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A runaway train
was headed straight for small business' bottom line and now,
mirabile dictu, it's off the track.
I refer, of course, to the recent striking down by Congress of
rules intended to reduce repetitive stress injuries in the
workplace. With compliance costs estimated at anywhere from $5
billion to $100 billion, depending on who did the estimate, the
ergonomics program may have been the Clinton administration's
greatest affront to American business. But it wasn't the only one
and, while its nullification should be celebrated, it should not be
allowed to lead to complacency.
Created by the Occupational Safety and Health Administration (OSHA)
and 10 years in the making, the ergonomics program represented a
scattergun approach to the problem of workers being injured by
repeatedly performing the same task. By OSHA's own admission, 4.75
million small businesses would have been subject to the rules, 4.2
million of them employing fewer than 20 workers.
The workplace was defined so broadly that even home-based firms,
where a single friend or relative labors a few days a week at data
entry or bookkeeping, could have been affected. And business owners
would have been required to spend from $250 to $1,000 a year per
employee workstation just on prevention.
What doomed the measure
Whatever the price tag, the program was shaping up as a
compliance nightmare. Reading snippets of it, you had to wonder if
it wasn't the latest handiwork of Ira Magaziner, architect of that
regulatory morass known as "Hillary's health care plan." But forget
the bureaucratic silliness — the "MSD (musculoskeletal disorder)
incidents," the "action triggers," the "quick fixes" — underlying it
all was real economic inequity, the kind that can be fatal to a
small business operating on razor-thin margins.
Consider: The rules would have covered injuries sustained outside
the workplace — while playing golf or softball, for example — and
then merely aggravated at work. Moreover, employers would have had
to pay injured workers 90% of their pay for up to 90 days, while it
was determined whether the employee could return to work; the
comparable rate under Workman's Compensation is two-thirds of full
pay.
What doomed the measure was the happy coincidence of Republicans
controlling both Congress and the White House.
Under the Congressional Review Act (enacted in 1996 as part of
the Small Business Regulatory Fairness Act), all "major" federal
regulations are subject to congressional review. Some 20,000
regulations have been submitted for review in the last five years,
but not a single one has been disapproved until now. The reason?
While Republicans in the past had the votes to nullify regulations,
they did not have the votes to override the presidential veto that
inevitably would have followed.
So, this is one regulation that has died with the new
administration and Congress. Now you can go blithely about the
business of making money and enjoying life, right? Well, not
exactly.
Cause for alarm
Though the ergonomics package no longer is a problem, new rules
governing the reporting of workplace injuries remain on the books,
and small-business advocates say they will add substantially to
business' red-tape burden unless amended. Also cause for alarm is a
trio of new environmental regulations — governing watershed
pollution, lead emissions and sulfur levels in diesel fuel — that
figure to have a significant negative impact on certain
small-business constituencies.
There are others as well, many of them so-called "midnight
regulations" the Clinton White House attempted to sneak into effect
in the period between the election and the Bush inauguration. It's a
time-honored way for an administration to put its mark on the body
bureaucratic one last time — think of a dog lifting its leg — and it
should come as no surprise that in this, as in so many other things,
the Clinton gang was particularly profligate.
A recent study by the Mercatus Center at George Mason University
in Virginia found that President Clinton broke Jimmy Carter's
1980-81 record for the most pages published in the Federal Register
during the post-election quarter: Clinton's post-election
regulations filled 26,542 pages vs. 24,531 for Carter.
While this latest batch of midnight regulations are subject to
congressional review (Congress has until approximately mid-2001 to
review all rules submitted after July 13 of last year),
small-business advocates in Washington say that few, if any,
additional regulations will rise to the level of the ergonomic rules
and be slapped down with a resolution of disapproval. But there are
other remedies.
One of Andrew Card's first official acts as White House chief of
staff was to direct agency heads to postpone for 60 days the
effective date regulations that had been issued but not yet become
effective. Those rules are subject to administrative review and
withdrawal.
Expect them to head to court
And not every regulation that took effect before Clinton vacated
the White House is immune. The most notable example in this category
is the "integrity and business ethics" standards intended to deny
federal contracts to firms that have broken the law.
The rules were roundly derided by business as a sop to labor
unions ("labor violations" are among the offenses not to be
tolerated). The rules, which took effect Jan. 19, were suspended for
six months, thanks to a ruling by the panel that reviews federal
procurement regulations. It's expected that the Bush administration
eventually will be able to withdraw the rules.
In cases where administrative or legislative remedies aren't
available, there's always the law. Look for special interest groups
that have been hit hard by a rule — often in the environmental area
— to go to court hoping to prove a flaw in the rulemaking process.
But whatever becomes of the Clinton's midnight rules blitz, this
much seems certain: The regulatory arm of the Bush administration
will be less punitive.
"The Bush administration is going to focus more on compliance
assistance, on a partnership with small business," says Karen
Bosgraaf, manager of regulatory policy at the National Federation of
Independent Business.
And when rules are laid down, she adds, "hopefully they'll be
less heavy handed and costly, and focus more on voluntary efforts." |