"This document was published prior to the publication of OSHA's final rule on Ergonomics Program (29 CFR 1910.900, November 14, 2000), and therefore does not necessarily address or reflect the provisions set forth in the final standard."

                                                               Rev.6/6

Opening Remarks

* Thank you, Peter, for that kind introduction (Peter Hernandez, Vice President, Employee Relations, will introduce you). It's a distinct pleasure to have this opportunity to talk to the top safety and health and employee relations officers of the major American steel companies and to describe some of OSHA's priorities in this Administration.

The Problem

* If today is like any other day, 17 workers will be killed in a fatal traumatic injury. That's better than it used to be, but 17 a day, day in, day out---that's 6,000 a year.

* We don't know how many workers succumb to death by illness contracted as a result of exposures on the job because there is no national surveillance system for occupational disease. But even conservative estimates place that number at something like 50,000 deaths a year: cancer and non-cancer-related workplace illness exposures.

* The economic cost of these injuries and illnesses goes way beyond direct workers' compensation payments. The National Safety Council estimated in 1992 that workplace injuries and illnesses cost the economy $115 billion.

* Insurance premiums, lost productivity, increased training costs, and, of course, the human side of this equation, the pain, the suffering, the anguish that workers feel is unquantifiable.

* However you tote it up, there's an enormous amount of preventable injury, illness and death in America's workplaces. And there are great opportunities for the Government, labor organizations, employers, and others to work together in partnership, to do something about that.

OSHA's Mission

* OSHA's mission is spelled out clearly in its statute. We are to save lives, prevent injury, and protect the health of America's workers.

* Our mission involves focusing our resources on the most serious threats to worker health and safety whether that's enforcement, our standard setting, or our education and training resources.

* We need to find ways to encourage workers and employers to cooperate so that they can produces the safest and healthiest workplaces possible and thus enable American businesses to be as profitable and competitive as they possibly can.

* That mission extends to the protection of over 93 million workers in this country working in over 6.2 million establishments.

* To carry out that mission, we have a budget of $300 million and a staff of 2,300 people.

* Together with our state plan partners, and it is important to recognize a federal/state partnership in enforcement and education services in OSHA, we field directly about 2,100 front-line people. Twenty-one hundred compliance people, 6 million workplaces. You can do the math.

* The gap between OSHA's mission on the one hand and its resources on the other is the principal driver requiring us to reinvent OSHA. What is it we can do to extend the research and range of OSHA's activities with our existing set of resources?

* I think there is a lot we can do and I think you, too, can have a major role to play.

* A long time ago, Abraham Lincoln had this to say about change. He said that the dogmas of the quiet past are inadequate to the stormy present.

The Politics of Workplace Safety and Health

* To help us think anew about OSHA and about the challenge of reducing preventable injury and illness, let me propose to you a simple model to try to explain the politics of workplace and safety and health.

* What explains the behavior of the actors in the political arena, the labor organizations, businesses, insurers, public health officials, Government, bureaucrats---all the people who get into the mix when workplace safety and health policies are discussed and implemented?

* Imagine for a moment that in the world of safety and health, the various players think along two dimensions.

* One dimension is the orientation of the actor toward employers or toward workers. I mean, in simple terms, employer organizations tend to think about workplace safety and health in terms of cost. How much is it going to cost the employer? Is this regulation going to impose more cost on a business operation than is going to be received in benefits? On the other hand, worker advocates will say how can we have this system protect the interest of workers. Their perspective is worker-oriented. So we have one dimension in employer orientation and a worker orientation.

* Now the other dimension is incentives. What is the view of the actor toward incentives in the system? Do they primarily prefer market incentives? In other words, let the price system work. Let it send signals about proper resource allocation. Let it reward successful safety and health management with more competitive enterprises that succeed in the market, and drive out those who are less competitive. Or do they believe in government rules? Regulations needed to establish minimum standards of performance.

* Now, let's put these two together and see what we get. If we have someone oriented toward employers who believes in the market, we have an approach that says to the Government, "Hands off. Government regulation interferes in the efficient allocation of resources in the market. You can't possibly do anything right, you bureaucrats, so just keep out, hands off, let the market work."

