July 1, 1996
Joseph A. Dear
Assistant Secretary
Department of Labor
200 Constitution Avenue, NW
Washington, DC 20210
Dear Assistant Secretary:
The Office of Advocacy of the U.S. Small Business Administration
(SBA) appreciates the opportunity to comment on the Occupational
Safety and Health Administration's (OSHA) proposed rulemaking on
occupational injury and illness recording and reporting
requirements.(1)
The Office of Advocacy of the SBA was established by Congress
under Public Law No. 94-305 to advocate the views of small
business before Federal agencies and Congress. Advocacy is also
required by 612 of the Regulatory Flexibility Act (RFA)(2) to
monitor agency compliance with the RFA. These comments are
directed towards OSHA's compliance with RFA and specific issues
within the proposed rulemaking that should be reevaluated for
their impact on small business and small organizations.(3)
This proposal is a comprehensive rulemaking that amends the
recordkeeping requirements for employers, changes the exemption
criteria, alters the definition of key terms, and subjects
businesses to new mandates for releasing information.
Regulatory Flexibility Act: Certification
Pursuant to the Regulatory Flexibility Act, OSHA certifies that
the proposed rule will not have a significant adverse impact on a
substantial number of small entities. The certification explains,
"The proposed rule exempts construction employers with less
than eleven employees and non-construction employers with
less than 20 employees from most of the requirements, and
would not have a differential impact on small business."
The proposed new exemptions for the smallest employers send a
signal that OSHA is willing to offer relief to the smallest
businesses.
In the certification, OSHA is also certifying the rule for its
impact on all small entities, as defined by the Regulatory
Flexibility Act. In fact, a majority of the community that is
fully covered in this rulemaking is small entities, specifically
small businesses and small organizations. If OSHA concludes that
certification is adequate at the time the final rule is
promulgated, the certification must be accompanied by the factual
basis for the certification.
That statement also must address the community of small
businesses and small organizations that do not fall into the
categories which are partially exempted in the rulemaking.
However, if OSHA is planning to use an alternative definition of
small entity for the purposes of this certification, that
definition must be published and subject to public comment.
Exemption and Calculating Employment
Currently, the proposed rule offers partial exemptions to
employers with no more than ten employees at any time during the
calendar year immediately preceding the current calendar.
However, the Office of Advocacy believes the proposed methodology
for determining an employer size in the rulemaking could prevent
practical application of the exemption to many, if not most,
smaller businesses. In fact, Advocacy is concerned that under the
new proposed rulemaking more businesses could be covered than
under the current standard.
The methodology for determining an employer's size seems to be
changed from no more than ten employees at any time during the
preceding calendar year to a cumulative total of employees in the
entire previous year. Industries that have a fluid workforce
e.g., retail, restaurants, construction, etc., would be unduly
burdened if the proposed methodology is applied.
While OSHA's intent may not be to change the methodology, the
change in wording could be interpreted to mean that OSHA will
count all employees in the previous year when determining the
eligibility for exemption. The number of employees in a given
year could easily exceed the maximum determined by the standard
for exemption while the company would have no more than the
maximum in a given day.
Specifically, the proposed rulemaking states:
"Construction employers with 10 or fewer employees for the
entire previous year are exempt from the regulations from
this Part 1904..." [emphasis added]
"Employers in industries other than construction with 19 or
fewer employees for the entire previous year are exempt from
the regulations of this Part 1904..." [emphasis added].(4)
The current regulation determines exemptions for small employers
using the following definition:
"An employer who had no more than ten (10) employees at any
time during the calendar year immediately preceding the
current calendar year need not comply with any of the
requirements of this part except..."(5)
Companies that have a changing workforce, or significant turnover
in a given year, would be placed in the position of meeting the
standard based on the employment rolls of an entire year. This
would expand the number of employers that would likely be
subjected to the new standard. Also, the method for counting the
"entire previous year" does not specify a calendar year, which
could increase confusion.
Recommendation: The Office of Advocacy recommends that OSHA
consider one or more of the following alternatives: 1) retain the
current wording and methodology to count employees, 2) consider
the averaging method used by the Small Business Administration's
Office of Size Standards for employment,(6) and/or 3) extend the
exemption to smaller establishments, as well as smaller firms.
