OSHA regulations are a “massive challenge” to small businesses in the homebuilding industry. Accordingly, OSHA should shift its emphasis from a “disproportionate” reliance on traditional enforcement and levying significant monetary penalties to compliance assistance.
Those sentiments were expressed by J. Gary Hill at a February 27, 2018, hearing of the House Subcommittee on Workforce Protections. Hill owns a homebuilding small business in Greensboro, North Carolina, and also chairs the Construction Safety and Health Committee of the National Association of Home Builders (NAHB). He noted that NAHB’s 140,000 members construct approximately 80 percent of all new housing in the United States each year. The industry also “overwhelmingly compromises small businesses” with more than 80 percent of NAHB’s builder member’s constructing fewer than 25 homes per year and more than half building fewer than 10 homes per year.
Few Workers, Many Hats
According to Hill, a typical NAHB builder member firm is truly a small business, employing fewer than 14 workers.
“The staff and owners of these small companies wear many hats,” testified Hill. “These can include: investor—responsible for funding construction projects; salesman—meeting with prospective home buyers; purchasing manager—in charge of ordering construction materials and supplies; marketing manager—promoting the company and its products; accountant—ensuring creditors and employees are paid; construction manager—ensuring that the home gets built on time and within budget; and construction worker—swinging the hammer to ensure a quality product.”
Regs Account for One-Quarter of Home Price
Hill implies that NAHB members are willing take on these roles as part of business, but when faced with OSHA’s regulations, they throw up their arms in frustration.
“Small home builders and specialty trade subcontractors are often puzzled by the complexity and range of OSHA requirements imposed upon them,” said Hill. “For example, more than 61,000 pages of regulations appeared in the Federal Register in 2017, with the annual cost of these regulations reaching trillions of dollars. Because of the lack of compliance assistance from OSHA, when multiple rules and regulations are imposed at the same time, smaller companies typically must rely on expensive outside professional consultants (e.g., lawyers and accountants) to help them demonstrate compliance with technical regulations and reporting requirements.”
Hill notes that NAHB’s research found that regulations imposed by government at all levels account for almost one-quarter of the final price of a new single-family home.
Innovative Partnerships Needed
While recognizing that OSHA has the statutory authority and obligation to issue standards and regulations that are reasonably necessary and appropriate to protect the safety and health of workers, Hill said OSHA can—and must—reestablish its focus and efforts on compliance assistance to employers to help them understand their duties under the numerous safety laws and regulations.
Hill included the following among the steps OSHA can take to shift the Agency more toward assistance.
- Renew efforts to form collaborative relationships with trade associations and their members to inform and educate employers of their regulatory responsibilities. Hill listed multiple past and successful collaborations between OSHA and the NAHB, including NAHB’s participation in OSHA’s Alliance Program; OSHA’s publication of a fact sheet on confined spaces in residential construction; and development of the NAHB/OSHA Jobsite Safety Handbook and the Selected Construction Regulations for the Home Building Industry.
- Develop new and innovative ways to partner with employers to achieve compliance. Many such programs were developed in the past, but Hill insists that in recent years, OSHA has been more in favor of traditional enforcement and levying significant monetary penalties.
- Reinvigorate the Focused Inspection Program. Started in 1994, this program contained a process for construction safety inspections that looked specifically at four types of hazards: falls, struck-by, caught in between, and electrical. Employers are eligible for focused inspections if they have complete safety and health programs that include employee training and participation.
- Ensure that state plans do not replicate OSHA programs. “State plans are laboratories for innovation and creative approaches to reducing work-related accidents,” said Hill. “Recently, OSHA conducted enhanced monitoring of state programs with an emphasis on greater alignment to federal OSHA. However, this approach directly conflicts with and defeats the intent of the OSH Act. OSHA must learn from and utilize the successes stemming from states’ alternative and innovative approaches.”
Other recommendations for OSHA include soliciting more input from OSHA’s Advisory Committee on Construction Safety and Health (ACCSH) and allowing warnings in lieu of citations for lesser violations such as paperwork or administrative tasks.
Hill’s testimony is here.