Briefing Report to Congressional 

IZlequester’s 

iii& 1992 

---- 

? OCCUPATIONAL 

SAFETY& HEALTH 

Employers’ 

Experiences in 

Complying With the 

Hazard Communication 

Standard 

II Ill I

146524 

GAWIIRD-9%63BR 
,,,I 

II__, L.~-~..---_..--_I.-.. _-... - -... _. .--I .” .-.- .“_. -_- . .-_... ._.. .” *I. ..I...__-I .“.-._--__-- -.--__11----1.- 

1 
GA!0 United States 

General Accounting Office 

Washington, D.C. 20548 

Human Resources Division 

B-243568 

May 8,1992 

The Honorable Dale L. Bumpers 

Chairman, Committee on Small Business 

United States Senate 

The Honorable Norman Sisisky 

Chairman, Subcommittee on Exports, 

Tax Policy, and Special Problems 

Committee on Small Business 

House of Representatives 

As you know, the Hazard Communication Standard (HCS) requires 

employers to identify workplace chemical hazards and communicate this 

information to employees. First promulgated for the manufacturing sector 

in 1983, HCS was extended to nonmanufacturing employers in 1987. HCS is 

administered by OSHA, an agency of the U.S. Department of Labor. 

In response to your request and after discussions with your offices, we 

examined (1) the difficulties small employers report they are experiencing 

in complying with HCS, in particular with the material safety data sheet 

(MSDS) requirements,’ and (2) the methodology underlying OS-IA’S 

estimates of costs for small employers in nonmanufacturing industries to 

comply with the MSDS requirements. Consistent with your request, we 

focused on small employers, although we collected information on 

employers of all sizes. (In our 1991 report, we responded to other 

questions you asked about HCS2) We presented our preliminary results in a 

briefing with your offices on October 24, 199 1. Our final results appear in 

this report, which includes the charts used in that briefing (see app. I). 

‘Typically, the MSDS is a 1-5 page document detailing, among other information, the chemical’s 

properties and hazards and precautions for its safe use and handling. For examples of MSDSs, see 

Occupational Safety & Health: OSHA Action Needed To Improve Compliance With Hazard 

Communication Standard (GAO/HRD-92-8, Nov. 1991). 

“GAO/HRD-92-8. 

Page 1 GAO/HRD-9243BR OSHA Hazard Communication Standard 
B-24350g 

Results in Brief “’ Of the small employers (those with fewer than 20 employees) we surveyed 

who appeared to be complying with the Hazard Communication Standard,3 

almost 70 percent reported little difficulty with either of the two MSDS 

requirements. However, almost 80 percent of such small employers 

reported problems complying with HCS’s training requirements. Over half 

of small employers reported some cost increases to comply with HCS’s 

paperwork/clerical requirements, but fewer than a fifth reported “great” or 

“very great” cost increases.4 

Although OSHA'S general approach to estimating the cost to 

nonmanufacturing employers of complying with the MSDS requirements is 

sound, the estimates derived from the cost model depend on the 

assumptions OSHA made about the values of the variables, Because of data 

limitations, we did not assess the accuracy of most of the numerical values 

OSHA assumed in its cost calculations. In one case, OSHA appears to have 

understated the compliance costs by excluding nonwage benefit costs such 

as pensions and health benefits from its wage rate variables. 

About 45 percent of all employers appearing to comply believed that, on 

balance, HCS had been beneficial for workers, compared with about 9 

percent who reported that HCS had a net negative effect and 36 percent 

who said it had equally positive and negative effects or none at all. 

Nevertheless, over 56 percent of all such employers reported a “great” or 

very “great” improvement in the availability of hazard information in the 

workplace and in management’s awareness of workplace hazards. Also, 

about 30 percent of the employers said they replaced hazardous chemicals 

used in their workplaces with less hazardous ones because of information 

they received on an MSDS. 

%e define as appearing to comply with HCS those employers who received MSDSs and provided 

information to us indicating compliance with the MSDS, labeling, and training requirements. Employers 

who appeared to be in noncompliance with HCS tended to report less serious difficulty or lower cost 

increases with HCS. To avoid misstating the actual extent of compliance difficulties and related cost 

increases, we focused on employers appearing to comply with HCS. Because we did not determine 

whether employers maintained a written hazard communication program, we did not ascertain actual 

compliance. 

‘To obtain employers’ perceptions concerning HCS’s effect on their business operation costs, we asked 

for what they considered to be the most appropriate responses to several questions regarding the cost 

Impact of various aspects of HCS. These responses ranged from “not at all,” ‘little,” “somewhat,” 

“moderately,” “greatly,” to a high of “very greatly.” (See app. 11 and IV.) We did not obtain actual 

employer cost data. 

Page 2 GAO/HRD-92.83BR OSHA Hazard Communication Standard 
B-243568 

Scope iind 

Methodology 

To answer your question about employers’ experience with HCS, we 

(1) conducted a nationally representative survey of about 2,000 

construction, manufacturing, and selected service industry employers, 

(2) interviewed representatives from five drug and chemical distributor 

employers, and (3) interviewed OSHA officials about HCS compliance issues. 

We surveyed a random sample of employers in three industry groups 

(manufacturing, construction, and selected service industries) listed in the 

national data base maintained by the U.S. Small Business Administration as 

of July 1990. Our results are weighted so that our estimates describe the 

information we would have obtained had we surveyed the universe of 

employers in that data base. Because we wanted to compare the 

experiences of employers of different sizes, we stratified our sample by 

each employer’s number of employees. (See apps. II and IV.) 

To answer your question about OSHA’s methodology in estimating 

compliance costs for the standard’s MSDS requirements, we obtained and 

analyzed documentation from OSHA on its model and general methodology 

for estimating the compliance costs of the standard’s MSDS requirements in 

nonmanufacturing industries. (See app. III.) Our work was performed 

between July 1990 and July 199 1 at OSHA’S headquarters and Philadelphia 

regional office in accordance with generally accepted government auditing 

standards. 

Background Under HCS, chemical manufacturers and importers must evaluate each 

chemical they produce or import to determine if it is hazardous when used 

in the workplace. For chemicals determined to be hazardous, the iirm must 

prepare a material safety data sheet. Manufacturers and importers also 

must label the chemical’s container and include the MSDS with the initial 

shipment of the chemical to employers. Employers who receive hazardous a 

chemicals without labels or MSDSS must obtain them from the supplier or 

produce their own. They are also required to (1) maintain a current file of 

MSDSs for the chemicals they use and make it accessible to employees, 

(2) develop a written program describing how they will meet HCS's 

requirements, and (3) train their employees in the safe handling and use of 

hazardous chemicals. 

In our November 199 1 report, we focused on the extent of small employer 

compliance with HCS. From a nationally representative survey, we found 

Page 3 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
B-243568 

58 percent of small employers and 52 percent of all employers to be out of 

compliance with key requirements of HCS.6 Moreover, we reported that 

many small employers may have been out of compliance, not because of 

HCS’s administrative burden but because they were unaware of HCS. Over 

29 percent of all small employers said that they had little or no awareness 

of HCS, and almost 40 percent of those with at least some awareness did 

not know that employers with 10 or fewer employees are covered by HCS. 

Principal Flndings 

Most Small Employers 

Reported No Difficulty 

Complying With MSDS 

Requirements 

Almost 70 percent of the small employers who appeared to comply 

reported no difficulty either maintaining a current MSDS file or ensuring 

employee access to it. For the individual requirements, over 75 percent of 

these small employers reported no difficulty maintaining a current MSDS 

file and over 80 percent described no difficulty ensuring employee access 

to it. (See fig. 1.4.) Small employers reported less difficulty complying with 

the MSDS requirements than did large employers. (See fig. 1.5.) 

Small employers’ ability to comply with the MSDS requirements may be due 

to the small number of MSDSS they had. Half of the small employers 

appearing to comply reported that they had 8 or fewer MSDSS, with almost 

75 percent having 25 or fewer. By comparison, half of all large 

employers-those with 500 or more employees-reported that they had 

250 or more MSDSS. 

Some Problems Reported 

With HCS Training 

Requirement 

Almost 80 percent of small employers who appeared to be complying with 

HCS reported some problems complying with the HCS training a 

requirements. Insufficient training expertise and that the MSDSS were too 

complex to use in training were the problems most small employers 

reported they experienced to at least “some” extent. (See fig. 1.7.) Large 

employers were more likely to report difficulties to some extent with all 

aspects of the HCS training requirement. (See fig. 1.8.) 

50ther findings included that the MSDSs had readability, format, and language problems. 

Page 4 GAOMRD-92-63BR OSHA Hazard Communication Standard 
B-243568 

Hti of Small Employers 

Reported Some Cost 

Increases Due to HCS 

Requirements 

The implementation of HCS could result in cost increases for small 

employers. For example, clerical and paperwork costs could increase as 

employers collect or develop MSDSS for all hazardous chemicals used in 

their workplaces and then keep their MSDS files current0 

For each individual cost category, over half of the small employers who 

appeared to comply with HCS reported some increased costs. However, 

fewer than 15 percent of small employers described these increases as 

“great” or “very great.” (See fig. I. 10). A greater proportion of large than 

small employers said that they experienced cost increases from 

compliance.7 (See fig. I. 11.) In the key areas of papenvorldclerical and 

MSDS storage costs, about 40 percent of small employers reported little or 

no increase in either category and over 80 percent reported at most 

“moderate” cost increases. 

Distributors’ MSDS 

Diffkulties Appear 

to Vary by Industry 

Compliance difficulties with the MSDS requirement vary by industry, 

judging from interviews we conducted with distributors of chemicals, 

pharmaceuticals, and health and beauty aids. Chemical distributors 

adapted to HCS with few problems, implementing computerized systems for 

shipping and receiving MSDSS to respond quickly to customer requests for 

MSDSS. Their HCS compliance costs were relatively modest, the distributors 

said, and did not create an individual competitive disadvantage because 

they fell on all employers in the industry. 

Drug and health/beauty aid distributors also have adapted to HCS, although 

they reported greater difficulties than the chemical distributors. For 

distributors handling many chemicals covered by HCS, the tracking systems 

for maintaining current MSDSS for each substance and transmitting the 

appropriate sheets to customers were not as well developed as the systems h 

used by the chemical distributors. In addition, drug and health/beauty aids 

distributors reported uncertainty about products for which they were 

required to maintain MSDSS and customers to whom they should ship 

MSDSs. 

‘In 1087, OSHA estimated that the extension of HCS to nonmanufacturing industries would cost 

employers about $687 million during the first year of implementation. 

7For example, about 76 percent of the large employers had some increase in paperwork/clerical costs 

from HCS compared with 53 percent of small employers. 

Page 5 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
B-243568 

OSHA Cost Model Sound but OSHA’S methodology for estimating the costs of compliance with the 

Accuracy of Assumed Values standard’s MSDS requirements, including the general approach and 

Is Unconfirmed equations, is fundamentally sound. However, the estimates derived from 

the cost model depend on the assumptions OS-IA made about the values of 

the variables. For example, OSHA appears to have understated the costs of 

complying with the MSDS requirements by not including nonwage benefit 

costs such as pensions and health benefits into the wage rate variables. 

Because of data limitations, we did not judge the reasonableness of many 

of the other numerical values OSHA used in its calculations. The more 

realistic the assumptions, the more accurate OS-U’S cost estimates. (See 

app. III.) 

Employers Reported Benefits The effect of HCS on employees was positive in the opinion of nearly half 

F’rom HCS to Workers and (some 45 percent) of employers of all sizes who appeared to comply with 

Management it; negative in the view of about 9 percent. Most of the rest-36 percent, 

believed that it had equally positive and negative effects or none at all.” 

(See fig. I. 15.) Over 56 percent of employers reported “great” or “very 

great” improvement in the availability of hazard information in the 

workplace and in management’s awareness of workplace hazards.D (See fig. 

I. 16.) Large employers were more likely to report benefits from HCS than 

small employers. 

The vast majority of all employers-between 74 and 84 percent-believed 

that HCS had no impact on productivity, employee or management morale, 

or workplace-related injuries and illnesses. Between 5 and 10 percent of all 

employers said worker or management workplace morale declined, and 10 

percent said productivity declined. However, about 17 percent of all 

employers believed that HCS had reduced workplace-related employee 

injuries, while only about 1 percent said that HCS increased workplace 

injuries. 

Despite MSDSS' weaknesses in format and language, over half of the 

employers believe that MSDSS provide essential information about the risks, 

safe handling, and general use of hazardous substances. Almost 30 percent 

sHCS could have a negative effect on employees if, for example, the hazard information resulted in 

increased psychological stress among employees. 

eAbout 40 percent of all employers also believed that HCS had a positive effect on management-for 

example, creating a safer and more productive workplace-compared with less than 20 percent who 

believed it had a net negative effect. 

Page 6 GAOIHRD-92-63BR OSHA Hazard Communication Standard 
B-243568 

of employers said that they replaced a hazardous chemical with a less 

hazardous one because of information they received on an MSDS. 