Many employers are small businesses that have multiple
establishments where a small number employees work. These
establishments should be considered for the exemption.
Let me emphasize that we believe OSHA's intent is to offer an
exemption to the smallest employers, and the Office of Advocacy
would like to assist the agency in meeting that objective.
Industry Relief Under Exemptions
Advocacy estimates this exemption could potentially apply to over
95 percent of non-construction firms with employees.(7) With a
lower threshold, nearly 80 percent of construction firms are
exempted. The Office of Advocacy supports exemptions for industry
groups that have low workday case rates, using data extracted by
three-digit SICs. We support exemptions for those industries in
SICs 01 through 51 which have not historically been exempted from
recordkeeping but have low case rates.(8)
Using similar fact-based judgements, the agency's should further
justify the proposed lower exemption threshold for construction.
Is there evidence that firms with 11 to 19 employees have a
higher injury, illness or death rate than those with 10 or fewer
employees? Is there analytical proof that this threshold should
be significantly different than other industries? Are there
different incident rates among construction industry sectors?
According to the 1992 Bureau of the Census data, there are about
150,00 construction companies with 11-19 employees. While
construction has historically had a higher incident rate, recent
statistics show that it is no longer the leader in injury and
illness, and programs, such as focused inspections, have
accelerated the industry's focus on safety and health. The Office
of Advocacy recommends that the exemption be expanded for
construction to those companies with fewer than 20 employees
unless analysis can demonstrate that this sector of the industry
is significantly different and needs coverage.
Coverage
The coverage, as well as exemptions, are not balanced
proportionally among industries. Coverage is much broader
incidently for those industries that have a higher number of
workers per firm. OSHA should be fully aware of the implications
for those industries. For instance, 26 percent of the
manufacturing industry is covered. Most of these firms are small
businesses. In some sectors, the percentage of covered companies
is much higher. For instance, 47 percent of petroleum refining
and related industries are covered and most are small firms. The
large number of firms covered in manufacturing should trigger a
second look at OSHA's plans to certify this rule under the
Regulatory Flexibility Act.
It should be emphasized, that while the agency's exemptions
present a significant relief to the smallest companies, the
majority of entities that are fully covered by this rulemaking
are small entities.
Recommendation: The impact of this rulemaking on those firms
which are covered must be fully considered.
Definitions(9)
OSHA has altered and added some definitions under the proposed
rule. Advocacy would like to address a few of these.
Employee
Advocacy believes that the notation accompanying the definition
of "employee" goes beyond the statutory intent. OSHA is proposing
to include independent contractors and workers from temporary
help services in the employee definition. Small businesses would
not only have expanded obligations for coverage, but this
methodology for counting employees would impact the opportunity
for an exemption under this standard.
Establishment
OSHA is expanding the coverage of this standard to include a new
class of worksites. By changing the definition of "establishment"
to any single physical location that is in operation for 60
calendar days or longer, employers will be subjected to an
increase in recordkeeping for industries with temporary
worksites, such as companies that provide contractor services to
the workplaces of other employers. Advocacy believes the current
requirement in which employers must have records accessible from
a central location is sufficient and more practical. The benefit
of having records at so many project locations is unclear.
Another option is an exemption for employers that have a small
number of employees at an establishment e.g., less than 20
employees, as long as the information is obtainable from a
central location.
Days Away From Work & Restricted Work Activity
The agency's proposal to set a cap of 180 days of recordable Days
Away From Work (currently Lost Workdays) is a commendable change
to the standard. Advocacy believes OSHA's proposal to change the
method for counting Days Away From Work to exclude restricted
work activity is a good effort, and we support this proposal
However, the new definition for classifying "restricted work
activity" could increase the number of cases that would be
subject to this standard, and subsequently, classified as a
"recordable incident." Small businesses would face increased
recordkeeping.
Under the proposed definition, a case would be determined as a
"restricted work activity" if the employee cannot perform what he
or she was doing at the time of the illness or injury, or he or
she could not perform the activities scheduled for that day.
While this would be a very simple method, it would encompass more
recordable incidents. Many workers have a myriad of tasks
associated with their job, especially in small firms where any
individual may wear many "hats." If an employee can return to
work and perform functions within their job description, this
should not be considered "restricted work activity." OSHA should
retain the current definition.
