what safety devices

14

the company already has in place, what training exists for employees and take these into consideration.

Manufacturing in the United States is under assault like never

before. I believe that providers of jobs in this Nation are taxed,

sued and regulated to death by what are largely unintended consequences of government action. I do not think our competitors

have these same issues to contend with.

All people like me ask of lawmakers like the ones on this subcommittee is to keep a perspective of what each new law and regulation means to people trying to make a living in the rest of the

country. For a long time there has been a Dayton United Metal

Spinners Company and we would like to keep it that way for a long

time. But when the Government comes knocking on your door, they

see retribution and condemnation as its role in what amounted to

a worker failing to do his job properly.

The NAM and its members are working to extend this great

American economy. We want to lower the costs of production that

hamstring us against the world competitors that are taking away

so much of our national wealth. This subcommittee can play its

part by examining new methods for agencies like OSHA to employ

when reaching out to employers and workers.

No one wants an unsafe workplace. I live and work with my employees and see them around town. Do I want to alienate them and

drive them away and see harm done to them? No. I am not that

kind of a person and my company is not that kind of a company.

This experience with OSHA shows how sometimes its inspectors

can stray from their mission of safety and health and get out of

control. Legislation that would allow small businesses to have their

attorneys’ fees reimbursed when they successfully defend a citation

would be a step in the right direction to help small manufacturers

like myself in dealing with these unruly situations.

I invite you to visit your local manufacturing companies to see

firsthand what they are making. The American manufacturer

wants to work. Let us keep it that way. Thank you again for this

opportunity and I look forward to answering any questions that

you may have.

[The prepared statement of Mr. Dodd follows:]

PREPARED STATEMENT OF JERROLD DODD

Good afternoon, Mr. Chairman and members of the subcommittee. I am Jerrold

Dodd, General Manager and Chief Operating Officer of Dayton United Metal Spinners, Inc. I am pleased to have the opportunity to testify on behalf of the National

Association of Manufacturers (NAM) on ways to improve the relationship between

OSHA and small businesses that benefit not only employers, but their workers.

As you are aware, the NAM is the Nation’s largest industrial trade association

representing small and large manufacturers in every industrial sector and in all 50

States. The NAM’s mission is to enhance the competitiveness of manufacturers and

improve American living standards by shaping a legislative and regulatory environment conducive to U.S. economic growth. In light of our dedication to that mission,

the NAM commends the Chairman and ranking Democrat for your efforts on this

subcommittee to improve this important relationship between small business and

OSHA.

Thank you for allowing me the time to tell you about what is unfortunately a very

troublesome episode from my company’s own history with OSHA.

First off, Dayton United Metal Spinners has been in business for 57 years. My

brother and his wife bought the company in 1993, but have left the running of the

company in my hands. We have a proud history of producing high-quality metal

spinning products in a safe, family atmosphere. We are small, with under 20 workVerDate 11-MAY-2000 09:39 Oct 06, 2005 Jkt 000000 PO 00000 Frm 00018 Fmt 6633 Sfmt 6621 21216.TXT SLABOR2 PsN: SLABOR2
15

ers, but each of the jobs at our plant is a good job; valuable to the workers and their

families.

The reason I am here today is to relate a first-hand experience of what I believe

to be an OSHA injustice. I think the Small Business OSHA Due Process Reforms,

when passed, will certainly be a step in the right direction to correct some of the

unfavorable OSHA conditions small businesses confront and maybe even prevent

what I experienced from happening in the future.

On or about September 10, 2004, one of my punch-press employees severed the

tips of two fingers. We packed the fingers on ice, called the emergency squad and

had him flown to an amputee specialist at the Jewish Hospital in Louisville, Kentucky. The fingers were saved, reattached, and he came back to light duty within

3 months. Approximately 1 week after the accident, an investigator from the Cincinnati, Ohio, OSHA office stopped in. She started asking a few questions about

what happened, when by sheer coincidence the injured worker stopped in with his

girlfriend. He came into my office, so I told the investigator that she was welcome

to ask him what happened.

It was at this moment that the injured worker told the OSHA investigator in

front of me, his girlfriend, and my administrative assistant, that the accident was

his fault. He told the investigator that he was trying to set up the punch press while

it was still turned on. He admitted this was a mistake—his mistake—and said he

was trained otherwise.

The investigator then took him out in the parking lot and spoke with him. A little

while later she came back in and said she wanted to take some pictures and speak

with some other employees. The injured worker came back into my office and told

me that while outside alone with the investigator she told him to never admit

wrongdoing in front of his employer and that he had grounds for a ‘‘major’’ lawsuit.

The investigator also told him that he may not have a workers’ compensation claim

if he admitted wrongdoing and he would have to pay for all the expenses himself.

I asked the injured worker if he would sign an affidavit to that effect and he later

did just so. He also stated again that he told the investigator the accident was his

own fault. The machine should have been locked out and he failed to do that. He

was also upset that an OSHA investigator would even tell him that he could sue

the company and should never admit to wrongdoing.

My story does not stop there.

The OSHA investigator also spoke outside to an employee who was working at

a machine behind the injured worker at the time of the incident. The repeated investigation of this employee was just short of harassment. The employee, after being

repeatedly asked the same questions with a tape recorder being selectively turned

on and off, said the investigator made her feel like she was lying and that the company was being attacked for wrongdoing. The investigator also asked this second

employee for her home phone and address so she could contact her away from the

factory. I also have a signed affidavit from this employee stating exactly what happened during the OSHA interview.

Needless to say, the manner and scope of the questioning by the OSHA investigator left not only my employees, but me very upset. Later, I wrote a letter to the

Regional Director of OSHA in Chicago expressing my displeasure.

To my chagrin, this letter seemed to provoke the agency further and resulted in

another visit from the first investigator and her superior, an OSHA Area Director.

In the meantime, I had to hire Mr. Gary Auman of Dunlevey, Mahan and Fury, to

represent me. Remember, this entire chain of events was caused by an employee forgetting to follow safe operational procedures.

When this second visit occurred it became more of an interrogation of me than

an investigation of what happened with the worker and his severed fingers. The

OSHA investigator was vindicated by her superior, and all of a sudden I was the

bad guy.

I explained that I wanted no part of an interrogation, called Mr. Auman, put him

on the phone with the Area Director, and they left.

Some time passed, but when I next heard from OSHA it was in the form of a notice that I had been fined $17,000. Of course, small companies, such as mine, have

no option but to pay an attorney to try and negotiate a lesser fine, despite then having to pay the eventual fine and attorney’s fees.

To date, I have paid over $8,000 in such fees and got my fine reduced to $3,500.

This incident gets worse. In addition to the above, this injury got me kicked out

of my BWC group, which I was in for having a good safety record. My projected

BWC premiums are now going to run between $45,000 and $50,000 a year versus

the $15,000 I used to pay.

16

All this expense is for something that an employee admitted was his fault. With

the shrinking manufacturing work my company sees each year; this is all money

that I can’t afford to pay.

Instead of understanding and help from OSHA, I got fined, thrown out of a group

rating, and possibly faced with closing my doors if the money keeps flowing out the

door for the wrong reasons.

We have worked very hard on writing safety and operational procedures that have

allowed us to be audited and found compliant to meet the AS9000 standards necessary in our industry. We train all of our employees in these safety and operational

procedures and spend large sums to keep our equipment safe.

If I were to make a recommendation or two, I would first suggest that OSHA investigators be re-trained to get out of the ‘‘employer always guilty first, then the

employee’’ mindset. They should be more of a help in showing employers what needs

fixing, and then give the employer time to make repairs. Fines should be a last option. They should also be absolutely prohibited from giving legal advice or suggesting legal remedies to any employees they interview.

It is next to impossible for a person running a small business to know everything

there is to know in the OSHA standards manual. Investigators need to recognize

that, look at what safety devices the company already has in place, what training

exists for employees, and take these into consideration.

Manufacturing in the United States is under assault like never before. I believe

that providers of jobs in this nation are taxed, sued and regulated to death by what

are largely unintended consequences of government action. I don’t think our competitors have these same issues to contend with.

All people like me ask of lawmakers like the ones on this subcommittee is to keep

a perspective on what each new law and regulation means to people trying to make

a living in the rest of the country. For a long time there has been a company called

Dayton United Metal Spinners, and we’d like to keep it that way for a long time

to come. But, when the government comes knocking on the door, like they did in

my case, and only sees retribution and condemnation as its role in what amounted

to a worker failing to do his job properly, then I just don’t know what to think about

the future.

The NAM and its members are working to extend this great American economy

to a new century of growth and opportunity. We want to lower the costs of production that hamstring us against the world competitors that are taking away so much

of our national wealth. This subcommittee can play its part by examining new methods for agencies like OSHA to employ when reaching out to employers and workers.

No one wants an unsafe workplace. I live and work with my employees and see

them around town. Do I want to alienate them, drive them away and see harm done

to them from my own incompetence? No way. I’m not that kind of person and my

company is not that kind of business.

This experience with OSHA shows how sometimes its inspectors can stray from

their mission of safety and health and get out of control. Legislation that would

allow small businesses to have their attorneys’ fees reimbursed when they successfully defend a citation would be a step in the right direction to help small manufacturers like myself in dealing with these unruly situations.

I invite all of you to visit your own local manufacturing companies and see firsthand what they’re making. The American manufacturer wants to work, let’s keep

it that way for a long, long time.

Thank you again for this opportunity and I look forward to answering any questions you may have.

Senator ISAKSON. Thank you, Mr. Dodd. Your testimony was very

informative, albeit slightly a little long. So I would tell the other

members if they will watch the red light and try and sum up when

it is on, that would be greatly appreciated. Mr. Swindal.

Mr. SWINDAL. Chairman Isakson, members of the subcommittee,

thank you for the opportunity to testify before you today on small

employer concerns with rules and regulations promulgated and enforced by the Occupational Safety and Health Administration,

OSHA.

I own a masonry construction business in Birmingham, AL. We

do a variety of masonry, stone and blast-resistant construction in

the United States.

17

As I am sure most of you are aware, OSHA has a variety of programs in place to exchange ideas with trade associations about best

practices which their member companies have a place to protect

employees on the job and improve upon the effectiveness of standards impacting their industries.

The Mason Contractors Association of America has an alliance

with OSHA which focuses on scaffolding, fall protection, wall bracing and forklift safety issues. Our director of engineering, with the

help of several others in the industry, has written a handbook on

wall bracing which OSHA actually refers to for guidance.

These alliances are, in our view, invaluable because they allow

us to share ideas with OSHA on how we can better protect health

and safety of our workers. I commend OSHA for the resources they

dedicate to this important effort.

The Mason Contractors Association would like to expand on this

concept through our existing alliance. In essence, take it one step

further and allow qualified safety personnel from our industry to

train OSHA compliance officers and agency personnel responsible

for writing, interpreting and enforcing health and safety standards,

primarily those impacting construction including masonry and

other specialty trades.

We have had some initial conversations with OSHA about this

and they seem very willing to work with us to establish what we

like to call a ‘‘Training Exchange Program.’’ We have also asked

the agency to add a masonry specific course to its curriculum at the

OSHA Training Institute and again have someone with broad experience from our industry assist in teaching OSHA officials about

the practical applications, some of the standards they write and enforce that are specific to our specialty trade.

By way of example, 2 years ago in Florida and Massachusetts

two companies were cited for leaving materials on the scaffolding

at the end of the work day. The materials are left on scaffolding

for a number of reasons. First and foremost, it would be impractical to remove part of a pallet of bricks from the scaffolding without creating some very precarious and potentially life-threatening

problems.

Moreover, many of these materials remain so the masons can

simply pick up their tools the next morning and go to work.

OSHA’s strict interpretation of this standard would have forced

contractors to bring laborers on the site an hour prior to the start

of a work day and pay them overtime to remove the materials at

the end of the workday, this requiring materials to be handled two

or more times and opening the door for possible injury. This simply

made no sense.

A group of contractors met with the Directorate of Construction

of OSHA to explain to them that they were actually creating more

safety problems. OSHA ultimately issued a different interpretation

to allow contractors to leave materials on the scaffolding without

being cited.

But it is this type of situation which could easily be avoided if

we as contractors were allowed to offer very detailed training guidance to agency officials, most of whom have very little hands-on experience. While it may be the case that only the larger mason contractors would have the resources to make this training exchange

18

program work, every mason contract construction company small

and large would ultimately benefit. Our goal here is information

sharing and the resolution of interpretations and/or citations in a

nonconfrontational fashion. The number one goal of any contractor

is the health and safety of its employees.

If our industry is allowed to work more cooperatively with OSHA

to help avoid the issuance of these certain citations due to the lack

of understanding about a particular provisions’ applications, we

will do a great service to the industry, the OSHA officials and the

Administrative Law Judges who are already overwhelmed with

work. It simply makes sense to have this type of collaborative

structure in place. The contractors and their employees will feel

less threatened if they know OSHA has more knowledge and insight into the specifics of the trade. And the OSHA officials should

be grateful for the knowledge they gain about an industry that contributes a tremendous amount of jobs and economic stability to our

country.

Remember, there are literally millions of construction workers in

this country today.

