Workplace Safety and Health: OSHA's Voluntary Compliance Strategies Show Promising Results, but Should be Fully Evaluated Before They Are Expanded
Released: 2004-03-30T00:00:00

Letter

Background

Congress passed the Occupational Safety and Health (OSH) Act in 1970 to ensure safe and healthy working conditions for every worker in the nation. OSHA has responsibility for enforcing the provisions of the act, including overseeing most worksites, with the exception of some small employers in low-hazard industries and small farming operations. OSHA has direct enforcement responsibility for about half the states; the remainder have been granted authority for their own enforcement. At present, 22 states have been approved by OSHA to operate their own programs covering all worksites; 4 are approved for covering public sector employee worksites only; and OSHA directly oversees all worksites in the remaining states.

OSHA uses two approaches to ensure compliance with federal safety and health laws and regulations—enforcement and voluntary compliance. Enforcement, which represents the preponderance of agency activity, is carried out primarily by using compliance officers to inspect employer worksites. Worksites and employers whose conditions fail to meet federal safety and health standards face sanctions, such as paying penalties for violations of health and safety standards. In this enforcement capacity, OSHA targets employers for inspection using injury and illness rates for industries and specific worksites. For example, it has targeted the construction industry for inspections because of high injury and illness rates. OSHA also conducts inspections when employers report fatalities or serious injuries and when workers file complaints about serious safety and health hazards. The voluntary compliance approach, in contrast, invites employers to collaborate with the agency and uses a variety of incentives to encourage them to reduce hazards and institute practices that will foster safer and healthier working conditions. Such incentives include free consultations, exemption from routine inspections, and recognition for exemplary safety and health systems.

To participate in voluntary compliance programs, employers must also meet certain requirements, which often include the adoption of some form of safety and health management program—a program that takes a systems approach to preventing and controlling workplace hazards. OSHA has four basic requirements for a safety and health management program: (1) Management Leadership and Employee Involvement—Top-level management must be committed to carrying out written comprehensive safety and health programs. Employees must be actively involved in the execution of the program. (2) Worksite Analysis—Employers must have a thorough understanding of all hazardous situations to which employees may be exposed, as well as the ability to recognize and correct these hazards. (3) Hazard Prevention and Controls—The program must have clear procedures for preventing and controlling hazards identified through worksite analysis, such as a hazard tracking system and a written system for monitoring and maintaining workplace equipment. (4) Safety and Health Training—Training is necessary to reinforce and complement management’s commitment to safety and health and to ensure that all employees understand how to avoid exposure to hazards.

To keep pace with the increasing demands on OSHA staff to help administer and promote voluntary compliance programs, in 2001 OSHA created the new position of “compliance assistance specialist.” According to OSHA officials, funding for this position was authorized in fiscal year 2002. Compliance assistance specialists provide general information about OSHA standards and promote voluntary compliance programs, as well as OSHA’s compliance assistance resources, such as training and Web site resources. They also respond to requests for help from a variety of groups and participate in numerous seminars, workshops, and speaking events. Most specialists are former OSHA compliance officers who conducted inspections of employers’ worksites. In their new positions, the specialists are not involved in OSHA’s enforcement activities. There is one Compliance Assistant Specialist position in each OSHA area office in states under federal jurisdiction, with a total of 65 in fiscal year 2003.

OSHA’s strategic management plan identifies particular safety and health problems and industries on which to focus the agency’s efforts. In its current 5-year plan for years 2003 through 2008, one of the agency’s three goals is to promote a safety and health culture through compliance assistance, cooperative programs, and strong leadership. This goal includes increasing the number of participants in voluntary compliance programs and improving the programs’ effectiveness. Another goal is to reduce occupational hazards by, for example, reducing the rate of workplace injuries and illnesses by 5 percent annually. OSHA’s third goal focuses on strengthening the agency’s capabilities and infrastructure, including improving the agency’s access to accurate, timely data, and enhancing its measures for assessing the effectiveness of its programs.

OSHA Has Employed a Variety of Voluntary Compliance Strategies, Which Has Extended the Agency’s Reach to a Growing Number of Employers

OSHA’s voluntary compliance strategies—four programs plus compliance assistance activities such as education and outreach—have expanded the agency’s reach to a growing number of employers. The agency’s four programs reach a range of employers and use a mix of strategies. They target both exemplary worksites and hazardous ones, and they influence employers directly by implementing safety and health programs and indirectly through collaboration with trade and professional associations. Some programs offer employers incentives to participate, such as a reduced chance of on-site inspection or special recognition for safety and health programs. Two of the programs were officially introduced in the last decade, adding to the number of participants engaged in voluntary compliance. OSHA plans to dramatically increase the number of employers and organizations participating in voluntary compliance programs. However, OSHA officials expressed concerns that such plans for expansion could tax the agency’s limited resources.

Voluntary Compliance Programs Are Designed to Reach a Range of Employers

OSHA’s voluntary compliance programs have been implemented incrementally to reach different employers and worksites in various ways. They represent a mix of strategies to help improve workplace conditions (see table 1).

In addition to these formal programs, OSHA conducts other compliance assistance activities, such as outreach and training activities, to aid employers in complying with OSHA standards and to educate employers on what constitutes a safe and healthy work environment.

State Consultation Program

The State Consultation Program, begun in 1975, operates in every state. Its primary focus is to help small businesses employed in high-hazard industries comply with OSHA standards and address their methods for dealing with worksite safety. The agency funds all state governments to carry out the program. In fiscal year 2003, OSHA provided $53 million to state governments. States provide free consultation visits at employers’ requests to identify safety and health hazards and discuss techniques for their abatement. In fiscal year 2003, state agents conducted about 28,900 consultation visits. The names of employers receiving consultation visits are kept confidential and separate from OSHA enforcement officials. Depending on an employer’s request, a state consultant may conduct a full safety and health hazard assessment of all working conditions, equipment, and processes at the worksite, or he or she may focus solely on one particular hazard or work process. Employers receive a detailed written report of the consultation findings and agree upon a time frame for eliminating the hazards.