Work Related
OSHA is proposing to include incidents occurring at recreational
facilities located at employers' worksites. While there is an
exemption provided for voluntary participation in wellness
programs, the employer would be subjected to coverage when
workers engage in activities of their own choice. For instance,
under this proposal an injury resulting during a lunch time
basketball game would be covered. Any voluntary activity should
be exempted.
OSHA Injury and Illness Log and Summary(10)
OSHA's proposed rulemaking would provide employers with a step by
step method for determining if an incident is recordable. This
flowchart method is helpful for small businesses. We commend OSHA
for this approach.
Advocacy has reviewed the recordable incidents listed in the
Table of Specific Conditions (Mandatory Appendix B)(11) and found
that specific safety and health standards for coverage would be
promulgated by this recordkeeping rulemaking. This rulemaking
would single out standards that are currently covered by the
"general illness recording criteria," according to OSHA.
Recommendation: Advocacy recommends withdrawing this portion of
the proposed rulemaking and consider promulgating it separately.
It is premised on speculative data rather than on recordable
incidents.
If promulgated, Advocacy's recommendation is that a recordable
incident under the "Specific Conditions" should be subject to a
health care provider's clinical diagnosis. No small entity should
be charged with making a medical diagnosis.
Small businesses, especially, would be burdened by making a
determination under the listing of conditions using other than
the expertise of a health care provider. For instance, the first
condition listed is complex and could by no means help an
employer or employee identify a health hazard. This condition is
listed:
System: Multi-system
Condition: Carbon monoxide poisoning
Recording criteria:
Elevated carboxyhemoglobin levels and/or diagnosis
by a health care provider.
It would be unreasonable to expect the average employer to
diagnosis this condition using the "recording criteria" without
laboratory tests and a health care provider's diagnosis.
There is an argument that this information will be used for
identifying trends in occupational health. The most contentious
issue is the musculo-skeletal system, also referred to as
ergonomics. The agency would be challenged to prove the
scientific validity of incidents recorded. These are complex and
misunderstood conditions, and the information would be collected
by individuals who are generally without the medical and
scientific education required to make these determination.
The Office of Advocacy also requests that OSHA consider the
likelihood that this information will be collected by the agency
given restricted mechanisms and limited resources. If research is
appropriate, it should be done by a research body and not a
regulatory agency.
Access to OSHA Injury and Illness Incident Record(12)
Under the proposed rulemaking, the employer would be required to
make available to an employee, former employees or employee
representatives all OSHA Injury and Illness Incident Records
(proposed Form 301). This provision would not only inflict undue
hardship on small businesses by requiring added reporting
burdens, it breaches standards for individual privacy. Employees
and their representatives would have access to the injury or
illness records of other workers. This proposal would overturn
the body of law and regulations that support privacy of worker
information. This access may result in a limited or distorted
report if the details are to be shared.
The small business community has raised concerns about the
admissibility of Form 301 in court if it becomes "public" through
release to private parties. The concept of blacking out names
would be impractical in a small firm where individual records
would not be anonymous; with a small number of employees,
deductive reasoning could be used to determine whose record was
being reviewed.
Recommendation: Advocacy recommends that this requirement is
deleted.
Construction Provisions(13)
The provisions in the proposed rule that apply strictly to the
construction industry would require general contractors to
collect the records of subcontractors. The parameters are set at
projects valued at $1 million or more and for subcontractors with
11 or more employees. Both general contractors and subcontractors
are predominantly small businesses.(14) The proposed rulemaking
would increase the paperwork burden for both general contractors
and subcontractors, and it is unclear what specific benefit would
be derived from this paperwork collection activity. This
information is available to OSHA, and this recordkeeping seems to
duplicate reporting requirements.
While there is some speculation that information could be derived
about specific types of construction projects e.g., residential,
commercial, etc., there has been little substantiation that OSHA
has a mechanism, resources or the right to collect this data.
Recommendation: Advocacy recommends dropping this provision from
the rulemaking.
Software Development(15)
Finally, OSHA is proposing to develop computer software to assist
employers in the task of recordkeeping. The Office of Advocacy
applauds this initiative. The agency may want to partner with the
private sector in the development of the software to utilize
fully the expertise, resources and distribution mechanisms of
private companies and organizations, such as trade associations.
