[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]


                 DEPARTMENTS OF LABOR, HEALTH AND HUMAN

               SERVICES, EDUCATION, AND RELATED AGENCIES

                        APPROPRIATIONS FOR 2001

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION
                                ________

  SUBCOMMITTEE ON THE DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, 
                    EDUCATION, AND RELATED AGENCIES

                 JOHN EDWARD PORTER, Illinois, Chairman
 C. W. BILL YOUNG, Florida          DAVID R. OBEY, Wisconsin
 HENRY BONILLA, Texas               STENY H. HOYER, Maryland
 ERNEST J. ISTOOK, Jr., Oklahoma    NANCY PELOSI, California
 DAN MILLER, Florida                NITA M. LOWEY, New York
 JAY DICKEY, Arkansas               ROSA L. DeLAURO, Connecticut
 ROGER F. WICKER, Mississippi       JESSE L. JACKSON, Jr., Illinois
 ANNE M. NORTHUP, Kentucky          
 RANDY ``DUKE'' CUNNINGHAM,         
California                          

 NOTE: Under Committee Rules, Mr. Young, as Chairman of the Full 
Committee, and Mr. Obey, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.

           S. Anthony McCann, Carol Murphy, Susan Ross Firth,
             and Francine Mack-Salvador, Subcommittee Staff

                                ________

                                 PART 1

                           DEPARTMENT OF LABOR
                                                                   Page
 Secretary of Labor...............................................    1
 Pension Agencies (PBGC and PWBA).................................  143
 Bureau of Labor Statistics.......................................  177
 Employment and Training Administration/Veterans Employment and 
Training Services.................................................  209
 Employment Standards Administration..............................  273
 Occupational Safety and Health Administration....................  315
 Mine Safety and Health Administration............................  375
                                ________

         Printed for the use of the Committee on Appropriations

                                ________

                     U.S. GOVERNMENT PRINTING OFFICE
 64-402                     WASHINGTON : 2000

                        COMMITTEE ON APPROPRIATIONS

                   C. W. BILL YOUNG, Florida, Chairman

 RALPH REGULA, Ohio                 DAVID R. OBEY, Wisconsin
 JERRY LEWIS, California            JOHN P. MURTHA, Pennsylvania
 JOHN EDWARD PORTER, Illinois       NORMAN D. DICKS, Washington
 HAROLD ROGERS, Kentucky            MARTIN OLAV SABO, Minnesota
 JOE SKEEN, New Mexico              JULIAN C. DIXON, California
 FRANK R. WOLF, Virginia            STENY H. HOYER, Maryland
 TOM DeLAY, Texas                   ALAN B. MOLLOHAN, West Virginia
 JIM KOLBE, Arizona                 MARCY KAPTUR, Ohio
 RON PACKARD, California            NANCY PELOSI, California
 SONNY CALLAHAN, Alabama            PETER J. VISCLOSKY, Indiana
 JAMES T. WALSH, New York           NITA M. LOWEY, New York
 CHARLES H. TAYLOR, North Carolina  JOSE E. SERRANO, New York
 DAVID L. HOBSON, Ohio              ROSA L. DeLAURO, Connecticut
 ERNEST J. ISTOOK, Jr., Oklahoma    JAMES P. MORAN, Virginia
 HENRY BONILLA, Texas               JOHN W. OLVER, Massachusetts
 JOE KNOLLENBERG, Michigan          ED PASTOR, Arizona
 DAN MILLER, Florida                CARRIE P. MEEK, Florida
 JAY DICKEY, Arkansas               DAVID E. PRICE, North Carolina
 JACK KINGSTON, Georgia             MICHAEL P. FORBES, New York
 RODNEY P. FRELINGHUYSEN, New Jersey CHET EDWARDS, Texas
 ROGER F. WICKER, Mississippi       ROBERT E. ``BUD'' CRAMER, Jr., 
 GEORGE R. NETHERCUTT, Jr.,         Alabama
Washington                          MAURICE D. HINCHEY, New York
 RANDY ``DUKE'' CUNNINGHAM,         LUCILLE ROYBAL-ALLARD, California
California                          SAM FARR, California
 TODD TIAHRT, Kansas                JESSE L. JACKSON, Jr., Illinois
 ZACH WAMP, Tennessee               CAROLYN C. KILPATRICK, Michigan
 TOM LATHAM, Iowa                   ALLEN BOYD, Florida
 ANNE M. NORTHUP, Kentucky          
 ROBERT B. ADERHOLT, Alabama        
 JO ANN EMERSON, Missouri           
 JOHN E. SUNUNU, New Hampshire      
 KAY GRANGER, Texas                 
 JOHN E. PETERSON, Pennsylvania     
 VIRGIL H. GOODE, Jr., Virginia     