Small employers receiving consultation visits may qualify for recognition in the Safety and Health Achievement Recognition Program (SHARP), which exempts them from general, scheduled inspections for 1 or 2 years as models for good safety and health practices. Participants in SHARP must have safety and health programs, which are management programs, in place to prevent and control occupational hazards. In fiscal year 2003, there were 699 SHARP worksites in both federal OSHA states and state- plan states. Although SHARP worksites are exempt from scheduled inspections, they are still subject to inspections resulting from employee complaints and other serious safety and health problems, such as fatalities.

The Voluntary Protection Programs, established in 1982, are designed to recognize single worksites with exemplary safety and health programs. As of September 30, 2003, there were a total of 1,024 VPP worksites in both federal OSHA and state-plan states. The manufacturing and chemical industries comprise 21 percent and 20 percent of these recognized worksites, respectively (see fig. 2).

The majority of VPP worksites in federal OSHA states have more than 200 employees (see fig. 3). While the VPP does not specifically target large businesses, they tend to be the businesses that attain VPP status. According to an OSHA official, this trend is due to the fact that large businesses tend to have staff and expertise available for a comprehensive safety and health program.

To participate in VPP, employers must have worksites that exceed OSHA standards and they must commit to a process of continual improvement. Employers achieving all VPP requirements are designated as Star VPP worksites, which signifies the highest level of workplace safety and health. As of September 30, 2003, 92 percent of all VPP worksites in federal OSHA states have Star designation. To be eligible for this exemplary status, employers must meet a number of specific requirements for their worksite: (1) worksite injury and illness rates must be below the average rate for their industry sector for at least 1 of the 3 most recent years; (2) a safety and health program must have been implemented and maintained for at least 1 year; and (3) worksites must undergo and pass a comprehensive review by OSHA personnel, including an on-site review of the facility and interviews with management officials and employees. In exchange for OSHA recognition, VPP worksites are exempt from scheduled enforcement inspections. However, VPP worksites are still subject to inspections resulting from employee complaints and other significant events, such as fatalities.

To attract additional VPP worksites and expand the overall program, OSHA has recently announced three new VPP initiatives: VPP Challenge: a program that will serve as a roadmap to help employers, particularly small employers, achieve VPP status regardless of their current level of safety and health.

VPP Corporate: a program that offers a more streamlined application process for corporations that already have worksites in VPP and want to bring additional worksites into the program.

VPP Construction: a program that builds on information learned at previous VPP demonstration worksites and is designed to make it easier for construction worksites, particularly temporary worksites, to apply for and attain VPP status by, for example, reducing the amount of time that safety and health improvements must be in place.

Strategic Partnership Program

The Strategic Partnership Program, formalized in 1998, is designed to help groups of employers and employees working at multiple worksites in high- hazard workplaces to address a specific safety and health problem. As of September 2003, 66 percent of partnerships are construction-related. A partnership agreement sets goals, such as the reduction of injuries, specifies a plan for achieving them, and provides procedures for verifying their completion. Some partnership agreements may also require the development of a safety and health management program and the involvement of employees in carrying out the partnership agreement. The program does not offer exemption from enforcement inspections but does offer other incentives. These include limiting scheduled inspections on only the most serious prevailing hazards, penalty reductions for any hazards cited during an inspection, and priority consideration for the State Consultation Program.

Partnerships can be developed on an area, regional, or national basis. When a national partnership is established, it must be implemented in all area and regional OSHA offices where a partner has a worksite. For example, the Associated Builders and Contractors created a national Strategic Partnership with OSHA that was implemented at the local level between the association’s chapters and area and regional OSHA offices. As of September 2003, there were 205 operating Strategic Partnerships in federal OSHA states, about 87 percent of which represented industries or areas of emphasis in OSHA’s Strategic Management Plan (see fig. 6).

OSHA officials attributed the fact that so many partnerships are construction-related to the national partnership with the Associated Builders and Contractors. This partnership provided a template from which other construction partnerships were developed. Additionally, OSHA officials informed us that, because it was originally difficult for construction worksites to enter into VPP, employers in the industry who wanted to enter into a voluntary compliance program with OSHA had tended to form a strategic partnership. While a few strategic partnerships are very large, most participating worksites are small businesses with 50 or fewer employees.

Alliance Program

The Alliance Program targets trade, professional, and other types of organizations to work collaboratively with OSHA to promote workplace safety and health issues. Alliances can be formed through national or regional offices. As of September 2003, approximately 51 percent of OSHA’s national alliances were with trade associations and 38 percent were with professional associations. The Alliance Program, which included 100 alliances as of September 2003, is one of OSHA’s newest and least structured voluntary compliance programs. In contrast to the other three voluntary compliance programs which typically include safety and health programs at specific employer worksites, alliance agreements focus on goals such as training, outreach, and increasing awareness of workplace safety and health issues. To date, alliances have participated in a variety of activities, such as (1) creating electronic informational tools that have been posted on the OSHA Web site, (2) developing industry- specific voluntary guidelines and training materials, and (3) improving OSHA’s training courses. Alliance members are not exempt from OSHA inspections and do not receive any enforcement-related incentives for joining an alliance. Instead, OSHA officials informed us that trade and professional associations have used the Alliance Program as a proactive method of addressing existing and emerging workplace safety and health issues, such as ergonomic issues. As of September 2003, 41 percent of OSHA’s national alliances were ergonomic-related. See figure 7 for an example of an ergonomic-related alliance.

In addition to its voluntary compliance programs, OSHA conducts numerous training and outreach activities on a variety of safety and health issues. These activities augment both the voluntary compliance programs and OSHA’s enforcement program, according to OSHA officials. For example, outreach activities can be conducted in relation to inspections, in an attempt to help employers ready themselves for an inspection. The OSHA Training Institute offers 80 courses on a range of safety and health issues, most of which are available to the public as well as to OSHA employees for training. In fiscal year 2003, however, the majority of its almost 5,000 students were OSHA employees. In addition to the Training Institute, OSHA has 33 Education Centers, nonprofit organizations (mostly universities), which have agreements with OSHA to teach 16 of the most popular Training Institute courses. An agency official told us that using these Education Centers around the country has allowed OSHA to greatly expand the amount of nonagency personnel who receive training in safety and health issues. In fiscal year 2003, these centers trained almost 16,000 students, approximately 98 percent of whom were non-OSHA personnel. Through a grant program, the agency also distributes some funds to nonprofit organizations to develop training or educational programs about safety and health issues of current emphasis in OSHA’s Strategic Management Plan. In fiscal year 2003, OSHA funded 67 such training grants totaling over $11 million.