Agency Comments OS-I.4 believes that our findings demonstrate that the Hazard 

Communication Standard has contributed significantly to better safety and 

health for workers while at the same time posing minimal compliance 

problems for employers. The agency interprets our findings as supporting 

OSHA’s contention that the standard is feasible for small businesses. The 

agency agreed to consider our concerns regarding their calculation of 

nonwage benefit costs in future cost estimation efforts and to include this 

report in its entirety in the record of future rulemaking on this issue. (See 

app. VI.) 

As arranged with your office, we will send copies of this report to the 

Secretary of Labor and other interested parties and make it available to 

others upon request. If you have any questions concerning the report, 

please call me at (202) 5 12-7014. We list other major contributors in 

appendix VII. 

Linda G. Morra 

Director, Education 

and Employment Issues 

Page 7 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Contents 

Letter 

111 

Appendix I 

Occupational Safety & 

Health: Employers’ 

Experiences in 

Complying With the 

Hazard Communication 

Standard 

Appendix II 

GAO’S Employer 

Survey on OSHA’S 

Hazard Communication 

Standard: Methodology, 

Sampling, and Analysis 

Questionnaire Design 

Initial and Aausted Universe and Sample Sizes 

Likely Employer Compliance With Individual HCS 

Requirements 

GAO Interviews With Chemical and Drug Distributors 35 

Assessment of OSHA’S Cost Estimate Methodology 36 

Appendix III -- 

GAO Assessment of 

OSHA’S Model for 

Summary of OSHA’S Cost Model 

Basic Equations in OSHA’S Cost Model 

Estimating Compliance 

Costs With the MSDS 

Requirements of HCS 

Appendix IV 

Information on 

Responses to Selected 

GAO Survey Questions 

42 

a 

Page 8 GAO/H&D-92-63BR OSHA Hazard Communication Standard 
Contentr 

Appendix V 

Data Supporting 

Figures in Appendix I 

Appendix VI 61 

Comments From the 

Department of Labor 

Appendix VII 

Major Contributors to 

This Report 

63 

Related GAO Products 64 

Tables Table II. 1: Standard Industrial Classification (SIC) Codes for 

Selected Industry Groups, GAO Employer Survey (July 

1991) 

31 

Table 11.2: Number of Employers Identified in Selected 

Industry and Employer Groups, by Size, GAO Employer 

Survey (July 199 1) 

32 

Table 11.3: Number of Employers Sampled by Industry Group 

and Employer Size Strata, GAO Employer Survey (July 

1991) 

32 

Table 11.4: Adjusted Sample and Response Rate for Industry 

Group and Employer Size Strata, GAO Employer Survey 

(July 1991) 

33 

Table 11.5: Determination of Adjusted Universe, GAO 

1, 

34 

Employer Sample (July 199 1) 

Table III. 1: Estimated Costs of Compliance With HCS to 39 

Nonmanufacturing Industry, OSHA Cost Model 

Table V. 1: Data for Figure I.4 

Table V.2: Data for F’igure I.5 

Table V.3: Data for F’igure I.7 

Table V.4: Data for Figure I.8 

Table V.5: Data for F’igure I. 10 

Table V.6: Data for F’igure I. 11 

Table V.7: Data for F’igure I.16 

58 

58 

58 

59 

59 

59 

60 

Page 9 GAO/HRD-92-03BR OSHA Hazard Communication Standard 
Contents 

F&p-es 

Table V.8: Data for Figure I. 17 60 

A 

Figure I. 1: Assignment Objectives 12 

Figure 1.2: Methodology 13 

Figure 1.3: Employer Experiences W ith HCS: MSDS Duties 14 

Figure 1.4: Most Small Employees Report No Difficulty W ith 15 

MSDS Duties 

Figure 1.5: More Large Employers Than Small Report MSDS 

Difficulties 

16 

Figure 1.6: Employer Experiences W ith HCS: Training 

Requirement 

17 

Figure 1.7: Small Employers Have Varied Experiences W ith 

HCS Training 

18 

Figure 1.8: More barge Employers Than Small Report Training 

Problems 

19 

Figure 1.9: Employer Experiences W ith HCS: Compliance 

costs 

20 

Figure I. 10: Over 50 Percent of Small Employers Had Some 

Cost Increases 

21 

Figure I. 11: More Large Employers Than Small Report Cost 

Increases 

22 

Figure I. 12: Distributors’ Experiences W ith MSDS Duties 

F’igure I. 13: OSHA’S Cost Methodology 

F’igure I. 14: Benefits Employers Report Prom HCS 

Figure I. 15: Other HCS Effects Reported by Employers 

Figure I. 16: Over 40 Percent of Employers Say HCS Has 

Positive Effects 

23 

24 

25 

26 

27 

Figure I. 17: Employers Report Improvements Due to HCS 28 

4 

Abbreviations 

HCS Hazard Communication Standard 

IMIS Integrated Management Information System 

OSHA Occupational Safety and Health Administration 

MSDS Material Safety Data Sheet 

SBA Small Business Administration 

SIC Standard Industrial Classification 

USEEM United States Employment and Enterprise Microdata 

TPV Total Present Value 

Page 10 GAO/HRD-9243BR OSHA Hazard Communication Standard 

.‘.’ 

,I , 

, , 

, 
Page 11 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix I 

,) Occupational Safety & Health: Employers’ 

Experiences in Complying With the Hazard 

~ Communication Standard 

Flgure 1.1: 

Ek) Assignment Objectives 

l Identify employers’ 

(especially small employers’) 

difficulties, costs, and 

benefits in meeting HCS 

requirements 

l Assess OSHA’s methodology in 

estimating compliance costs 

with the MSDS requirement 

Page 12 GAOIHRD-92-63BR OSHA Hazard Communication Standard 
Appendix I 

Occupational Safety 4% Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Flaure 1.2: 

G+AD Methodology 

l Conduct national employer 

survey in three industry groups 

l focus analysis on employers 

in likely compliance 

*compare data by employer 

size and industry 

l Conduct interviews with 

chemical/drug distributors 

l Obtain and review OSHA’s 

compliance cost model 

Note: We describe the methodology used to develop our survey in appendix 11, which also includes a 

discussion of the interviews with chemical and pharmaceutical distributors. Appendix Ill contains our 

assessment of OSHA’s compliance cost estimates regarding the Hazard Communication Standard’s 

MSDS requirements, and appendix IV, responses to selected survey questions and the associated 

sampling errors 

Page 13 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix I 

Occupational Safety & Health: Employers’ 

Experiences In Complying With the Hazard 

Communication Standard 

Flgure 1.3: 

w E mployer Experiences With 

HCS: MSDS Duties 

l About 70 percent of small 

employers had no difficulty 

with the MSDS duties 

@ maintaining current MSDS file 

*assuring employee access 

l Most small employers had 8 or 

fewer MSDSs 

l Most large employers had 250 

or more MSDSs and difficulty 

complying with MSDS duties 

Note: About 70 percent of small employers-those with fewer than 20 employees-appearing to comply 

with HCS reported no difficulty complying with both MSDS requirements. 

Page 14 GAO/BRD-92-63BR OSBA Hazard Communication Standard 
Appendix I 

Occupational Safety & Health: Employers’ 

Experiences in Complying With the Hazard 

Communlcatlon Standard 

Flgure 1.4: 

Gm Most S mall E mployers Report 

No Difficulty With MSDS Duties 

Note: For each individual MSDS requirement, about 80 percent of all small employers appearing to 

comply reported no difficulty complying. About 7 percent of employers found complying with each 

MSDS requirement “very difficult.” Over 26 percent found maintaining current MSDS files “very easy,” 

and over a third found assuring employees access to the files “very easy.” 

Page 15 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix I 

Occupational Safety & Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Figure 1.5: 

GAO More Large Employers Than 

Small Report MSDS Difficulties 

PWCM ol Employm Who Fwnd Rqulnmw~l B-uvwy Dimoull 

Note: Almost 50 percent of large employers-those with 500 or more employees-appearing to comply 

found it at least “somewhat difficult” maintaining and keeping MSDSs up to date, and about 13 percent 

found it “very difficult” to do so. Thirty percent of such employers found it “somewhat” difficult ensuring 

employee access to MSDS files at each worksite, with about 5 percent finding it “very difficult.” 

a 

Page 16 GAO/BRD-92-63BR OSBA Hazard Communication Standard 
Appendix I 

Occupational Safety & Health: Employem 

Experiences Lu Complying With the Hazard 

Communication Standard 

Flaure 1.6: 

G&I Employer Experiences With 

HCS: Training Requirement 

.-.._- .-_. . ,- . . 

l 79 percent of small employers 

had some problems complying 

with training requirement 

l Greatest problems for small 

employers are with inadequate 

training expertise and the use 

of MSDSs in training 

l Larger employers more likely 

to have problems with training 

requirement 

Page 17 GAOiHRD-9243BR OSHA Hazard Communication Standard 
Appendix I 

Occupational Safety & Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Figure 1.7: 

GAO S mall E mployers Have Varied 

Experiences With HCS Training 

Pmbt.m. Erpwt.nc.d In Prcwldlnp WCS R.,,“tnd ,,.tn,nS 

El NwLlMo Enent 

Sme Exiont 

Moderate Enent 

I 

Chat Enent 

‘day Gnat Extent 

Note: While 79 percent of small employers appearing to comply reported difficulty at least to “some 

extent” with the HCS training requirement, at most about 54 percent of such employers had difficulty with 

any aspect of the requirement. About 22 percent of such small employers had “great” or “very great” 

difficulty providing training to employees at multiple worksites. About 20 percent of employers had 

similar degrees of difficulty with employee turnover. 

a 

Page 18 GAO/BRD-92-63BR OSHA Hazard Communication Standard 
Appendix I 

Occupational Safety % Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Figure 1.8: 

G-AZ) More Large E mployers Than 

S mall Report Training Problems 

SO P.,c.nl of Employ.” With ProUwm 

79 

0 Fewer Than 20 Employee8 (Small) 

29 m 408 Employees (Medum) 

111 500 w More Employeea (Large) 

Note: A greater proportion of large than small employers appearing to comply reported difficulties “to at 

least some extent” on all potential training problems that we asked about (see app.lV). Over 70 percent 

of these large employers expenenced some difficulty integrating MSDSs into their training program 

compared with about 50 percent of the small employers. 

Page 19 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix I 

Occupational Safety 81 Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Figure 1.9: 

w Employer Experiences With 

HCS: Compliance Costs 

l Over half of small 

employers reported some 

cost increases for each 

HCS requirement 

l Large employers were more 

likely to report some cost 

increases than small employers 

Page 20 

a 

GAO/BRD-9243BR OSBA Hazard Communication Standard 
Appendix I 

- 

Occupational Safety & Bealth: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Flgure 1.10: 

GAD Over 50% of S mall E mployers 

Had Some Cost Increases 

Note: For each individual area, over 50 percent of small employers appearing to comply found that their 

costs had increased “somewhat.” However, 15 percent of employers appearing to comply experienced 

“great” or “very great” cost increases from HCS’s paperwork/clerical requirements, the largest 

proportion of any of the five categories and about 8 percent of such employers experienced “great” or 

“very great” increases in employee training costs. 

Page 2 1 GAOMRD-9243BR OSHA Hazard Communication Standard 
Appendix I 

Occupational Safety & Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Flgure 1.11: 

w More Large E mployers Than 

S mall Report Cost Increases 

00 

70 

00 

00 

.o 

20 

20 

IO 

0 

Note: Almost 25 percent of large employers appearing to comply reported “great” or “very great” cost 

increases from HCS’s paperwork/clerical requirements 

Page 22 GAO/HRD-92-63BR OSHA Hazard Communication Standard 

,;‘. ‘/ I, I.,,,’ ‘,” 
Appendix I 

Occupational Safety % Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Flgure 1.12: 

MO Distributors’ Experiences 

With MSDS Duties 

Interviews showed that 

l Chemical distributors adapted 

to MSDS duties with little 

difficulty 

l Drug distributors had more 

difficulty 

@ Uncertain about the products 

covered and recipients of 

MSDSs 

a 

Page 23 GAO/HRD-9243BR OSBA Hazard Communication Standard 
Appendiz I 

Occupational Safety & Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Figure I.1 3: 

QW OSHA’s Cost Methodology 

*Structure and approach of 

OSHA’s cost model regarding 

MSDS requirements are sound 

l However, in one case, OSHA’s 

model may underestimate 

compliance costs because 

nonwage compensation is 

excluded in wage variable 

Note. See appendix III for a discussion of OSHA’s cost methodology. 

