Groups Challenge OSHA Ergo Rule Cost Estimates

Sept. 8, 2000
Industry groups and a corporate-sponsored foundation have found\r\nnew reasons to hammer away at OSHA's ergonomic rule's cost estimates.

Industry groups and a corporate-sponsored foundation have found new reasons to hammer away at OSHA''s ergonomic rule''s cost estimates on both procedural and substantive grounds.

OSHA''s $4.2 billion annual cost estimate for the rule has been widely criticized by opponents as far too low.

This much is beyond dispute: OSHA added thousands of new pages of additional research on its cost estimates in late July, after the close of the public comment period, but just before the Aug. 10 deadline for post-hearing comments.

As a result, no one will be able to comment on the new data prior to the issuance of the final rule later this year.

"Rulemaking by stealth," charged Baruch Fellner, an attorney representing the National Coalition on Ergonomics (NCE), a group of industry opponents of the proposed rule.

In a letter to OSHA Administrator Charles Jeffress, Fellner argued the new documents show OSHA has adopted a new methodology for estimating the rule''s cost.

The National Association of Manufacturers (NAM) soon joined in, and both groups demanded that OSHA extend the comment period and conduct additional hearings on the new material.

The two associations went to cross-examine OSHA and its contractor on the alleged new method.

But OSHA denied it had adopted a new methodology, and refused to schedule more hearings. "It is routine to place additional, supplementary information in the docket while the public record is open," said an OSHA spokesperson.

At least one motive of the recent flap is the effort by industry opponents of the ergonomics rule is to stockpile complaints about OSHA''s rulemaking procedures for later use in a court challenge to the standard.

Fellner''s letter closed with a thinly-veiled threat: "Playing short shrift with due process will doom any final standard in ensuing court review."

But OSHA''s last-minute submission of the new cost estimates may be an admission that this piece of the rule is in trouble.

The agency must submit its final standard for review by the Office of Management and Budget (OMB). One of the principal areas OMB looks at in proposed rules is the estimate of costs and benefits.

If OSHA''s final rule is weak here, it could seriously complicate OMB''s efforts to complete its review by year''s end.

OSHA''s original cost estimates have been criticized because they were based on informal interviews and because they made unrealistic assumptions.

Ron Bird is chief economist at Employment Policy Foundation (EPF), and industry-supported research organization based in Washington, D.C.

"Instead of going out into the field and conducting research to find out what actual practice was, they just made guesstimates sitting in their offices," said Bird.

EPF believes the ergonomics rule will cost as much as $99.3 billion a year, which would mean OSHA''s estimate is off by a factor of 23. EPF''s report cites several examples of OSHA''s errors and omissions.

According to Bird, "OSHA assumed, without doing any research, safety manager would need only one hour to become familiar with the rule. OSHA further assumed only one person in each establishment would need to spend the time it takes to read the standard."

EPF conducted a survey of safety and health professionals and discovered it would take 33 hours per establishment to understand the rule, which is over 100,000 words long, counting the preamble and explanatory material.

Bird explained, "OSHA compounded the problem with its naive assumption that only one person at each work site would need to read the rule. This amounts to a $3 billion mistake."

OSHA assumed that any firm doing something about ergonomic problems would incur no additional cost in complying with the rule.

But EPF argues the rule is so demanding, it is reasonable to assume no establishment is 100 percent compliant, adding an estimated $11.7 billion to the rule''s cost.

The rule requires an immediate protective response in the event of a single covered musculoskeletal disorder (MSD), so each employee complaint of MSD symptoms must be noted and assessed to determine if it is an OSHA recordable.

But according to EPF, OSHA fails to consider the cost of screening all complaints of potential MSDs before they are classified as OSHA recordables: a $29.7 billion mistake.

An OSHA spokesperson countered that the agency''s original economic estimates are based on sound information drawn from an extensive analysis of more than 14,000 scientific studies.

Whether OSHA sticks to its original cost estimates in the final rule remains to be seen, but Fellner offered a prediction.

"In light of what has been put in the record, they will be extraordinarily embarrassed if they stick to $4.2 billion."

by James Nash

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