The agency provides outreach to employers and workers in a number of other ways, such as through newsletters, brochures, compact discs, speeches, and conferences. OSHA also mails materials on specific safety and health issues to target audiences. Regional officials we spoke with said that several OSHA staff are called upon to conduct outreach efforts because it requires specialized skills and knowledge of standards. OSHA also works in cooperation the U.S. Small Business Administration’s Small Business Development Centers. Additionally, OSHA recently revised its Web site, which provides informational tools and referrals on a variety of safety and health issues. For example, OSHA has a Web service entitled “eTools,” which offers detailed graphics about specific worksite hazards, how to remedy them, and how OSHA regulations apply to worksites.

Participation in Voluntary Compliance Has Grown in the Past Decade, and OSHA Plans Dramatic Increases

While voluntary compliance strategies directly reach relatively few of the nation’s employers, participant numbers have grown since 1998 with the build-up of programs. Also, in the last decade, most of the programs have experienced tremendous growth in the number of employers and organizations that participate. For example, the VPP has increased from 122 worksites in 1993 to 1,024 worksites in 2003, an increase of 739 percent, and the Strategic Partnership Program grew from 39 partnerships in 1998 to 205 existing partnerships in 2003, a 426 percent increase. (See fig. 8.)

OSHA plans to expand the number of voluntary compliance program participants and its compliance assistance activities and has established strategic goals for doing so. According to OSHA officials, the agency’s fiscal year 2004 goals include the addition of 45 new VPP worksites and 50 VPP Challenge worksites, as well as 50 new strategic partnerships and 75 new alliances. Furthermore, OSHA officials have set a target goal of increasing the number of VPP worksites eight-fold—from 1,000 worksites to 8,000 worksites.

Although it is difficult to quantify, the voluntary compliance programs appear to have extended the agency’s influence. For example, through the agency’s enforcement program, OSHA and its state partners conducted almost 96,000 inspections in 2002—reaching no more than and probably fewer than 96,000 worksites. The VPP and Strategic Partnership Program in 2003 directly reached some 6,000 employers, who may not have otherwise been selected for OSHA inspections. These two programs, together with the State Consultation Program, covered approximately 2.3 million of the more than 100 million employees under OSHA’s oversight. Additionally, although OSHA may not have direct contact with an employer as part of its Alliance Program or training and outreach activities, employers are reached indirectly through the dissemination of safety and health information, which, according to our discussions with Alliance participants, has helped employees learn about workplace safety and health issues.

OSHA’s Expansion of Voluntary Compliance Programs May Tax Its Limited Resources

The resources OSHA devotes to its voluntary compliance strategies consume a significant and growing portion of the agency’s limited resources. In fiscal year 2003, OSHA executed its numerous programs under a $450 million budget. The agency spent $126 million on its voluntary compliance programs and compliance assistance activities— approximately 28 percent of its total budget—and about $254 million, about 56 percent of its budget, on enforcement activities. The percentage of resources dedicated to voluntary compliance programs and compliance assistance activities has increased by approximately 8 percent since 1996, when these programs represented about 20 percent of the agency’s budget. During this same period, the proportion of resources OSHA dedicated to its enforcement activities fell by 6 percent, from about 63 percent to about 56 percent of the agency’s total budget, although the total funds devoted to enforcement have remained fairly constant because of increases in OSHA’s total budget over this period. In addition, enforcement efforts, as measured by the number of inspections, have remained constant or increased slightly each year, according to agency officials. While it cannot be determined that resources were directly redistributed from enforcement to compliance assistance activities, funding for OSHA’s other programs remained relatively stable, with only small increases or decreases in funding since 1996 (see fig. 9).

Notwithstanding their voluntary nature, all of OSHA’s voluntary compliance programs require agency oversight to ensure that participants comply with requirements or agreements and this growing administrative responsibility requires concerted agency resources. For example: To certify a worksite as a VPP worksite requires a comprehensive on-site review that usually lasts 1 week and involves approximately three to five OSHA personnel. In contrast to the SHARP on-site review, VPP employers use their own resources to implement their safety and health programs and the program must be functional before OSHA personnel come to the worksite to conduct the on-site review for Star approval. Additionally, OSHA reviews participants’ yearly self-evaluations to ensure that injury and illness rates have not increased beyond program requirements and any changes that have been made to the safety and health program. Furthermore, VPP worksites must be recertified every 1 to 5 years, depending on their VPP designation. A VPP worksite recertification involves an additional on-site review by OSHA personnel, similar in duration and comprehensiveness to the original on-site review.

In the Strategic Partnership Program, OSHA conducts verification inspections for a percentage of partner worksites to ensure that partners are abiding by the partnership agreement.

The Alliance Program involves quarterly meetings with Alliance members to ensure progress towards alliance goals are being met. Additionally, OSHA training staff reviews all alliance training materials to ensure their accuracy with OSHA standards.

Furthermore, while the State Consultation Program is run by the states, OSHA largely funds the program, and its plans to expand the SHARP program will require additional agency resources and oversight on the part of state consultants. State consultants must work closely with employers to help them improve and implement their safety and health programs because most small employers do not have the resources necessary to attain SHARP status on their own. The consultant also must conduct a one-or-more day on-site review of the worksite to ensure that the employer has addressed all workplace hazards and properly implemented a safety and health program. Additionally, SHARP worksites are reevaluated every 1 to 2 years, depending on the amount of time a worksite has been in the program and the recommendation of the state consultant. These reevaluations require another on-site review of the worksite by the state consultants.