Page 24 GAOIHRD-92-63BR OSBA Hazard Communication Standard 
Appendlx I 

Occupational Safety & Health: Employers’ 

Experlencee in Complying With the Haze,rd 

Communication Standard 

Figure 1.14: 

G’GAQ Benefits Employers Report 

From HCS 

l Over 40 percent of employers 

report positive HCS effects 

for employers and employees 

l Employers report safety and 

health improvements due to 

HCS 

l 29 percent of employers say 

they use a less hazardous 

chemical in the workplace 

because of HCS 

a 

Y 

Page 25 GAO/BRD-92-63BR OSBA Hazard Communication Standard 
Appendix I 

Occupational Safety & Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

Flgure 1.15: 

m Other HCS Effects Reported 

By E mployers 

l HCS had little effect on 

productivity, even for those 

employers reporting great 

cost increases 

0 17 percent of employers 

report fewer work related 

injuries 

l 16 percent of employers 

report fewer work related 

illnesses 

Note: Large employers appearing to comply were generally more positive about HCS’s effect on both 

employers and employees than small employers. Over 67 percent of such large employers believed that 

HCS had a positive effect on employees-compared with about 45 percent of small employers 

appearing to comply. Almost 60 percent of such large employers believed that HCS had a positive effect 

on employers compared with about 42 percent of the small employers. 

a 

Page 26 GAO/HRD-92-63BR OSBA Hazard Communication Standard 
Appendix I 

Occupational Safety % Health: Employers’ 

Experiences in Complying With the Hazard 

Communication Standard 

GAO Over 40% Of E mployers Say 

HCS Has Positive Effects 

On Employ*n 

Ellc( al HCS 

On Emnployba 

Page 27 GAOiHRD-92-63BR OSHA Hazard Communication Standard 
Appendix I 

Occupatlonal Safety & Health: Employers’ 

Experience@ in Complying With the Hazard 

Communication Standard 

Figure 1.17: 

GM E mployers Report 

Improvements Due to HCS 

SO 

00 

WI 

10 

a0 

10 

0 

Pnanl 01 Employem 

Page 28 GAO/HRD-9%63BR OSHA Hazard Communication Standard 
Annendix II 

GAO’s Employer Survey on OSHA’s Hazard 

Communication Standard: Methodology, 

Sampling, and Analysis 

We gathered data on employers’ experience with OSHA’S Hazard 

Communication Standard through a questionnaire survey conducted from 

October 1990 through July 199 1. The survey was designed to collect 

information on the extent of employer awareness and knowledge of and 

compliance with HCS; employers’ perceived costs, benefits, and difficulties 

in complying with HCS; and sources of employers’ information on HCS. 

Questionnaire Design Our survey questionnaire was designed to ensure that the data collected 

were consistent.* We pretested it with representatives of seven employers 

in the Washington, D.C., area, including a small and a medium-sized 

construction employer; a small manufacturing employer; and a small, two 

medium-sized, and a large personal services business. We gave OSHA 

officials copies of the draft questionnaire for review. Guided by the results 

of the pretest and OSHA officials’ comments, we revised the questionnaire 

to ensure that all questions were fair, relevant, and easy to understand and 

answer. We also tested it to ensure that the task of completing it would not 

place too great a burden on the respondent. 

Initial and Adjusted 

Universe and 

Sample Sizes 

We mailed questionnaires to a random sample of employers, stratified by 

industry and employer size and selected from a July 1990 United States 

Employment and Enterprise Microdata (USEEM) file data base obtained 

from the U.S. Small Business Administration (sBA).~ 

The USEEM file includes information on different types of business 

organizations. We included in our population only records of employers 

representing (1) employer headquarters with a single establishment, (2) 

employer headquarters with multiple establishments, or (3) subsidiary 

headquarters. For employers who maintained operations in several 

industries or sectors, our questionnaire included instructions to help 1, 

ensure that answers were provided for what they considered their most 

typical or common operation. 

‘For a copy of the questionnaire, see Occupational Safety & Health: OSM Action Needed To Improve 

Compliance With Hazard Communication Standard (GAO/HRD-92-8, Nov. 1991). 

“SBA modified an employer data base obtained from the Dun and Bradstreet corporation. We chose 

USEEM because SBA’s modifications improved the file’s reliability and SBA frequently updates the 

information to improve its accuracy. The USEEM file also includes employer phone numbers and 

addresses, as well as names of employer representatives, to facilitate additional contact if necessary. 

Finally, we were able to obtain and access the fde with minimal difficulty. 

Page 29 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix II 

GAO’s Employer Survey on OSHA’s Hazard 

Communication Standard: Methodology, 

Sampling, and Analysis 

We chose our sample from three different industry groups (see table II. 1.): 

l The manufacturing sector, because it was the first major industrial group 

covered by HCS, beginning in 1985. 

l The construction sector, because it was not covered by HCS until 1987, and 

although it is an industry with considerable experience with OS-IA, a 

number of its representatives have reported difficulties in complying with 

HCS.” 

l The personal services sector, a combination of various service industry 

operations, including personal services, automotive, and other repair 

service operations where employees are very likely to come into contact 

with hazardous chemicals. An industry group not covered by HCS until 

1987, it appears to have less experience with OSHA than some others.4 

Representatives of various segments of this sector also have reported 

difficulties in complying with HCS. 

“In FY 1989-90, almost half of all inspections reported in our OSHA inspection data base involved 

construction worksites. See GAO/HRD-92-8. 

41n FY 1989-90, only about 3 percent of all inspections reported in our OSHA inspection data base 

involved worksites in SIC codes 72, 75, and 76. See GAO/HRD-92-S. 

Page 30 GAO/HRD-92-63BR OSHA Hazard Communication Standard 

.,a 

,- 

” ‘, 

‘, 
Appendix IL 

GAO’s Employer Survey on OSwA’s Hazard 

Communication Standard; Methodology, 

Sampling, and Analysis 

Table 11.1: Standard lndurtrlal 

Classlficatlon (SIC) Codes for Selected Industry group SIC code 

Industry Groups, GAO Employer Survey 

Descrlptlon 

._--_--- 

(July 1991) 

Manufacturing 2000-3999 All durable and nondurable manufacturing 

industries 

-. --- -- __- 

Construction 

industries 

Personal services 

1500-1799 

7211 

7212 

7213 

7216 

7217 

7218 

7219 

7221 

7231 

7241 

7251 

All construction 

___-- --- ___-.- __-- 

Power laundries, family and commercial 

Garment pressing and agents for laundries 

and dry cleaners, 

Linen supply 

Dry-cleaning plants, except rug cleaning 

Carpet and upholstery cleaning 

Industrial launderers 

Laundry and garment services 

Photographic studios, portrait 

Beauty shops 

Barber shops 

Shoe repair shops and shoeshine parlors 

7261 Funeral services and crematories 

7500-7599 Automotive repair services, garagesa 

7600-7699 Miscellaneous repair services 

aThese industries include, among other activities, automotive rental and leasing; general automotive 

repair; top, body, and upholstery repair and paint shops; tire retreading and repair; and other automotive 

services. 

To obtain information about the experiences of employers of various size, 

we stratified our sample accordingly, defining employers with fewer than 

20 employees as small, those with 20 to 499 employees as medium-sized, 

and those with 500 or more employees as large (see tables II.2 and II.3).5 

%e classified employers by size and industry according to the initial SBA/Dun and Bradstreet size and 

industry classification rather than the employers’ survey response. 

Page 3 1 GAO/HRD-92-63BR OSH.4 Hazard Communication Standard 
Appendix II 

GAO’s Employer Survey on OSM’s Hazard 

Conummicatlon Standard: Methodology, 

SampMn& and Analysis 

Table 11.2:. Number of Employers 

ldentlfled In Selected Industry and 

Employer Groups, by Size, GAO 

Employer Survey (July 1991) 

Industry groijp ___- 

Manufacturing --- --..___ 

Construction 

Personal services -..-.-__ 

1-19 

346,103 

742,255 

693,250 

Number of employees 

20-499 500 or more 

99,329 6,756 

51,374 634 

14,390 207 ___- 

All 

452,190 

794,263 

707,647 

Total 1.781.608 165.093 7.599 1.954.300 

Table 11.3: Number of Emolovers 

Sampled by Industry Grduphd 

Employer Size Strata, GAO Employer 

Survey (July 1991) 

Employer size (no. of 

employees) ---.---_____ 

Number of employees by Industry group 

Personal 

Construction Manufacturing services Total 

Fewer than 20 300 300 285 885 

--_..- --.-..-._--..~---~ 

20 to 499 215 215 203 633 

--___ 

500 + 160 215 94 469 

Total 675 730 582 1.987 

Ad(justed Sample Size and 

Response Rate 

We mailed 1,987 questionnaires to employers throughout the United 

States. After adjustments for employers not meeting our criteria, such as 

no longer being in operation, being self-employed with no employees, or 

classified in the incorrect industry, our count was 1,120 responses for a 

77-percent response rate (see table 11.4). In addition, we assumed that any 

employer whose questionnaire was returned to us by the U.S. Postal 

Service as undeliverable and had no forwarding address and no current 

telephone listing was no longer in operation. Most employers classified as 

such were in the small employer (fewer than 20 employees) stratum. 

Page 32 GAO/HRD-92.63BR OSBA Hazard Communication Standard 
Appendix II 

GAO’s Employer Survey on OSIiA’s Hazard 

Communication Standard: Methodology, 

Sampling, and Analysis 

fable 11.4: Adjusted Sample and 

Response Rate for Industry Group and 

Employer Size Strata, GAO Employer 

Survey (July 1991) 

Industry group/ employer size 

----- 

Construction -.-______--. 

Fewerthan20emdovees - 

Sa;yk Adjusted Number Percent 

size received received 

-___ 

--__l -_I___ 

300 137 97 70.8% 

20to499employees 215 194 155 79.9 -----__I_-- --- 

500+ employees 160 148 120 81.1 

-_ - ____ _--.- 

Total 675 479 372 77.7 

Manufacturing ~____- -.___ 

Fewerthan20employees 300 159 113 71.1 

------- 

_ -- 

20to499employees 215 207 160 77.3 

--___- 

500+ employees 215 198 173 07.4 

-.---- l_l_.__ ------ 

Total 730 564 446 79.1 

Personal services ___- -~-_~ 

Fewerthan20employees 285 149 102 

-- -.-.------.-.- ___-__ __-___-_ 

-6_8_~ 

20to499em~lovees 203 177 128 72.3 

500+ employees 

.-...- .._ --.--I_ 

Total 

Total employers with Fewer than 

20 employees 

20to499employees -_.-_..-.---.--~~ 

500+ employees 

Total 

94 81 72 88.9 

582 407 302 74.2 

885 445 312 70.1 ____- 

633 S78 443 76.6 ____-__ __I-.---..-... 

469 427 365 85.5 

1967 1450 1120 77.2 

As HCS, like OSHA regulations generally, applies only to employers with 

employees, we excluded employers who reported themselves as 

self-employed with no employees. In addition, we excluded employers with 

operations exclusively outside of our designated industries as specified in 

the SIC codes in table II. 1. Finally, we excluded employers who were 

financial holding companies and had no actual operations or employees in 

any of the industries we were surveying. 

l 

Measures to Reduce Number To maximize our response rate, we conducted two mail and two telephone 

of Nonrespondents follow-ups. The lowest response rates were for the small employer strata, 

with small personal services employers having the lowest at 69 percent. 

Scientifically selecting our sample enabled us to use the results to 

represent employers in the universe. To reflect the employers in the entire 

universe, we weighted each of the employers in our sample (see table 11.5). 

To obtain the estimated number in the adjusted universe, we multiplied the 

adjusted sample of respondents by the corresponding assigned industry 

Page 33 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix II 

GAO’s Employer Survey on OSHA’6 Hazard 

Communication Standard; Methodology, 

Sampling, and Analynis 

weight. Our estimates represent employers in the universe who probably 

would have responded had they been sent a questionnaire. 

Table 11.5: Determination of AdJusted 

Universe, QAO Employer Sample 

(July 1991) 

Industry group/ employer size -.--.----- 

Construction 

Small 

Medium 

Large 

.- .-.. -.-.-... ~.._ .- 

Manufacturing --- 

Small 

Medium 

Number of employers 

Adjusted Assigned Adjusted 

respondents weight universe -~- 

-------__. 

97 22474.18 239,996 ___-- 

155 238.95 37,037 

---__ _ -__--- -__. -.--~-- 

120 3.96 476 

-- --__-- ____--- 

113 1,153.68 130,365 

160 462.00 73.919 

Large 

Personal servlces -_. _ --.- -..-_ - .-_- ---. ----- --..... .-. 

Small ---__..-- -.- _... ---____ 

Medium 

173 31 A3 5,438 

102 2,432.46 248,111 -..-.--~- 

128 70.89 9.074 

Lame 72 2.20 159 

Sampling Errors Because we surveyed a sample rather than the universe of employers, each 

reported estimate has an associated sampling error. The size of the 

sampling error reflects the precision of the estimate; the smaller the error, 

the more precise the estimate. Sampling errors for estimates from this 

survey were calculated at the 95-percent confidence level. This means that 

the chances are about 19 out of 20 that the actual number or percentage 

being estimated falls within the range defined by our estimate, plus or 

minus the sampling error. For example, if we have estimated that 30 

percent of a group has a characteristic and the sampling error is about 6 

percentage points, there is a 95-percent chance that the actual percentage 

is between 24 and 36. 

Generally, the sampling errors for employer characteristics did not exceed 

9 percentage points at the 95-percent confidence level. However, for the 

number of employers in certain combined industry and size strata (for 

example, small construction employers) and certain other characteristics, 

the sampling errors were higher. Sampling errors are stated in given points 

for employer characteristics, because this is generally how the size 

estimates are presented in the report. (Sampling errors are given in app. IV 

and V.) 