Again, thank you for the opportunity to present these ideas to

you and I would be glad to answer any questions. Thank you very

much.

[The prepared statement of Mr. Swindal follows:]

PREPARED STATEMENT OF ROY SWINDAL

Chairman Isakson, members of the subcommittee, thank you for the opportunity

to testify before you today on small employer concerns with rules and regulations

promulgated and enforced by the Occupational Safety and Health Administration

(OSHA).

I own a mason contracting business in Bessemer, Alabama. I do a variety of masonry work throughout the country.

As I’m sure most of you are aware, OSHA has a variety of programs in place to

exchange ideas with trade associations about ‘‘best practices’’ which their member

companies have in place to protect employees on the job and improve upon the effectiveness of standards impacting their industries. The Mason Contractors Association

of America has an Alliance with OSHA which focuses on scaffolding, fall protection,

wall bracing and forklift safety issues. Our Director of Engineering, with the help

of several others in industry, has written a handbook on wall bracing which OSHA

actually refers to for guidance on wall bracing issues. These Alliances are, in our

view, invaluable because they allow us to share ideas with OSHA on how we can

better protect the health and safety of our workers. I commend OSHA for the resources they dedicate to this important effort.

The Mason Contractors Association would like to expand on this concept through

our existing Alliance—in essence take it one step further—and allow qualified safety

personnel from our industry to train OSHA Compliance officers and agency personnel responsible for writing, interpreting and enforcing health and safety standards,

primarily those impacting construction and masonry. We have had some initial conversations with OSHA about this and they seem very willing to work with us to establish what we like to call a ‘‘Training Exchange Program.’’ We have also asked

the Agency to add a masonry specific course to its curriculum at the OSHA Training

Institute and, again, have someone with broad experience from our industry assist

in teaching OSHA officials about the practical applications of some of the standards

they write and enforce such as scaffolding, fall protection, the overhand bricklaying

exemption and other issues specific to our specialty trade.

By way of example, 2 years ago contractors in Florida and Massachusetts were

cited for leaving materials on the scaffolding at the end of the work shift. The materials are left there for a number of reasons. First and foremost, it would be impossible to remove part of a pallet of bricks from the scaffolding without creating some

very precarious and life-threatening problems. Moreover, many of these materials

remain so the masons can simply pick up where they left off the previous day.

OSHA’s strict interpretation of this standard would have forced contractors to bring

19

laborers on the job site an hour prior to the start of a shift and pay them overtime

to remove the materials at the end of the shift. This simply made no sense and we

met with the Directorate of Construction at OSHA to explain to them that they

were actually creating more safety problems. OSHA ultimately issued a different interpretation to allow contractors to leave materials on the scaffolding without being

cited. But it is this type of situation which could easily be avoided if we as contractors were allowed to offer very detailed training and guidance to agency officials,

most of whom have very little hands-on construction experience.

While it may be the case that only the larger mason contractors would have the

resources to make this Training Exchange Program work, every mason contracting

company, small and large, would ultimately benefit. Our goal here is information

sharing and the resolution of interpretations and/or citations in a nonconfrontational fashion. The number one goal of any contractor is the health and

safety of their workforce. If our industry is allowed to work more cooperatively with

OSHA to help avoid the issuance of certain citations due to a lack of understanding

about a particular provisions application, we will do a great service to the industry,

the OSHA officials and the Administrative Law Judges who are already overwhelmed with work. It simply makes sense to have this type of collaborative structure in place. The contractors and their employees will feel less threatened if they

know OSHA has more knowledge and insight into the specifics of their trade. And

the OSHA officials should be grateful for the knowledge they gain about an industry

that contributes a tremendous amount of jobs and economic stability to our country.

Again, thank you for the opportunity to present these ideas to you today. I’d be

happy to answer any questions.

Senator ISAKSON. Mr. Swindal, thank you very much. Mr. Sapper.

Mr. SAPPER. Thank you, Mr. Chairman.

My name is Art Sapper. I am a partner in the OSHA practice

group of the law firm of McDermott, Will and Emery here in Washington. I represent today the Chamber of Commerce of the United

States.

I have been practicing OSHA law for 31 years, both in the government and out. I also taught a course at Georgetown in OSHA

law. And I would like to focus my remarks today on the problem

that really amounts to an underlying pathology in the current enforcement of the OSHA Act, and that is judicial deference to OSHA

instead of the Review Commission.

That deference was required indeed by a U.S. Supreme Court

case. The U.S. Supreme Court held, in a case called CF&I Steel,

that if OSHA’s interpretation is merely reasonable it wins, even if

the Review Commission and even if a court thinks OSHA’s interpretation is wrong. They do not have to be right. So OSHA is

awarded a home run, you might say, even if it, in fact, hit only a

foul ball.

The correctness of the Review Commission interpretation is literally irrelevant. Why is it important? Because it was the Review

Commission that Congress established in 1970 as the oversight

agency over OSHA, to look over OSHA citations carefully. Yet it

does not matter if the Review Commission has an opinion on the

matter any more. OSHA wins if it is reasonable, even if everybody

thinks it is wrong, including the court, including the Review Commission.

Now OSHA is essentially a prosecuting agency. And like all prosecuting agencies, it is supposed to do its job with zeal. It would not

be doing its job if it did not do it with zeal. But when you have

an agency that is supposed to act like that, you must have an oversight body over it. You must have a body that can say that OSHA

is wrong, not merely that its lawyers can cobble together an argument that sounds reasonable, which is the case now. But for all

20

practical purposes, there is no such oversight today because of that

U.S. Supreme Court decision.

What are the bad effects of this? First of all, it undermines rulemaking. You see, deference kicks in only if the standard is ambiguous. So if you are an OSHA rule writer, you are going to write ambiguities into your standards. That way you avoid all of the hard

work that goes into making hard policy decisions on the public

record and with evidence. You can just write the standards to be

ambiguous and settle the policy issue through the back door later

through interpretation. And as long as you cobble together a reasonable sounding interpretation, you are going to win.

And that is exactly what happened in the American Cyanamid

case. There a major policy decision was never made in rulemaking.

After the hazard communication standard was adopted, there was

an internal controversy within OSHA over whether or not to impose something called target organ labeling.

It is not important what it is. Let us just say when you read the

OSHA standard when it was adopted it was not there. The only

thing that was there was a vague allusion to it in an appendix to

the standard. The Review Commission said it is not there. So that

if the label said do not breath this stuff, that is bad. It must say

it causes lung damage. OK, it is a policy decision. But it was never

made in rulemaking.

When it was challenged, the Review Commission said it is not

there. The Sixth Circuit reversed, saying it does not matter if it is

not there. OSHA’s interpretation is reasonable so we are going to

require millions of product labels to be rewritten based on a policy

decision that was never actually made in rulemaking.

Another problem with deference. It makes for some really far out

interpretations. Remember, I said the Agency is supposed to enforce the act with zeal? Well, it does. And that is the problem sometimes.

I once had a client, who happened to be a small employer but it

could have been a large one, that was not guilty of an OSHA violation. This we knew to a dead certainty. It received a citation. We

went to the OSHA supervisor in charge of the case and we said we

would like you to withdraw this. Why? Because my client did not

know of the violation. He did not know of it and he could not have

known of it with the exercise of reasonable diligence.

Now if that sounds familiar to people in this room, that is because that has been the case law under the OSHA Act for over a

quarter of a century. The commission and the courts all agree that

that is a requirement that OSHA must satisfy before it can issue

a citation.

This supervisor, a man I have known personally for many years,

and who has had many years of experience in OSHA law, was unaware of the case law. Why? Because the OSHA field manual does

not inform him of it because OSHA has never acceded to all of this

case law. Why? Because its lawyers believe that they can cobble together a reasonable sounding argument that says that all this case

law is wrong. So they do not tell their inspectors about it, they do

not tell their supervisors about it. We asked this gentleman to

withdraw the citation based on this case law. He did not know

21

about it. He was not going to take my word for it so he, logically,

refused.

Now my client happened to be a small employer. He could not

afford to fight this case. So he had to confess to a wrong he did

not commit. He paid the citation. Yes, right, we got the penalty reduced. But he had to admit to something that he did not do wrong,

all because this supervisor was never informed of this case law.

And the reason that he was not informed of it is because of judicial

deference to OSHA.

OSHA does not have to accede to any court decision if it thinks

it can come back with a merely reasonable counter argument.

Now there is absolutely no doubt that Congress never intended

this. It is not even arguable. On the floor the U.S. Senate, Senator

Javits assured the Senate that the Review Commission would decide cases ‘‘without record regard to the view of OSHA’’. And in

fact, it was that assurance that assured the passage of the Javits

compromise. And that compromise permitted the passage of the

OSHA Act. Without it, we would have no OSHA today.

Unfortunately, through fate, the lawyers brief to the U.S. Supreme Court in the CF&I Steel case did not bring that up to the

U.S. Supreme Court. It was not there. I do not blame the U.S. Supreme Court for coming out nine to zero against the employer. It

just was not there. But we know today that it is. We know today

that the Senate was assured that the role of the commission would

be an important one, that it oversee OSHA, that it could say when

OSHA is wrong.

Finally, another problem I would like to bring to your attention

about judicial deference is that yes, the U.S. Supreme Court doctrine says that OSHA can be reversed if it is unreasonable. Well,

try and prove that OSHA is unreasonable. A small attorney who

does not have a lot of experience with OSHA is simply not going

to be able to do it. Not that I don’t have a lot of respect for my

colleagues in smaller towns and cities or in large towns who do not

specialize in OSHA, but they do not specialize in OSHA. Even I

have had tremendous difficulty trying to prove that OSHA is unreasonable, even when it is.

For example, I have had one case pending before the Review

Commission where OSHA’s interpretation is just crazy. It has been

pending there for 101⁄2 years by the way, at least.

The interpretation, by the way, is that whenever a maintenance

mechanic has to work on a piece of equipment he has to have been

trained on how to lock out that very piece of equipment before he

works on it. It sounds reasonable at first glance. Then you realize

that there are tens of thousands of machines in a large manufacturing plant. It would seem crazy, therefore, it would seem enough

to have trained him on general lockout skills that he can then

apply to each machine as he comes across them. But that issue is

now pending before the Review Commission and the Review Commission is not free to decide whether OSHA is right or wrong.

So there is an underlying pathology. It makes for arrogance and

not just ignorance on the part of the OSHA inspectors. And the Review Commission was established, Mr. Chairman, to make sure

that that is cabined, that zeal is controlled.

I thank the chairman for his time.

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[The prepared statement of Mr. Sapper follows:]

PREPARED STATEMENT OF ARTHUR G. SAPPER

Mr. Chairman, and members of the subcommittee, I am pleased to be testifying

before you this afternoon. I am a member of the OSHA Practice Group of the law

firm of McDermott Will & Emery LLP.

I am testifying today on behalf of the U.S. Chamber of Commerce. I am a member

of the Chamber’s Labor Relations Committee and its OSHA Policy Subcommittee.

For 31 years, I have been deeply involved in OSHA law. For 12 of those years,

I served in the Government. I spent over 10 years at the Occupational Safety and

Health Review Commission, where I became Deputy General Counsel. I also spent

2 years at the Federal Mine Safety and Health Review Commission as its Special

Counsel. For over 17 years, I have advised employers regarding their obligations

under the Occupational Safety and Health Act of 1970, 29 U.S.C. § 651–678, and I

have litigated some of the groundbreaking cases under the statute. I have written

and lectured on OSHA law. I have helped to co-author treatises on the OSH Act,

including the well known American Bar Association treatise, OCCUPATIONAL

SAFETY AND HEALTH LAW (2d ed. 2002). I was for 9 years an adjunct professor

at Georgetown University Law Center, where I taught a graduate course in OSHA

law.

Many of the U.S. Chamber’s members are small-and medium-size companies. The

burden of OSHA enforcement falls with special weight upon them, for they can rarely afford to defend themselves against OSHA charges. Unfair aspects of OSHA enforcement—and there are unfair aspects—make it especially difficult for them to assert their rights and often deprives them of a fair hearing entirely.

We therefore encourage the subcommittee to favorably report several bills amending the Occupational Safety and Health Act that we hope will be introduced shortly.

These are moderate and limited bills. They are narrowly targeted at some of the

worst problems with OSHA enforcement. They do not affect OSHA’s ability to adopt

standards. They do not affect OSHA’s inspection authority. They do not diminish

the obligations of any employer or diminish workplace safety. They do not take

away any power that Congress in 1970 intended that OSHA have. Yet, they will

make important improvements in the OSH Act. They will restore balance to OSHA’s

enforcement of the act, and give small businesses a fair chance to plead their case.

They will enhance public respect for the fairness of OSHA enforcement, which is essential if the act is to be effective.

A PATHOLOGY IN THE ENFORCEMENT OF THE OCCUPATIONAL SAFETY AND HEALTH ACT

Mr. Chairman, there is a pathology in the enforcement of the OSH Act. It causes

courts to issue wrong decisions. It undermines the rulemaking process. It lets

OSHA’s prosecutorial zeal go unchecked. It encourages arrogance in OSHA’s attitude toward employers. It effectively strips from many employers a fair opportunity

to assert their rights. And it betrays a promise made to the United States Senate

in 1970, when the OSH Act was passed.