Expansion of OSHA’s voluntary compliance programs as planned will further require such resources, particularly for the oversight of a much larger number of program participants. According to national and regional OSHA officials we spoke with, expanding the voluntary compliance programs to the intended levels will be difficult given OSHA’s current resources, and some expressed concern that too much expansion of some programs may compromise program quality. Of particular concern to them, they said, has been the agency’s continued focus on increasing the number of VPP worksites. Several regional officials—whose offices are responsible for conducting on-site reviews—said that increasing the number of VPP worksites would strain their resources because of the number of staff required to conduct reviews of new worksites and re- certifications of existing worksites.

To date, regional offices have been creative in their methods of handling the increasing number of participants in voluntary compliance programs. For instance, the offices have relied increasingly on the use of the Special Government Employee Program and the Mentoring Program, both a part of the VPP. The first allows employees from VPP worksites, at the expense of their employers, to assist OSHA employees in conducting on-site reviews. OSHA uses the Mentoring Program to match VPP candidates with VPP employers, who assist the candidates in improving their safety and health programs and preparing for the on-site reviews. These two programs allow OSHA to leverage its resources by using employees at VPP worksites to assist OSHA in carrying out the responsibilities involved in operating the program, decreasing the number of OSHA personnel needed.

While several regional OSHA officials said these strategies have allowed them to manage the increase in VPP applicants, they are unsure how many more they can accommodate without obtaining additional resources.

Voluntary Strategies Appear to Have Many Positive Outcomes, but the Absence of Comprehensive Data Limits Assessment

While OSHA’s voluntary compliance strategies have increased the number of worksites the agency reaches, and participants and others have provided enthusiastic testimony regarding their ability to foster better safety and health practices, the lack of comprehensive data on the outcomes of the programs has hindered our ability to assess their effectiveness. Employers we visited said their participation had reduced injury and illness rates, which in turn had lowered their workers’ compensation costs. These employers and many employees we interviewed also credited OSHA’s voluntary compliance programs with improving employee-management relationships and their relationships with the agency. However, although OSHA has begun to collect data on the impact of some of its voluntary compliance programs, it does not yet have the data needed to assess the effectiveness of these programs, or make decisions about how to allocate its resources among the programs.

Participants, OSHA Managers, and Specialists Cited Reduced Injuries and Illnesses and Other Benefits

The employers and employees at the worksites we visited, OSHA officials, and researchers and occupational safety and health specialists identified many benefits of OSHA’s voluntary compliance programs.

Reduced Injuries and Illnesses for Participating Employers

The most commonly cited benefit of participating in OSHA’s voluntary compliance programs was the reduction in the number and rate of injuries and illnesses. All nine employers we visited reported that the number of injuries and illnesses at their worksites had declined since they began participating in the programs. For example, one VPP site in the paper industry reported that it typically had 12 to 14 accidents that resulted in injuries each year before working toward VPP approval, but that the worksite has reduced that number to 5 accidents or fewer in the last 3 years. Another participant, a partnership comprising eight nursing homes, reported in its annual evaluation that the injury and illness rate for its second year of participation had decreased 27 percent. OSHA, based on limited analysis of VPP sites’ annual injury and illness data, reported that participating employers that had effectively implemented workplace safety and health programs had significantly fewer injuries and illnesses—54 percent fewer—than comparable worksites in the same industries that had not implemented such programs.

Lower Costs

A second benefit of voluntary compliance programs is decreased costs to employers, primarily through reductions in workers’ compensation premiums. Employers at the sites we visited reported that they had seen significant decreases in their workers’ compensation costs. For example, a meat packaging facility we visited estimated workers’ compensation costs savings of about $200,000 during the period in which it had been involved with VPP. In addition to lowered workers’ compensation costs, employers commented that improvements in safety and health had reduced employers’ cost of lowered productivity that resulted from employees missing work because of injuries and illnesses. Although OSHA has information on its Web site on how reducing injuries such as by implementing safe procedures can save employers money, it does not include information on specific industries. OSHA officials told us that, although the experiences of some companies in saving money through safety improvements could be helpful to other employers, some companies are reluctant to share their data on cost savings with OSHA. However, the agency is developing some of the information through its Alliance Program. For example, the objectives of one alliance with a health care company include developing and incorporating materials into business school curricula that communicate the business value and competitive advantages associated with implementing comprehensive safety and health programs in the workplace.

Improved Relationships with OSHA and between Employers and Employees

According to employers and employees at worksites we visited, voluntary compliance programs also improved their relationships with OSHA and improved the relationships between management officials and employees. At every worksite we visited, representatives told us they were very comfortable with interacting with OSHA. Some spoke of a change from fearing OSHA’s visits to seeing them as helpful. For example, management officials at a steel erector company commented that, before their partnership, management did not want to talk to OSHA and dreaded its visits whereas, after participating in the partnership, they have a good relationship with OSHA staff. Several representatives at the worksites we visited also commented that they now regularly call OSHA for answers to safety problems. Some employees at the sites also commented that they have seen improved relationships with OSHA. For example, the union president at a VPP site said that, as a result of the close interaction with OSHA staff during the VPP approval process, he feels comfortable calling OSHA directly to discuss safety and health issues.

Similarly, employees and employers at several worksites gave examples of how their participation in these programs resulted in improved relationships between management and employees. One safety director for a union involved in a partnership said that after some workers were fired for not complying with safety rules, they came to the union looking for support, but because of the involvement of the union in the partnership, the union supported the disciplinary action. Both management and employees recounted how important working together was during the approval process and how those efforts have continued in order to maintain their participation in the programs, often through team meetings and safety committee meetings.

Increased Responsibility for Safety by Management and Employees

Employers and employees at the workplaces we visited also reported a shift to a safety culture in which they all take responsibility for safety, thereby contributing to improved productivity, morale, and product quality. At all the sites we visited, employees spoke of being empowered to remind others to comply with safety requirements. Several described a shift in attitude from noncompliance to one in which good safety procedures, such as wearing appropriate personal protective equipment and inspecting equipment, were ingrained in daily activities. They also said that they felt good that management had made the additional investment in safety. In addition, management officials at several sites said that this increased attention to safety had benefited their firm in other ways. Some mentioned that others using their services reviewed the company’s safety records or training, and that the company’s recognition as an exemplary site gave them a competitive advantage. For example, management officials at one SHARP site whose workers construct facilities on their clients’ worksites said that the SHARP certification helped the company continue to get contracts for projects. At one VPP site, management representatives also told us that participation had brought an improved workplace ethic where employees felt management cared about them, lower absenteeism rates, and a more disciplined approach to work.

