Joseph F. Olimpio
Director
Longshore and Harbor Worker's Compensation
Employment Standards
Room C-4315
200 Constitution Avenue, NW
Washington, DC 20210-002
Dear Mr. Olimpio:
The Office of Advocacy of the U.S. Small Business Administration (SBA) was established by Congress under Pub. L. 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) (5 U.S.C. 601-612) to monitor agency compliance with the RFA. On March 28, 1996, President Clinton signed the Small Business Regulatory Enforcement Fairness Act (SBREFA) which made a number of significant changes to the Regulatory Flexibility Act, the most significant being provisions to allow judicial review of agencies' compliance with the RFA.
On July 3, 1997, the Department of Labor forwarded a proposed rule for amending the regulations implementing the Longshore and Harbor Worker's Compensation Act (LHWCA). The rule, if promulgated in final will increase the amount of civil money penalties levied under the LHWCA. According to the proposal, "an average of $25,000 in civil money penalties was collected each year in 206 cases." Under the proposal, the "total additional amount collected would not exceed $2,500." The Assistant Secretary for Labor certified that the proposed rule would not have a significant economic impact on a substantial number of small entities.
The Office of Advocacy is unable to ascertain whether the certification is correct because it is ambiguous. Does the expected increase of $2,500 pertain to each individual case or is for the all of the cases combined? Whereas $2,500 in the aggregate may not have a significant impact on a substantial number of small business, an $2,500 per case may be significant, depending on the size of the business. Advocacy submits that the agency should clarify the proposed ruling and determine whether the conclusion is correct.
Without clarification, it is difficult, if not impossible, to ascertain the true economic impact that this amendment may have on the small businesses that may incur penalties. Moreover, a comprehensible analysis of the proposed action is necessary for the members of the industry and the community to access fully and provide comments on the economic impacts of the proposed action. As such, the Office of Advocacy requests that the Department of Labor provide the necessary information to clarify the proposed amendment.
If you have any questions about this matter, please contact Jennifer A. Smith, Assistant Chief Counsel for Economic Regulations at (202) 205-6943. Thank you.
Sincerely,
Jere W. Glover
Chief Counsel
Office of Advocacy
Jennifer A. Smith
Assistant Chief Counsel
Economic Regulations