* I think you can describe that as the belief largely in vogue until 1970, when Congress enacted the Occupational Safety and Health Act. That Act was essentially a conclusion that the market wasn't going to work its efficient best with respect to workers' safety and health--that the Government did need to step in with standards, and that it is possible at least in the short-term for employers to take a low road and provide a lower level of safety and health to create short-term competitive advantages.

* So in 1970 we had a major shift. We went from the employer-market orientation to a worker-rule based interpretation. A command and control system, if you will.

* Let's set standards. Let's empower the Government to enforce those standards. Let's give the Government the ability to issue economic sanctions, a more punitive market signal about the importance of safety and health. And that's where OSHA started out. Not without some controversy in the 1970's.

* In the 1980's there was a change in direction. It was not possible to completely repudiate or repeal the Occupational Safety and Health Act, but the view shifted. It said,"Well, we're going to have a more employer-oriented system, but we accept the necessity of some rules." You could call this the cost-benefit approach. "We'll accept the rules if their benefit exceeds the cost." This was largely the approach taken during the Reagan and Bush years.

* That leaves one other combination: a worker-oriented market-driven approach, a cooperative, collaborative approach to workplace safety and health. And if you think for a moment, you can place yourself in that four-quadrant grid on how you approach this issue. I want you to think a moment about that cooperative grid, that place where we find a high-performance firm that has decided for whatever reason -- because they have a humane human resources policy or they just have a hard-headed business approach -- that it is good practice to manage safety and health actively, to involve their workers, to stay ahead of government standards, and to use the management of safety and health to create competitive advantage. Employers have accomplished remarkable reductions in their worker's compensation costs by adopting that practice. These are companies that use total quality management principles of continuous quality improvement and very successfully have dealt with workplace safety and health issues. Why aren't there more of them and what can we do to encourage employers to take the high road?

Enforcement

* We know from experience that enforcement action works. We can use enforcement to block some employers from taking the low road. In the cases of really "bad actor" employers, we will propose the maximum penalties possible. It's not a pleasant task, but we are authorized to do that. We can focus and concentrate our resources and try to find the "bad actors", but with 2,100 compliance officers and an inspection frequency of getting every workplace every 87 years, the strategy has its limitations.

Encouraging the High Road

* So we need to change. We need to move more employers to that worker-oriented, market-driven approach of cooperation and collaboration.

* We can do this through assisting them in developing high-performance workplaces which include excellent safety and health programs. And when they develop such programs, we want to celebrate their success.

* This can be done through OSHA's Voluntary Protection Programs, which recognize excellence in worksite safety and health. We want to encourage as many employers as possible to achieve that excellence and join VPP.

* One of OSHA's goals for the current fiscal year is to expand the number of VPP sites from 118 to 200. We are well on the way to achieving this goal. For FY 1995, our goal will be 300 VPP sites.

* The benefits of VPP are great. Throughout VPP, workers lost workday case rates are 62 percent below the national averages for their industries.

* Workers' compensation costs and turnover can be reduced dramatically and productivity can be greatly increased. In essence, it results in a healthier organization, both physically and economically.

* We also have a program that works through OSHA-funded state consultation services that is called the Safety and Health Achievement Recognition Program (SHARP). It recognizes small worksites that have established effective programs. We are expanding that program.

Setting the Rules of the Road Through Standard Setting

* We also can set the rules of the road with finely balanced standards, in other words standards that will abate workplace risks with a minimal disruption of the production on which the income of employers and employees depends.

* Targeted, more timely and balanced standard setting is one of our principal goals.

* OSHA takes too long on standards. For example, the confined space standard took 17 years. People are injured and become ill because of the length of time required to produce a standard.

* OSHA is creating a system of priorities based on the nature of the hazard; number of workers at risk; and the level of exposure.

* We also are exploring opportunities to streamline the process through such techniques as negotiated rulemaking and by developing generic standards.

* During fiscal years 1994 and 1995 we are planning action on some 40 safety and health standards. This includes 18 proposed and 22 final standards. It is the most ambitious regulatory agenda in OSHA history.