Page 34 GAO/HRD-9%63BR OSHA Hazard Communication Standard 
Appendix II 

GAO’s Employer Survey on OSHA’e Hazard 

Communication Standard: Methodology, 

Sampling, and Analysis 

Likely Employer 

Compliance With 

Individual HCS 

Requirements 

Using our employer survey data, we defined as in likely compliance 

employers who said they had received an MSDS~ and did not report being 

out of compliance with one or more of the three HCS requirements we 

asked about7 These were: 

. Maintenance of a hard copy or computerized file of MSDSS on most or all of 

the products that contain hazardous substances (one of the MSDS 

requirements); 

l Provision of training to employees on the safe handling and use of 

hazardous chemicals (training requirement); 

l Maintenance of container labels that clearly indicate the identity of the 

substance and warning of its hazards for most or all of the products for 

which the employer has an MSDS (labeling requirement). 

We measured the extent of any cost increases experienced by employers 

from various aspects of HCS through a series of questions based on a 

6-point scale: not at all, a little, somewhat, moderately, greatly, and very 

greatly (see app. IV). We measured the severity of seven problems 

employers may encounter from HCS's training requirement by asking them 

the extent to which the problems had been encountered at their business: 

little or no extent, some extent, moderate extent, great extent, very great 

extent, and don’t know/not applicable (see app. IV). 

GAO Interviews With 

Chemical and Drug 

Distributors 

In May and June 199 1, to obtain information on the experience of chemical 

and drug distributors in complying with HCS, GAO conducted interviews 

with five firms active in either SIC 5 122 (Drugs, Proprietaries, and 

Sundries) or 5 169 (Chemicals and Allied Products Not Elsewhere 

Classified). The firms were located in either the Baltimore or Philadelphia 

area. The five firms differed in the amount of sales, the number of 

employees, number of distributing facilities, primary products distributed 

and principal markets of operation. Two of the firms distributed chemicals, 

and three distributed drugs. Of the latter, two also distributed health and 

beauty aid products and one manufactured drugs. 

Interview questions focused around four main issues: (1) the difficulties, if 

any, the firms have experienced in complying with the MSDS requirements 

“About 50 percent of all employers reported that they had received no MSDSs. 

7For a discussion of employer noncompliance with HCS, see GAO/HRD-92-8. 

Page 36 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix II 

GAO’s Employer Survey on OSHA’s Hazard 

Communication Standard: Methodology, 

Sampling, and Analysis 

of HCS; (2) the Ms~s requirements’ effect on the firms’ costs; (3) the 

perceived benefits received, if any, from the MSDS requirement; and (4) 

suggestions for modifying the HCS requirement. 

Assessment of OSHA’s To assess the methodology underlying OSHA’S compliance cost estimates 

Cost Estimate for the MSDS requirements in nonmanufacturing industries, we obtained 

and analyzed documentation from OSHA on its model and general 

Methodology methodology for estimating the compliance costs of the standard’s MSDS 

requirements in nonmanufacturing industries. However, because of data 

limitations, we did not judge the accuracy of many of the assumptions (for 

example, the number of chemical hazards used in the workplace of a 

typical nonmanufacturing firm or voluntary compliance with HCS) made by 

OSHA in developing its estimates. 

Page 36 GAO/HRD-92-63BR OSHA Hazard Communication Standard 

j, 

I’ 

j,’ 

I 

,. 

‘. 
Appendix III 

GAO Assessment of OSHA’s Model for 

Estimating Compliance Costs With the MSDS 

Requirements of HCS 

In November 1983, OSHA published a final Hazard Communication 

Standard covering manufacturing industries. As part of that regulatory 

effort, OSHA had determined that it was economically feasible for all 

manufacturing industries to implement the HCS requirements.’ In May 

1985, a U.S. Circuit Court of Appeals ordered OSHA to apply HCS to 

nonmanufacturing industries unless the Secretary of Labor could state 

reasons why this application would not be feasible.” 

To provide direct evidence of the economic feasibility of expanding HCS's 

coverage, OSHA commissioned a study with the JACA Corporation to 

estimate the economic impact of extending OSHA to the 50 major 

nonmanufacturing industry groups within its jurisdiction. The study 

included estimates of the costs and the general economic impact of this 

regulatory revision. From this study and other evidence presented in the 

record, OSHA concluded that extension of HCS to nonmanufacturing 

industries was economically feasible. 

Industry groups and government agencies criticized OSM’S conclusion, 

contending that OSHA’S analysis was flawed and greatly underestimated the 

HCS compliance costs of nonmanufacturing employers, especially small 

employers. Some critics have focused on the material safety data sheet 

requirements of HCS, asserting that it has generated an excessive 

paperwork burden on employers. 

After analyzing OSHA’S cost estimate methodology concerning these MSDS 

requirements, we concluded that OSHA’S general approach and the 

equations comprising its model for estimating the HCS compliance costs 

are fundamentally sound. However, the estimates derived from OSHA’S cost 

model depend on assumptions made about the values of the model’s 

variables (such as the number of hazardous chemicals used in an 

employer’s workplace). Because of data limitations, we did not assess the a 

accuracy of most of the numerical values OSHA assumed in its cost 

calculations. The more realistic the assumptions, the more accurate OSHA’S 

cost estimates will be. In one case, however, OSHA appears to have 

understated the compliance costs by excluding nonwage benefit costs such 

as pensions and health benefits from its wage rate variables. 

‘A factor in determining whether a specific standard is economically feasible is its affect on the 

financial viability of an industry.Industrial Union Department, AFL-CIO v. Hodgson, 499 F 2d 467, 

477-78 (D.C. Cir. 1974). 

‘United Steelworkers of America v. Auchter, 763 F.2d 728, 739 (3d Cir.1985). 

Page 37 GAOEIRD-92-63BR OSHA Hazard Communication Standard 
Appendix III 

GAO Assessment of OSHA’e Model for 

Estimating Compliance Costs With the MSDS 

Requirement.9 of HCS 

Summary of OSHXs 

Cost Model 

The costs to chemical manufacturers and importers of complying with HCS 

differ markedly from the costs nonmanufacturing employers would incur 

when the standard is applied to them. Under HCS, chemical manufacturers 

and importers must conduct a hazard evaluation-evaluate each chemical 

they produce or import-to determine if it is hazardous. For chemicals 

determined to be hazardous, they must prepare an MSDS providing details 

on the chemical’s properties, hazards, safe use, and handling. In addition, 

chemical manufacturers and importers must provide MSDSS to employers 

who use hazardous chemicals. 

Employers who use hazardous chemicals in the workplace must maintain a 

current file of MSDSS and permit workers access to that file. In 

nonmanufact,uring industries, most employers likely will use MSDSS 

received from chemical manufacturers and importers rather than develop 

their own MSDSS. However, (1) employers must maintain MSDS files on 

hazardous chemicals used in the workplace and (2) employers who 

distribute hazardous chemicals must provide MSDSS to their customers. 

Thus, a nonmanufacturing employer’s cost of complying with the 

requirements will depend on the number of chemical hazards present in the 

employer’s own workplace(s), the number of employers who will require 

MSDSS, and the unit cost of preparing an MSDS. 

In its cost model, osm estimates that keeping MSDS files current will cost 

the nation’s nonmanufacturing industries $44.9 million the first year and 

$84.8 million over 40 years (the latter figure is calculated in terms of total 

present value-TN--and assumes a lo-percent discount rate). To distribute 

MSDSS to employees will cost nonmanufacturing industries $19.3 the first 

year and $88.9 (TPV) over 40 years. 

OS~ also found that the costs of complying with the MSDS requirements 

alone were about 10 percent of the total compliance costs of HCS, both 

during the first year and over a 40-year horizon. (See table III. 1). 

Page 38 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix III 

GAO Assessment of OSHA’s Model for 

Estimating Compliance Costs With the MSDS 

Requirements of HCS 

Table 111.1: Estlmated Costs of 

Compliance With HCS to 

Nonmanufacturlng Industry, OSHA Cost 

Dollar figures in millions 

~---_---~- 

Model Flrst-year Percent of total 

HCS requirement cost first- year cost 

Total P;~;;;: 

.--- --________ 

MSDS: 

-----__ ___~-- 

Maintain MSDS files $44.9 6.5% $84.8 

--.- .__.... ----- ___-- --.. .- 

Provide MSDS to customers 19.3 2.8 88.9 ---..___.__. .- ~--- 

Total $64.2 9.3% $173.7 

Labelingb 12.8 1.9 170.9 

.____-. --~.. 

Written programC 137.4 20.0 170.9 

--__--~-_ ___- -..--- 

TrainingC 472.9 68~s~-.-~EE4,!! 

Total cost of HCS 

compliance $667.3 100% 1,570.l 

aAssuming a lo-percent discount rate. 

bManufacturers and importers must label the container of any hazardous chemicals they ship, and 

employers who use hazardous chemicals must ensure that each such chemical in the workplace is 

labeled or otherwise identified. 

“Employers using hazardous chemicals must develop a written hazard communication program that 

describes how they will meet HCS’s requirements and train their employees in the safe handling and use 

of the chemicals. 

Basic Equations in 

OSHA’s Cost Model 

The OSHA cost model for each of the MSDS requirements involves two 

equations: one to calculate the unit cost, the other to calculate total costs. 

The total costs for each requirement are calculated by multiplying the unit 

cost of preparing or maintaining an MSDS by the number of MSDSS. The 

equations are corrected for the creation of new businesses, the 

development of new chemicals and their introduction into the workplace, 

and prior employer compliance with state right-to-know laws. 

Nonmanufacturing employers are divided into classes based on their SIC 

code and size (number of employees). Total costs are estimated for each 

SIC/size class. The total cost of compliance with HCS is determined by 

summing the total costs for each class. 

The unit costs of both preparing and maintaining an MSDS are calculated by 

the same formula: 

AC=W*T+S 

Where AC is the unit cost, W is the wage rate of the employee, T is the time 

required by the employee to prepare or maintain one MSDS, and S is the 

Page 39 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix III 

GAO Assessment of OSHA’s Model for 

Estimating Compliance Costs With the MSDS 

Requirements of HCS 

cost of supplies used to prepare or maintain one MSDS." 

The total annual cost of maintaining MSDSS for each nonmanufacturing 

size/SIC group is: 

TCm= (AC * N * H) * (1 + G”) * (1 + Gh) * (1 -P) 

Where TCm = the total cost of maintaining MSDSS, AC = the unit cost, N = 

the number of firms in the size/src class, H = the number of chemical 

hazards in a typical firm, G”and Gh = the growth rates of N and H 

respectively, and P = the proportion of firms voluntarily complying with 

HCS.4 

OSM assumed that the requirement to ship MSDSS to customers would 

affect wholesalers of durable and nondurable goods and selected retailerse5 

The total annual cost of wholesalers providing MSDSS is defined as: 

TCP= (AC * M * S) * (1 + G”) * (1 + Gh) * (1 -P) * (1 - Pr) 

Where TCP = the total cost of providing MSDSS; AC, G”, Gh, and P are 

defined above; M = the total number of MSDSS needed by 

nonmanufacturing firms;” S = the share of total wholesale sales accounted 

for by the particular size/SIC class; and Pr = the probability that a firm will 

buy a hazardous chemical product from a retailer rather than from a 

wholesaler. 

“Data for the wage rate (W), the employer time required (T), and the supply cost (S) variables were 

described in OSHA, Final Regulatory Impact and Regulatory Flexibility Analysis of the Hazard 

Communication Standard, Aug. 9, 1983. 

4The Bureau of Labor Statistics furnished the data on the number of firms in each class/SIC class, while 

the number of hazards was determined from the National Occupational Hazard Survey and National 

Occupational Exposure Surveys. The other variables (G”, G”, and P) were estimated by the JACA 

Corporation. 

5Under HCS, wholesalers and distributors must transmit an MSDS with the initial shipment of a 

hazardous chemical to all employers. MSDSs need not be transmitted if, among other provisions, the 

hazardous product shipped is (1) prepackaged for sale to consumers or (2) sold in solid form for direct 

ingestion by a patient. This second exemption includes pills not made into liquid form and/or not 

crushed or otherwise combined before ingestion. Distributors need not send an MSDS to retailers who 

have informed them that they do not sell the hazardous chemical to commercial customers or open the 

sealed container to use it in their own workplace. 

“The number of MSDSs (M) was estimated by the JACA Corporation. 

Page 40 GAO/BRD-9%63BR OSHA Hazard Communication Standard 

.‘! ,I : 1 :. ,, ,.’ ., ‘, .I 
Appendix III 

GAO Assessment of OSHA’s Model for 

Estimating Compliance Costs With the MSDS 

Requirements of HCS 

The total annual cost of providing MSDSS by retailers is similarly defined by: 

TCP = (AC * M * S) * (1 + G”) * (1 + Gh) * (1 - P) * Pr 

The results from OSM’s model depend on the agency’s assumptions 

concerning the values of the variables (such as the level of unit costs, 

number of chemical hazards present in a nonmanufacturing workplace, 

number of MSDSS needed, number of firms, or employee compensation 

costs). Changes in these values will change the calculated total costs7 The 

more realistic OSM’S estimated numerical values for these variables, the 

more accurate its estimates of compliance costs will be. 

