From the January 1998 issue of Entrepreneur

The people at the Occupational Safety and Health Administration (OSHA) must feel much like the Union troops in Gettysburg did while watching successive waves of Confederate troops storm up Cemetery Ridge. During the past few Congresses, Republicans have led relentless attacks on the workplace safety agency.

Now Rep. Jim Talent (R-MO), chairman of the House Committee on Small Business, is leading what may be the political equivalent of Pickett's charge with his introduction of the Safety Advancement for Employees (SAFE) Act. Though SAFE has gained some congressional support in recent months, the general feeling is that President Clinton will not likely back the act.

The key provision of the bill (H.R. 2579) says businesses that have their premises audited by an OSHA-certified private company would be exempt for two years from penalties resulting from a formal OSHA inspection. The business owner would be required to abate any workplace hazards found during the audit, and if he or she did not make a good-faith effort to remain in compliance with OSHA laws during the subsequent two-year period, the exemption from penalties would be lost. Sen. Mike Enzi (R-WY) has introduced the Senate version of the bill (S.1237), which, at press time, had passed the Senate Labor and Human Resources Committee.

As opposed to past efforts to clip OSHA's wings, this one has some Democratic support, at least in the House. In fact, the notion of enlisting private companies in federal agency reviews has become an accepted congressional antidote to bureaucratic congestion.

Current policy allows businesses to get a safety consultation (which does not necessarily involve a full audit) from an OSHA-paid state employee. And companies that correct all problems identified in a full audit are exempt from OSHA inspections for one year. There are huge backlogs for that popular service, however.

Part of the problem, as many small-business groups see it, is that OSHA's inspections are often the result of an on-site accident or a phone call from a complaining employee. Often, the inspectors find no serious violations; rather, they generally uncover paperwork violations, such as companies that fail to keep up on their material safety data sheets. In 1994, for instance, the top six most-cited violations involved paperwork deficiencies.

Many small-business groups endorse the SAFE Act; after all, insulation from OSHA penalties may seem like a good reason to obtain a third-party audit. That may not be the biggest incentive, however.

Bob Cornell, director of operations for Mon Valley Petroleum in McKeesport, Pennsylvania, says the 25-employee company paid about $3,000 for an audit in 1994. The audit helped the company go from having five injuries and 27 lost work days in 1994 to one injury and no lost time in 1997. As a result, Mon Valley has saved $15,000 per year in workers' compensation insurance costs since the audit. Businesses may see this kind of change as an even better reason to support the bill.


Stephen Barlas is a freelance business reporter who covers the Washington beat for 15 magazines.

Contact Sources

Sen. Mike Enzi, (202) 224-3424

Mon Valley Petroleum, 5515 W. Smithfield St., McKeesport, PA 15135, (800) 251-3366

Occupational Safety and Health Administration, (202) 219-8151, http://www.osha.gov

Rep. Jim Talent, (202) 225-5821, http://www.house.gov/smbiz