* In development of standards, we are implementing a new process that emphasizes: -- effective teamwork; -- early resolution of issues; -- simultaneous rather than consecutive development of standards packages, including regulatory text, preamble, risk assessment, regulatory impact analysis, and compliance/outreach materials;

-- expedited review within the Department of Labor and by the Office of Management and Budget.

* We used two broad criteria in considering our top OSHA standards priorities:

1. Generic standards which fill significant gaps in hazard protection. We call these OSHA "building blocks."

2. Specific standards covering very high risk or very broad exposure issues.

Leading the first category of building blocks aimed at filling significant gaps in hazard protection is ergonomics protection. We plan to publish a proposed ergonomics standard by the end of this fiscal year September 30.

Ergonomics Standard

* There is an escalating problem of musculoskeletal disorders in the workplace. The problem is the product of a mismatch between the design of the workplace or the worker's tools and his or her ability to respond to the demands of the job. The result is an imbalanced work system.

* Not only does it contribute greatly to the costs of workers' compensation, but this imbalance also results in poor productivity, poor quality and much pain and suffering.

* The solution requires looking at the individual in the context of the organization, the task, the technology and the environment. This must be integrated into the design phases of future work.

* We must put ergonomic principles and design into new jobs and minimize the ergonomic risk factors on existing jobs.

* And workers have to be involved in this process. Workers provide the detailed knowledge achieved only by doing the job. They have eight hours per day to think about how the job could be improved. That feedback rarely makes it back to the process or design engineer. High performance means closing the feedback gap through continuous worker input.

* OSHA is now in the process of developing a proposed ergonomics protection standard that will be used to assist and promote the process of improving workplace design and performance to eliminate or minimize the risk of all work-related musculoskeletal disorders.

* The scope of this rule and the variety of workplaces it will cover make its development a daunting task. Clearly, a rule that can't be enforced or that no one can understand will not be useful to anyone. We are committed to effective regulations that:

-- clearly address workplace hazards -- define responsibility and accountability -- clearly state the criteria for compliance -- are in plain language -- are technically competent and easily understood -- affect workplace activity and conditions only to the extent necessary to address hazards -- address diversity of workplaces -- are compatible with and do not overlap related regulations

* Professionals from OSHA and NIOSH have been working closely together to analyze large amounts of data, review the vast literature, and work on describing health effects and risk factors for musculoskeletal disorders and abatement methods.

* We also have been reviewing the history of OSHA corporatewide settlement agreements that involve ergonomics programs such as those we reached in the auto industry and the meat industry.

Health and Safety Programs

* Another of our proposed building block standards will involve requirements for written health and safety programs. This would implement concepts contained in OSHA Reform legislation now before Congress. We expect to publish a proposal in the second quarter of FY 1995.

Exposure Assessment and Medical Surveillance

* Also filling a significant gap in hazard protection would be standard for exposure assessment programs. and medical surveillance programs. The standards would complement OSHA standards that set permissible exposure limits (PELs) for air contaminants.

* The second category of high priority standards involves standards addressing issues that pose high risks to certain groups of workers.

Indoor Air Quality.

* We have stepped up to a big health problem and published a proposed rule that would regulate indoor air quality and environmental tobacco smoke to protect more than 20 million exposed workers. We have taken the action to prevent thousands of heart disease deaths, hundreds of lung disease deaths, and respiratory diseases and other ailments linked to these hazards. The environmental tobacco smoke provisions would apply to more than 6 million enclosed and indoor workplaces under OSHA jurisdiction, while the indoor air provisions apply to more than 4.5 million non-industrial worksites. Hearings are to begin in the fall.

Fall protection. This includes:

* A final fall protection standard for construction, scheduled for this summer.

* Two standards on scaffolds in construction (final in first quarter of FY 1995) and in maritime (publish final during fourth quarter of FY 1995).

* Final standard on walking/working surfaces (provides fall protection and scaffolds for general industry), which is scheduled for publication in the third quarter of FY 1995.