Safety and Health Improvements for Nonparticipating Employers

In addition to the more anticipated benefits of improving injury and illness rates and reducing employers’ costs, participants commented that VPP, SHARP, and Strategic Partnership Program participants played a role in influencing other employers to implement good safety and health practices. A key component of VPP is outreach to other firms, and representatives at all three VPP sites we visited spoke of mentoring to others in their industries. For example, one site hosted a VPP Day to encourage others within its industry to participate in the program. Interestingly, one of the VPP sites we visited had been encouraged by other VPP sites to participate in the program. Participants in the Strategic Partnership Program and SHARP sites we visited also reached out to others within their industry, informing them of the value of good safety and health practices and encouraging their participation in OSHA’s voluntary compliance programs. Some specialists with whom we spoke commented on the value of this aspect of the programs, although one noted that the mentoring focus should be on improving employers’ safety and health practices, not on helping employers complete the program application paperwork.

Employers participating in these programs also sometimes influenced other employers’ practices by requiring them to meet certain standards if they were working on the participating company’s premises or to qualify as one of the company’s subcontractors. In some cases, they also reported that other companies sought them out as suppliers and contractors because of their good safety records. OSHA officials also noted that participation in voluntary compliance programs could influence those companies’ suppliers and contractors to improve their safety. For example, they told us that many construction contractors now require their subcontractors to have insurance rates below a certain level—rates that are based on their injury and illness rates.

Improved Safety and Health for Small Employers

Several participants and specialists reported that the State Consultation Program, Alliance Program, and OSHA’s outreach and training help inform small employers—who typically have less in-house expertise to address safety and health issues—about how to make safety and health improvements. The State Consultation Program, which is designed to provide guidance on specific problems or, more generally, employers’ health and safety management programs, is targeted to small employers. The three sites we visited that utilized this program had initially sought consultations because they needed expert advice on safety and health practices that was not available from their own staff. According to several specialists, the Alliance Program also connects with small businesses by working through the trade associations that they participate in, because the associations build on already existing relationships. In addition, the OSHA regional offices we visited had used several outreach approaches to reach out to small employers, for example, a free forum where small contractors could learn the proper use of cranes and scaffolding. Similarly, one of OSHA’s area offices provided employers training courses at the local Small Business Development Center on OSHA’s requirements— including its record-keeping requirements—and how good safety and health practices can save them money. Regional offices have also developed newsletters for employers in specific industries, such as a letter and accompanying compact disc on electrical hazards provided by one office to electrical contractors.

Although we saw evidence of OSHA’s efforts to reach more small businesses, several specialists said OSHA should include more small businesses in voluntary compliance program activity. A representative from a national employers association commented that smaller employers fear OSHA because they do not know what to expect when the agency goes into a business, even if for compliance assistance activities. Several specialists with whom we spoke noted that smaller businesses might not be aware of the voluntary compliance programs that are available. A representative from an insurance company who addresses risk management regularly commented that smaller worksites, particularly those that change locations frequently such as sites in the construction and roofing industries, are more likely to have safety problems.

Because OSHA Has Just Begun to Collect and Analyze Data on Its Voluntary Compliance Programs, Their Effectiveness Cannot Be Fully Assessed

OSHA currently lacks the data needed to fully assess the effectiveness of its voluntary compliance programs. Developing outcome measures is difficult, particularly when factors other than program participation can affect key indicators such as injury and illness rates. However, agencies are required to develop such measures and it is especially important for OSHA, given its limited resources, to be able to evaluate the effectiveness of these programs. Currently, OSHA does not collect complete, comparable data needed to measure the value of its programs, including their relative impact, resource use, and effect on the agency’s mission. In OSHA’s current strategic management plan, one of the agency’s three goals includes increasing the number of participants in voluntary compliance programs and improving the programs’ effectiveness. Another goal includes improving the agency’s access to accurate, timely data, and enhancing its measures for assessing the effectiveness of its programs. However, OSHA has not yet developed a comprehensive strategic framework that articulates how the programs fit together in accomplishing the agency’s goals or how its resources should be allocated among the various programs. While OSHA or its state representatives ensure that voluntary program participants are complying with the programs’ requirements, and often obtains some information on program effectiveness, such as data on injuries and illness, it does not assess the overall impact of the programs on worksites’ safety and health.

Currently, OSHA’s assessments of each program are at a different stage of development and the approaches vary: VPP—Presently, OSHA’s analysis of the program is limited to reviewing VPP sites’ annual injury and illness rates in the years immediately before they are approved for the program. However, because worksites often make safety and health improvements over a longer period in anticipation of their participation in the program but before they are approved, the rates OSHA reviews may not reflect changes in injury and illness rates from improvements made as a result of their participation. To assess the impact of VPP, OSHA contracted with a private firm in October 2003 to conduct an evaluation of the changes in participating employers’ injury and illness rates resulting from the program. The evaluation, to be completed in September 2004, will evaluate the impact of VPP from the point at which employers decide to apply for VPP until they are designated a VPP site. It will also determine the impact of VPP on other worksites through participating employers’ outreach and mentoring efforts and provide data on dollars spent by VPP sites on safety and health programs and cost savings from reduced workers’ compensation costs. However, because VPP does not require applicants to provide data on their injury and illness rates for the years prior to participation, OSHA will still be unable to systematically assess whether improvements in their injury and illness rates resulted from program participation.