Because of data limitations, GAO cannot judge the validity of many of 

OSM’s assumptions underlying the numerical values it used. However, in 

one case where we did make an assessment, OSM likely understated the 

costs to comply with the MSDS requirements by not including nonwage 

compensation costs such as pensions and health benefits in the wage rates 

used in their calculations8 

7For example, for the model’s voluntary compliance variable, P, OSHA assumed an annual rate of about 

Z-percent compliance with both MSDS requirements for all industries and employer sizes, except for 

employers in wholesale trade (SIC code groups 50 and 5 l), where OSHA assumed a 60-percent 

compliance rate for the provision of MSDSs. 

sCorrecting for nonwage compliance costs would increase the estunated costs of complying with the 

MSDS requirement from $68.7 million to $87.9 million. 

Page 41 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix IV 

Information on Responses to Selected GAO 

Survey Questions 

This appendix presents response information on selected questions from 

our survey questionnaire concerning the Hazard Communication Standard. 

The questions chosen are those relating to issues discussed in this 

report-including employer compliance difficulties with WCS, as well as the 

costs and benefits of compliance-and used in the figures throughout the 

text. Unless otherwise specified, information is for those employers 

appearing to comply with the HCS. 

The associated sampling error is shown in parentheses after each 

response. For some of the smaller cells, the error may be quite large. 

Results with sampling errors greater than or equal to +/-20 percentage 

points are indicated by **. In some instances, response totals may not 

equal 100 percent due to rounding. 

We presented information related to survey questions on employer 

noncompliance with HCS, OSHA'S outreach efforts, and employer problems 

with MSDSs in our report of November 199 1 .l A complete copy of the 

questionnaire is included in this earlier report. 

‘GAO/HHD-92-S. 

Page 42 GAO/HRD-9%63BR OSHA Hazard Communication Standard 
Appendix IV 

Information on Responses to Selected GAO 

Survey Questions 

12. Overall, do you believe that OSHA’S regulation on right to know has had 

a positive or negative effect on employers? 

Industry group/ employer 

size 

Constructlon 

Small 

Mechum 

Large 

Total 

Manufacturing 

Small 

Medium 

Large 

Tolal 

Servlces 

Small 

Medium 

Large 

Total 

Total 

Small 

Medium 

Large 

Tdtal 

Y 

Effect (percent of employers responding) 

Very Somewhat Equally positive Somewhat Very Don’t 

positive posltive & negative negative negative None know .-- --- --___..~~-. -~~ 

__- ___. .-~~ . ** 8%   **  8% 8% 

** ~~(+‘-‘5) ~~_ ..~.....~ ..*_1_ -... -._ ** ** (+/-15) (+/-15) _____ --..__ -_~~--_._~-._~. 

13% 26 28% 18% 8% 3 3 

( t /-9) ( + I;1 1) ( + l-2 J)-_ (+/-lo) (+I-7) ( + /-5) ( t '-5) 

.-. _ __.-.__.--~..- .-.- ~-.-... -.- 

10 27 29 19 6 3 6 

(t/-7) ~(+'-lq ~~~ ~~~ (+/-IO) ( + '-9) (i-l-5) (-k/-4) ( t /-5) .--_ ~~~ _--- 

25 14 19 16 13 6 6 

(+/-18) (+'-'~') (t/-J 4) (+/-14) (+I-14) (+/-IO) (t/-IO) 

ii 

--.-~-.__...-~~-. 

17 26 9 0 0 22 

(+/-16) ( + '- ! 8) ---~A. +!:?LL!Yi!?~-~- ( + '-0) ( + LO) (i-'-17) _ 

14 28 32 14 1 9 2 

~~~(+'-!) (+'-2) (+'-6) (t/-3) ~. ~!+'-g) -~. -..- (+/-lo) --(+/-7) -- 

17 45 28 9 0 2 0 

(t/-6) ( + '-9) -L!L!L- ~-w:tj) ( t '-0) 

. .._ ____ ...~.~~~-.--_.-~~+/ro) 

15 28 30 12 1 5 10 

(+'-7) (+-'-9) -_ (j-./-9,. (t/-6) (+'-1) (t/-3) (+'-7) 

  **  6 6 0 0 

**   (-t/-12) (t/-12) ( + /-0) (.-I '-_o, 

23 17 29 17 10 0 4 

(t/:12) (+/-lo) _--(-t/-12) (+/-lo) (+/-8) ( + '-0) ( t '-5) __ ._~. 

25 25 13 18 0 13 6 a 

!+'-14) (+.'-14) .- ~~ --_.__ A.+'-10) (t/-12) ( t '-0) (t/-IO) ( t /-8) 

19 **  ** 7 7 0 0 

(+'-'8). .~ **. .~. .~ ---~- -2t:.-- __- ( +'-'1)_-(+/-1!_L_-_~(+~~---_!+/-05 

-..~---- ___-__--. . . -.I_.. ~~ 

22 20 30 10 8 3 8 

(+'-12) (+'-I') .~ .----...w2?L-p. ( t '-9) (+I-8) (+I-5) (t/-7) 

14 27 31 15 3 7 3 

(t/-5) (+'-7! ~~~ ~~~~~__ Lk!T~..______.__~~ (+I-6) (t/-2) (+'-4) (t/-23) 

16 43 27 10 0 3 1 

~~ (t-4 (+'-8) .~~- __. Lt!:7_)_--..~~~~ (t/-5) (t/-0.3) (+'-2) (t/0.3) 

19 23 30 12 6 4 6 

(+I-8) ( t l-7) (t/-8) (+/-6) ( t '-5) (-t/-3) (+I-4) 

Page 43 GAOIHRD-92.63BR OSHA Hazard Communication Standard 

I 

;“.‘: ; _. :. ., 

5 

,’ , 
Appendix IV 

Infomatlon on Responses to Selected GAO 

Survey Questions 

Overall, do you believe that OSHA’S regulation on right to know has had a 

positive or negative effect on employees? 

Industry group/ employer 

size 

Effect (percent of employers responding) 

Somewhat Don’t 

positlve 

Equally positive Somewhat 

81 negative negative 

Very 

negative None know 

-.-..-- ____.. .~- 

Constructlon 

Small 

Medium 

Large 

Total 

Manufacturing 

Small 

Medium 

Large 

Total 

Services 

Small' 

Medium 

Large 

Total ' 

Total’ 

Small' 

Medium 

Large' 

Total 

-_____. .-. _____---___-...-.~-~~   **  8% 8% ** 8% 

  **  (+/-15) (+/-15) ** (+/-15) --- 

15% 30% 25% 8 3 13% 7 

( + /-9) (+/-12) (+/-II) ( + l-7) -_--- ( + ~-5LlY!l!$ _... --_!~t-/!?) 

9 39 22 9 3 9 9 

J + i-6,. ! +/-“I (+/-9) .-----(+/-6)~-.-(+/:4~---~ (+/-6) ( + M) -_ -.- ~~~ 

26 20 18 8 6 15 7 

(+/-18) t+/-lp) (+/-11) (+/-lo) (+/-14) (+/-IO) .~ ~. ( + l-1 4]... __~~~ ~--._... ~~~~~ 

17 30 17 9 0 0 26 

!-km? _c+/-!P! (+/-'Q (+/-12) ( + /-0) ( + /-0) (+/-IQ __ ~_~ . .---.._~-____ 

16 27 30 5 0 17 5 

(+/-8)~. ..~(+!-91 .~~ ~pm_mm(+/-'O) (+/-4) ( + /-0) (+/-8) (+/-4) 

22 47 19 5 1 5 2 

( +/-!I ..( +t9L ..~. (+/-7) (+/-4) (+/-2) (+I-4) (+/-2) -~______-.~ -.--. 

17 29 25 6 0 10 13 

~(~+/-7) J+/.-?) ~~~~~~~~ (+I-8) ( + /-5) (+/al) (+/-5) (+/-7) 

  **  0 6 6 13 

**   (+/-0) (+/-12) (i-/-12) .-.__ (+/-17) 

26 18 29 10 4 8 6 

(+/-121 ~~~~ ~~~ ~.~ .. ~~~ ~~~~~ .. ---- (+/-II) (+/-13) _..~ (+!I!) ..____ (+/-5L LIE! __. --ems!) 

19 41 9 13 0 13 6 

(+/-1_2). .- (+./-I:) ~~ -~~.- -- ~~ -____--___ ( + /-9) ~~_~~ ___ (+/-lo) ( + LO) _ (+/-lo) ( +/-8, 

19 **  ** 1 6 6 12 

(+-l-18)   (+/-1) (+/-11) (-b/-11) (+/-15) 

23 

..-.. ._~._. .--____--.-___ 

22 22 5 5 8 15 

(+/-12) (+/-12) (+/-12) (+I-6) (+/-7) (+I-8) (+/-IO) 

'I 7 27 29 6 1 16 5 

(+/-!3 -~~ -- (+/-7) _ ~~ ~~~~ _ (+/-7) (-k/-4) (t/-l) (+I-6) (+I-3) ..___ ~~ __---_ .___-.- 

21 47 19 5 1 5 2 

I (?!:6) (+/-2) ~.~ ..!.+e?.. _~ .-. ..~ ~~-._!+/Is)___--~-~..--~~~~.~_. (+/-3) (+/-l) (+/-3) 

20 25 25 5 4 11 11 

(+/-8) (+/-8) (+/-8) (+-14) (+/-4) (+/-6) ( t l-6) 

Page 44 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix IV 

Information on Responses to Selected GAO 

Suwey Questions 

13. Listed below are things that might or might not be improved as a result 

of the regulation. In your opinion, to what degree, if at all, has the 

regulation improved each of the following? 

Degree of improvement (percent of employers responding) 

Very 

great Great Moderate Somewhat Slight None Aspect -_--_-__--- ___--.. of workplace 

Quality of your employees’ formal/on-the-job training in avoiding 

( +E, 

30% 28% 15% 11% 11% 

workplace hazards ( + /-9) ( + l-8) ( + l-6) ( + /-6) (+/-6) ~. --~-..___-__. -~--._ ___---____ 

Your employees’ awareness of workplace hazards 

(+/-:) (+;Z, (+Egs, (+;-:, (+:-:I ( .+ /-85) 

----__ 

Your employees’ care in handling and use of hazardous 

subslances (+,-ii (+Z, ,+,T:, (+E, (+I-:, (+;;, 

Availability of information on hazardous substances in your 

__.-- -__ ____. ~--- 

workplace (+::I 

r 

(+;I;, (+fE, (+;A, (+I-:) (+I-46) 

Your management’s awareness of workplace hazards 

-.-----..~ 

W-Z) (+I-:, 

Page 45 GAOiHRD-92-63BR OSHA Hazard Communication Standard 
Appendix N 

Information on Responses to Selected GAO 

Survey Questions 

14. Consider ways the regulation on right to know has affected your 

business: To what extent, if any, have your clerical costs due to the 

regulation’s paperwork requirements increased? 

Industry group/ Extent of increase (percent of employers responding) 

employer size None Little Somewhat Moderate Great Very great Constru~tlon -.--~- .-___ _--.._- 

-.~ _...... -.-----.-^-.--.-_--------..-.._-~~~-. .--. 

Small 8% **  8% ** ** 8% 

(+/-I51 ** 

- . -...-..-- -_.. --. (t/-15)   

..___-- (+/:J:) ___.~.....___.. 

Medium IO 15% 22 27% 20% 7 

(+/-8) ( + /-9) (+/-11) (+/-11) (-t/-6) 

. -..--- .--.. -..---_---...-__~ . . . -~.-- ..--~~.- ---..- (@/-I 0) 

Large 3 15 15 40 21 7 

~__ (+/-4) ( + /-8) ( + /-8) (+/-II) ( + /-9, (+/-6) ..- _-----.---.~. ._......__~ -- ..--__- .-.---- .._ ~- _~_-.__-...-.-_-.-_-~.--..~.-. -~ - ~- 

Total 8 31 12 24 17 7 

~~_ ( ++j 1) (+/-19) (+/-II) (+/-17) (+/-I41 --._.___- ..__ .--.... (+/-11) 

Manufacturing ..-. _~ --.. ~_~~~. --. __.--- 

Small 22 13 26 30 9 0 

(+/-17) .-. ( + Mp) _(+/-I81 (+I-191 (+/-12) ( + /-0) __-----...---..- _-.. _..~~~~ ..- ~~.. -~~~~ 

Medium 9 24 21 29 11 6 

(+/-9) ( + /-9) -_ _I+ /-9, (t/-10) (+/-lo, ( + /-5) 

Large 5 19 21 30 19 6 

(L-b P) .___ _........... A?/-71 ..~_~ ...~~ ~~~... (+/-7) ( + /-8) (+/-7) (-b/-4) ~~ . 

Total 14 19 23 30 10 4 

(+I-71 (+/-7) ( + t-8) (+A9) (+I-6) (+I-3) _.._._____ ~~~- _..._....__ ~~.-.--~----~ 

Services 

Smail **  ** 13 ** 13 0 

  (t/-17) **  (+/-17) ( + l-0) 

Medium 13 23 27 23 13 2 

( + /-9).-m.. (+/-12) (+/-13) (+/-12) (+/-?! .-~-. mp!+/.-?) Large 9 41 19 13 19 0 a 

( + /-9) 

Total' 

(+/-15) (+/-12) (+/-IO) 

** 19 14 -- _ 19 -_-I? !Z) 13 . ._~~ _~-~--I!- m 0 

** (+/-18) (t/-15, (f/-18) (+/-15) (+/-0.3) _.-.. _~___.. .--. ~~~ ~._....____~~~... ~~-- --~... _--~ -~ ~~~~~~---.-.~~~~ .- 

Total 

Smail 23 24 15 23 12 3 

(+/-12) (+/-13) (+I-61 (+/-I21 

Medi'um 

(-t/-l!) ._(+/-5) 

10 21 22 28 13 6 

(.$-/-5) ( +/bz) __-.-- .....( +/-7) .._ (+/-7) (+I-51 

Large 

__--.- (.+I-41 

5 19 20 31 19 6 I 

(+/-13) (+/-6) (+/-7) (+I-7) (+/-6) 

Total 

..J + I-4) 

18 23 17 25 13 4 

( + l-8) (+/-8) (+/-6) (+/-8) (+/-6) (+/-3) 

Page 46 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix IV 

Information on Rerponses to Selected C3AO 

Survey Questions 

To what extent, if any, have your overhead costs due to storing and 

maintaining information on hazardous substances increased? - 

Industry group/ 

employer size 

Cdnstructlon 

Small 

Medium 

Large 

Total 

Manufacturlng~ 

Small 

Medium 

Large 

Total 

Extent of Increase (percent of employers responding) 

None Llttle Somewhat Moderate Great Very great 

0% ** 8% ** 8% 8% 

( -y-O). .~~~~~ .._... 

** (+A15) ** (+/-15) (+/-15) -.---__ 

8 26% 31 16% 15 3 

(t/-7) (+/-4) (+/-12) ( t /-9) (+/-5) ~~~~- -. _~--.. ....~._~~ - --- ( + /-q 

10 15 14 35 12 4 

(t/:7) ~~~__~_~~~~~~_~_~~,~~__ (+/-8) __ ---_--_ ( + l-9) (+/-ll) (+/-7) ( + /-5) 

3 ** 15 26 10 6 

( +4 ** (+/-11) (+/-18) (+/-lo) -.___...._ ~~. ..__ _.... ~_ (t/-11) _-..--. .-.- 

~22---~~- --_ ~~-- ~~~9 -~.- -----.tt-.- _--.--~.. ..-.. 

17 9 0 

(+/-'7!. (+!I!?! . --.-p--_"*--- (+/-16) (t/-12) ( t LO) .- - ~_~ _______---_-. 

14 27 22 28 2 6 

(-+!:7)~-_._ -.- ~~ .- ( + /-9) ( + /-9) t+/-1g (+/-3) (+/-5) 

9 22 21 30 14 4 

i+/-:). _~~ ~. ~~~ (+/-7) (t/-7) ( t /-8) (t/-6) (+/-3) ---- ~~ -_-__- ..------- .-.-. -- . -__ 

17 20 30 24 5 4 

Set&es 

Small 

Medium 

Large 

Total 

Total 

Small 

Medium 

.! +I 4 ~~ _~ .~.~ P/:7) _~~ ~~--k!Y%~-. (t/-8) (t/-5) (t/-3) 

-- 

- .-... ..~~ ._~~~~~~.. _.__ -- ..~_~-_._~~~-___-- .___ 

** 13 0 ** 13 0 

** (t/-17) ** (+/-17) ( + LO) 

17. 

J-t /-0) -.... ~-- - 

30 19 23 9 2 

(+/.-jl) ~~ ~_~. -. (+/-13) _~~~_ -_~~~ (+/-Ii) (+/-12) ( t /-8) (+/-4) .~~__ ___.__ ________ --..--..-__.- 

13 28 31 19 9 0 

(+/-lo) (+/-14) ( H+j>l ( + /-Ia --.+!zL-. _____ -w?) 

6 

l * 14 2 ** 12 1 

** (t-/-151_ ... _--- (t/-l) ** (+/-15) (+/-0.3) ____-....- 

._____-____-.__..-- -.. .- 

18 23 14 32 10 3 

(+/-lo) (+/-12) (t/-8) (i-/-14) ( t /-9) -.__. ( t /q 

13 27 24 25 6 5 

( + 4 ~. ~- . ~-~~-kk!:!2 __~- . . . .._ ~-r+/-.!)___.~~-~-_-~3~.~-._(_+_/-4) 

9 22 21 31 13 4 

+. ( + /-5) (t/-7) (+/-7) (+/-7) (+/-6) ( t /-3) 

16 24 18 30 9 4 

(+/-7) ( + /-8) ( t /-5) ( + /-9) (+I-6) ( t /-3) 

Page 47 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix IV 

Information on Reeponuee to Selected GAO 

Survey Questions 

To what extent, if any, have your overhead costs due to developing a 

written training document increased? 

. . . 

Industry group/ Extent of increase (percent of employers responding) 

employer size None Little Somewhat Moderate Great 

Consttvctlon 

Very Great -________ __---. 

____---- 

Small   9% **  ** 0% 

  (+/-18) **  ** 

-~.-- ._.. ~-.----_._- ._..._ - ._._.__ - ._.______ ___ 

( + /-0) 

Medium 5% 10% 25 37% 17% 5 

j '- /-cj, ._ -.-_ _- (t/-8) (+/-lo) (+/-12) (+/-IO) (+I-5) ---l_-_l--- 

Large 4 13 28 34 16 4 

.(+/-y (+I-8) (+/-lo) (+/-1O) __-.__ct/-8) (+/-2) -~-.-_ 

Total 14 15 15 ** 18 2 

bkjnufacturjgg- ($1-15) _ (+/-16) ** (t/-12) (+/-lo) ( + /-2) -_____.___ _ 

Small 13 22 17 ** 9 4 

Medium 

..J +np, __._. (+/-17) (+/-16) ** (+/-12) ( + /-9) 

-___----.------ 

7 14 33 27 13 5 

Large 

(+/-6) (+/;8) (+/-lo) (+/-lo) (+/-7) (+/-5) 

3 17 33 33 10 4 

Totil 

__ -_(+/-3) (+I-7) (+/-8) ___-. ( + i-8) (+ d-5) (+I-3) __________ __-_I____ 

9 17 27 31 11 5 

Seivlces 

._(+I+)_ (+/-8) (+I-8) ( + /-9) (+/-6) (+/-4) ___._~____._ 

smalls .'. 

___----- 

  6 **  13 0 

**   

Medium- -. 

(+/-12) (+/-17) ( + /-0) I_______ ---I__.--- 

10 25 23 17 23 2 

_ ..._j-//:) (+/-12) (+/-12) (+/-I 1) (+/-12) t+/-4) -__I_ 

Large 13 28 16 38 6 0 

iota1 

....,... (+ 1-J 0) ___ (+/-14) (+/-11) 

**  ** 8 

** iI* (+/-11) -- 

Total 

Wall 20 25 10 

Medi"m. 

~-- (+/-12) .._ .~..~~.._ . ..__ __._.,_____...__... 

(+/-13) ( + /-9) 

7 14 31 

-.. 

Large .--.- 

--_m_.-( + /-4) (+I-6) (+I-8) 

4 17 32 

1 

-Gal 

___- -(+/-3) (+I-6) (+I-8) -- .._ -. ___..__ ____ 

14 21 18 

(+/-8) (+I-8) (+/-6) 

(+/-15) -~---.__ (+/-6) (+/-0) l -.--. -. 

** 13 0 

** (+/-15) (+/-0.3) ..-___ .--___- 

----- -_- _... -.-. 

31 13 1 

(+/-14) (+/-lo) ( + /-2) 

29 15 5 

(+I-7) ( + /-6) (+/-3) 

-- --_ _I_--.- 

33 10 4 

(+I-8) (+/-5) (+/-3) -- 

31 14 3 

( + l-9) (+/-7) (+/-2) 

Page 48 GAOiHRD-92-63BR OSHA Hazard Communication Standard 

..I 

7, ‘. / 
Appendix N 

Information on Responses to Selected GAO 

Survey Questions 

To what extent, if any, have your overhead costs due to following the 

regulation’s labeling reauirements increased? 

Industry group/ Extent of increase (percent of employers responding) 

employer size None Little Somewhat Moderate Great Very great 

~~@&~tlon 

.-- - 

Small 

.’ ~. 