                 James W. Dyer, Clerk and Staff Director

                                  (ii)

 
DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, EDUCATION, AND RELATED 
                    AGENCIES APPROPRIATIONS FOR 2001

                                         Wednesday, March 22, 2000.

                        U.S. DEPARTMENT OF LABOR

                                WITNESS

HON. ALEXIS M. HERMAN, SECRETARY OF LABOR

                        Introduction of Witness

    Mr. Porter. The subcommittee will come to order. We 
continue our hearings on the budget for the Department of Labor 
and are most pleased to welcome Secretary Alexis Herman. And 
Madam Secretary, this will be my last appearance before you 
since I am retiring from Congress and I just got back from 
Chicago where I had been all weekend, came back for hearings 
yesterday here and heard 40 public witnesses, and then went 
back last night for the primary election to nominate the two 
candidates who will run for my seat in the fall, and I am 
exhausted very frankly. I thought when I retired I wouldn't be 
campaigning any more, and I am campaigning for other people 
more than I ever did for myself.
    So we very much appreciate your accommodating our need to 
move you to this afternoon, and I think this is the first 
hearing since you were married. We would like to congratulate 
you and wish you every happiness.
    And since this is my last hearing where I will get a chance 
to hear you, I just want you to know what a real pleasure it 
has been to work with you and to try to address our country's 
problems as best we can on a cooperative basis, and thank you 
for your service as Secretary of Labor. I also want to say that 
Darla Letourneau has done a wonderful job. We all appreciate 
her work, and we value that relationship as well.
    So, Madam Secretary, with that, please proceed with 
whatever you would like to say.
    Secretary Herman. Well, thank you very much.
    Mr. Porter. I am sorry, Mr. Obey, would you like to--all 
right. Please proceed.
    Mr. Obey. Just happy to have you here.

                           Opening Statement

    Secretary Herman. Well, thank you very much, Mr. Chairman 
and Congressman Obey, for your opening comments and my 
appreciation for your best wishes for myself and my new 
husband. I am telling everyone that I am trying my hand now at 
balancing work and family, but I am certainly delighted, Mr. 
Chairman, to appear before you and the distinguished members of 
this subcommittee and to thank you for the opportunity to 
present the Department of Labor's budget for Fiscal Year 2001.
    Mr. Chairman, even though you say you are exhausted from 
your travels from Chicago, and no doubt that is understandable, 
allow me at this time to pay tribute to you for your leadership 
in what has certainly been an exhaustive record in standing up 
on behalf of working Americans throughout our Nation, and while 
I know that you are especially known for your contributions to 
the biomedical research field, I think the work that you have 
done as Chairman of this Committee and throughout your career 
to advance the cause of working Americans, I certainly applaud 
and thank you as Secretary of Labor. I want to pay particular 
tribute not only for the outstanding leadership that you have 
given on the pension front and all of the guidance to our own 
PWBA team at the Department of Labor, but clearly it was much 
of your guidance and much of the original thinking that went 
into a lot of the reinvention efforts that we are presently 
engaged in as part of our ongoing work to improve the 
efficiency of OSHA.
    And I especially want to thank you for being the champion 
that you have been to advance the issue of child labor, of the 
support that this committee has given to our increased efforts 
on the international front and for the strong voice that you 
have been for human rights around the world, and so for all of 
these issues and more, we thank you for your leadership today.
    I think that we are all aware of the strength of the 
American economy today and yet despite widespread prosperity, 
including more than 20 million new jobs that have been created 
in the past seven years, we still face two major workforce 
challenges. Business leaders tell me that they simply cannot 
find the skilled workers that they need and at the same time, 
millions of Americans remain outside of the mainstream of our 
prosperity for lack of job skills. Yet, if we address these two 
problems together, I believe they present an historic 
opportunity: To provide the business community with the skilled 
workers it urgently needs to keep our economy growing, while at 
the same time bringing skills, jobs and hope to individuals and 
communities that have for too long been left behind.
    To address these and other goals, the President's budget 
for fiscal 2001 requests $39.8 billion for the Department of 
Labor. This includes $12.4 billion in discretionary funds, an 
increase of $1.2 billion over last year.
    This budget reflects the three strategic goals that I have 
outlined for our Department from the beginning: A prepared 
workforce that ensures that all Americans have the opportunity 
to find and hold jobs and to improve their skills over a 
lifetime; a secure workforce that reflects such basic values as 
dignity, family and community; and quality workplaces that 
offer safe and healthful conditions that are free of 
discrimination.
    The majority of the increase in our budget is for targeted 
initiatives that address our first strategic goal, that of 
providing workers with the skills they will need to succeed in 
today's economy.