State Consultation Program—OSHA has been assessing possible approaches for obtaining data on these programs, but it has been difficult because of the confidentiality that state programs provide to program participants. In an October 2001 report on the program, we suggested that OSHA collect additional data to use in evaluating its impact. In 2002, an OSHA-sponsored evaluation of the program concluded that the program resulted in some positive outcomes, including that participating worksites (1) were cited for fewer serious violations if inspected by OSHA within 2 years of the consultation visit and (2) had larger average declines in lost workday injury and illness rates than other worksites. The report, however, noted that factors other than the consultation program might have contributed to these positive outcomes and that further analysis, particularly the long-term effects of the program, would require the collection of more data. OSHA attempted to collect such information through a data initiative it uses to obtain information on the impact of its enforcement efforts. However, in 2002, the Office of Management and Budget denied OSHA permission to extend this data collection effort to collect data from all employers, including those with less than 40 employees. These employers represent a significant portion of the employers that participate in the State Consultation Program, but are not presently addressed in the data initiative.

Strategic Partnership Program—Currently, OSHA requires program participants to file annual evaluation reports. However, according to an OSHA-requested study of reports submitted through September 30, 2002, the agency did not collect consistent information from partnerships or use common performance measures. For example, some partnerships did not submit evaluation reports, while others provided incomplete or inconsistent information because OSHA allowed participants to select the types of data reported. Similarly, the U. S. Department of Labor’s Office of Inspector General, which also assessed the program, reported in September 2002 that there was insufficient information on five of the nine partnerships it analyzed to evaluate their impact. For example, one partnership only provided data on injuries and illnesses for 25 of its 222 participants. In response to these studies, OSHA officials said that they were obtaining comments on a revised format for these reports that would include common data elements for all partnerships and that OSHA would then be able to establish a new database designed to track consistent measures across partnerships. The revised format for the partnership reports will be available in Spring 2004, according to an OSHA official.

Alliance Program—Goals for each alliance are individually developed and are often not readily measurable. Currently, OSHA monitors goals and accomplishments of individual alliances by participating in quarterly meetings and preparing annual evaluations. OSHA officials told us that OSHA has not yet developed an evaluation approach for the national program. Several individual Alliance Program representatives from alliances established in 2002 told us that they have not established a system for assessing the impact of their alliances, and some commented that this would be difficult, given the nature of their goals. For example, one alliance’s goals are to provide information and guidance to help protect employees’ safety and health—particularly from hazards likely to result in amputations and ergonomic hazards—and to provide training to employers to help identify and correct these hazards. While the alliance has provided information to employers and workers on its Web sites, and has developed and provided training, it is difficult to determine the impact of the alliance since companies also implement safety and health improvements on their own.

Researchers and Other Specialists Suggested a Variety of Additional Voluntary Compliance Strategies

Researchers, safety and health practitioners, and other specialists we interviewed suggested a variety of additional strategies for voluntary compliance, some of which might require legislative changes. Some strategies might help OSHA leverage its existing resources and others suggest the need for additional resources. The strategies that researchers and specialists proposed generally fell into four categories: (1) providing more incentives to encourage additional employers to voluntarily improve safety and health in the workplace; (2) promote more systematic approaches to workplace safety and health; (3) focusing more specifically on high-hazard, high-injury workplaces; and (4) using third-party approaches to achieve voluntary compliance. While these strategies could be potentially useful and effective, according to specialists, they could also entail the need for safeguards, oversight, and enforcement. (See table 2.)

Provide More Incentives for Employers to Make Safety and Health Improvements

Specific suggestions for additional financial incentives included (1) providing information to employers on the possible financial and other benefits of improving safety and health, (2) encouraging the use of workers’ compensation incentives for employers that participate in OSHA’s voluntary compliance programs, and (3) creating tax incentives for improvements. Another suggestion was to deter employers from continuing poor safety and health practices by publishing injury and illness rates for such worksites.

Develop and Publicize Information on Financial Benefits—To counter employer assumptions that safety and health improvements would necessarily be costly, some specialists called for the agency to develop and publicize more industry-specific data about the financial and other benefits possible by investing in safety and health improvements. OSHA provides general information about the direct and indirect costs of injuries and illnesses on its Web site and is working to develop more industry data through its alliances and other voluntary programs. As useful as industry- specific information might be, especially to small employers, such proprietary data are difficult to obtain and expensive to develop, according to specialists. Developing this information might also be a better role for industry than for government. In addition, improving safety and health could cost employers more money, not less.

Encourage Workers’ Compensation Incentives—OSHA could encourage state programs and private insurers to consider employers’ participation in voluntary compliance programs when they calculate premiums for employers. Such incentives could include, for example, reductions in employers’ insurance premiums or credits for participation. For many employers, the possibility of achieving lower insurance premiums could be a significant motivator for improving workplace safety and health. However, because each state has its own laws governing workers’ compensation programs, it could prove challenging to create such financial incentives. Furthermore, although some insurers offer rate reductions to employers that participate in OSHA’s voluntary compliance programs, according to OSHA officials, the agency’s other attempts to work with insurers have not succeeded because they did not want to have clients perceive them as an agent of OSHA. Figure 10 describes the relationship between workers’ compensation and occupational safety and health programs in two states.

Offer Tax Incentives for Capital and Other Improvements—Tax incentives, which would require changes in the tax code, may be especially useful for helping small employers who might lack resources make safety and health improvements. Having a tax incentive also signals to businesses that the government values such investments in safety and health. However, distinguishing business purposes from safety and health purposes can be difficult with tax incentives. Tax incentives could also tend to favor capital-intensive solutions to safety and health problems— such as the purchase of equipment—rather than behavioral or systematic solutions. They may also subsidize improvements that employers might have made in any case. Finally, in addition to the potential for manipulation, using tax incentives could entail lost tax revenues, without OSHA knowing their impact on safety and health.