Recommendation: A standard should be set for the contents of the
software, so small entities that use commercial software are not
vulnerable to the "interpretations" of the rule by the software
developer. OSHA should be a software distributor if possible.
We also believe that a cooperative effort to advertise this
software through the U.S. Business Advisor and SBA's regional
offices could maximize its use. The dissemination of software as
a working tool for compliance is an excellent example of OSHA's
new small business outreach focus.
If you have any questions, please contact me or Anita Drummond of
my staff at (202) 205-6533.
Sincerely,
Jere W. Glover
Chief Counsel for Advocacy
END NOTES
1. Fed. Reg., Vol. 61, No. 23, pp. 4030-4066 (Feb. 2, 1996).
2. 5 U.S.C. 601-612.
3. Defined in 5 U.S.C. 601 and 13 CFR Part 21.
4. 29 CFR Proposed 1904.2(b).
5. 29 CFR 1904.15.
6. SBA calculates the number of employees in each pay period
over 12 months and divides by the number of pay periods to
establish an average. Both full and part-time employees are
included. This calculation could be done for the last calendar
year to determine the employment average for exemption
eligibility.
7. Estimation based on information from U.S. Small Business
Administration, Office of Advocacy, based upon data prepared
under contract by the Bureau of the Census (1992).
8. The Office of Advocacy extracted data from Bureau of the
Census and it is attached with a breakdown of the number and
types of firms covered by and exempted from this rulemaking.
9. Proposed 1904.3.
10. Proposed 1904.4.
11. Proposed 1904.4(b)(4)(iv).
12. Proposed 1904.11(b)(5).
13. Proposed 1904.17.
14. 13 CFR Part 121 Small Business Administration Size Standards.
15. Fed. Reg., Vol. 61, No. 23, p.4048 (Feb. 2, 1996).
FIRMS COVERED BY RECORDKEEPING PROPOSAL
Extracted from Data from Bureau of the Census (1992)
SBA Office of Advocacy, July 1996
TOTAL No Employees 1-19 20=/+
All Industries
5,095,456 644,453 3,928,541 522,362
Construction (exemption set at 10 or fewer employees)
548,453 93,428 449,072 41,953
(<10 392,137)
Mining (covered by MSHA)
22,953 2,347 17,014 3,592
SICs 52-89 (most are exempted by recordkeeping rulemaking)
3,464,100 382,441 2,742,442 339,217
Balance of industries covered (some exempted that have a low
workday loss rates)
1,023,850 166,237 683,520 137,600
Conclusions
General Industry*
857,613 Firms in SICs 01-51 covered by rulemaking
720,013 Firms with 1 to 19 workers and exempt from most
paperwork
137,600 Firms covered fully
Construction
491,025 Firms covered by rulemaking
392,137 Firms with fewer than 10 workers and exempt from
most paperwork (Note: the rule exempts firms with
1-10 employees but data are broken out for firms
with less than 10 employees)
98,888 Firms with 10 or more employees; all but those
firms with exactly 10 employees are covered fully
*This does not account for the sectors (three-digit SICs) that
were exempt that would now be covered as subsets of SICs 52-89.
This does not account for the sectors that are currently covered
but would be exempt as subsets of SICs 52-89.
Comments of
Jere Glover
Chief Counsel for Advocacy
U.S. Small Business Administration
Public Meeting on Proposed Rule
Occupational Injury and Illness Recording
and Reporting Requirements
Presented by Anita Drummond, Assistant Advocate
Before the
Occupational Safety and Health Administration
U.S. Department of Labor
May 1, 1996
Introduction
Good Afternoon. The Office of Advocacy of the U.S. Small Business
Administration (SBA) appreciates the opportunity to comment
during this public meeting on the Occupational Safety and Health
Administration's (OSHA) proposed rulemaking on occupational
injury and illness recording and reporting requirements.(1) My
name is Anita Drummond, and I am here to present comments on
behalf of Jere Glover, Chief Counsel for Advocacy.