                       YOUTH OPPORTUNITY MOVEMENT


    We have put special emphasis on helping young Americans, 
particularly with the Department's new Youth Opportunity 
Movement.
    I recently announced the first round of youth opportunity 
grants to address skills training and job placement by building 
new partnerships in 36 of the poorest urban and rural areas and 
Indian reservations in America. Our new budget includes $375 
million for this initiative, an increase of $125 million over 
the current year. We believe this program will make a 
difference in many thousands of young lives.

                     SAFE SCHOOLS/HEALTHY STUDENTS

    We are also concerned about violence and drug abuse among 
young people and about the future of those who get in trouble 
with the law.
    Last year the Department of Justice, Education and Health 
and Human Services began the Safe Schools, Healthy Students 
initiative. Our new budget includes $40 million to enable the 
Department of Labor to join this partnership and support 
community-wide programs to prevent youth violence and drug 
abuse.
    Young people who have broken the law need to provide and we 
need to give them positive alternatives and second chances. 
That is why our budget includes $75 million to bring young 
offenders into the workplace through job training and placement 
and by creating new local partnerships with the criminal 
justice system and the workforce development systems.

                       FATHERS WORK/FAMILIES WIN

    For all of our focus on young people this certainly cannot 
be our only concern. We have to reach out to the other untapped 
pools of workers. Our budget therefore includes $225 million 
for Fathers Work, Families Win, a new two-part initiative that 
grows out of our Welfare to Work program. Fathers Work will 
provide jobs for noncustodial parents, mostly fathers, who owe 
child support, and Families Win will help low income parents by 
providing better access to community services and upgrading job 
skills.

                       PERSONS WITH DISABILITIES

    We are also reaching out to persons with disabilities. Our 
Nation took an important step last December when President 
Clinton signed the bipartisan Work Incentives Improvement Act, 
which makes it possible for millions of people with 
disabilities to take jobs without losing their health 
insurance. We now propose to establish an Office of Disability 
Policy, Evaluation, and Technical Assistance, headed by an 
Assistant Secretary, which will provide leadership in bringing 
disabled Americans into the workforce.

                           HOMELESS VETERANS

    We are also reaching out to homeless veterans. Our budget 
includes funds to provide training and other services to 15 
thousand of these veterans and we hope that this will result in 
them being placed in jobs.

                         UNIVERSAL REEMPLOYMENT

    We are also working to meet the President's goal of 
providing assistance to all dislocated workers. To achieve the 
goal of universal reemployment our budget includes an increase 
of $275 million for information, training, and for One-Stop 
Career Centers.

                         NATIONAL SKILLS SUMMIT

    Mr. Chairman, with regard to our urgent need for skills 
training, let me mention that on April 11 we will host a 
national skills summit at Howard University. This summit will 
bring together leaders of business, labor, government and 
community based organizations, as well as workers themselves, 
to exchange ideas and best practices and to develop realistic 
programs for meeting employers' immediate needs for skilled 
workers.

                            SECURE WORKFORCE

    My second goal, that of a secure workforce, is one where I 
am hoping that we will continue your efforts to expand economic 
security for working families and thus for entire communities. 
People who work hard and play by the rules should not have to 
live in poverty, nor should their families. That is why our 
budget request for the Pension and Welfare Benefit 
Administration includes additional resources to expand our 
protection of the health care benefits and pensions of more 
than 150 million American workers and their families.