~~~~~ . . . ~~.. .~.- --.... --~~-..--------.~.--.--_-__-. --   8% **  8% 8% 

** ** (+/-15) ** (+/-15) (+/-15) -___--_---~-.. 

Medium 10% 19% 27 29% 12 3 

-.(t /-q _--.-_ _- __ _- (+/-IO -.- (+/-11) (+/-12) _ (+W (+I-5) ___._ 

Large 15 16 22 22 24 2 

( + /-9) iotai !!I!?L 14 .- .._ -- ._-. wrll)_.. 27 14 ( + /-9) ( + /-9) (+I-3) ___-.-__--__---- 30 9 --..-..- 6 - 

(+/-14) (+/-18) (+/-II) (+/-I@ (+/-11) (+/-IO) 

@akufacturlng ~.- .__- 

Small 13 17 ** 22 13 0 

(+/-14) (+/-16) ** (+I-17) (+/-14) ( + l-0) 

Me&urn 

__-----____.--- _____- 

9 18 31 26 12 5 

(+/-6) (+I-8) (+/-IO) ( + /-9) (+/-7) (+I-5) 

Large 

.__-__ _______ ~.. 

5 19 20 39 14 3 

( t /-!J. _.!? !:Ll-_ (t-/-7) (+/-8) (t/-6) (t/-3) .._--. ._. ..__ _. __. .- 

Total 11 18 32 25 12 3 

SerVices 

(.+E! ._.. .I~+@- _... .._ 

( +/-9). (+/-8) (t/-7) (+I-3) __- -.._ ---._..--__ ___.--- 

SAall ** 7 ** 13 13 0 

** (t/-13) ** (t/-18) ..-(t/-18) ( + /-0) __---_ .-- 

Medium 19 21 29 

!+!-.I!) -~+l:X-._ (t/-13) 

(Ai, 17 2 

(i-/-II) (i-l-4) ._- ~.-.__--. ---______ 

Large 10 42 26 19 3 0 6 

( t l-9) (i-L-16) (t/-14) (+/-13) (t/-16) ( + /-0) 

Total ** 8 21 13 14 0 

** (+A12) (+/-19) (t/-16) (t/-16) (t bO.4) 

Total 

--___ --I-.--.---- -- 

Small 27 18 20 22 11 3 

(+/-13) (-k/-II) (-f/-11).- (+/-12) ( + l-9) (+I-5) ---_--__ _----__- 

Medium IO 18 30 26 12 4 

(+I-5) (_t@) _____._.._ (+A7) (t/-7) (-t/-5) (i-l-3) 

ia;ge 

_...._ ---__ 

6 19 20 38 14 3 

Y 

Toit 

.~ . 

(~j- /d) (+/-6) (t/-6) (+/-8) (t/-3) ___.. .- 

20 _~_...._.~. . . .._ _ 18 24 

(+/-6) 

24 12 3 

( t /-8) (+/-7) (+I-7) (+I-8) ( t /-6) (t/-3) 

Page 49 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix N 

Information on Responses to Selected GAG 

Survey Queetlons 

To what extent, if any, have your equipment costs due to the purchase of 

additional safety equipment increased? 

Industry group/ Extent of increase (percent of employers responding) 

employer size None Little Somewhat konst&tioA -- .._ ..- . .._.........__ --_ -.- _ Moderate Great Very great -__ 

small .- 

-.____ -----.._ ** 8% 8% ** 8% 0% 

** (+/-16) (+/-16) ** (+/-lo) ( + LO) __- 

Medium 18% 26 16 30% 7 3 

...- J+/-IO) (+/-11) ( + /-9) (+/-12) (+/-6) (+I-5) 

Large. 

____-. ____ - ___-.-- ..-- 

19 24 29 21 6 2 

( + l-9) ( + /-9) (+/-IO) 

iolal ~. 

- _..----. ---.--.-__--.---~~.-- 

_. .^_. 28 14 11 

( +/-9) (+I-5) J++?) 

** 8 1 

.._-_ ( + l-1 9) (+/-II) (+/-II) ** Manufacturing (+/-II) (+-/-I) _______ - ._..._ --.-.--.-. 

~ - 

______ _.._ -.--.-.-.-. -.-- 

Small 17 17 26 22 17 0 

_(+/-16) (_+/;.16)- (t/-18) (+/-16) (+/-14) ( + /-0) 

--- --___. 

Medium 19 23 21 24 8 5 

(+I-8) ( + i-9) ( + /-9) ( + /-9) (+/-6) ( + l-5) 

Large. -. 