The Office of Advocacy of the SBA was established by Congress
under Public Law No. 94-305 to advocate the views of small
business before Federal agencies and Congress. Advocacy is also
required by 612 of the Regulatory Flexibility Act (RFA)(2) to
monitor agency compliance with the RFA. These comments will be
directed towards the agency's compliance with RFA and specific
issues within the proposed rulemaking that should be evaluated
for their impact on small business and small organizations.
Before addressing the proposed rule, we would like to commend
Assistant Secretary Joe Dear for his appointment of Greg
Watchman, Deputy Assistant Secretary, as the new Small Business
Advocate Chairman. The Office of Advocacy looks forward to
building a strong link with OSHA in order to identify added ways
to assist small businesses to comply with OSHA standards. We
recognize the agency has made a tremendous effort under the
leadership of Assistant Secretary Dear to include small business
in the development of standards through the stakeholder process
and other means. We look forward to working with Deputy Assistant
Secretary Watchman.
Proposed Rule
This proposed rulemaking is a comprehensive document that amends
the recordkeeping requirements for business, changes the
exemption criteria, alters the definition of key terms, and
subjects businesses to new mandates for releasing information.
My comments today only address some of the major issues, the
written comments of the Office of Advocacy will be more
extensive.
Regulatory Flexibility Act and Exemptions
Pursuant to the Regulatory Flexibility Act, the Assistant
Secretary certifies that the proposed rule before us will not
have a significant adverse impact on a substantial number of
small entities. The certification explains,
"The proposed rule exempts construction employers with less
than eleven employees and non-construction employers with
less than 20 employees from most of the requirements, and
would not have a differential impact on small business."
The proposed new exemptions for smaller employers send a
significant signal that OSHA is willing to offer relief to more
small businesses. Currently, the agency offers partial exemptions
to businesses with no more than ten employees at any time during
the calendar year immediately preceding the current calendar.
Advocacy estimates this exemption could potentially apply to as
many as 87 percent of non-construction firms with employees.(3)
However, the Office of Advocacy believes the proposed methodology
for determining an employer size in the rulemaking could prevent
practical application of the exemption to many, if not most,
smaller businesses. In fact, Advocacy is concerned that under the
new proposed rulemaking more businesses could be covered than
under the current standard. Therefore, Advocacy will recommend
some alternatives to assure a significant exemption is provided
for smaller businesses.
The methodology for determining an employer's size seems to be
changed from no more than ten employees at any time during the
preceding calendar year to a cumulative total of employees in the
entire previous year. Industries that have a fluid workforce
e.g., retail, restaurants, construction, etc., would be unduly
burdened if the proposed methodology is applied.
While OSHA's intent may not be to change the methodology, the
change in wording could be interpreted to mean that OSHA will
count all employees in the previous year when determining the
eligibility for exemption. The number of employees in a given
year could easily exceed the maximum determined by the standard
for exemption while the company would have no more than the
maximum in a given day.
Specifically, the proposed rulemaking states:
"Construction employers with 10 or fewer employees for the
entire previous year are exempt from the regulations from
this Part 1904..." [emphasis added]
"Employers in industries other than construction with 19 or
fewer employees for the entire previous year are exempt from
the regulations of this Part 1904..." [emphasis added].(4)
The current regulation determines exemptions for small employers
using the following definition:
"An employer who had no more than ten (10) employees at any
time during the calendar year immediately preceding the
current calendar year need not comply with any of the
requirements of this part except..."(5)
Companies that have a changing workforce, or significant turnover
in a given year, would be placed in the position of meeting the
standard based on the employment rolls of an entire year. This
would expand the number of employers that would likely be
subjected to the new standard. Also, the method for counting the
"entire previous year" does not specify a calendar year, which
could increase confusion.
The Office of Advocacy recommends that OSHA consider one or more
of the following alternatives: 1) retain the current wording and
methodology with the higher exemptions, 2) consider the averaging
method used by the Small Business Administration's Office of Size
Standards for employment,(6) and 3) extend the exemption to
smaller establishments, as well as smaller businesses. Many
employers are small businesses that have multiple establishment
where a small number employees work. These establishments should
be considered for the exemption.
Let me emphasize that I believe OSHA's intent is to offer an
exemption to smaller employers, and the Office of Advocacy would
like to assist the agency in meeting that objective.