That pathology is the emasculation of the agency that Congress established to be

a check on OSHA’s excesses—the Occupational Safety and Health Review Commission.

That emasculation occurred in Martin v. OSHRC (CF&I Steel Corp.), 499 U.S. 144

(1991), where the Supreme Court held that an OSHA interpretation of an ambiguous regulation must be upheld if the interpretation is merely ‘‘reasonable’’—even if

the court believes that the interpretation is wrong. The decision awards OSHA a

home run even if the Review Commission and a court think that OSHA has hit only

a foul ball. Some courts have even extended that decision to require deference to

OSHA even when OSHA interprets the OSH Act, as opposed to OSHA’s own standards. As I shall show later, this course of decisions is contrary to known congressional intent and to a pledge made directly to the United States Senate.

I can hardly exaggerate the adverse effects of this decision on the fairness of enforcement under the OSH Act.

As I have said, the decision emasculates the Review Commission as a check on

OSHA. Now, OSHA is supposed to enforce the law with zeal. But zeal comes with

a price—it can cause enforcement officials to get carried away. It can cause OSHA

enforcement officials to resort to wrong legal interpretations merely because their

lawyers can make them sound reasonable. Zeal needs to be held in check and overseen by persons chosen for their impartiality. That is why the commission was created—to serve as an impartial check on prosecutorial over-zealousness. But the Review Commission can no longer do that.

23

1The letter can be found at http://www.google.com

Chief Justice John Marshall once said that the duty of the courts is ‘‘to say what

the law is.’’ The Review Commission may no longer say what the law is. It may say

only whether OSHA’s lawyers are reasonable—not right—when they say what the

law is. This disability prevents the Review Commission—the body that Congress established to act as a check on OSHA—from doing its job. The Commission cannot

restrain over-zealous enforcement officials if it must follow legal interpretations because they are merely defensible, and ignore whether they are wrong. That is the

nub of the issue.

SOME EXAMPLES

The following are just a few examples of the unfortunate consequences of judicial

deference to OSHA:

• Depriving small employers of their day in court. A clear example of the destructiveness of deference to OSHA is the Second Circuit’s decision in Chao v. Russell

P. Le Frois Builder, Inc., 291 F.3d 219 (2d Cir. 2002). There, OSHA’s lawyers had

devised an absurdly hyper-technical argument that the Review Commission could

not relieve even deserving employers from merely procedural defaults. The court

held that it was required by CF&I Steel to follow that interpretation. (See the fuller

description of the case below.)

• Telling the public to ignore the commission. In 1995, OSHA issued an interpretation letter (Letter to L. Kreh from R. Whitmore (April 4, 1995) 1) that told an employer to ignore a Review Commission decision. OSHA did not appeal the decision.

Instead, it just ignored it and, worse, told the public to ignore it too. This is the

kind of the arrogance that the CF&I Steel decision breeds.

• Imposing target organ labeling without rulemaking. In Martin v. American Cyanamid Co., 5 F.3d 140, 16 BNA OSHC 1369 (6th Cir. 1993), rev’g 15 BNA OSHC

1497 (Rev. Comm’n 1992), the issue was whether millions of product labels had to

be re-written. OSHA decided—after the rulemaking was over and after internal disagreement—that labels on chemical containers must state the bodily organs they affect. So, ‘‘Do Not Inhale’’ was no longer good enough; only ‘‘Causes Lung Damage’’

would do. Neither the standard nor its legislative history said that OSHA was right,

and OSHA could point to only an ambiguous statement in an appendix to the standard. The Review Commission held that OSHA’s interpretation was wrong. A court

of appeals upheld OSHA’s interpretation, however, not because it was right, but because it was merely ‘‘reasonable.’’ OSHA thus used deference to avoid rulemaking

requirements, to evade scrutiny by the Office of Management and Budget under the

Paperwork Reduction Act, and to force millions of perfectly sensible product labels

to be re-written.

• Machine-specific lockout training. OSHA has interpreted its lockout standard

(29 C.F.R. § 1910.147) to require that maintenance employees be trained on how to

lock out every machine they service. Do the words of the standard clearly require

such machine-specific training? No. Did OSHA decide in rulemaking that it should

be required? No. Would such a requirement be massively expensive? Yes. Would employees remember such training? No. Is such a requirement unreasonable? Yes, but

it is very expensive to prove it. We were counsel to a large industrial corporation

that received a citation requiring machine-specific training. To our client, the expense of litigating the issue would have been too high and, given CF&I Steel, the

probability of success too uncertain, to justify litigation. This employer was thus

forced to admit violations it did not commit.

• Chemical-specific hazard training. OSHA has taken the position that when employees are given chemical safety training, the employees must be told the name of

every plant chemical and the hazard it presents. This is an absurd interpretation.

For example, if you run a gasoline refinery, which has literally thousands of different flammable liquids, you must have a trainer uselessly recite to employees a

mind-numbing list of the name of each flammable liquid. To challenge this view, a

coalition of seven major trade associations had to finance and file an amicus curiae

brief documenting in detail the error in that interpretation. That substantial effort

was driven by the effect of the CF&I Steel decision. Ordinary employers—even large

employers—simply cannot afford to mount such an effort. And so they forgo their

rights.

These are just a few examples of the destructiveness of judicial deference to

OSHA. What cannot be cited to the Senate are the thousands of cases that are

never brought because this destructive doctrine makes it too expensive and, frankly,

fruitless for employers to seek justice in the first place.

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2See 29 C.F.R. § 1910.900(j)(iv), (s)(2), and (z), published in 65 Fed. Reg. 68261 (2000). 3 E.g., BUREAU OF NATIONAL AFFAIRS, OCCUPATIONAL SAFETY AND HEALTH REPORTER: CURRENTS REPORTS, Index to Vol. 33, Nos. 1–38 (Jan. 2—Sept. 25, 2003) (listing 15 stories in 9

months). 4 E.g., AcuTech, ACUSAFE NEWS ‘‘Insider: Update to OSHA Changes on PSM Interpretation’’

(January 2000) (Attachment T). 5See ‘‘OSHA’s Policy Concerning Employees Working At Home,’’ Hearings before the Committee On Education and the Workforce, Subcommittee on Oversight and Investigations, United

States House Of Representatives (Jan. 28, 2000). News reports about the controversy were

broadcast on, for example, CNN Headline News on January 5, 2000. The letter was withdrawn.

See Letter from Richard E. Fairfax to T. Trahan (November 15, 1999). 6 E.g., Beaver Plant Operations, Inc., 18 BNA OSHC 1972, 1974 n.6 (No.97–152, 1999). 7OSHA Directive CPL 2-0.124, Multi-Employer Citation Policy (December 10, 1999) <http://

www.osha-slc.gov/OshDoc/Directive–data/CPL–2-0–124.html>. 8 E.g., Pride Oil Well Service, 15 OSHC 1809, 1814 (OSHRC 1992); Southwestern Acoustics &

Specialty, Inc., 5 OSHC 1091 (OSHRC 1977). 9 N.Y. State Elec. & Gas Corp. v. Sec’y of Labor, 88 F.3d 98, 105 (2d Cir. 1996); Carlisle Equip.

Co. v. Sec’y of Labor, 24 F.3d 790 (6th Cir. 1994); Pennsylvania Power & Light Co. v. OSHRC,

737 F.2d 350 (3d Cir. 1984); Capital Elec. Line Builders v. Marshall, 678 F.2d 128 (10th Cir.

1982); Ocean Elec. Corp. v. Sec’y of Labor, 594 F.2d 396 (4th Cir. 1979); Dunlop v. Rockwell

Int’l, 540 F.2d 1283, 1289–92 (6th Cir. 1976); Horne Plumbing & Heating Co. v. OSHRC, 528

F.2d 564 (5th Cir. 1976); Brennan v. OSHRC (Alsea Lumber), 511 F.2d 1139 (9th Cir. 1975).

EFFECTS ON RULEMAKING

The CF&I Steel decision has also had the perverse effect of rewarding OSHA for

writing ambiguities into its standards. The reason for this is that, under CF&I

Steel, ambiguity enhances OSHA’s litigating position. If a standard is ambiguous,

OSHA need only put forth a ‘‘reasonable’’ interpretation and it will win. This permits OSHA to resolve major policy issues through ‘‘interpretation’’ and without rulemaking. That is why key provisions of the ill-fated ergonomics standard, for example, repeatedly used the ambiguous words ‘‘reasonable’’ or ‘‘reasonably’’ to describe

the employer’s duty.2

The decision also encourages OSHA to evade congressionally imposed requirements for OSHA standards, such as proving ‘‘feasibility’’ and ‘‘significant risk.’’ It

encourages OSHA to evade congressional oversight, to evade oversight by the Office

of Management and Budget under the Paperwork Reduction Act, and to evade the

requirements of the Small Business Regulatory Enforcement Fairness Act. This is

precisely what happened in American Cyanamid, for example. There, OSHA was

able to impose a major policy decision without rulemaking and without scrutiny by

the Office of Management and Budget under the Paperwork Reduction Act.

The CF&I Steel decision has also caused OSHA to develop at least two non-rulemaking avenues for making new rules—interpretation letters and compliance directives. Especially since the CF&I Steel decision, the interpretation letter culture has

flourished in the OSHA field. The issuance of such letters is often featured in occupational safety and health journals 3 and newletters.4 OSHA’s abortive ‘‘home office’’

policy was announced in an interpretation letter.5 OSHA’s lawyers cite such letters

against employers when they favor their litigating position.6 Similarly, OSHA has

taken to announcing major policies in compliance directives, such as its policy on

multi-employer worksites.7 As the home-office debacle shows, this secret law-making

process encourages loose thinking and irresponsible decisions. Instead of OSHA regulating through rulemaking, where public comment must be considered and other

protections (such as those in the Regulatory Flexibility Act) must be provided,

OSHA issues interpretations based merely on internal discussions. The result is

rules made without rulemaking.

EFFECTS ON ENFORCEMENT AND SMALL EMPLOYERS

But worst of all is the disrespect that these decisions breed for the commission

and even the courts. I will give you an example of how this attitude deprives employers of their legal rights. For over a quarter century, the commission has held

that a violation cannot be found unless OSHA shows that the employer knew or

should have known of the violative condition.8 The courts have accepted this holding.9 One would think that OSHA would, therefore, educate its employees and compliance officials on this principle and that it would be reflected in OSHA’s Field Information Reference Manual but neither is the case.

I have had settlement conferences with both long time and new area directors

who give me blank stares when I mention the knowledge principle. Their

unawareness means that the company will have to contest the citation and then

spend time and money fighting charges that should never have been made. Small

and medium size employers can’t afford to do that, and even large employers often

25

10Leon Green, Public Destruction of Private Reputation—A Remedy?, 38 MINN. L. REV. 567,

572-73 (1954), quoted in David W. Robertson, The Legal Philosophy of Leon Green, 56 TEX. L.

REV. 393, 436 (1978). 11S. Rep. No. 1282, 91st Cong., 2d Sess. 55 (1970), reprinted in SENATE SUBCOMMITTEE ON

LABOR, LEGISLATIVE HISTORY OF THE OCCUPATIONAL SAFETY AND HEALTH ACT OF 1970, 92d

Cong., 1st Sess. at 141, 194 (Comm. Print. 1971) (debate ‘‘so bitter as to jeopardize seriously

the prospects for enactment . . . ). See also the pointed remarks by Senators Dominick and

Smith appended to the Senate Report at 61–64, Leg. Hist. at 200-03. 12S. Rep. at 15, Leg. Hist. at 155. 13For example, the Federal Coal Mine Health and Safety Act of 1969, 30 U.S.C. § 801 et seq.

(1976), gave all administrative functions to the Department of the Interior. That department established an enforcement arm, the Mining Enforcement Safety Administration (MESA), and an

adjudication arm, the Interior Board of Mine Operation Appeals (IBMA). The IBMA reviewed

questions of law de novo, without deference to MESA (see, e.g., Eastern Associated Coal Corp., 7 IBMA 133, 1976–77 CCH OSHD ¶21,373 (1976) (en banc); 1 COAL LAW & REGULATION, ¶

1.04[9][b][iii], p.1–49 (T. Biddle ed. 1990) (‘‘Of course, the Board could independently decide

questions of law.’’)), and its views were given deference by courts. Zeigler Coal Co. v. Kleppe, 536 F.2d 398, 409 (D.C. Cir. 1976) (IBMA’s view ‘‘must be given some significant weight’’).