.._ -...------...-._.--_.--.---.-. -.._I_---------__ -.~-.I_ 

10 18 29 30 14 1 

(+I-7) (+/-a) (+/-8) (+/-6) (+I-2) 

Toial 

( + (-5) .-_______- --.. 

18 20 24 23 12 3 

(+/-8) 

Se/vices 

_(+/-a) ( + l-9) (+/-8) (+/-7) (+/-3) ~..- ____--__. 

S&all 

___-.-__--- -. 

  **  13 ** 13 

  **  (+/-17) ** (+/-17) 

Medium 

__-__ 

17 15 17 27 19 6 

i.a;ge 

.-- _(+/-I 1) (+/-IO) (+/-11) (+/-13) (+/-11) (+I-7) 

13 28 19 34 6 0 a 

----. J.+/-10) (+/-11) (+/-12) (+/-15) (+/-la) ( + l-0) 

Toial 

__- __--. --____- 

19 ** 1 14 ** 12 

(+/-18) ** (+/-I) 

Tatal. 

___- (+/-15) ~_.**~----~~-i+/-E) 

SrtAall 

.~ ..- .._-_ ...__ _.___. -_____-_c.-- --.- 

23 20 10 24 18 5 

(+/-13) (+/-11) (+A12) (+/-12) (+/-ll) (+I-7) 

Medium 

..~ _.. --.-. _--_- ___ -_..-_..--I_..-.._-_-.-~..----_--.-_ ___- __--- 

19 23 20 26 9 5 

(+A7) (+/-7) (+I-4) (+I-3) 

Large ---~ 

__ ( +/-6) _ _--_ (+I-7) 

10 18 29 _~ ---___ 29 13 1 

" (+/-5) (+I-6) (+/-7) (+/-7) ( 

Tdtal 

_____- + k!! __..___ m.-+!L., 

21 21 14 25 14 4 

(+/-a) (+/-8) (+I-5) (+/-8) (+/-7) (+/-4) 

Page 50 GAOMRD-92-63BR OSHA Hazard Communication Standard 
Appendix lV 

Information on Responses to Selected GAO 

Survey Questions 

To what extent, if any, have your employee training costs due to the 

regulation’s training requirements increased? 

industry group/ Extent of Increase (percent of employers responding) 

employer size None Little Somewhat Moderate Great 

._ Very great _ _ .- _ 

Constructlon 

&nail 0%   **  0% 0% 

( + /-0) **   ( + LO) ( + /-0) 

Medium 

__-____ 

12 18%. 26% 28% 10 3 

(+I-8) (+/-IO) (+/-II) (+/-II) (+/-8) .- . . . -- --...-.-..-__- ~- .- ( -t /-5) 

Large 3 12 19 33 18 15 

(+I-4) (+/-7) ( + /-9) (+/-IO) ( + /-9) (+I-8) 

iotili -- 

..-. _.. . ..-.. -. -- _-._ - -- 

4 22 30 **  3 1 

(t/-17) (t/-18) ** ( t /-2) (+/-1) 

ijaAufacti;ing 

-., -- (+ /-3) 

---.- 

Small 17 22 22 17 22 0 

(+/-16) (-t/-17) (+/-17) (+/-16) (t/-17) ( + /-0) 

Medium- -. 

--.- _- -- 

10 23 23 27 13 5 

___ (+/-6) ( t /-9) ( + /-9) (i-/-IO) (+/-I) (+/-5) -- 

Large 0 14 28 34 19 5 

__ _&j-O, (t/-8) ( + /-8) (t/-8) (+/-7) ( t /-4) 

Total 

__- 

12 22 23 24 17 3 

~_ (t/-7) (t/-8) ( + /-8) (+/-8) (+I-8) (i-l-3) 

SeAicis ~ 

---- 

Small   0 **  6 0 

** ** ( + LO) ** (t/-12) ( t LO) 

-- 

___--_____ 

Medium 17 17 23 35 8 0 

(+/-11) (t/-II) (t/-12) (t/-14) (+/-8) 

i&ge-. 

(+/I_) 

6 31 19 31 13 0 

(t/-8) (t/-15) (i-/-12) (t/-15) (+/-IO) (+/-0) * 

Total 

.. _.-...- ___-___- 

** ** 2 ** -- 6 0 

  (t/-l) **  (i-/-12) ( + LO) Total 

~ 

.--- __- __..---- 

--. -- 

-.___ __.--____ .--.-___- ..- 

Small 17 29 16 30 8 0 

(-b/-10) (+/-14) (+/-lo) (+/-13) _ (+/-7) ( + l-0) 

Mkdium -. 11 21 I__- 24 28 12 --.--. 4 

--- (+/-5) (+/-7) (t/-7) (+/-7) (+/-5) (+/-3) 

LIarbe 

-.-__ -_ 

0 15 27 34 19 5 

(+/-0.3) (+/-6) (-b/-7) ( t/-8) (t/-6) (+/-3) 

Total .' 

~-. 

--_-.- 26 - -- 19 

___.- 

14 29 -.----__- 10 2 

(+/-7) ( + /-9) (+/-7) ( + /-9) (+I-5) (i-/-l) 

Page 5 1 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix Iv 

Information on Response6 to Selected GAO 

Survey Questions 

15. As a result of the regulation, to what extent, if any, has each of the 

following increased or decreased in your business? 

Aspect of workplace 

Morale (management) 

Morale (employee) 

Productivity (employee). 

Workplace-related injuries (employee) 

Extent of change (percent of employers) 

Greatly Somewhat About Somewhat Greatly 

increased Increased the same decreased decreased __I____-.. 

6% 11% 74% 9% 1% 

(+/-5) ( + /-6) ( + l-9) ( + /-5) (+/-1) -- 

7 11 76 5 0 

_-_ J+kg) _ ( + /-5) ( + /-8) ( + /-5) ( +/:J, 

4 4 83 8 2 

(+/-4) ( + /-4) ( + l-7) (t /-5) ( + /-3) ---- __I.__ 

0 1 82 11 6 

Workplace-related illnesses-(employee) 

__ .pJ-g -. __ --_ _-..__-- (t-/-l) ~_ (t /-7) ( + i-5) ( t /-5) __.--.____ ___-._-._---.~ 

0 1 84 9 6 

( + l-0) (+/-I) ( t l-7) ( t l-5) (t l-5) 

2 1. When your business receives products containing hazardous 

substances, or substances you believe to be hazardous, how often is the 

MSDS with the initial shipment, with every subsequent shipment, received 

whenever a manufacturer updates the MSDS, and/or received after you 

request the MSDS from the manufacturer or distributor? 

$&tlons of recent 

With the initial shipment 

With every subsequent 

shipment 

Received whenever a 

manufacturer updates the 

MSDS 

Received after the MSDS .is 

All or 

almost all 

of the time 

40% 

( + /-9) 

(+?, 

(2, 

Frequency (percent of employers responding) 