                          EQUAL PAY INITIATIVE

    I strongly believe also that a secure workplace must 
provide equal pay for equal work. That is why the President's 
equal pay initiative proposes $17 million for the Department to 
expand opportunities for women and to narrow this wage gap. 
These programs would include training and apprenticeship 
opportunities for women in nontraditional occupations such as 
high-tech industries.

                           QUALITY WORKPLACES

    Our third goal, that for quality workplaces, that 
guarantees that every American is employed today in workplaces 
that are safe, that are healthy, and discrimination free, 
requests an additional $668 million to promote health and 
safety for more than 100 million workers through the programs 
of the Occupational Safety and Health Administration and the 
Mine Safety and Health Administration. And although tough 
enforcement is necessary when employer practices threaten 
worker safety or health and jeopardize pensions or endanger 
children, the fact of the matter is that we need to not only 
focus on a stricter and targeted enforcement effort but we need 
to combine these efforts as well with educational assistance, 
and that is why we are putting greater emphasis in this budget 
on compliance assistance.

                          DOMESTIC CHILD LABOR

    To continue our commitment to reducing more than 200 
thousand workplace injuries that occur among young people in 
America each year, we are requesting $13 million for the 
Department's domestic child labor activities.

                          ERGONOMIC RULEMAKING

    OSHA's responsibilities include ergonomics rulemaking. 
Repetitive motion, as you know, is the biggest cause of injury 
in the workplace today, and a total of more than 600 thousand 
injuries each year. OSHA's proposed standard, we believe, can 
protect 27 million workers from the risk of crippling 
disability, and we need to complete that work this year.

                       INTERNATIONAL CHILD LABOR

    Finally, in this age of globalization our concern for 
quality workplaces must extend worldwide. Our Department is 
working in many ways to meet the President's challenge to put a 
human face on the global economy. We recognize that today what 
happens around the globe indeed impacts workers around the 
corner and as you know we oppose, here in this country and 
wherever it exists, child labor. We are focused, especially 
today, on the eradication of the most abusive child labor as it 
occurs anywhere in the world and we are proposing $100 million 
to support international efforts to end the worst forms of 
child labor.

                     HIV/AIDS WORKPLACE INITIATIVE

    I would like to highlight our focus this year on an AIDS 
initiative, tying this issue to what is taking place on the 
continent of Africa, and believing that we have an opportunity 
through new workplace based initiatives to make a real 
difference in combatting the terrible devastation that AIDS is 
causing around the globe today. Seeing it increasingly as not 
just a disaster in terms of human lives but also in terms of 
real economic issues today. We believe that we have a role to 
play in fostering this effort as well.
    As I conclude, Mr. Chairman, let me say that we are working 
to bring better lives to the workers of America and also around 
the globe and I believe, as the President does, that there has 
never been a better time than today to put America to work, to 
impart skills, to bring security to the workforce and to ensure 
that our workplaces reflect such basic American values as 
health, safety and fairness. We at the Department of Labor will 
work with you in every way we that we can to meet these goals.
    I will be happy now to take any questions that you may 
have.
    [The information follows:]



    office of disability policy evaluation, and technical assistance

    Mr. Porter. Madam Secretary, we are sorry that this is two 
15-minute votes, which means that we will have to recess 
briefly, and perhaps this is the--let me ask a couple of 
questions that just occurred to me as you were making your 
statement. Would the Office of Disability Policy Evaluation and 
Technical Assistance, would that require authorizing 
legislation to fund?
    Secretary Herman. No, it would not.
    Mr. Porter. You have the authority to reorganize it?
    Secretary Herman. Yes.