Definitions(7)
OSHA has altered and added some definitions under the proposed
rule. Advocacy would like to address a few of these.
Employee
Advocacy believes that the notation accompanying the definition
of "employee" goes beyond the statutory intent. OSHA is proposing
to include independent contractors and workers from temporary
help services in the employee definition. Small businesses would
not only have new obligations for coverage, but this methodology
for counting employees would impact the opportunity for an
exemption under this standard.
Establishment
OSHA is expanding the coverage of this standard to include a new
class of worksites. By changing the definition of "establishment"
to any single physical location that is in operation for 60
calendar days or longer, employers will be subjected to an
increase in recordkeeping for industries with temporary
worksites, such as companies that provide contractor services to
the workplaces of other employers. Advocacy suggests that an
exemption for employers that have a small number of employees at
an establishment e.g., less than 20 employees, should be
considered as an alternative. This way OSHA could adopt the
proposed definition while allowing relief to smaller businesses.
Days Away From Work & Restricted Work Activity
The agency's proposal to set a cap of 180 days of recordable Days
Away From Work (currently Lost Workdays) is a commendable change
to the standard. Advocacy believes OSHA's proposal to change the
method for counting Days Away From Work to exclude restricted
work activity is a good effort, and we support this proposal
However, the new definition for classifying "restricted work
activity" could increased the number of cases that would be
subject to this standard, and subsequently, classified as a
recordable incident. Small businesses would face increased
recordkeeping.
Under the proposed definition, a case would be determined as a
"restricted work activity" if the employee cannot perform what he
or she was doing at the time of the illness or injury, or he or
she could not perform the activities scheduled for that day.
While this would be a very simple method, it would encompass more
recordable incidents. Many workers have a myriad of tasks
associated with their job. If an employee can return to work and
perform functions within their job description, this should not
be considered "restricted work activity." OSHA should retain the
current definition.
OSHA Injury and Illness Log and Summary(8)
OSHA's proposed rulemaking would provide employers with a step by
step method for determining if an incident is recordable. This
flowchart method is helpful for small businesses. We commend OSHA
for this approach.
Advocacy has done a preliminary review of the recordable
incidents listed in the Table of Specific Conditions (Mandatory
Appendix B)(9) and found that specific safety and health
standards for coverage would be promulgated by this recordkeeping
rulemaking. This rulemaking would single out standards that are
currently covered by the "general illness recording criteria,"
according to OSHA. Advocacy's preliminary recommendation is that
a recordable incident under the "Specific Conditions" should be
subject to a health care provider's clinical diagnosis. Small
businesses, especially, would be burdened by making a
determination under the listing of conditions using other than
the expertise of a health care provider.
Access to OSHA Injury and Illness Incident Record(10)
Under the proposed rulemaking, the employer would be required to
make available to an employee, former employees or employee
representatives all OSHA Injury and Illness Incident Records
(proposed Form 301). This provision would not only inflict undue
hardship on small businesses by requiring added reporting
burdens, it breaches standards for individual privacy. Employees
and their representatives would have access to the injury or
illness records of other workers. This access may result in a
limited or distorted report if the details are to be shared.
The small business community has raised concerns about the
admissibility of Form 301 in court if it becomes "public" through
release to private parties. The concept of blacking out names
would be impractical in a small firm where individual records
would not be anonymous; with a small number of employees,
deductive reasoning could be used to determine whose record was
being reviewed. Advocacy recommends that this issue is revisited.
Construction Provisions(11)
The provisions in the proposed rule that apply strictly to the
construction industry would require general contractors to
collect the records of subcontractors. The parameters are set at
projects valued at $1 million or more and for subcontractors with
11 or more employees. Both general contractors and subcontractors
are predominantly small businesses.(12) The proposed rulemaking
would increase the paperwork burden for both general contractors
and subcontractors, and it is unclear what specific benefit would
be derived from this paperwork collection activity. This
information is available to OSHA, and this recordkeeping seems to
duplicate reporting requirements.
A major concern about this proposed recordkeeping is the exchange
of potentially sensitive, private information among companies
that are competitors in the marketplace. While a company may
serve as a general contractor on one project, it could easily be
a direct competitor with its subcontractors on another job.
Advocacy recommends dropping this provision from the rulemaking.