None or 

Most of Half of the 

the time tlme Some o:iz 

almost none Don’t 

of the time know 

28% 10% 4% l 

~~ (+!;8)- i+E G!!, .____ -T.-.w!l-.~- .___ -!.A!3 

~~~ .J$;, __- (t/-i, (+;:I (+;i, (t/-i, 

-__ _____~. -_-_--.---_ -._~-~ .-... 

(+ZZ, _ -- pH/:, ,+;;, (+:-ii, (+;;I 

requested lrom the 

manufacturer or distributor 

Page 5 2 GAO/HRD-9%63BR OSHA Hazard Communication Standard 
Appendix IV 

InformaCion on Responses to Selected GAO 

Survey Questions 

23. For all the MSDSS you have received, how easy or difficult are they for 

you to maintain and keep up to date and to ensure employee access to 

them at each worksite? 

Requirement 

Maintain MS&s and keep up to date 

_ ~~~~~ _...._. ._ 

Ensure empl&ee-access to them at each worksite 

Frequency (percent of employers responding) 

Very Somewhat Neither eas 

Y 

Somewhat 

easy easy nor difficu t difficult dlff::u 7 t 

-___--- 

24% 24% 28% 16% 

(+I-8) ( + /-8) ( + l-8) ( + /-6) ( +E, ~~ __ 

(+Ei, (+2, 

25. At your business, have you ever replaced a more hazardous substance 

with a less hazardous substance because of information received from a 

MSDS? 

Industry group/ employer size ------ 

Construction 

Small 

___..__ 

Medium 

Large 

Total 

Manufacturing 

Small 

_~~ ~--___- 

Medium 

Large 

Total 

Percent of employers responding 

Yes No -- 

-----__ -- 

** l * 

** ** 

--___ 

20% 80% 

(+/-IO) (+/-lo) - -____ 

40 60 

(+/-11) (+/-11) --- 

26 ____--- 74 

( + /-8) (+/-8) 

6 

________._____-----..~..-~ 

29 71 

(+/-19) (+/-19) - ---_____-. __ 

38 62 

(+/-lo) (+/-lo) 

70 30 

(+/-8) ( + I-8) ___.. ___-- 

37 64 

(+/-17) (+I-17) --- 

(continued) 

Page 53 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix IV 

Information on Responses to Selected GAO 

Survey Queetions 

Industry group/ employer size -_- 

Services 

Small 

---_-__--- 

Percent of employers respondlng 

Yes No -- 

~.._ 

  

**  ** 

Medium 38 62 

(+A13) -.--____ --.-- --__~- __II_- ( + /-fg 

Large 58 42 

(+/-16) (+/-16) 

-____- . .._ -.--.--- ___-- 

Total 21 80 

( + l-9) ( + I-9) 

Small 25 75 

(+/-12) (+/-12) _._-_..__---._ __-___ ~---~_l_~-_. 

Medium 34 66 

(+/-7) (+/-7) ---------- .~-.-~-- .---____ ___-__. --___-- -- 

Large 68 32 

(+/-7) (+/-7) 

-._ -- - --- __I--. 

Total 29 71 

‘(+/-8) (+/-a) 

26. Listed below are reasons why a business might not replace a more 

hazardous substance for a less hazardous substance. Which is the primary 

reason why your firm does not replace its hazardous substances? 

Reason for not replacing hazardous substance (percent of 

Industry group/ employers responding) 

employer size _.I__-_~_--__-~---__-~- (1) (2) (3) (4) ._.. ~__ (5) 

Construction __________ -.--..-~- 

Small 7%   7% **  ’ 

(+/-14) ** ** (+/-14) ** 

-__ 

Medium 7 51% 26% 3 13% 

( + /-6) (+/-13) (+/-11) ( + /-5) ( + /-9) __.---_-__-._- ._.._ ~. ..~_ _-..~-.- .___ __ ------ -.-- ___ ..~ 

Large 5 39 33 6 17 

( +m l_--l_-_ (+/-11) (+A11) ( + /-6) (+I-7) --. 

Total 7 40 28 6 19 

(+/-lo) (+/-19) (+/-‘fa ______~ ( -t l-9) (+/-16) 

(continued) 

Page 84 GAO/HRD-92-03BR OSHA Hazard Communication Standard 
Appendix Iv 

Information on Responses to Selected GAO 

Survey Questions 

Reason for not replacing hazardous substance (percent of 

Industry group/ employers responding) 

employer size -_-----.-.--.-- (1) _____ (2) (3) (4) ---- (5) 

Manufacturing --- ---- --__.-----. --- 

Small 0 30 ** 13 17 

( + /-0) (+/-19) ** (+/-14) (+/-16) __--- 

Medium 2 35 48 4 12 

(+/-3) (+/-lo) (+/-II) ( + l-4) (+/-7) .~ 

Large 3 34 50 6 7 

( + l-3) (+I-8) ( + l-9) ( + l-4) ( + l-4) .___--_-- _-.. 

Total 2 33 45 7 14 

( + l-2) ( + /-9) (+/-IO) ( + /-6) (+/-7) ~-________--- 

Services ~--- __-~ 

Small 0   7 13 

(+/-0) **  ** (+/-13) (+/-18) -___.. 

Medium 6 43 33 6 12 

(+I-7) (+/-14) (+/-13) ( + /-7) ( + /-9) .___-.- -. 

Large 3 42 36 3 16 

( + l-6) (+/-16) (+/-15) ( + /-6) (+/-12) ____ 

Total 1   7 13 

(+/-1) **  ** (+/-12) (t/-17) 

Total -.___-_____ -~ 

Small 3 31 41 9 17 

( + -/5) (+/-I41 (+/-14) ( + /-8) (+A11) 

Medium 4 39 41 4 12 

( + l-3) ( + /-8) (+/-8) ( + /-3) ( + /-5) 

Large 3 35 49- 6 8 

( + /-3) ( + /-8) ( + l-8) ( + /-4) ( + /-4) --_ -..____-____-__ -. 

Total 3 34 41 7 15 

( + /-3) ( + /-9) ( + l-9) (+I-5) (+I-71 

Legend a 

(1) Can’t determine from the MSDS how hazardous the substance is 

(2) Don’t know whether or not a replacement exists 

(3) No replacement exists 

(4) Replacement costs are too high 

(5) Other (Please specify) 

Page 55 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix Iv 

Information on Responses to Selected GAO 

Survey Questions 

29. Listed below are problems that might be encountered by a business in 

providing training to employees on the safe use and handling of hazardous 

substances. To what extent, if any, do you believe these problems have 

been encountered at your business? 

Extent of problem (percent of employers responding) 

Little 

Problem or/none Some Moderate Great Very 

..~. 

IAuilicienl expertise in 

- ..---. - . . -.--_.--___-.---- 

24% 

great 

38% 22% 

training _... ( + /-w _ 

( + /-8) ..~ ( + /-7) ( +Z, ( +;I$ 

.-- .____I___ 

High employee turnover or 

transfer (+;:I (+;;I (+i-E, (+;;I 

--_-.-_--.__-- p/-i, 

MSDSs too difficult to use in 

the training program (+E, (+;E, 

&ploye& located at more 

(+EY) (+I-!) (+/-Z) - .-__ ------ 

than one work site (+/E, (+;i, (+/-Z) (+/-:I (+/-El 

E&ployees having variable 

--. 

work schedules (+Z, (+/-:I -...-- ~-~.-~-.--._- _____.._____ ___I_______ 

High cost of training 

(+i-zi, (+I:) (+I-:) 

(+Z, 

Don’t know/ 

not applicable 

( +E) 

-- 

( + ;:I 

(+/:;I 

(+PY, 

-.. 

(+:-:I 

Page 66 GAOEIRD-92-63BR OSHA Hazard Communication Standard 
Appendlx IV 

Inf’ormetlon on Responses to Selected GAO 

Survey Questions 

30. How useful, if at all, would the following be in training your employees 

on the safe use and handling of hazardous substances? 

Degree of usefulness (percent of employers respondlng) 

Type of tralnlng assistance 

More detailed lab&on hazardous 

product 

MSDSs or similar information on 

hazardous substances that are easy to 

understand 

..” .._ .-- -- ..__ - ~ 

More specific pamphlets or written 

materials targeted to the hazardous 

substances used in your workplace 

Training videos targeted to the 

hazardous substances used in your 

industry 

Extrlrey$ Very 

useful 

Moder;w;,i 

23% 23% 23% 

(+I-8) ( + /-8) ( + I-8) 

(CE, (,13& (+;i, __~ -~__-- 

(+E, (1-E) ,+;-;, 

(+I-:, 

Not wee; Not 

applicable 

.- 

11% 

(+/6) (+:;, 

(+/-:I (+/-.Oi) 

--.-.-. 

d ( + /-:, 

,+;-;, (+I-& 

Page 57 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix V 

Data Supporting F’igures in Appendix I 

Table V.l: Data For Figure 1.4 

Percent of emymyerr ;;it fewer than 20 

P Y 

1 2 3 4 5 

Maintaining current MSDS file 26% 24% --- 30% 13% 7% ___- 

Assuring employees file access 37 21 24 11 7 

Note: Sampling errors range from +/-I4 percentage points for small employers finding it very easy to 

assure employees access to MSDSs to +/-7 percentage points for those small employers who find it 

very difficult to maintain a current MSDS file 

Table V.2: Data for Figure 1.5 . _ 

Percent of employers who found 

requirement somewhat/very dlfflcult 

1 2 3 

Maintaining current MSDS file 

Assuring employees file access 

20% 27% 50% _- -I-- 

18 20 30 

Note: Sampling errors range from +/-12 percentage points for employers with fewer than 20 employees 

who find it somewhat/very difficult to maintain a current MSDS file to +/-6 percentage points for 

employers with 20 to 499 employees who found it somewhat/very difficult to assure employees access to 

MSDSs. 

Table V.3: Data For Figure 1.7 

Percent of small employers who had problems 

providing HCS-required tralnlng 

1 2 3 4 5 ___l_-- --- 

Insufficient training expertise 46% 23% 21% 8% 3% -- _.-. - -.- . ..-_-- _I_- I__--- -- -__- 

Employee turnover 55 18 7 17 3 

-...--.-.~.----.--_-_~--.---.- __- --I___ 

MSDSs too difficult to use 47 25 17 9 3 -_.- -__.-..--__--.-__ 

Employees at multiple worksites 65 11 2 11 G 

-..~ .---.--...~~_.- - --__ _I- -. 

Employees with variable work 

schedules 73 3 12 8 4 

High training expenses 64 12 13 10 1 

1, 

Note: Sampling errors range from +/-15 percentage points for employers with fewer than 20 employees 

who had problems with insufficient training expertise, employee turnover, and using MSDSs in training to 

little or no extent; to -t-/-3 percentage points for those who found employees at multiple worksites a 

problem to a moderate extent or high training expenses to a great extent. In this table and others, 

response totals may not equal 100 percent due to rounding. 

Page 58 GAOMRD-9%03BR OSHA Hazard Communication Standard 
Appendix V 

Data Supporting Figures in Appendtx I 

Table V.4: Data for Figure 1.8 

___- 

Insufficient training expertise 

Employee turnover _--.- _.--.. -.---.--- -... --.-.- 

MSDSs too difficult to use 

Percent of employers who had 

problems prov;N# HCS-required 

g 

1 2 3 

--- 

54% 67% 56% 

---- 

45 66 60 

54 76 73 

Employees at multiple worksites 35 42 54 __--.- 

Employees with variable work schedules 27 45 63 

-__ ___--- - 

High training expenses 37 53 53 

Note: Sampling errors range from t/-15 percentage points for employers with fewer than 20 employees 

who had problems with insufficient training expertise, employee turnover, and using MSDSs in training to 

little or no extent; to t /-7 percentage points for those medium-size or large employers who had difficulty 

using MSDSs in their training programs. 

Table V.5: Data for Figure 1.10 

Percent of small employers who had 

cost Increases 

Paperwork/clerical 

MSDS storage _~~.. _~. .~~ 

Written program development 

Labeling 

Employee training 

1 2 3 

47% 30% 15% 

41 47 12 ___ -... 

44 41 14 __~~---~ 

45 42 14 

..- 

46. 46 8 

Note: Sampling errors range from t/-15 percentage points for small employers who experienced little or 

no increase in labeling requirement costs to +/-7 percentage points for small employers who 

experienced a great or very great increase from increased employee training costs 

Table V.6: Data for Figure 1.11 

.____-...__ 

Paperwork/clerical 

MSDS storage 

--~- ..- -- 

Written program development 

Labeling 

Emolovee trainina 

Percent of employers who had cost Increases 4 

1 2 3 _____--__--- 

53% 69% 76% _____-.- ~- 

59 60 69 __-- __-.-----~. 

56 79 80 ___.-__-__---.---_~.. _ 

-~ 56 72 

I_-- 

..--11_5 

54 68 85 

Note: Sampling errors range from +/-15 percentage points for small employers who experienced great 

or very great increases in labeling requirement costs to +/-6 percentage points for large employers who 

experienced a great or very great increase from increased employee training costs, 

Page 59 GAO/HRD-9%63BR OSHA Hazard Communication Standard 
Appendix V 

Data Supporting Figures in Appendix I 

Table V.7: Data for Flgure I.16 

Percent of emdovers 

On emnlnvers 

1 2 3 4 5 

42% 30% --la% 4% 3% 

On emblovees 45 25 9 11 11 

Note: Sampling errors range from +/-9 percentage points for employers finding a very/somewhat 

positive effect from HCS on employees to +/-3 percentage points for employers finding no effect from 

HCS on employers. 

Table V.6: Data for Figure 1.17 _ ,.. 

Percent of employers 

1 2 3 

Quality of workplace hazard training 

Employee hazard awareness 

36% 43% 22% 

.-___ -___-- 

41 39 20 ~__- 

Employees’ care in handling/use of chemicals 41 38 21 ______c_-~-.-_. 

Availability of hazard information 56 37 7 --________I_ __.--.._- 

Management awareness of workplace hazards 56 31 13 

Note: Sampling errors range from +/-9 percentage points for employers finding a great or very great 

improvement from HCS on the quality of workplace hazard training to +/-4 percentage points for 

employers finding slight or no improvement from HCS on the availability of workplace information. 

Page 60 GAO/HRD-9%63BR OSHA Hazard Communication Standard 
Appendix VI 

- 

Comments From the Department of Labor 

r 

U.S. Department of Labor AssIslanl Secretary lor 

Occupmonal Safety and Heanh 

Washlnqton DC 20210 

Ms. Linda G. Morra 

Director 

Education and Employment Issues 

U.S. General Accounting Office 

Washington, D.C. 20548 

Dear Ms. Morra: 

Thank you for your letter of February 7 to Secretary of Labor 

Lynn Martin, in which you requested comments on the General 

Accounting Office (GAO) draft report entitled, Occupational 

Safety and Health: Employers' Experiences in Comolylng With the 

Hazard Communication Standard. The Occupational Safety and 

Health Administration (OSHA) appreciates the opportunity to 

present comments on such an important study of hazard 

communication. 

OSHA is encouraged by GAO's overall findings. These findings 

demonstrate that the Hazard Communication Standard (HCSI has 

contributed significantly to better safety and health for workers 

while, at the same time, posing minimal compliance problems for 

employers. 

The objective of the GAO study was to examine the possible 

difficulties small employers may be experiencing in complying 

with the HCS, and the methodology underlying OSHA's estimates 

that was used to assess costs for small employers. OSHA applauds 

the report for its factual recounting of GAO's findings in the 

investigation of these two issues. 

The GAO findings support the Agency's contention that the 

standard is feasible for small businesses, and that compliance 

results in benefits. GAO found that almost 70 percent of small 

employers that had made an attempt to comply with the standard 

were able to do so without experiencing significant burdens. 

This finding is consistent with OSHA's experience in implementing 

the rule. 

Additionally, OSHA considers the benefits of complying with the 

HCS to be significant. GAO notes that more than half of the 

small employers who attempted to comply with the standard 

reported a vast improvement in the availability of hazard 

information and in management's awareness of workplace hazards. 

Reported reductions in injuries and illnesses were also 

significant. Further, GAO found that 30% of all employers (and 

nearly 70% of large employers) have replaced a more hazardous 

Page 6 1 GAOMRD-9243BR OSHA Hazard Communication Standard 

a 
Appendlx VI 

Comments From the Department of Labor 

substance with a less hazardous substance because of information 

received from a Material Safety Data Sheet. In our view, that 

represents a very significant finding, and vividly demonstrates 

the tremendous impact which the HCS is having on the promotion of 

safe and healthful workplaces. 

We were also encouraged by the finding that OSHA's methodology 

for estimating compliance costs is fundamentally sound. We have 

endeavored in all such analyses to use accepted and objective 

economic analysis methodologies. We will continue to try to 

utilize the most accurate data available in these models, and 

will carefully review the study's comments with respect to the 

calculation of non-wage benefit costs. 

Finally, let me assure you that OSHA will continue its efforts in 

assisting employers, especially small employers, in understanding 

and complying with the HCS. You can be assured that the Agency 

intends to include the GAO report in its entirety in the record 

of future rulemaking on this issue. 

Sincerely, 

Dorothy L'. Strunk 

Acting Assistant Secretary 

Page 62 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Appendix VII 

Major Contributors to This Report 

Human Resources 

Division, 

Washington D.C. 

Carlotta C. Joyner, Assistant Director, (202) 512-7010 

Charles A. Jeszeck, Evaluator-in-Charge 

Susan L. Sullivan, Senior Social Science Analyst 

Wayne M. Dow, Senior Operations Research Analyst 

Tom S. Hungerford, Economist 

Philadelphia Regional David J. Toner, Regional Management Representative 

Office Michelle Walker, Senior Evaluator 

William F. Schmanke, Evaluator, Computer Science 

Marilyn R. Fisher, Computer Programmer Specialist 

Page 03 GAO/HRD-92-63BR OSHA Hazard Communication Standard 
Related GAO Products 

(206176) 

Occupational Safety & Health: Worksite Safety and Health Programs Show 

Promise (GAO/r-HRD-92-15, Feb. 26, 1992). 

Occupational Safety & Health: OSHA Action Needed To Improve 

Compliance With Hazard Communication Standard (GAO/HRD-92-8, 

Nov. 26, 1991). 

Occupational Safety & Health: Worksite Programs and Committees 

(GAO/T-HRD-92-9, Nov. 5, 1991). 

Managing Workplace Safety and Health In the Petrochemical Industry 

(GAOm-HRD-92-1, Oct. 2, 1991). 

OSHA’S Oversight of Federal Agency Safety and Health Programs 

(GAOm-HRD-91-31, May 16, 1991). 

Occupational Safety & Health: OSHA Policy Changes Needed to Confirm 

That Employers Abate Serious Hazards (GAO/HRD-9 1-35BR, May 8, 199 1). 

Occupational Safety & Health: Inspector Opinions on Improving OSHA 

Effectiveness (GAO/HRD-9 1-9FS, Nov. 14, 1990). 

Occupational Safety & Health: Options For Improving Safety and Health in 

the Workplace (GAO/HRD-90-66BR, Aug. 24, 1990). 

How Well Does OSHA Protect Workers From Reprisal: Inspector Opinions 

(GAO/-T HRD-90-8, NOV. 16, 1989). 

a 

Page 04 GAO/HRD-9%03BR OSHA Hazard Communication Standard 
Orders may also be pi;tcvd by calling (202) 275-6241.