Publish Injury and Illness Rates for Employers’ Worksites— Gathering and publishing the injury and illness rates for employers’ worksites could build on market incentives to pressure employers to change their practices. For example, a subcontractor might find it difficult to obtain a contract because of liability concerns if it were known that the company had a high rate of workplace injuries. Right now, OSHA publishes the names of about 3,200 worksites identified through its site- specific targeting program as having high rates of injuries and illnesses, but it does not publish the actual rates for these worksites. However, there are several potential problems with this approach. First, injury and illness rates for one particular year may not accurately capture the performance of employers, especially small employers. Second, businesses would likely oppose the publication of these data because they view worksite injury and illness rates as confidential business information that, if published, could allow business competitors to glean information about the company’s productivity. In fact, OSHA took this position when it denied, in July 2003, a Freedom of Information Act appeal that sought to obtain rates for specific worksites: OSHA relied on an exemption protecting trade secrets and commercial or financial information and refused to disclose the information unless the parties in question approved. Finally, publicizing injury and illness data might also pressure employers to underreport injuries and illnesses, creating the need for further policies or legislation requiring full and accurate reporting and recording.

Promote More Systematic Approaches to Workplace Safety and Health

Specific suggestions from researchers and specialists included (1) encouraging employers that participate in OSHA’s voluntary programs to influence their contractors and suppliers to make safety and health improvements, (2) requiring certain employers to have a safety and health management program, and (3) requiring employers to have an employee- management safety and health committee.

Encourage Employers to Influence Contractors and Suppliers—To “influence the supply chain,” OSHA could encourage employers participating in its voluntary programs to consider suppliers and contractors’ safety and health records before making contracting decisions and encourage their suppliers and contractors to have a safety and health program. OSHA currently requires this approach of employers participating in VPP. Because employers are increasingly using contractors and temporary workers, focusing employers’ attention on contractors’ and suppliers’ safety and health records was considered a useful way to achieve some leverage in a changing economy. Safety and health problems at contractors and suppliers could also entail potential costs for employers or could also indicate other forms of poor management, such as poor product quality. As an example of the effectiveness of this approach, one automaker grouped its suppliers into three tiers according to their safety and health records, and then each tier of suppliers pressured the lower tier to improve, according to a specialist we interviewed. However, the degree of an employer’s potential influence over suppliers and contractors could vary by employer size as well by industry. For example, a Fortune 500 employer could have far more influence on its supply chain than a small body shop, and the construction industry, which relies on numerous subcontractors working under a general contractor, may be better able to influence subcontractors than other industries. Implementing this approach may be difficult because suppliers and contractors may be unwilling to share their safety and health records or plans and employers would need staff to conduct such reviews of its suppliers and contractors. It may be similarly difficult for OSHA to monitor and verify this process through employers participating in its voluntary programs.

Require Certain Employers to Have Safety and Health Management Programs—As discussed in a previous GAO report and testimony, OSHA could require certain employers—such as those with high injury and illness rates—to have safety and health management programs. The establishment of safety and health programs, including elements such as hazard prevention and control, is currently required for participants in the VPP, Strategic Partnership, and SHARP programs. Extending this approach to other employers could help prevent additional injuries and illnesses. It could also help employers respond more flexibly to advances in technology and other workplace issues than with specific standards. On the other hand, it could be difficult for OSHA to enforce employers’ use of safety and health programs, and small and mid-size employers may not have the information or tools to implement these programs without assistance. In our earlier testimony, we noted that reservations about these programs stem primarily from concern about implementation issues, rather than about their value.

Require Employee-Management Safety Committees—OSHA could issue a regulation requiring employers to have an employee-management safety committee at every worksite to investigate accidents, settle disputes, and provide information to management. The VPP does not require employers to have such a committee at every worksite, but does consider it one way to achieve employee involvement. If required for all employers, such committees might raise additional issues, including the determination of who would represent workers.

Focus More on High- Hazard, High-Injury Workplaces

Specific suggestions for focusing more on high-hazard, high-injury workplaces included targeting employers with the highest levels of injury and illness for voluntary programs and having such employers choose between likely inspection and cooperative approaches with the agency.

Target Employers with Highest Levels of Injury and Illness—OSHA could classify employers according to their level of injury and illness and focus the agency’s voluntary compliance efforts on those with the highest rates. While this suggestion was seen as a way for OSHA to best use its limited resources, according to specialists, it might also entail additional costs for data development.

Allow Employers to Choose between Likely Inspection and Cooperative Approaches—Another suggestion was for OSHA to pursue a previously attempted strategy targeting employers with the highest rates of injury and illness. The agency informed these employers that they had been placed on a primary inspection list, but that they could reduce the likelihood of inspection if they chose to work cooperatively with the agency by fulfilling certain requirements. Now, when OSHA informs selected employers that they have among the highest injury and illness rates in the country, the agency refers employers to outside consultants, insurance carriers, and state workers’ compensation offices for advice on improving safety and health; employers with fewer than 250 employees are also referred to the State Consultation Program.

Use Third-Party Approaches

Specific suggestions for third-party approaches included (1) supporting the development of a voluntary national or international standard for workplace safety and health and (2) using private consultants to conduct safety and health evaluations of worksites.

Support Development of a Voluntary National or International Standard for Workplace Safety and Health—Having a voluntary national or international standard could help strengthen the infrastructure for workplace safety and health and could build on some employers’ desire for a widely recognized credential that could be useful to them in competing with other companies, especially in global markets. For example, employers can seek certification from independent organizations for achieving International Organization for Standardization standards. To a certain extent, OSHA is currently playing a role in the development of a voluntary standard, according to OSHA, since some OSHA staff members are assisting a national standards committee that is working on a safety and health standard. In addition, many industry associations are involved on this committee, OSHA staff noted. Limitations of this approach are that: (1) such standards are not mandatory, but serve more as flexible guidance, because they reflect agreements reached by committees; (2) although large employers competing in the international marketplace tend to seek out international standards credentials, these are not necessarily the employers needing OSHA’s attention; and (3) it can be difficult to set voluntary standards because organizations need to invest resources and provide appropriate expertise.