Software Development(13)
Finally, OSHA is proposing to develop computer software to assist
employers in the task of recordkeeping. The Office of Advocacy
applauds this initiative. The agency may want to partner with the
private sector in the development of the software to fully
utilize the expertise, resources and distribution mechanisms of
private companies and organizations, such as trade associations.
We also believe that a cooperative effort to advertise this
software through the U.S. Business Advisor and SBA's regional
offices could maximize its use. The dissemination of software as
a working tool for compliance is an excellent example of OSHA's
new small business outreach focus.
Thank you for the opportunity to speak during this public meeting
on this proposed rulemaking. The Chief Counsel for Advocacy will
submit more extensive comments to the record.
U.S. Establishments, Firm Size by Employment - 1992
U.S. Small Business Administration, Office of Advocacy
based upon data prepared under contract by the Bureau of Census
Industry Total 0 1-19 >20
All Industries
Mining
Construction
Industries Covered
Written
Advocacy also believe that the agency is proposing a small
business size standard for the purposes of exemption, and the
agency is using a size standard that is not consistent with that
in 3 of the Small Business Act. In order to be in compliance
with the RFA, the agency should submit a request Small Business
Administration for approval of this small business size standard.
It is the perogative of the Assistant Secretary to make this
dertermination if the proposed rule is not expected to have a
significant economic impact on a substantial number of small
eneities. The Office of Advocacy believes that this certification
may have been issued in consideration of findings published in
OSHA's "Preliminary Economic Analysis of Changes to Recordkeeping
Regulation" (June 28, 1995). While this report was produced for
compliance with Executive Order 12866 (1993), the findings were
based on the erroneous use of data by presuming that small
business exemptions proposed by this rulemaking would apply to
"establishments." However, this rulemaking would apply to
exemptions to "employers." If the exemption were applicable to
establishments, a significant larger number of worksites would be
be eligible for the exemption.
The Office of Advocacy reviewed the statement of the agency
regarding compliance with Executive Order 12866 (1993), requiring
an assessment of the costs and benefits of the regulation and
design of the regulation to impose the least burden on society
consistent with the agency's regulatory objective.
The Office of Advocacy reviewed OSHA's "Preliminary Economic
Analysis of Changes to Recordkeeping Regulation" (June 28, 1995).
In reviewing the data, Advocacy found that the agency estimated
the impact of the regulation assuming exemptions for
"establishments" with a given number of employees. However, the
proposed rulemaking would offer exemptions to "employers" with a
given number of employees. The use of the term of
"establishments" in lieu of "employers" provides misleading
evidence to the relief being offered to employers.
Further, the agency finds in its Regulatory Impact Assessment,
"The average establishment affected by the proposed changes
to the recordkeeping requirements would incur a net
reduction in recordkeeping costs. The proposed exemption
from the regulation of all non-construction establishments
with fewer than 20 employees will mean that most small
entities will experience an even larger cost savings."
Establishment
The reason for inclusion of recreational facilities in the
definition of establishment in the preamble of this rulemaking is
unclear. Has there been a recorded and significant question about
the application of the standard to such locations? Employers that
offer recreational facilities, such as a basketball court, would
now incur added liability under the new standard for recordable
injury and illness.
END NOTES
1. Fed. Reg., Vol. 61, No. 23, pp. 4030-4066 (Feb. 2, 1996).
2. 5 U.S.C. 601-612.
3. Estimation based on information from U.S. Small Business
Administration, Office of Advocacy, based upon data prepared
under contract by the Bureau of the Census (1992).
4. 29 CFR Proposed 1904.2(b).
5. 29 CFR 1904.15.
6. SBA calculates the number of employees in each pay period
over 12 months and divides by the number of pay periods to
establish an average. Both full and part-time employees are
included. This calculation could be done for the last calendar
year to determine the employment average for exemption
eligibility.
7. Proposed 1904.3.
8. Proposed 1904.4.
9. Proposed 1904.4(b)(4)(iv).
10. Proposed 1904.11(b)(5).
11. Proposed 1904.17.
12. 13 CFR Part 121 Small Business Administration Size Standards.
13. Fed. Reg., Vol. 61, No. 23, p.4048 (Feb. 2, 1996).