(MESA was later transferred to the Labor Department and became MSHA after the Federal

Mine Safety and Health Act of 1977 was passed; the IBMA’s functions were transferred to the

newly-created Federal Mine Safety and Health Review Commission.) 14 AMERICAN BAR ASSOCIATION, OCCUPATIONAL SAFETY AND HEALTH LAW 32–33 (2d ed. 2002). 15 Id.; Judson MacLaury, The Job Safety Law of 1970: Its Passage Was Perilous, MONTHLY

LAB. REV. 22–23 (MARCH 1981). 16 Judson MacLaury, ‘‘The Occupational Safety and Health Administration: A History of its

First 13, 1971–1984,’’ available at http://www.dol.gov/asp/programs/history/monoosha13introtoc.htm#jud,esp. Chapter 1, ‘‘George Guenther Administration, 1971–1973: A Closely

Watched Start-Up’’ (http://www.dol.gov/asp/programs/history/osha13guenther.htm) (Javits ‘‘a

New York Republican who had played a major role in the passage of the Act’’). 17Leg. Hist. at 463 (remarks of Senator Javits). 18 Id. at 463; see also id. at 193–94, 200-03, 380-94, 479.

find the prospect too expensive, and so they must accept unjustified citations. The

result is occasional justice for large employers and no justice for small ones. I have

had to tell small employers and medium-size employers who were innocent of any

violation, ‘‘Yes, you are right, OSHA is wrong, but you can’t afford to prove it.’’

The decision also encourages in OSHA a palpable arrogance. A safety expert I

once knew complained to me shortly after the CF&I Steel decision came out that

OSHA had suddenly become arrogant in its behavior. As a great legal scholar once

said, ‘‘There is nothing so calculated to make officials and other men disdainful of

the rights of their fellow men, as the absence of accountability.’’ 10

IT WASN’T SUPPOSED TO BE THIS WAY: THE PROMISE MADE TO THE SENATE

The great irony is that it was not supposed to be this way. This we know for certain. The legislative history of the compromise that permitted the passage of the

OSH Act indisputably proves this.

In 1970, the act almost did not pass. Many feared that, if all functions under the

Act were placed in the U.S. Labor Department, that Agency would become too powerful and the confidence of employers in the fairness of the act would be shattered.11

Proponents of giving all powers to the Labor Department argued that a departmental appeals board (i.e., a board established by Cabinet agencies to adjudicate

cases brought by an enforcement bureau) would afford sufficient oversight and independence.12 Such boards decided cases de novo and their views were given deference

by the courts.13 But distrust of internal appeals boards was widespread, and a veto

was threatened by the President.14 To permit the passage of the act, a compromise

was agreed upon: An independent Review Commission would be established as a

check on prosecutorial excess. 15

The legislative history directly addresses whether the Review Commission would

defer to OSHA. The author of the compromise, Senator Jacob Javits, whom even the

Labor Department’s own historian has stated ‘‘played a major role in the passage

of the act,’’ 16 specifically assured the Senate that the commission would decide cases

‘‘without regard to’’ OSHA. He stated that adjudication would be conducted by

‘‘an autonomous, independent commission which, without regard to the Secretary, can find for or against him on the basis of individual complaints.’’ 17 On the strength

of that assurance, Senator Holland immediately declared his support, stating that

‘‘that kind of independent enforcement is required.’’ 18 On the heels of that remark,

the Senate passed the OSH Act. These remarks appear to be the only legislative

history that directly addresses the deference issue. They indisputably show that the

U.S. Senate and the Congress intended that the commission not defer to OSHA.

Deference to OSHA is, of course, contrary to congressional intent, for the commission cannot both decide cases ‘‘without regard to’’ OSHA and also defer to its views.

26

19That CF&I Steel was then in bankruptcy is shown by United States v. Reorganized CF&I

Fabricators of Utah, Inc., 518 U.S. 213 (1996). That it was represented by a small practitioner

is shown by the legal directory at http://pview.findlaw.com/view/2222453–1?noconfirm=0. That

this small practitioner had not previously litigated OSHA cases can be shown by a Westlaw or

Lexis search of the commission’s cases.

Moreover, deference makes the commission even more subservient than the department appeals boards that Congress in 1970 specifically rejected as insufficiently

independent.

So why did the CF&I Steel decision come out the other way? Unfortunately, the

employer’s brief in that case did not bring Senator Javits’s floor statement to the

Supreme Court’s attention. The employer’s brief did not quote or cite the remark

and, apparently as a result, the Court did not discuss it. The employer, CF&I Steel,

was then in bankruptcy, used a sole practitioner with almost no OSHA experience,

and apparently could not afford the cost of thorough legal research.19 The remark

was briefly mentioned in only an amicus curiae brief and apparently overlooked.

Thus, one cannot blame the Supreme Court for this misstep. The Senate should,

however, cure it.

We urge the Senate to redeem the promise made to its members by Senator Javits

by restoring the Review Commission’s proper place under the OSH Act.

THE VACANCY PROBLEM

Another bill before the committee would expand the Review Commission from

three to five members. This is a much-needed reform, and we most respectfully urge

that it be passed.

For over two thirds of its existence, the commission has been so paralyzed by frequent vacancies that it has been unable to do its job. At the moment, the commission has only two members, which nearly always results in paralysis. Unfortunately,

that is common. For about half its existence, the commission has had two or fewer

members and, for over a third of that time, it has had only two members. For 20

percent of that time, it lacked even a quorum of two. Between 1996 and 1999, it

had a full complement for only a third of the time. So cases sit, often for many

years, and the backlog mounts as new cases come in. One large and important case

has been pending before the Commissioners for 11 years.

This endemic problem has greatly damaged public respect for the commission and

prevented it from doing what Congress expected—decide cases expeditiously and

keep a watch on OSHA’s excesses. This would be far less likely to happen if the

OSHRC had five members. As I mentioned above, I have served at both the OSHRC

and its counterpart under the Mine Safety Act, the Federal Mine Safety and Health

Review Commission (FMSHRC), which has five members. The difference between

the two agencies is like night and day. A major reason for this is that the FMSHRC

has five members while the OSHRC has only three. Because it has five members,

the FMSHRC has enjoyed a much more stable membership than the OSHRC. The

FMSHRC can usually be assured of having at least a quorum of three to decide

cases. The OSHRC cannot.

We respectfully urge the Congress to expand the commission to five members.

ATTORNEYS’ FEES—LEVELING THE PLAYING FIELD JUST A BIT

The bill on attorneys’ fees is a modest step in the right direction. It would award

attorneys’ fees and expenses to the very smallest employers if they win. It applies

to employers with not more than 100 employees and a net worth of not more than

$7 million and applies only to OSHA.

The Equal Access to Justice Act (EAJA) has not succeeded in protecting small employers from erroneous OSHA prosecutions. The principle reason is that, under the

EAJA, even if an employer wins, OSHA does not have to pay the employer’s attorneys’ fees unless OSHA’s position was not ‘‘substantially justified.’’ That is far too

easy a target for OSHA to hit. OSHA’s specialized lawyers can almost always come

up with a plausible justification for the prosecution, and that is in practice all that

they need to show. And it is difficult and expensive to prove that OSHA’s position

was not ‘‘substantially justified’’ even if it was. Even if a small employer proves that

he or she is innocent and OSHA should not have brought the case, that employer

must still start another proceeding, incurring even more expenses, to prove that

OSHA’s position was not ‘‘substantially justified.’’ This is a formidable deterrent to

seeking fees, particularly since OSHA can meet this test relatively easily.

The bill will help solve this problem, and somewhat re-open the door to the courthouse for small employers. To be sure, the bill’s effect will be modest, as it covers

only the smallest of the small employers covered under the EAJA, which applies to

27

employers of 500 employees and not more than $7 million. Few small employers will

want to gamble on winning in court. Few will beat OSHA’s specialized attorneys.

Nearly all will continue to settle at the informal conference stage, to which this provision does not apply. Nevertheless, the prospect of having to pay attorneys’ fees

and expenses should encourage OSHA and its lawyers to be sure of their legal

ground before prosecuting a small employer. It will force them to focus on employers

that truly deserve their attention. That will assuredly be a good thing.

Now some will argue that this provision will ‘‘chill’’ legitimate enforcement by

OSHA, because the expenses will be paid from OSHA’s budget. However, the Congressional Budget Office estimated the cost of a previous version of this legislation

to OSHA at about only 3 million dollars per year. This seems to be a small price

to pay to make OSHA think twice about the strength of its case before going after

the small employer and to inject a little justice into a system that grinds up small

employers in litigation costs and effectively denies them the opportunity to vindicate

themselves.

GIVING SMALL EMPLOYERS A NEEDED BREAK FROM DEFAULT JUDGMENTS

Right now, the case law under the OSH Act deprives employers—and especially

small employers—of the same right to seek relief from a default judgment possessed

by nearly every other litigant in the Nation. If a small employer fails to file an answer to a complaint on time in almost any other court, that court has the power

to relieve the small employer of the default, and give him a day in court. But that

is not true under the OSH Act. According to a recent decision by the U.S. Court

of Appeals for the Second Circuit, which I will soon describe, an employer flatly

loses its opportunity to defend itself before the Occupational Safety and Health Review Commission, and will be deemed guilty, if it misses a rigid 15 working day

deadline to file a notice contesting an OSHA citation, even if the employer had a

good excuse for missing that deadline. The employer is out of luck and the Government wins without even proving its case.

Although OSHA recently announced that it would no longer urge this interpretation, administrations change and there is no guarantee that a future OSHA will adhere to this course. Accordingly, a bill to cure this problem permanently is needed.

THE FACTS OF THE LE FROIS CASE—AN UNDISPUTED CASE OF EXCUSABLE NEGLECT

Take the case of Russell P. Le Frois Builder, Inc. OSHA issued citations and

$11,265 in proposed penalties to that company by certified mail. A secretary for the

company got the envelope from the post office, and put it with the day’s other mail

on the front seat of her car. The envelope with the OSHA citation apparently

slipped behind the seat, where it was found after the 15 working day contest deadline expired. The company had used the same mail pickup system for 18 years and

had not previously had a problem with it. Le Frois promptly filed a notice of contest,

and asked the independent Occupational Safety and Health Review Commission for

‘‘a chance to tell our side and to defend ourselves.’’ The commission excused the lateness of the notice of contest, finding this to be a case of excusable neglect.

OSHA agreed that the Le Frois case involved excusable neglect. But OSHA appealed anyway to the U.S. Court of Appeals for the Second Circuit—and won, with

one judge dissenting. Chao v. Russell P. Le Frois Builder, Inc., 291F.3d 219 (2d Cir.

2002). OSHA convinced the court that the Review Commission lacked the power to

relieve an employer from a default on the ground of excusable neglect.

THE UPSHOT—EXCUSABLE NEGLECT IS IRRELEVANT

The Review Commission thus stands nearly alone among the courts of the Nation

in lacking the power to relieve an employer of a procedural default caused by neglect that is excusable. If this result makes no sense, that is because sense has nothing to do with it. OSHA’s litigation position and the decision of the Second Circuit

turn instead on a hyper-technical reading of the OSH Act and judicial deference to

OSHA. The decision holds that Section 12(g) in which Congress ordered the commission to apply court rules, including a rule permitting relief from default judgments—

was overridden by Section 10(c) of the OSH Act, which makes uncontested citations

final and not subject to review.

I will spare the subcommittee my technical analysis of the matter. Suffice it to

say that the bill would do away with this unequal result and put employers on the

same footing as nearly every other litigant in the Nation: They will have the right

to ask for relief from a default judgment and, after explaining, have a reasonable

opportunity to obtain that relief. This bill would permit the commission to grant relief in rather narrow circumstances—when the default is due to ‘‘mistake, inadvertence, surprise, or excusable neglect.’’ That language is taken directly from Federal

28

20See Potlatch Corp., 7 BNA OSHC 1061, 1064 (OSHRC 1979) (no time or location limit on

‘‘repeated’’ violations). 21 E.g., Felden v. Ashland Chemical Co., 631 N.E.2d 689 (Ohio App. 1993) (admitting OSHA

citation); Industrial Tile v. Stewart, 388 So.2d 171 (Al. 1980) (same). 22See Fitchburg Foundry, 7 BNA OSHC 1516 (OSHRC 1979) (§ 10(a) requires notice of contest

to be sent to ‘‘the Secretary’’).

Rule of Civil Procedure 60(b), which has long been interpreted by the commission

and the courts to permit relief if there is a legitimate reason.

For that reason, the change brought about by this bill will be modest. Under the

bill, comparatively few employers will qualify for relief from default. The effect on

OSHA’s enforcement program will be small. But small employers will notice it. They

will know that under the OSH Act they can at least have a shot at justice. Why

is a shot at justice important? Because the consequences of being unable to appeal

an OSHA citation can be severe and far-reaching. They include: • Payment of proposed penalties. Penalties can range up to $7000 for ‘‘serious’’ and non-serious violations, from $0 to $70,000 for each ‘‘repeated’’ violation, and

$5000 to $70,000 for each ‘‘willful’’ violation. • Inclusion of the citation on the employer’s ‘‘history of previous violations,’’ which

raises subsequent penalties, and which is available to the public to see on the Web. • Exposure to subsequent ‘‘repeated’’ or ‘‘willful’’ violations, even if the subsequent

violation occurred at a different workplace or years later.20

• Disqualification in some jurisdictions from bidding on public construction contracts. E.g., CAL. GOV’T CODE § 14661(d)(2)(B)(vi)(II). • Use of the citation against the employer in civil litigation.21

• A requirement to abate the cited condition. This might require that a factory

be rebuilt or a construction method be abandoned. It might require that a machine

be modified to meet specifications in an inapplicable standard. See, e.g., Losli, Inc., 1 BNA OSHC 1734 (OSHRC 1974), where a failure to contest a citation meant that

a metal shear had to be modified to meet inapplicable specifications for power presses—a nonsensical result.