Use Private Consultants to Conduct Safety and Health Evaluations—This suggestion would entail allowing employers to voluntarily use private consultants to conduct worksite safety and health evaluations and certify worksites, in return for incentives, such as a limited exemption from future inspections or reduced civil penalties. Using third-party, private-sector consultants to certify workplace safety and health was also proposed in the late 1990s as an amendment to the OSH Act—known as the SAFE Act. Using consultants could leverage existing OSHA resources by helping workplaces that might never otherwise see an OSHA inspector, especially small employers, and possibly also by enabling employers to address additional safety and health issues that might not be covered under an OSHA inspection for compliance with standards. At the same time, using consultants also raises various implementation, oversight, and legal issues described below. (a) Implementation—A key issue is that consultants’ independence may be compromised if employers paid consultants directly for conducting audits and certifying employers. Employers might also need more than one consultant to conduct a comprehensive review of both safety and health issues. Finally, the use of consultants would set the federal program in competition with the State Consultation Program, according to OSHA officials. (b) Oversight—One issue is what kind of oversight is possible when employers will not—or cannot—make improvements that consultants recommend. Another is that differences in consultants’ focus would create inconsistencies in the certification process, since a workplace evaluation could focus on compliance with OSHA standards or on the broader safety and health environment, as under OSHA’s VPP, Partnership, and SHARP programs. (c) Legality—Finally, constitutional issues have been raised as to whether OSHA can use private consultants, as envisioned by the SAFE Act, to conduct safety and health evaluations of employers’ worksites and to issue certificates of compliance, exempting employers from civil penalties for a limited period of time. For example, when Congress was considering the SAFE Act, the Justice Department argued that the act might be unconstitutional because, among other things, it delegated executive functions to private entities without providing adequate supervision or accountability for their activities. The Senate Committee on Health, Education, Labor, and Pensions, which had jurisdiction over the legislation, disagreed with Justice’s arguments, asserting that they reflected a misunderstanding of the proposed role and authority of third- party consultants.

Conclusions

By many accounts, OSHA’s voluntary compliance strategies have improved employers’ safety and health practices by allowing the agency to play a collaborative, rather than a policing, role with employers. The testimony and enthusiasm of participants suggests that OSHA’s voluntary compliance programs have considerable value. The agency has begun to develop performance measures and collect data on some program outcomes, as well as undertake efforts to evaluate its programs, such as contracting for a VPP evaluation and revising the performance evaluation format for the Partnership program. However, because OSHA does not yet have comprehensive data on its voluntary compliance programs, the agency cannot fully assess the effectiveness of any single program or compare the relative effectiveness of the programs. OSHA should position itself to know, for example, the relative effectiveness of programs that focus on employers predisposed to following good safety and health practices as compared to those that attempt to reach employers and industries with poor safety and health records. Without such information, the agency is also limited in its ability to make sound decisions about how to best allocate its resources among individual programs, or between voluntary compliance programs and its other activities, particularly enforcement.

After several years of experimentation and growth, this is an opportune time for OSHA to determine how to best target its voluntary compliance efforts. Having a mix of strategies appears useful in reaching different types of employers and industries. At the same time, having such a mix may unduly tax the agency’s resources unless it is accompanied by a comprehensive, strategic framework that establishes priorities and defines how these strategies fit together to accomplish the overall goals of the agency. Absent such a strategic framework, OSHA cannot ensure that it is making the best use of its resources to improve workplace safety and health. Furthermore, the agency must balance its plans to expand its voluntary compliance programs with its enforcement responsibilities. Given OSHA’s current resources, it is unclear how it can undertake much expansion without a careful assessment of the impact on its resources and other programs. Unless it has such an assessment, OSHA runs the risk of compromising the quality of its voluntary compliance programs.

Recommendations for Executive Action

In order to strengthen OSHA’s voluntary compliance strategies, the Secretary of Labor should direct the Assistant Secretary for Occupational Safety and Health to identify cost-effective methods of collecting complete, comparable data on program outcomes for the VPP and Partnership programs to use in assessing their effectiveness, and continue to search for cost-effective approaches that will enable the agency to assess the effectiveness of the State Consultation and Alliance programs, and develop a strategic framework that articulates the purposes and distinctions of the different voluntary compliance programs, sets priorities among these programs, and identifies how the agency’s resources should be allocated among these programs, before further expanding them.

Agency Comments

We provided a draft of this report to OSHA for comment. OSHA’s formal comments and our responses are contained in appendix I. In addition to its written comments, OSHA provided us with technical comments, which we incorporated as appropriate.

OSHA generally agreed with our findings, conclusions, and recommendations. The agency asserted, however, that we had based our recommendations on a small sample of worksites and that our methodology for selecting researchers and specialists was not scientific and was subject to biases. We did not base our recommendations on site- specific findings or on interviews with researchers and specialists, but rather on programwide data. More specifically, our recommendations were based on our analyses of OSHA’s program requirements and program data as well as the findings and conclusions reported in the OSHA- sponsored and Inspector General evaluations of these programs that were cited in our report. Although our selection of researchers and specialists was, by necessity, judgmental, we sought to obtain a broad, balanced range of perspectives and expertise about the programs’ effectiveness.

As agreed with your office, unless you publicly announce its contents earlier, we plan no further distribution of this report until 30 days after its issue date. At that time, we will send copies of this report to the Secretary of Labor and the Assistant Secretary of Labor for Occupational Safety and Health and other interested parties. We will also make copies available to others upon request. In addition, the report will be available at no charge on GAO’s Web site at http://www.gao.gov.

Please contact me or Revae Moran on (202) 512-7215 if you or your staff have any questions about this report. Other contacts and staff acknowledgments are listed in appendix II.

Appendix I: Comments from the Occupational Safety and Health Administration

GAO Comments

1. We added information on page 20 to show that OSHA’s enforcement efforts, as measured by the number of inspections, have remained constant or increased slightly each year from 1996 to 2003. 2. We did not base our recommendations on site-specific findings or on interviews with researchers and specialists, but rather on programwide data.

Appendix II: GAO Contacts and Staff Acknowledgments

GAO Contacts

Staff Acknowledgments

Carol L. Patey and Christine A. Houle made significant contributions to this report in all aspects of the work and Leslie C. Ross assisted during the information-gathering segment of the assignment. In addition, Susan C. Bernstein, Julian P. Klazkin, Lynn M. Musser, and Walter K. Vance provided key technical and legal assistance.