                              TRADE POLICY

    Mr. Porter. I would assume that, but the question came to 
me I want to ask about. The administration's policy is 
basically a free trade policy and is encouraging China to join 
the World Trade Organization and to open up markets across the 
world for American products even as we have opened ours to 
them. You kind of stand in the middle of it because American 
labor, much of it, is opposed to this policy at least in some 
aspect. I wonder if you can paint a picture for us as to how 
you reconcile these two positions. I can see that it is very 
easy and what you see as the principal thrust of your input to 
make this, to make common ground available on this issue.
    Secretary Herman. I could literally take up the balance of 
the time of this hearing, Mr. Chairman, responding to that 
question but let me put my thoughts in perspective as we look 
at these two issues. Certainly the administration is an 
administration that supports free trade and open markets, and 
it has been a significant contributor to the more than 20 
million jobs that this administration has created. We believe 
that a strong exporting economy does in fact lead to the 
creation of jobs here at home and it does serve to better the 
conditions of working Americans.
    I also believe that we need a new paradigm on this issue. 
The promotion of trade and open markets and the promotion of 
the rights of workers, core labor standards, if you will, 
should not be seen as opposing goals or opposing objectives, 
rather they should be viewed as mutually reinforcing. The goal 
of trade is not trade in and of itself, but is and ought to be 
the lifting up of the human condition around the world.
     And so I don't talk about the issue of China, or what we 
are doing to further open our markets as two separate issues 
but in the context of how we begin to talk about the realistic 
actions of pursuing open markets while at the same time 
beginning to talk about the advancement of core labor standards 
and how we make this a race to the top and not a race to the 
bottom. I think for far too long we have had rhetorical 
engagement on this issue and not enough practical actions and 
examples of how we can reconcile these views. I believe very 
strongly, for instance, that the goal of the child labor 
initiative and the emphasis that we have put there is not just 
because it is the correct, right and moral thing to do for the 
children around the globe but if we can begin to come together 
on this basic core labor standard as we are doing globally, the 
eradication of the most abusive forms of child labor, I think 
it begins to point the way for us to begin to take into account 
other core labor issues as we are presently doing and I think--
--
    Mr. Porter. I am sorry to interrupt, Madam Secretary. I 
want to come back to this when we come back but I see labor 
rights as basic human rights, the right to organize and to 
collectively bargain and to strike and the like and we deal 
with this same issue obviously, the human rights issue in the 
context of China and try to find a way to preserve the open 
trade and to extend it but at the same time make progress on 
the other side of it, and how do you do that?
    I am very interested. Let us revisit it when I come back. 
The subcommittee will stand in recess for these votes.
    [Recess.]
    Mr. Porter. The subcommittee will come to order. Madam 
Secretary, Mr. Cunningham has a meeting and has to leave and 
wants to ask a question, and I am going to yield to him my 
remaining time at this point.

                           STOCK OPTION PLANS

    Mr. Cunningham. Thank you, Mr. Chairman. Madam Secretary, 
as you know, the Department recently ruled that the Fair Labor 
Standards Act required employers to count stock option profits 
when computing employees' overtime pay. It affects more than 
just the stock options. It impacts all kinds of incentive 
programs for this economy, this new economy that we are in. 
Employers, workers industries and unions, it affects 
negatively. Republicans and Democrats in a coalition both in 
the House and Senate are supporting a change in this law, as I 
believe that you are. We are leading the House and the Senate 
to have this new law updated and I would ask that, or just ask 
for your commitment that you will continue to press that we 
resolve this thing in a most efficient way.
    Secretary Herman. Well, you certainly have my commitment in 
that regard, Congressman Cunningham. The Department does 
support the use of stock option plans and we look forward to 
continuing our work with you together to resolve this issue in 
a way that I think will be advantageous for American workers 
and I want to thank you for your leadership in this regard.
    Mr. Cunningham. Thank you. We have Members on this 
committee, both sides of the aisle, in the Senate the same way, 
that--I thank you in support of that. That is all I have, Mr. 
Chairman. Thank you.
    Mr. Porter. Thank you, Mr. Cunningham.
    Mr. Obey.