Moreover, there is more than one way that small employers can innocently fail

to timely contest a citation, aside from losing a mail envelope. For example, a notice

of contest sent to the wrong agency—to the Review Commission rather than

OSHA—is ineffective.22

Legislation to permanently fix this problem should be introduced.

Thank you for permitting me to participate in this afternoon’s panel. I look forward to answering any questions that you may have.

Senator ISAKSON. Thank you, Mr. Sapper. Ms. Rhinehart.

Ms. RHINEHART. Thank you, Mr. Chairman, Mr. Chairman and

Senator Murray.

I appreciate the opportunity to testify this afternoon on measures

to improve safety and health protections for America’s workers, and

particularly workers at small businesses. Clearly, a lot of work remains to be done.

I appreciate the opening comments of the Senators and the panelists. I think it is clear that we all agree and support job creation

in America. We all want to see increased employment and see our

economy grow. We also all support workplace safety to protect

America’s workers. The question is how we get there.

The fact is that there is much work that still needs to be done.

We have serious safety and health problems in America’s workplaces.

Senator Murray recounted these statistics better than I can and

so I will be very brief in summarizing just a couple. Each day 15

workers die on the job, over 5,500 a year. That is not counting the

tens of thousands of workers who die from occupational diseases

like cancer caused by asbestos, benzene and other substances.

There are more than 12,000 workers a day who are injured on the

job, more than 4 million workers each year. That is the population

of many small towns in America who get injured on the job every

day of every year in this country.

29

The cost of these injuries, according to data produced by the Lib- erty Mutual Insurance Company, is more than $1 billion a week.

Not $1 billion a year, $1 billion a week. So it is an extremely expensive cost to our Nation, to workers, to their families. The fact

is that prevention of these injuries and illnesses is good for workers. It is good for families. And it is good for the bottom line.

Now there are many well-meaning good employers out there

doing the right thing, trying to protect their workforce and paying

attention to job safety issues. But we would not have 4 million injuries in America today and 50,000 to 60,000 workers being killed

and dying from occupational disease in this country if everybody

was doing the right thing. So clearly, there are problems that still

need to be addressed.

One of the problems is that we have a job safety agency that is

chronically underfunded and has just an enormous job to do with

very limited resources. OSHA gets about $450 million a year to

protect the health and safety of more than 100 million workers at

more than 8 million worksites. Federal OSHA has less than 1,000

inspectors. There are about 2,000 inspectors nationwide, if you

count Federal, OSHA and State plans. As Senator Murray pointed

out, this is enough inspectors to inspect each workplace in America

once every 108 years.

In some States, there are even fewer than average inspectors.

Like for example, Georgia only has 33 inspectors to cover 220,000

businesses. And so inspectors there can only get to workplaces once

every 158 years. Other States like Washington State are actually

better than the average. Washington State has 119 inspectors to

cover about the same number of workplaces as exist in Georgia.

There, inspectors can get to workplaces on average once every 33

years. Better, still not great. It is clearly a very under-resourced

Agency.

So given the fact that OSHA cannot get to workplaces all that

often, you would expect to find significant penalties when they do

get to the workplace and find that an employer has been violating

the job safety law. You would expect significant penalties. But that

is simply not the case. The average penalty for violating the OSHA

law is only $955. It is less, it is $872 on average, for series violations of the law which are violations that pose a substantial risk

of death or serious injury to workers.

And criminal enforcement under the OSHA law, in comparison

to environmental laws for example, is virtually nonexistent. And

that is because the criminal provisions in the OSHA law are such

that an employer can only be prosecuted for a willful violation of

the law if a worker dies. If a worker is injured or put at great risk,

that is not enough. A worker actually has to die. And in that instance, the penalty is a misdemeanor, 6 months in jail. You can go

to jail for longer for harassing a wild burro on Federal lands than

you can for willfully killing a worker in this country. And that is

just not right.

So in our view, the law needs to be strengthened, not weakened,

and much more needs to be done to protect workers in this country.

I would like to make a couple of points about safety and health

as it pertains to small business in particular. I think we all would

agree that small does not necessarily mean safe, that there are seVerDate 11-MAY-2000 09:39 Oct 06, 2005 Jkt 000000 PO 00000 Frm 00033 Fmt 6633 Sfmt 6601 21216.TXT SLABOR2 PsN: SLABOR2
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rious hazards that exist in small businesses, particularly in certain

industries like, for example, construction.

According to the Bureau of Labor Statistics, in the construction

sector firms with fewer than 20 employees are 38 percent of the

workforce but have 55 percent of the fatalities. There are other

studies that have been done around the country. For example, in

Texas a study of Hispanic construction workers showing the same

sort of disproportionate fatality rate as small construction employers.

There are a number of measures in place in law and by OSHA to assist small employers in complying with the law. There is a $53

million per year compliance assistance program that is directly targeted to small employers. That is four times the annual budget

that OSHA has to set job safety standards. Four times that budget

goes to assist small employers in complying with the law. Last year

about 31,000 employers, all small employers, received assistance

through that program.

Small employers get up to 60 percent penalty reduction when

they are cited by OSHA. Very small employers, employers with

fewer than 10 employees, are exempt through an appropriations

rider from regular job safety inspections.

And there are other laws like SBREFA and the Regulatory Flexibility Act and alphabet soup of regulatory oversight laws that direct the Agency to pay particular attention to the concerns of small

business.

We agree that consultation and outreach to small business is appropriate but we also think that we need strong enforcement of the

law as a deterrent to get employers to focus on protecting the safety and health of their workers. It is not one or the other. We really

do need both.

I see I am running short on time but I would like to spend just

a minute talking for a few minutes about a small employer by the

name of Eric Ho.

Senator ISAKSON. 2 minutes, is that good?

Ms. RHINEHART. I can do that. I can do this in 2 minutes. Thank

you, Mr. Chairman.

Senator ISAKSON. Even two-and-a-half, you are so nice.

Ms. RHINEHART. I appreciate it, Mr. Chairman.

I would like to talk for a couple of minutes about Eric Ho, a

small employer, and how that sad story relates to the issues that

we are talking about today and the legislation introduced in the

House of Representatives.

Eric Ho is a small employer in Houston, Texas. He hired 11 undocumented workers from Mexico to do building renovation work at

a facility in Texas. They were scraping and removing material that

contained asbestos. As you know, asbestos causes cancer, lung disease and a range of other disorders.

Eric Ho knew there was asbestos and he knew his workers were

being exposed. He provided them no training. He provided them no

respirators, none at all.

The city inspector of Houston inspected the workplace and he

saw dust and he saw that workers were not provided respirators.

That inspector issued a stop work order and told Eric Ho to stop

the job until he got a proper workforce and inspector on site.

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Eric Ho did not stop the job. Instead, he had the work done at

night, under cover of darkness. He locked the gates and had workers work behind locked gates with no water, one portable toilet, to

get the job done. No respirators, no training or other safety equipment.

OSHA inspected and cited Eric Ho for 11 willful violations of its

asbestos training standard and its asbestos respirator standard.

One violation per employee who was not provided a respirator or

training. Eric Ho admitted he did not provide the respirators or

training but he took his case to the Occupational Safety and Health

Review Commission which threw out 10 out of the 11 citations,

saying that OSHA only had authority to cite him once for violating

a training standard and once for violating the respirator standard,

even though 11 workers needed a respirator to protect them from

the asbestos and 11 workers needed training to be protected on the

job.

Incidentally, Eric Ho was also criminally convicted for violating

the Clean Air Act and letting asbestos into the air but he could not

be prosecuted under the OSHA law because the workers did not

die, they were just put in harm’s way. So he was criminally convicted under the environmental laws but succeeds before the Review Commission in getting 10 out of his 11 citations thrown out.

What does all that have to do with the price of milk and what

we are talking about here today? Two things. First, one of the

measures introduced in the House of Representatives, HR 742,

would give employers like Eric Ho their attorney’s fees. Because he

was able to get 10 out of 11 of those citations thrown out at the

Review Commission, he would have taxpayers pay his attorney’s

fees for fighting his case. So that bill would reward rogue employers like Eric Ho and give them their attorneys’ fees at the end of

the day. We think that is just an outrageous use of public funds

and taxpayer funds, especially when you are talking about an agency that does not have enough money to the job as it is.

Second, the Eric Ho case relates very much to the deference bill,

the bill that Mr. Sapper was talking about, that would shift the

deference from the Secretary of Labor to the Occupational Safety

and Health Review Commission.

Why is that? Well, because the issue in the Ho case was whether

or not the respirator and training standards were standards that

imposed obligations to individual employees, whether or not the

standards meant that each employee got a respirator or whether

just employees as a whole got respirators. The Secretary of Labor

interpreted the rules to say each employee, the rule means each

employee gets a respirator. The Review Commission engaged in exactly the kind of second-guessing that the U.S. Supreme Court said

it should not and it said no, the rule only allows one citation and

it threw out all but one of those citations against Eric Ho.

HR 741, the bill in the House of Representatives, would open the

door to more decisions like Ho, by giving the Review Commission

the authority to make decisions like that. And to give deference to

decisions like that, we believe, places deference and authority in

the wrong place. The deference should go to the policymaker, the

rulemaker, not to the adjudicator.

32

We think that the legislation moves things in the wrong direction

and we would prefer measures that would actually strengthen the

job safety law, not divert resources away from OSHA and the important work it needs to do.

Thank you, Mr. Chairman, and thank you for the additional couple of minutes.

[The prepared statement of Ms. Rhinehart follows:]

PREPARED STATEMENT OF LYNN RHINEHART

Mr. Chairman and members of the subcommittee, thank you for the opportunity

to testify today about the need to improve safety and health protections for the millions of workers employed by small businesses. My testimony will address several

legislative proposals (H.R. 739, 740, 741, and 742) that have been advanced and promoted on grounds that they will assist small businesses in their efforts to comply

with the requirements of the Occupational Safety and Health Act. This testimony

is submitted on behalf of the 13 million working men and women represented by

the 57 national and international unions that comprise the AFL-CIO.

The Occupational Safety and Health Act (OSH Act), as written and as administered by the Occupational Safety and Health Administration (OSHA), already includes numerous measures to assist small businesses in complying with the law. In

our view, the pending legislative proposals are either unnecessary or counterproductive. The bills will drain resources away from an agency that is chronically

underfunded and struggling to fulfill its statutory mandate. And the bills will do

nothing to address the serious job safety hazards faced by American workers.

Two weeks ago, on Workers Memorial Day (April 28), the AFL-CIO released a report, entitled, ‘‘Death on the Job: The Toll of Neglect,’’ that details the astounding number of deaths and injuries occurring in workplaces across the United States,

and the numerous shortcomings in our Nation’s efforts to deal with this serious

problem. Each year, millions of workers are injured or made ill by job hazards. According to the Bureau of Labor Statistics, each day, 15 workers die on the job. The

number would be far higher if deaths from occupational diseases such as cancer and

black lung disease were included.

At its current budget levels, OSHA’s enforcement reach is severely limited. There

are at most 2,138 Federal and State OSHA inspectors responsible for enforcing the

law at approximately 8 million workplaces. In fiscal year 2004, 861 Federal OSHA

inspectors conducted 39,246 inspections, and the inspectors in State OSHA agencies

conducted 58,675 inspections. At its current staffing and inspection levels, it would

take OSHA 108 years to inspect each jobsite in America just once.

The penalties assessed by OSHA for violations of the law are exceedingly modest.

In fiscal year 2004, OSHA assessed a total of $82.6 million in penalties against employers for 86,475 violations of the law, for an average penalty of just $955. The

average penalty for a serious violation of the Occupational Safety and Health Act—

defined as a hazard posing a ‘‘substantial probability that death or serious physical

harm could result,’’ 29 U.S.C. § 666(k)—is just $872.

Serious safety and health hazards exist at workplaces across the United States,

in businesses large and small. Just because a business is small does not mean it

is safer. To the contrary, small firms, particularly in high hazard industries like

construction, are very dangerous.

The Bureau of Labor Statistics’ fatality data—which, unlike injury data, is based

upon a government census, and not employer self-reports—shows that in high risk

industries such as construction, small firms account for a disproportionately high

percentage of fatal injuries. For example, according to BLS, firms with fewer than

20 employees employed 38.2 percent of the construction workforce, but accounted for

55.5 percent of all construction fatalities. (BLS, 2002 Census of Fatal Occupational

Injuries).

Similarly, a study of Hispanic construction workers in Texas found that 40 percent of fatalities among these workers occurred in establishments of less than 10

employees. (Fabrega and Starkey, Fatal Occupational Injuries among Hispanic Construction Workers of Texas, 1997 to 1999, Human and Ecological Risk Assessment,

2001; 7:1869–1883). And a study of fatalities among teenage construction workers

found a similar result. Sixty three percent of the teenage construction fatalities investigated by OSHA from 1984–1998 occurred at firms with fewer than 11 employees. (Suruda et al., Fatal Injuries to Teenage Construction Workers in the U.S.,

American Journal of Industrial Medicine, 2003, 44:510–514).

