February 2, 2012

OSHA rules are killing businesses, builders say

Owners of small home-construction businesses say they’re watching their livelihoods collapse under safety regulations they feel are more about punishing them than protecting their workers.

Owners of small home-construction businesses say they’re watching their livelihoods collapse under safety regulations they feel are more about punishing them than protecting their workers.

“They have not been making a safer workplace, but they are killing businesses, and they’re financially killing families,” said Greg Herndon, who operates a local roofing company.

Last year, the Department of Labor decided to ramp up enforcement of regulations aimed at reducing serious accidents and deaths, mainly from workers falling. But those who work on residential construction sites say the new fines – 10 times higher in some cases – are tearing away at their profits, even in cases where there are no injuries.

It’s an issue that has reached across the country, said Wess Galyon, president of the Wichita Area Builders Association. Later this month, Galyon said, the National Association of Home Builders will consider a resolution to ask Congress to pass sweeping reforms of the Occupational Health and Safety Administration.

“We are going to begin a very intense initiative in every state to pressure OSHA to consult more and punish less,” Galyon said.

“Nobody is saying safety isn’t important. It’s damn important. But we think there’s a better way to go about it. We want OSHA to work more to help bring businesses into compliance.”

A Washington, D.C., spokeswoman for the Department of Labor said OSHA has done just that.

“OSHA has done more than 700 outreach sessions with home builders and roofers in the past six months,” Diana Petterson said. “And, free on-site consultation is also available to all home builders.”

Chuck Grier, owner of UCI Inc. in Wichita, said his business has received intensive training, earning multiple safety certifications from OSHA.

“We obviously have a different kind of relationship with OSHA,” said Grier, whose 60-year-old business specializes in commercial and heavy construction. “We have received a great deal of training with our folks, and we have learned a great deal from our association with OSHA.”

Stiff fines

Owners of smaller companies engaged primarily in home building have a different view of OSHA. They say they are drawing stiff fines for infractions that don’t result in injury, while other infractions are overlooked.

A fine for a violation that once cost between $750 and $1,200 now runs $7,000 or more per incident, Galyon said.

“The reality is a lot of these guys don’t work on a very big margin and a large fine can put them out of business,” he said.

Dan Phillips, 57, runs a roofing company employing six people. One of his workers recently unlatched his safety rope momentarily, he said, while an inspector was watching down the street.

“If you watch a construction site long enough, someone is going to do something stupid,” Phillips said.

The inspector counted three violations, resulting in $23,000 in fines. OSHA said it reduces fines for smaller companies, which it did for Phillips, who had to pay $4,600.

“That’s still the profits for five or six jobs,” Phillips said. “But the real problem I had is they said I willfully broke the rules. They acted like I was thumbing my nose at them, and I had just paid thousands of dollars in safety equipment to comply with those rules.”

The fines stay on Phillips’ record for four years, and he has to notify OSHA every Monday where his crews will be.

It’s not the rules Phillips objects to. It’s the way they’re being enforced.

“The roofers and framers are the ones most likely to get caught,” Phillips said. “The people working inside are protected because OSHA can’t come on the work site, and they can’t see through the buildings.

“The day I got caught there were three or four violations inside. That’s what I object to: They’re not being applied straight across the board.”

In three decades of roofing, Phillips said he’s had one injury requiring medical treatment – an employee accidentally cut off the tip of their finger.

Herndon, 47, the roofing company operator, said the last serious injury on his work site was a dislocated shoulder eight years ago. But Herndon said he lives in fear that any employee lapse will shut down his business.

“Whether they will say it or not, builders are terrified,” Herndon said.

Punishment … crime

In Kansas, there were 100 non-fatal injuries reported on residential construction sites in 2010, according to the most recent reports available from OSHA.

Nationwide, falls are the leading cause of injury and death on residential construction sites, OSHA’s Petterson said, and one injury can result in $85,000 in workers compensation claims.

“It is one of the single most expensive injuries – and one that should be prevented,” she said.

The Wichita Area Builders Association has six people trained in helping construction businesses come into compliance with the new enforcements. Still, Galyon said the tough enforcement doesn’t match the risk to workers.

Four people died from falls on Kansas construction jobs in 2010. There were 38 work-related transportation deaths that year across all industries.

“If I’m going 150 mph down the highway, and I get caught, I’m going to get a large ticket, but not a $7,000 ticket,” Galyon said. “And I’m putting more lives at risk. We want to be safe. But in this case the punishment does not fit the crime.”

Petterson said OSHA is simply enforcing rules passed in 1994 at the request of the National Association of Home Builders.

But until last year, builders could use approved alternative safety measures that were less costly and sometimes more effective, Galyon said.

“Now you do it their way, or no way,” Galyon said.

Galyon said the 1994 initiative, supported by large multistate building companies, didn’t anticipate the impact on small construction businesses, which represent 80 percent of the group’s membership.

“It was not a well-thought-out decision,” Galyon said. “And it’s had a big blowback.”

Grier’s UCI is one of the larger construction businesses. While he acknowledges smaller companies have different challenges, he said the regulations protect his employees.

“We believe our employees are tremendously valuable assets,” Grier said. “We feel like what we invest in safety, we get back in benefits from the work we get from our people, who don’t get injured.”

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