                          DELAYS IN RULEMAKING

    Mr. Obey. Madam Secretary, two or three questions if I have 
the time, first of all with respect to your ergonomic standard. 
I think it is important that Congress distinguish between two 
things. I do not think that it is legitimate for Congress to 
try to delay that new standard. We have been fiddling around 
with it for years and I think it is about time that we make 
some decisions that will start protecting workers.
    I think that the proper role for Congress, rather than 
trying to once again delay the imposition of that standard is 
for Congress to raise any legitimate questions they have about 
standards that have been published, and in that spirit I simply 
would like to say that I believe the final decision has to be 
left in the agency's hands because they are the professionals 
who do not have any economic bias one way or another. But I do 
hope that as your agency reviews the standard that, while I 
certainly support OSHA's need to provide strong incentives for 
workers to come forward and report hazardous situations without 
the threat of being fired, I also hope that in finalizing the 
rule the agency will be able to work its way through to a 
position which recognizes that while there may be problems in 
some States with respect to lousy protection for workers under 
Workmen's Compensation programs, that there are some States, 
such as my own, where we have achieved a good equilibrium, and 
both labor and management are pretty content with the way 
Workmen's Comp programs work, and I hope that the arrangement 
will be refined in such a way that that can happen.
    Having said that, I just want to make note on something 
else. For a number of years Congress was lectured by W. R. 
Grace and Company. We had the famous Grace Commission, and they 
inundated us with their recommendations on how we could save 
taxpayers money. Many of their recommendations boiled down to 
simply doing less regulating. I think we now have one example 
of why they wanted to do less regulating.
    On February 12, 2000, in the Seattle Post Intelligence 
newspaper they reported that there was a case where thousands 
of workers were exposed to lethal doses of asbestos over 20 
years in a Montana mine owned by W. R. Grace. According to that 
article, more than 200 deaths were caused by asbestos exposure. 
That gets my attention because I used to work with asbestos 
products. And 400 people who are still living have been 
diagnosed with fatal asbestos-related disease from the ore. The 
government has been trying to regulate lower exposure levels, 
but as you know, the industry questioned the cost of 
regulation. They questioned the science. They used every 
procedural trick to delay the regulations. It took some 19 
years from the time this was first flagged until the standard 
went into effect.
    The article quotes someone involved in the case as sayingas 
follows, the industry tactic was first to deny the problem exists; 
second, once the problem was exposed to downplay the danger; and 
thirdly, to use delay tactics. Someone else in the article is quoted as 
saying you can buy a lot of lawyers, a lot of engineers and a lot of 
expert witnesses. Delay is relatively cheap. And then the article asked 
why has the industry fought so hard against regulation. In a word, 
money. Delay tactics preserve profits by deferring the cost of safety 
improvements to the workplace.
    In my view, these tactics have become all too familiar, and 
deaths and illnesses of these miners ought to remind us that we 
have a moral obligation to put workers first in dealing with 
issues like this, and I must say the technique of doubting and 
delaying reminds me of activities that have occurred on other 
occasions when OSHA has been trying to establish standards to 
protect workers, not the least of which is the long fight we 
have gone through to get an ergonomics regulation on the books.
    I would simply ask you, Madam Secretary, what lessons do 
you think we have learned from the development of the asbestos 
standards which took nearly 20 years and how can we apply them 
to current departmental rulemaking to make certain that delay 
doesn't become an excuse for not meeting responsibilities?
    Secretary Herman. Well, it is interesting, Congressman 
Obey, that you raised the asbestos standard issue in context 
with the ergonomic standard issue and what we are involved in 
presently. When I first came to the Department 20 years ago it 
was the asbestos issue that I was first involved in as Director 
of the Women's Bureau, looking at that time at what was taking 
place with women in particular, and it is a tragedy when we 
look 20 years later at what has happened and the fact that it 
actually took us until 1986 before we got a final standard in 
that regard. And I think that the lesson here really is, as we 
look towards future workplace action, protection that is 
delayed is really the result of protection that was denied in 
the beginning, and I think to the extent that we can put the 
focus on not denying workers the protections that they so 
rightfully deserve, that hopefully we won't see the kind of 
repeated incidents that we did see in the asbestos case.
    I hope that by going forward we can adopt a principle of 
recognizing that protection that is delayed, that is denied 
does result in the harmful tragedies that we see have occurred 
as a result of the W. R. Grace tactics in particular that you 
cited and those workers who literally lost their lives because 
of asbestos.
    I think it also tells us something else though. It is not 
just that protection that is delayed really impacts workers, 
but it also tells us that oftentimes the self-interest of 
business and the self-interest of workers are not necessarily 
compatible. They may not be the same goals and while the 
struggle, the tension is always to find some balance there, we 
can never lose sight of what our ultimate goal and objective 
should be, and that is the protection of the safety of the 
American worker first.
    Mr. Obey. Thank you.
    Mr. Porter. Thank you, Mr. Obey. Mr. Bonilla.