33

Clearly, small businesses have their share of workplace hazards, particularly in

high risk industries. Workers employed at these firms need the full protection of the

job safety law.

It is important to point out that OSHA, and the OSH Act, already include special

provisions designed to assist small employers and provide them special relief in enforcement proceedings. First, for more than 25 years, through a rider in the annual

OSHA appropriations bill, employers with 10 or fewer employees in ‘‘safer’’ industries have been exempt from OSHA general schedule inspections. This exemption

covers the majority of small businesses in this country. These firms are only subject

to inspections in the event of a fatality or complaint from employees alleging serious

hazards.

Second, the OSH Act itself directs that the size of the employer must be taken

into account in setting penalties, along with the seriousness of the violation, the employer’s compliance history, and the employer’s good faith. 29 U.S.C. § 666(j). OSHA

has established specific enforcement policies taking these statutory mandates into

account. Under OSHA’s policy, the smallest employers—those with 25 or fewer employees—are entitled to an automatic 60 percent reduction in the amount of the assessed penalty. The percentage reduction decreases as the size of the employer increases. (Field Inspection Reference Manual, Ch. IV.C.2.c.) Penalties may be further

reduced in any post-citation settlement, and they also may be reduced by the Occupational Safety and Health Review Commission (OSHRC), which considers the size

of the employer when establishing a final penalty amount.

Third, for decades OSHA has had a small business compliance assistance program. This program, administered through grants to the States, is currently funded

at more than $53 million in the fiscal year 2005 budget—more than 10 percent of

OSHA’s entire budget. This is nearly four times more than the agency spends developing workplace safety standards. According to OSHA, in fiscal year 2004, there

were 31,334 consultation assistance visits conducted under this program, all of

which, pursuant to OSHA’s policies, were conducted at business establishments with

fewer than 250 employees.

The AFL-CIO believes that these measures appropriately address the particular

issues and needs of small employers, and they should be continued. We do not support the additional measures contained in H.R. 739, 740, 741, and 742. It is important to point out that only one of these bills—H.R. 742—specifically applies only to

employers with less than 100 employees. The other bills apply to all employers covered by the OSH Act. These bills would chill enforcement of the law and divert

much-needed resources from enforcement and standard-setting, at a time when the

injury, fatality, and enforcement statistics all show that more, not less, enforcement

of the job safety law is needed to protect American workers.

Our views on each of the bills are set forth below.

H.R. 742, The Occupational Safety and Health Small Employer Access to

Justice Act

H.R. 742 would require taxpayers to pay the attorneys’ fees and legal costs for

‘‘small’’ employers (defined as employers with 100 or fewer employees and up to $7

million net worth) who prevail in any administrative or judicial proceeding brought

by OSHA or any challenge to an OSHA standard, regardless of whether OSHA’s action was substantially justified. This bill would drain resources away from OSHA

and further weaken OSHA enforcement at a time when it needs to be strengthened,

not curtailed.

Under the age-old American Rule, each party to litigation pays its own expenses.

This is true not only in private litigation but also in cases in which the Government

acts as public prosecutor to enforce consumer protection laws, environmental laws,

safety and health laws, and labor laws.

The Equal Access to Justice Act (EAJA) provides a limited exception to the American Rule. Under EAJA, organizations with no more than 500 employees and a net

worth of no more than $7 million, can recover their fees and costs if they prevail

in administrative or judicial proceedings against the Federal Government, but only

if they meet two conditions. First, an award is proper under EAJA only if the agency’s position was not substantially justified. Second, an award can only be made if

there are no special circumstances that would make the award unjust. 5 U.S.C.

§ 504.

H.R. 742 would create a special exception from the American Rule, and from

EAJA, for legal proceedings under the OSH Act. Employers that prevailed in administrative or judicial proceedings under the OSH Act would be entitled to fees and

costs from OSHA without having to show that the Government’s position lacked

substantial justification and that there are no special circumstances that would

make an award unjust.

34

There is no credible reason for carving out this exception either to the American

Rule or to EAJA. By subjecting OSHA to the payment of attorneys’ fees and costs

every time the agency loses a case to an employer falling within the bill’s definition,

the bill would seriously weaken OSHA’s effectiveness.

When Congress enacted EAJA, it considered and rejected automatic awards to

prevailing parties precisely because such an ‘‘approach did not account for the reasonable and legitimate exercise of government functions and, therefore, might have

a chilling effect on proper government enforcement efforts.’’ GAO, ‘‘Equal Access to

Justice Act: Its Use in Selected Agencies,’’ Jan. 14, 1998, at 9. Instead, Congress

crafted EAJA’s limited exceptions ‘‘to insure that the Government is not deterred

from advancing in good faith the novel but credible extensions and interpretations

of the law that often underlie vigorous enforcement efforts.’’ H.R. Rep. No. 1418,

96th Cong., 2d Sess. at 11.

H.R. 742’s reach is broad. Notwithstanding the label ‘‘small employer’’ in the title,

the bill would apply to all employers with not more than 100 employees and a net

worth of not more than $7 million. Data from the Census Bureau show that establishments with fewer than 100 employees make up 98 percent of all private sector

establishments. (U.S. Census Bureau, Statistics about Business Size, 2001). Excluding businesses with no employees (i.e., self-employed individuals), establishments

with fewer than 100 employees still comprise 86 percent of all private sector business establishments. Id. These firms employ fully 36 percent of all employees, or

nearly 41 million workers. Id.

In contrast, Congress traditionally defines ‘‘small business’’ for the purpose of establishing coverage under a range of other employment-related laws by imposing a

far smaller ceiling on the size of the workforce. The Age Discrimination in Employment Act, for example, applies to employers who have 20 or more employees. 29

U.S.C. § 630(b). Title VII of the Civil Rights Act, 42 U.S.C. § 2000e(b), covers employers with 15 or more employees. But the vast majority of private sector establishments would fall within the employee threshold for coverage established by H.R.

742.

H.R. 742 would provide a monetary incentive for more employers to challenge

OSHA citations, to spare no expense, and to drag out litigation of the case, because

at the end of the day they could recover their attorneys’ fees and costs if they prevailed.

The bill would allow even the worst employers—ones with repeated and egregious

violations—to recover fees if they prevailed on a particular violation. Take for example Eric Ho, who was cited for 11 willful violations of OSHA’s respirator and training standards after he exposed his immigrant workforce to asbestos by requiring

them to perform building renovation work behind locked gates at night without any

respirators or training. Eric Ho was criminally convicted of violating the Clean Air

Act. But he succeeded in persuading the Occupational Safety and Health Commission to throw out 10 of the 11 willful OSHA violations, on grounds that OSHA was

not allowed to cite Ho for each employee exposed to asbestos hazards, but could only

issue one citation. Secretary of Labor v. Ho, Nos. 98–1645 & 98–1646 (OSHRC, Sept.

29, 2003). H.R. 742 would require taxpayers to pay the attorneys fees and costs of

rogue employers like Eric Ho.

EAJA currently provides for fee awards if the Government’s position is not ‘‘substantially justified.’’ EAJA thus penalizes—and deters—the filing of insubstantial

complaints. No rational public policy would be furthered by discouraging OSHA

from issuing citations that are substantially justified but as to which the government ultimately is unable to carry its burden of proof. Rather, the inevitable result

of such a rule, which would penalize the government every time it loses, would be

to chill the issuance of meritorious citations in close cases on behalf of employees

exposed to unsafe working conditions.

It is important to point out that H.R. 742 is not limited to enforcement proceedings initiated by OSHA. By its terms, H.R. 742 applies to any administrative or judicial proceeding, meaning that qualifying employers could recover their attorneys’

fees and costs for successfully challenging an OSHA standard or regulation in court.

While OSHA has been quite successful in defending its rules and standards, this

provision will create a huge financial incentive for businesses to fight OSHA’s rules

even more routinely and aggressively, given the possibility of recovering their attorneys’ fees and costs at the end. As a result, OSHA will be even more reluctant to

issue much-needed workplace safety rules to protect workers.

H.R. 742 will drain resources away from an agency that has perpetually struggled

to do its job with the limited resources available to it. As estimated by the Congressional Budget Office, this bill would cost $7 million in fiscal year 2005 and $44 million total for fiscal year 2005–2009, which must come out of OSHA’s budget. This

would require Congress to appropriate additional money to OSHA’s budget to cover

35

the cost of the bill or to cut OSHA’s enforcement budget or reduce compliance assistance to small business. Passage of this bill would further reduce the resources available for implementing and enforcing the OSH Act, to the detriment of working men

and women who depend on OSHA to protect their safety and health on the job.

H.R. 741, The Occupational Safety and Health Independent Review of

OSHA Citations Act

H.R. 741 is a misdirected piece of legislation that would undermine the Secretary

of Labor’s authority to interpret and enforce the job safety law. The bill flies in the

face of Supreme Court precedent and longstanding administrative law principles.

The bill should be rejected.

H.R. 741 would overturn the Supreme Court’s unanimous decision in Martin v.

Occupational Safety and Health Review Commission, 499 U.S. 144 (1991). Martin

v OSHRC dealt with the question of which agency’s interpretation of an OSHA rule

should be given deference—the Secretary of Labor’s, or OSHRC’s. After reviewing

the language, structure, and legislative history of the OSH Act, the Court unanimously ruled that the Secretary of Labor, and not OSHRC, should be given deference.

The Court’s decision in Martin v. OSHRC was in keeping with well-established

precedent giving deference to administrative agencies that are given authority by

Congress to adopt and implement regulations. 499 U.S. at 150–151 (citing precedent). In Martin v. OSHRC, the Court elaborated on the important reasons for this

rule.

First, the Court pointed out that the Secretary of Labor ‘‘enjoys readily identifiable structural advantages over the commission in rendering authoritative interpretations of OSH Act regulations. Because the Secretary promulgates these standards, the Secretary is in a better position than is the commission to reconstruct the

purpose of the regulations in question.’’ 499 U.S. at 152. By contrast, OSHRC does

not promulgate occupational safety and health standards and has no such expertise.

Second, the Court pointed out that ‘‘by virtue of the Secretary’s statutory role as

enforcer, the Secretary comes into contact with a much greater number of regulatory problems than does the commission, which encounters only those regulatory

episodes resulting in contested citations.’’ 499 U.S. at 152. This experience makes

it ‘‘more likely [that the Secretary will] develop the expertise relevant to assessing

the effect of a particular regulatory interpretation.’’ Id. By contrast, OSHRC sees

only a small slice of the enforcement cases brought by the Secretary. Employers

seek review of less than 10 percent of all cases before the commission, and only a

fraction of these cases are heard by the full commission. As a consequence, the commission does not have the same breadth and depth of knowledge and experience as

the Secretary of Labor.

It is also important to note that under Martin v. OSHRC and related cases, the

Secretary of Labor still has the burden of showing that her interpretation is reasonable. Where the commission or a reviewing court believes the Secretary’s interpretation is not reasonable—for example, where the Secretary has advanced conflicting

or inconsistent interpretations—no deference is given to the Secretary’s view. Thus,

the Secretary does not have unbridled discretion; there is a very real and substantial check on her authority built into the system.

H.R. 741 would turn this well-established system upside down and say that the

Review Commission, not the Secretary, should get the final say on the meaning of

the Secretary’s regulations. This defies longstanding precedent and common sense.

As the Court in Martin recognized, the Secretary of Labor, as the policymaking entity that promulgates and enforces workplace safety standards, is in a far superior

position to interpret the meaning of her own regulations, and to have those interpretations respected so long as reasonable. Policy decisions like the interpretation of

workplace safety standards should be left with the policymaking body, not given to

an adjudicative body that lacks comparable knowledge, experience, and expertise.

H.R. 739, The Occupational Safety and Health Small Business Day in Court

Act

Under the OSH Act, an employer has 15 days in which to challenge an OSHA

citation. 29 U.S.C. § 659(a). If the employer does not file a notice of contest with

OSHRC by that deadline, the OSHA citation becomes a final order of the commission, enforceable against the employer. Id.

H.R. 739 would excuse employers from the OSH Act’s 15 day deadline if the employer can show that its failure to meet the deadline was caused by ‘‘mistake, inadvertence, surprise, or excusable neglect.’’

36

The intent of the bill, according to its proponents, is to incorporate into the OSH

Act provisions for obtaining relief from a final judgment similar to those provided

by Rule 60(b) of the Federal Rules of Civil Procedure (FRCP).

The bill is unnecessary. The Commission has always taken the position that Rule

60(b) applies to commission proceedings and that the Commission has the authority

to provide relief from a final judgment when the employer has made the requisite

showing under Rule 60(b). See, e.g., Secretary of Labor v. Branciforte Builders, Inc.,

9 OSHC 2113 (1981). The courts of appeals have generally agreed that Rule 60(b)

applies to commission proceedings and that OSHRC has authority to provide relief

from a final judgment where appropriate under that rule. See, e.g., Marshall v. Monroe & Sons, Inc., 615 F.2d 1156 (6th Cir. 1980); J.I. Hass Company v. Marshall, 9 OSHC 1712 (3d Cir. 1981); Avon Contractors, 372 F.3d 171 (3d Cir. 2004).