* Organization of negotiated rulemaking committee to begin work on standard for steel erection. We now have appointed the members of the committee, prepared documents on issues for negotiation, and hired a facilitator for the committee, Philip J. Harter, an attorney, (in accordance with the federal law governing such negotiated rulemaking). Public meetings of the committee will be held June 14, 15, and 16 in the Hyatt Regency Hotel in Bethesda, Md.

Respiratory Protection

* I know that some of you are interested in respiratory protection. We have been developing a proposal to revise the present respiratory protection standards, which have been in place more than 10 years and do not take into account the current state-of-the art for respiratory protection. Our proposal is scheduled to be published in November.

Air Contaminants

* We also have been working on ways to update the permissible exposure limits for air contaminants in the workplace, and we hope to have a plan for doing so by the end of this month.

* (Joe---The Solicitor's office says that in the air contaminants litigation, the Iron and Steel Institute specifically challenged the new limits for carbon monoxide and sulfur dioxide. In cases of several other limits, those for iron oxide, nuisance dusts, and limestone, for example, OSHA had acceded to the Institute's position during the rulemaking. But Charles Gordon of the SOL office, who handled the air contaminants case, said that the main objection was to the procedures used in the entire rulemaking, rather than to limits for specific air contaminants.)

Violence in Workplace

* Attention has been focused recently on problem of violence in the workplace.

* Reports from both NIOSH and BLS show that homicide is one of the leading causes of workplace deaths.

* In some cases, workplace violence is preventable. In others, it is not. Key is to recognize what is preventable and address it before problem occurs.

* As head of OSHA, I am terribly concerned about workplace homicides.

* Steps we are taking:

* OSHA represented on intergovernmental group on workplace violence that will present recommendations to President Clinton.

* Guidance has been given to OSHA personnel on use of the OSH Act's general duty clause to cite workplaces where criminal activity may endanger workers.

* Expediting the reappointment of NACOSH and will ask the committee to make workplace violence a priority issue.

* Appointed a special assistant to concentrate on gathering information on scope of problem, what industries are particularly affected, and possible remedies, including means of abating hazards of violence and possible regulations.

* We must focus on fixing the workplace, not targeting the worker. We must start by eliminating workplace problems that lead directly or indirectly to violence.

* Workplace stress may contribute to violence. We need to alleviate this stress.

* We welcome your perspective on this issue and any information you may have to help us address it.

The High Road includes Expanding Training and Consultation

* To assist employers to take the high road and to comply with standards, we are expanding the vital activity of training and education as well as consultation.

* For FY 1995, OSHA is proposing an increase of nearly $1.3 million in its training and education grants to the private sector. (Total would be $3 million.) Part of this increased funding would come from a proposal to retain tuition payments from the private sector of the Training Institute for training grant use. This would allow us to increase total grantees from 17 to 30.

* The Training Institute also is overseeing the establishment of additional regional Education Centers to expand the availability of OSHA-sanctioned safety and health training. We now have such centers in New Hampshire; New York State; Washington, D.C.; Texas; Georgia; Missouri; Colorado, and California.

* State consultation programs will emphasize emerging issues such as confined space entry, process safety management of highly hazardous chemicals, tuberculosis exposure and bloodborne pathogens.

OSHA Reform

* Both Secretary of Labor Robert Reich and I have testified before Congressional committees in support of legislative action on OSHA Reform.

* Advocates of safer and healthier workplaces can take some satisfaction from the successes of the Occupational Safety and Health Act since its passage in 1970. Rates of fatalities from traumatic injury have been cut in half, standards such as those for lead and cotton dust have produced measurable improvements in worker health, and enforcement accompanied by monetary fines has reduced worker injuries in workplaces.

* But the overall incidences of injury and illness measured by the Bureau of Labor Statistics have not declined significantly, and the costs of these injuries and illnesses continue to skyrocket. And who among us can forget the feeling that comes from knowing a fellow worker who was badly hurt in a preventable injury? There's no way to quantify the human costs.

* As the Assistant Secretary of Labor for Occupational Safety and Health, I am keenly aware of the potential for increasing the reach and range of OSHA's impact on workplace safety and health with existing resources. A concentrated focus on a management agenda to improve OSHA's organizational effectiveness can yield substantial improvements. Indeed these actions -- worker involvement, continuous quality improvement accountability, customer focus, -- are the only certain means of acquiring new financial and people resources given the fiscal realities of the federal budget. I am committed, I am determined to implement a program that will reinvent OSHA in all of its core activities -- enforcement, standard setting and education and training.