Proponents of the legislation argue that the bill is needed because of a contrary

court ruling in Chao v. Russell P. LeFrois Builder, Inc., 291 F.3d 219 (2d Cir. 2002).

But that decision is both an anomaly and irrelevant, given that the Solicitor of

Labor has now issued a memorandum stating that the Department of Labor will no

longer seek to prohibit employers from making a claim for relief under Rule 60(b).

See Memorandum to Regional Solicitors, et al., from the Solicitor of Labor (Dec. 13,

2004).

The bill is also inappropriately one-sided. It excuses employers from missing their

15 day deadline but does not provide the same relief to employees or their representatives who seek to exercise their statutory rights to challenge the period for

abatement in a citation. Fairness and reason dictate that both employers and employees should be afforded the same relief if Congress were to adopt this measure.

Finally, it is important to point out that the legislation, while purporting to incorporate the provisions of FRCP 60(b), does not actually track the language of that

rule. Rule 60(b) includes important safeguards and limitations, including that the

motion for relief under Rule 60(b) must be made within a reasonable time, and in

any event not more than 1 year after the judgment was entered. Rule 60(b) also

specifies that a motion made under the section does not affect the finality of a judgment or suspend its operations. Particularly in a circumstance where, as here, the

judgment at issue is one that requires employers to address workplace safety hazards, Rule 60(b)’s safeguards and limitations should apply. Parties should be required to make their motion for relief within 1 year, and the motion should not affect the employer’s obligation to abate the hazard while the employer is seeking relief from the judgment.

H.R. 740, The Occupational Safety and Health Review Commission Efficiency Act

H.R. 740 expands the number of members on the Occupational Safety and Health

Review Commission (OSHRC) from three to five, and mandates that all members

have legal training.

In our view, the bill is unnecessary and inappropriate in a time of severe budgetary constraints. The commission’s modest caseload does not warrant a 40 percent

expansion in the number of Commissioners. Moreover, the fact is that the commission’s perpetual case backlog has persisted regardless of whether the commission is

fully staffed or lacks a quorum. It would appear that factors other than the size of

the commission or the lack of a quorum affect the commission’s ability to issue decisions.

And it is no coincidence that Republican Members of Congress are pushing to expand the number of seats on the commission at a time when a Republican president

would fill the seats.

Proponents cite to the Federal Mine Safety and Health Review Commission as an

analogous agency with five Commissioners, not three. However, it is also the case

that the FMSHRC has more responsibilities, and hears more cases, than OSHRC.

For example, miners and their representatives are permitted to bring cases before

the FMSHRC alleging retaliation for exercising their rights under the mine safety

law, and the FMSHRC hears and decides these cases. The OSH Act has no comparable provision, and OSHRC has no comparable role.

Expansion of the Commission, and restricting the eligibility of individuals to serve

as Commissioners, are unnecessary and unwarranted proposals that should be rejected.

In sum, the AFL-CIO urges the subcommittee to explore ways of strengthening

the OSH Act and its enforcement in order to address the high injury and fatality

levels that persist in American workplaces today. Passage of H.R. 739, 740, 741, and

742 will do nothing to advance this goal; to the contrary, they will deprive OSHA

of the resources and authority they need to do the job.

Senator ISAKSON. Thank you, Ms. Rhinehart.

37

We will do our questions 5 minutes each. And then if there is

time and there are other questions, we will go to a second round.

I will start.

I have to ask Ms. Rhinehart a question. I take every story I hear

at every committee hearing at face value. You told a story with regard to Eric Ho and Mr. Dodd told a story with regard to his employee that cut off the ends of I think two fingers. Did you hear

that story?

Ms. RHINEHART. I did.

Senator ISAKSON. Based on your testimony, what Mr. Ho did was

outrageous. I think most people would react in that way. Do you

think the action of OSHA in the case that he talked about, of the

fingers, was as outrageous?

Ms. RHINEHART. Mr. Chairman——

Senator ISAKSON. That is not a trick question.

Ms. RHINEHART [CONTINUING]. It is not a trick question but it is

a hard question because, just as you do not have the entire record

in the Ho case before you, I do not have the entire case.

Senator ISAKSON. I would never hold you to it.

Ms. RHINEHART. I know you would not but I am troubled by some

of the things that Mr. Dodd said. I am troubled by some of the

things he said but I would really like to see——

Senator ISAKSON. Let me tell you why I asked that, and that is

a tough question and you are a sweet lady and I probably should

not have done that to you.

But I find oftentimes that we sometimes lose sight in these hearings of—we get an extreme issue. I would hope your situation and

the behavior of that OSHA inspector was an isolated instance, just

like I would hope and pray that the Eric Ho’s of the world are an

isolated situation, but recognize we need to be vigilant to see to it

that if those people exist they are pointed out.

The ideal in enforcement is for people to respect the law for what

it is intended to do. Which brings me to my first question which

I will throw out there.

I will ask Mr. Swindal, in your experience with OSHA directly,

or what you have heard, do you feel like that cases are made where

there is an example that can serve the purpose to send notice? Or

do you think they are always made based on the most merit of the

circumstances?

And I ask that question because Ms. Murray raised a very good

point, and that is the number of inspectors versus the number of

workers. The problem is we could not hire enough IRS agents or

anything else, versus the number of taxpayers, on compliance. So

there is a lot of example setting in terms of—which do you think?

Do you think it is based on merit, in all cases, or sometimes to set

the example to get the word out?

Mr. SWINDAL. You will hear in town that such and such, that we

have got inspectors coming around, they are all over, they are trying to do this and that. But there may have been a death and

something very, very serious could have happened in the city.

I have been involved in cases where an OSHA inspector comes

to the job and the site was ridiculous. It was in terrible shape. And

we had our people on the site having to follow the rules, making

38

sure everything was right, because we know it was a dangerous

site and we had complained to the general contractor.

I think that what I was talking about earlier, to avoid those circumstances where the agents are on this side and the contractors

are on this side or the manufacturers are on this side, the coming

together in a situation like I was discussing, as a training together

to go over situations before we have these occur. And to get the

smaller firms that are involved in construction, that do not have,

as you said, the safety directors, the people to go out and really

help them. They do not know the rules. How could you know all

the rules if you were a small, 15 or 20 man company? You will not.

Your MSDS books are going to be out of date. They are not going

to be correct. That is part of it. And it is unfortunate, but that is

the way it is.

And I think the partnership that we can create as a company

here and taking the time with professionals in our business, joining

with the OSHA team to look at these regulations: one, before they

are presented; two, to go over some of the regulations that are—

when there is a series of violations occur, and it seems to me there

is nothing you can do about it, and it does not work, come together,

sit down and discuss it with the contractor community or the safety

director as a team as we were discussing earlier.

That is what we see. It is a problem. As you said, the construction industry is absolutely the most unsafe of all the work environments. We are doing everything we can to improve it. But I go to

sleep every night praying that nobody’s going to get killed the next

day because I know they are on their own.

Senator ISAKSON. Thank you. Ms. Murray.

Senator MURRAY. Thank you, Mr. Chairman, and I would agree.

The statistic that Ms. Rhinehart cited—spending $1 billion a week

on occupational injuries, is a cost that is hurting all of us. And it

seems to me that one of our challenges is we do not have sufficient

funds within the budget to make sure we are educating people,

that OSHA has what they need, and NIOSH, to be able to educate

companies so they can follow the regulations without being surprised by them.

And I think that is something that all of us believe we should

be doing a better job of.

I do have a question. Ms. Rhinehart, you talked about Eric Ho.

Was part of the problem that there is not criminal liability? And

the fact that he could keep doing this for some time without facing

some kind of criminal—for something as egregious as you discussed.

Ms. RHINEHART. That is exactly one of the problems in the Eric

Ho case, is that the OSHA Act only allows a criminal prosecution

in circumstances where a worker died, where an employer willfully

violates an OSHA rule—which Eric Ho did and the commission

found he did—and a worker dies.

Here workers were not killed directly but they were poisoned by

asbestos.

Senator MURRAY. Which we know you may not know about for

30 years.

Ms. RHINEHART. Correct. There is no authority under the OSHA

law for prosecution in that instance. Ironically, there is, under the

39

Clean Air Act, for releasing asbestos into the air but not for poisoning the workers. In our view, it is a serious shortcoming in the law

and we would support legislation to correct it.

Senator MURRAY. Mr. Dodd, the chairman asked Ms. Rhinehart

one side of it. Let me ask you the other side of it.

You heard her story about someone who very willfully violated

the law, really put people at risk knowingly. Do you think that for

those egregious—not for your case, which can be understandable,

but for egregious cases should we have criminal liabilities within

OSHA? It does cost business.

Mr. DODD. That is a question, I think, for the courts to settle.

But if somebody does something like that, yes. People like myself,

people like Mr. Swindal, I am sure, who have been working for a

long time, trying to run an honest business and provide jobs for

people. We do not need people like that. The industry does not need

people like that. Those are the kind of people that hurt the industry.

So if it was me that was making the decision, if I was in charge

of that, if I was Senator Isakson and I had the power to say that,

I would say he needs to be prosecuted. He needs to be prosecuted.

That was more than willful. That was deliberate. If OSHA came

in and shut the place down and then he climbs over the fence and

unlocks it and has his workers back in there, then that is a criminal action.

But again, that is not for me to decide.

Senator MURRAY. Mr. Dodd talked about some of the things that

he felt were important for us to look at, training for OSHA inspectors, more help to businesses to be able to comply with the law. Ms.

Rhinehart, would you concur that those are some of the things we

need to look at? To reduce the number of injuries and deaths?

Ms. RHINEHART. Yes, I would agree that those are good suggestions and areas to look at. The only point I would make is that you

are talking about an agency that has $450 million to do its job.

Every time you move resources into this area, it takes them away

from another area like, for example, enforcement.

So it seems to me that some good suggestions have been made

and that perhaps some additional moneys could be found to explore

those sort of partnerships.

Senator MURRAY. Which would be my final point, and I have to

go to the floor so I am not going to be able to remain, Mr. Chairman. We can all talk about helping our companies understand the

rules. But if we do not provide the enforcement officers out there

working with them and the direction to do that, then we will be

back with egregious cases, injured workers and employers frustrated.

So I think it is an issue that our committee does have to look

at.

Thank you, Mr. Chairman.

Mr. SWINDAL. Senator Murray, could I ask you one question in

reference to that?

I do not think we will—do you actually think that we are going

to ever have the ability to legislate this to every company in the

United States? We, as companies, have got to take the responsibility along with OSHA to do this.

40

Senator MURRAY. I absolutely think that there are really good

employers out there who work really hard to comply with this. And

there are times when they simply do not have the knowledge of

what they need. How do we get them better information? As people

who want to make sure everybody has fewer injuries, fewer deaths,

we all share that same goal. We need to educate them.

That was my point, we cannot just expect this information to

somehow transform into businesses. We need to help provide the

resources to make sure it is out there.

Mr. DODD. That law that you are talking about, the Ho thing,

that law could also be used against—again, if Senator Isakson had

the power to say that he could be criminalized for that or punished

for that criminally, that same law—if the OSHA people have the

power, I guess, to say we are going to have you arrested for that

because you were criminal there, again that same law could be

used against Roy. It could be used against myself, too, as good employers.

They came in, you had this employee who just nipped off two fingers on a punch press. That, to me, is criminal in my mind, the

inspector’s mind. I am going to have to have you two arrested and

shut your place down.

Senator MURRAY. Thank you, Mr. Chairman.

Senator ISAKSON. Thank you, Senator Murray. Mr. Chairman.

The CHAIRMAN. Thank you. The accountant in me made me

make some calculations here. I noticed that we have 861 inspectors

now, at the Federal level. And so I made some calculations to see

how many we would have to have in order to get it down to one

inspection per 5 years.

It means that we have to add 18,000 inspectors to do the job. I

do not think anybody is going to consider that a reasonable number

to increase the budget by. So we are going to have to find some

other solutions. We are going to have to find some cooperative ways

where employers and OSHA and employees are working together.

Incidentally, I also did some calculations based on the numbers

provided in Ms. Rhinehart’s testimony. And I can figure out a way

to get that number down without increasing the workforce quite

that substantially. Those numbers indicate that there is less than

one inspection a week done by each of the employees. If we increase that to one per day, we bring the number down by 80 percent.

I have got to find out more about what takes so long to do the

inspections, because again when I was a safety officer, I never had

anybody inspect me longer than half a day and it was at multiple

sites. I have got to tell you, I got the violation once where we did

not have a no smoking sign the right number of feet from the rig.

Now that is very important. It was 3 feet short. And the actual rule

of the industry is that it has to be outside of the guy lines. And

it was well outside the guy lines. So people that were within a dangerous distance to the rig would know about it. But that took us

several weeks to get resolved.

So Mr. Swindal, I really like your program where industries do

some cross training with the OSHA inspectors so that they can

learn what the best practices are. These guys have a tough job.

They go from a dentist’s office to a construction site to a shoe store

41

to an oil field and that is all different practices. So there probably

needs to be a little bit of specialization which would speed up that

process a little bit.

But you suggested this idea of having safety personnel to cross

train. How do you think such a program—how can we implement

such a program?

Mr. SWINDAL. The Training Exchange Program which we are discussing is very similar to how the mason contractors, as I said earlier, we have created a number of manuals, one for forklift drivers,

one for bracing scaffolding.

We shared all of that information with OSHA. That was the first

way that we started to be able to try to work with them. And they

were very interested in understanding what we are trying to do.

So now what we do is we take, let us say from one of the best

safety directors of one of the major masonry contractors or glazing

contractors or concrete forming contractors. And he goes and he actually sits down and discusses any new regulations or regulations

that at the time OSHA is having a hard time enforcing or there

seems to be a rash of incidents about these.

And they sit down and they discuss what is causing this? Why

is this happening? And what can we do? Is something wrong with

the regulation? Is this really a safe/unsafe thing going on? Or is it

just something that has been on the books and it is not of any use

at the present time, the way it is being interpreted in this particular occasion?

So I think that would work very well and work with some of the

people that are in charge of the OSHA—we discussed the OSHA

training facility they have here. Do some mockups of any of the

new rules, whether it be for dentistry or whether it be for whoever

or whatever. But construction, in general, there are so many things

that can go wrong that are so dangerous. And we spend too much

time going through those.

The CHAIRMAN. But you are kind of saying that through this

process of doing the cross-training, you also have the people in the

industry comparing notes on what the good practices are, too.

Mr. SWINDAL. Yes.

The CHAIRMAN. Which undoubtedly has some good side benefits.

Mr. SWINDAL. With all of the trades involved and—this can go

from manufacture all the way across. It does not just have to be

for the masonry industry. We looked at it in that manner.

The CHAIRMAN. I noticed in your testimony, too, that you have

a drug testing program in place.

Mr. SWINDAL. Yes, sir.

The CHAIRMAN. You may not realize that in some States random

drug tests are illegal unless they are based on reasonable suspicions of drug use. They cannot be a preventive tool applied across

the board so that it does not discriminate. Clearly that is not the

case in Alabama.

Do you believe that your policy keeps your employees safer and

has other positive effects?

Mr. SWINDAL. The drug policy?

The CHAIRMAN. Yes.

Mr. SWINDAL. Yes. As a whole, it is preemployment, number one.

That stops probably—our HR director said it probably stops 50 perVerDate 11-MAY-2000 09:39 Oct 06, 2005 Jkt 000000 PO 00000 Frm 00045 Fmt 6633 Sfmt 6601 21216.TXT SLABOR2 PsN: SLABOR2
42

cent of the problems that we were having without it. Our insurance

rates have gone down dramatically and our injury, lost time injury

accidents, have dropped dramatically over the last 10 or 15 years

that we have been doing this.

The CHAIRMAN. I would agree. I am probably the only one in the

Senate that is trained to collect urine specimens and do saliva

tests.

Mr. SWINDAL. We have a number of foremen that can do the

same.

The CHAIRMAN. We found that it affected almost four out of five

employees that applied for jobs and we were able to cut off a lot

of accidents in the past that way.

Ms. Rhinehart, it has been observed in some instances the hazardous communications practices and procedures are pretty complicated. And we have been trying to work on those MSDS sheets

for quite a while and get them more reasonable so that they actually provide timely information to people in a crisis situation. It

would be nice if they knew all of that stuff beforehand, but they

do not even know what all the chemicals are before they get to

working on it.

Do you have any suggestions for simplifying that MSDS process

and some way that we can get that information to the workers

when it is more meaningful and more useful?

Ms. RHINEHART. I am wishing I could snap my fingers and become Peg Seminario, our Health and Safety Director, who would

have a very complete answer for you on that.

But perhaps developing some model MSDS’s, OSHA developing

some models and getting them out to businesses and to small business and providing them to workers would be of assistance across

the board. That is one suggestion.

The CHAIRMAN. Good. We would like to work with you on that

and other things that you have suggested in the testimony.

I see that my time is expired. I have some other questions but

I will submit those in writing.

Senator ISAKSON. Thank you, Mr. Chairman.

Mr. Sapper, you had a comment?

Mr. SAPPER. Mr. Chairman, I just wanted to add something

about the Ho case and the effect, or I should say the light it might

shed on the attorney’s fees bill. It actually proves the opposite of

the point that I believe Ms. Rhinehart was trying to make.

Had the attorney’s fees bill been law when the Ho case was

brought, OSHA would have easily seen that 10 out of the 11 citations were patently weak. They were so weak, in fact, that the Review Commission, even under the crippling disability imposed by

the CF&I Steel case, threw them out. Not only that, they were also

thrown out by the Fifth Circuit on appeal.

So had you been an OSHA lawyer looking at the Ho case, as

egregious as it was, and I agree that it was egregious, you would

have said to yourself, this guy should be slammed. But if we try

to do it 11 times, it is going to get thrown out. So you would have

had your mind concentrated mightily by the thought you will end

up paying this guy his attorney’s fees. So you will bring just a

straight case, no questionable citation items, just a straight case.

43

He would have been slammed. That would be the end of it. And

he would not have gotten a penny of attorney’s fees.

So I think it proves the opposite of the point that she was quite

eloquently trying to make. But those are the facts.

Senator ISAKSON. Well, it proves by my asking that question

about 15 minutes ago I provoked a lot of responses. But two of the

responses that I provoked were actually the intent of the question

and I would like to just tell you what those were.

If this subcommittee were to try and improve OSHA laws, undertaking one side or the other based on Mr. Dodd’s case or Ms.

Rhinehart’s example in the Ho case, we would do a great disservice. Because both of them are extreme examples. And were we to

assume all businesses were like Mr. Ho or all OSHA inspectors

were like the one that inspected you, we would have a heap of trouble.

Fortunately for us, I think both of those cases, both very egregious in different ways, should be dealt with as examples for either

inspectors or businesses to never do that again.

But in the meantime in the middle, the broad middle, wherein

I think most all American business is or strives to be, we need to

work for two things. One is good laws that protect the health and

welfare and safety of workers. And second is a proactive compliance attitude on behalf of business and the regulator.

To that end, I want to, as chairman of the subcommittee, commend Mr. Swindal and those that he represents for their best practices, recommendations and their offering to OSHA from the standpoint of training in the expertise that they have. And believe me,

high rise skin application is an expertise like something you have

never seen. I do not know what your rate per 100 on worker’s comp

is but—what is it, by the way?

Mr. SWINDAL. I do not know right now. We have to be self-insured with—we are self-insured with a very high deductible.

Senator ISAKSON. I would be willing to bet you that after payroll,

workers comp might be the number two expense in the company.

Mr. SWINDAL. Besides material, yes.

Senator ISAKSON. Which is another thing that, as a business person, is so important. And that is that safety is rewarded at the bottom line by better premiums, meaning lower premiums. And bad

practices are punished at the bottom line very severely.

Did I cut you off, Ms. Rhinehart? I let him say something and

you had a—I do not know whether you were pointing your index

finger at me or whether you wanted to be recognized.

Ms. RHINEHART. I was pointing it at Mr. Sapper.

Senator ISAKSON. That was the right answer.

Ms. RHINEHART. If I could just have a moment to respond.

Senator ISAKSON. We have 47 seconds left and then we are out

of time.

Ms. RHINEHART. I just wanted to point out that, in fact, there

was precedent for per employee citations of the sort of training and

respirator standards that OSHA cited Eric Ho for. So in fact, they

were relying on precedent, not just going off on a lark and citing

him for those 11 employees. I would make that point.

I would also say that I just do not think that any of us around

this table would criticize OSHA for pursuing an employer like Eric

44

Ho aggressively. I think we can all agree that employers like Eric

Ho need to be dealt with and dealt with severely. Thank you.

Senator ISAKSON. That was my point. Both of those stories indicated violators on all sides of this whole equation that should have

been dealt with and the whole situation would be a whole lot better

off.

I want to thank all of our witnesses for testifying today.

I want to ask unanimous consent that the record be held open

for 10 days for any additional submission or comment.

Hearing no objection, so ordered.

The subcommittee hearing is adjourned.

[Additional material follows.]

45

ADDITIONAL MATERIAL

STATEMENT OF TOM HOWLEY

Subcommittee Chairman Isakson, my name is Dr. Tom Howley and I currently

serve as President of the Academy of General Dentistry (AGD), a national professional association representing over 37,000 general dentists.

Let me begin this testimony by thanking you for your distinguished leadership on

this committee; for your continued and well-known support of the small-business

community; for your strong record as an advocate for workplace safety; and for your

demonstrated support for improving the programs and operations of the Occupational Health and Safety Administration (OSHA) through the enactment of appropriate reform legislation.

As you may know, a major focus of the Academy of General Dentistry’s work, is

to afford our members the opportunity to hone and refine their skills through highquality continuing education opportunities; to promote the highest degree of professionalism possible; and to promote excellent standards of patient care. Members of

the academy also know, from first hand experience, that appropriate access to oral

health care services is essential to maintaining good health—and that a lack of access to adequate oral health care is harmful to individuals and families, and is extremely costly to society as a whole.

As trained health care professionals, members of the academy are justifiably

proud of their long years of training, their special expertise, and their commitment

to quality health care—but our member dentists also wear another hat. As a practical matter, the vast majority of the Academy’s members practice in a small-business environment. Most dentists are small businessmen and women who are the

principal owners and operators of their individual dental practices. In this capacity,

they face the same day-to-day challenges faced by any small businessman or businesswoman. They must manage their cash flow and control expenses. They must

hire and retain a skilled workforce. They must ensure an accessible and wellequipped facility in which to provide their skilled services—and, like other small

businessmen and women, they must comply with a myriad of rules and regulations—some of which, do not always efficiently or fairly address the concerns for

which they were originally intended.

One Federal Agency, well known to our members, is the Occupational Health and

Safety Administration (OSHA). OSHA is primarily concerned with workplace and

workforce safety issues. Without question, the overall mission of OSHA is vital—

and it is clearly appropriate for this agency and for Members of Congress to be concerned about workplace safety issues. As small businessmen and women—who employ on average six persons in each dental practice—our members are committed

to ensuring a safe workplace environment, and invest much of their time and energy

doing so on a continuous basis.

In terms of ensuring a safe workplace environment, both for our employees and

patients, members of the academy and other practicing dentists have not always

found that interacting with OSHA has been an especially constructive or welcome

exercise. There have been instances where the Agency has gone about its mission

in a ham-handed manner—resulting in unrealistic burdens and unfair enforcement

actions being visited on our members and other small businessmen and women. To

address these concerns, we are pleased to add the support of the AGD to the large

number of business groups, trade and professional associations, that have called for

the enactment of reasonable OSHA reform legislation. Specifically, we are pleased

to endorse the enactment of four bills (H.R. 739, H.R. 740, H.R. 741 and H.R. 742)

introduced in the House of Representatives by your colleague from Georgia, Representative Charlie Norwood. We are further pleased that you are taking a leadership role in addressing the small business communities OSHA concerns by holding

this hearing today and focusing attention on the need for appropriate OSHA reform

legislation.

As you know Mr. Chairman, the reform legislation we seek to advance, has broad

support within the business community, and will go a long way towards addressing

legitimate concerns small businessmen and women have when it comes to OSHA

compliance and enforcement issues. The Norwood legislation being discussed today

will: (1) Provide the OSHA Review Commission with added flexibility when it comes

to applying the 15-day rule for contesting citations or proposed penalties, so that

an employer would not automatically lose their case on technical grounds—if for legitimate reasons, they are unable to comply with the 15-day deadline for an appeal;

(2) Expand from three to five the number of members sitting on the OSHA Review

Commission in an effort to prevent unnecessary delays in adjudicating cases; (3) Establish that the independent OSHA Review Commission—rather than OSHA itself—

46

is the entity that will be given deference on how to interpret OSHA law by appellate

courts reviewing the Commission’s decisions; and (4) Amend the Equal Access to

Justice Act (EAJA) to allow, under some circumstances, an employer to recover attorney’s fees incurred if they are successful in defending against OSHA citations.

Collectively, these proposed reforms will, if enacted, produce a fairer, more balanced,

and more effective OSHA enforcement environment. Such an environment will help

assist the small business community in meeting its responsibilities under the law

and will help ensure a safer workplace environment overall.

Mr. Chairman, we look forward to working with you and other Members of the

HELP Committee to advance these needed reforms. We commend your leadership,

the leadership of Representative Norwood in the House—and we also commend the

fine efforts of the U.S. Chamber of Commerce and the OSHA Fairness Coalition in

helping to focus attention on the need for OSHA reform legislation.

In conclusion, we thank the subcommittee for this opportunity to express the

views of the Academy of General Dentistry regarding OSHA.

For additional information regarding the Academy’s views on other matters likely

to be considered by the 109th Congress, please do not hesitate to contact us at the

Academy’s national office: 211 East Chicago Avenue, Suite 900, Chicago, Illinois

60611–1999, (Tel. 312–440–4300), (www.agd.org).

[Whereupon, at 3:30 p.m., the subcommittee was adjourned.]

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