* That's a lot, for sure, but it's not enough. Congress must enact improvements in the Occupational safety and Health Act. As the economic and human toll of preventable injury and illness continues to rise, the case for OSHA Reform becomes clear. The act needs strengthening to:

* get workers involved in plant health and safety through joint safety and health committees;

* provide coverage to seven million state and local government employees;

* adopt air contaminant standards that are truly protective;

* establish meaningful criminal sanctions for those few situations where injury or death is the result of willful violations of specific standards; and

* address the unique hazards and conditions of the construction industry.

* The House Education and Labor Committee completed its markup March 10. It made some changes, but preserved the major provisions of the legislation.

HEALTH CARE REFORM

* Not only will OSHA Reform assist in building the New American Workplace, but so will passage of the Administration's proposals for Health Care Reform.

* Health care now consumes nearly 15 percent of our gross domestic product, far higher than in any other industrialized country. Business health care expenditures, currently $200 billion, now nearly equal after-tax profits.

* A major factor is the bloated and highly inefficient structure we have for health insurance. Over $45 billion went for administrative expenses in 1992.

* Another reason for the soaring cost of employee health insurance is that the premiums businesses are paying are inflated by $25 billion to cover the health care costs of those without insurance.

* The pressures experienced by businesses as a result of skyrocketing health care costs are felt with full force by their employees. Businesses pass on rising health care costs by holding down employees' compensation, redirecting money that would otherwise have gone for wages. The Brookings Institution estimates that rising health care costs have consumed 58 % of workers' potential wage increases since 1980, and, if left unchecked, will soon consume 100%.

* Another response of some employers has been to require workers to pay an increasing share of their health care costs.

* For some, the alternative to reductions in compensation is to reduce or eliminate entirely the health care coverage itself. Employer coverage of the non-elderly population fell from 66.8 % in 1988 to 62.5 % in 1992.

* Also, up to 30 % of workers feel "locked" into current jobs because they fear that a new employer may not offer insurance, or someone in their family has a pre-existing condition that would not be covered if they switched jobs.

* Some of the benefits of the Administration's Health Security Act are that it would:

--Provide a truly competitive health insurance market and major administrative efficiencies that would result in major cost savings to both employers and those employees who contribute to health plan coverage.

--Lessen the burden that workers' compensation costs impose on American industry by partially integrating workers' compensation medical costs into the new system.

--Facilitate greater productivity growth. As health care costs decrease, the economy will be able to produce more output than it would have without reform. This productivity increase will raise living standards, which is the principal objective of this Administration's economic policies.

--Health insurance also would be completely portable, removing fears of employees who feel locked in by fear of losing health insurance on a new job, removing fears of those on welfare that if they join the workforce they lose health insurance coverage, and the fears of those who would like to start new businesses but are prevented by fear of losing their health insurance or by the prohibitive costs of providing their employees with health insurance.

* The Administration also has proposed a Reemployment Act, designed to equip all Americans to participate in the new, improving economy. Basically, It would consolidate all major dislocated-worker programs into an integrated service system geared to deliver what workers need to get their next job, regardless of why they lost their last job; and allow states to develop one-stop career centers to streamline access to a wide range of job training and employment programs.

Concluding Remarks

* I hope that you leave here today realizing that OSHA is moving ahead, with significant changes in enforcement, standards development, and encouragement to employers to follow the high road to workplace safety and health through VPP, training and consultation.

* As Secretary of Labor Reich has noted, in a highly competitive global economy, we simply cannot tolerate the high costs of workplace injury and illness. In today's economy -- where capital and information cross national borders instantly -- a nation's comparative advantage comes from the only resource that stays more or less fixed within its borders: its workers. That is why the centerpiece of this Administration's economic strategy is investing in our workers -- their skills, their abilities and their capacity to innovate. Investing in their health and safety is a part of this strategy, for healthy and safe workers are productive workers.

* We want your help.