                     LOCATION OF ERGONOMIC HEARINGS

    Mr. Bonilla. Thank you, Mr. Chairman. Madam Secretary, once 
again welcome. I would like to start out with questions about 
ergonomics. I am sure Mr. Obey, and I understood over the years 
this is one area we do not have agreement on, and the dispute 
that I have had and many other Members as well is about the 
sound science and medical research that is necessary before 
moving forward on a regulation that certainly merits 
consideration. However, there are many of us who feel that 
there are perhaps other motivations behind pushing a rule under 
such a timetable that are not based on sound science and 
medicine.
    One thing that is especially troubling is the Department's 
disregard for public input in my view into the rulemaking 
process. OSHA only gave the public three months to wait for the 
regulation and the supporting documents. I know though the 
regulation itself is only 10 pages but there are thousands of 
pages of supporting documents. The public deserves a chance to 
really understand and comment on a regulation of this breadth 
and one that has generated significant controversy.
    Leaving the comment period aside, I am also disturbed by 
the fact that there is not one single public hearing on the 
ergonomic standard south of Washington, D.C. On February 29th, 
I along with eight of my colleagues wrote to Mr. Jeffress on 
this issue and we have not received a response so I will pose 
the question to you. Can you explain why the Department has 
chosen to ignore such a large part of the country in the 
rulemaking process?
    Secretary Herman. Well I can't make a commitment here at 
this time, Congressman Bonilla, but I will tell you that I have 
personally taken a look at the geographic distribution of the 
public hearings that are taking place, and I am hopeful that we 
will be able to strike more balance.
    Mr. Bonilla. Would you be able to add a hearing somewhere 
in the South?
    Secretary Herman. I am presently asking the staff to come 
back to me on some recommendations on what we can do to achieve 
greater balance, geographically on the hearings.
    Mr. Bonilla. So you would acknowledge then that there is a 
void and discrepancy in looking at geographic distribution?
    Secretary Herman. What I want to acknowledge is that I 
think you have raised a legitimate issue and that I am 
committed to reviewing again our geographic decisions on where 
we are holding those hearings, and I would like to be able to 
get back to you. That is why you haven't heard back.
    Mr. Bonilla. I appreciate that, and I also would say that I 
am sure if the hearings were all held in the South some folks 
from other northern areas, the cultures are all different, the 
work environments are different, and certainly to emphasize 
every American deserves a chance to be heard.
    Secretary Herman. I can only say as a daughter of the South 
I would concur with that, and that is one of the reasons I too 
am particularly interested in the geographic distribution of 
those hearings.

                        LENGTH OF COMMENT PERIOD

    Mr. Bonilla. I appreciate that. I understand the 
Department's goal is to issue an ergonomic standard by the end 
of year and that would require the Department to review all of 
the comments it received by summer. Is that correct?
    Secretary Herman. It would require us not necessarily to 
review all of the comments by this summer. What we are 
attempting to do, given that we want to have input from as 
diverse a group as possible and we do want to take into account 
the hearings that are taking place around the country, we may 
need additional time to do that. But having said that, the 
burden is really going to be on the OSHA staff to make sure 
that we can accommodate both the need for diversity of input 
but at the same time sticking to a schedule to be responsive.
    Mr. Bonilla. How many comments on the ergonomic standard 
did OSHA receive?
    Secretary Herman. We are still in the process now of 
tabulating all of those comments, but it was in the thousands 
in terms of what we received thus far.
    Mr. Bonilla. When you get that all tabulated would you 
please send me a summary of the total number of comments?
    Secretary Herman. Yes.
    [The information follows:]

           Number of Comments on Proposed Ergonomics Standard

    As of April 12, 2000, OSHA has received 7,319 comments on 
the proposed ergonomics standard.

    Mr. Bonilla. Understanding the size of the comments that 
probably vary from the size of a postcard to hundreds of pages, 
I am sure there is quite a wide spectrum of the way you 
received them, how could OSHA possibly thoroughly review each 
of these in just a few months? I know you said it would be up 
to the staff but don't the people who took time to express 
their comments deserve to have them actually read and 
considered?
    Secretary Herman. I am not saying that we will not 
carefully review and take into consideration those comments. We 
certainly will, and that was very much a part of the schedule 
that we have laid out. And as you well know, Congressman 
Bonilla, this is something that we will have been going at for 
well over 2 years. So it has been an ongoing, tedious process 
from the very beginning, and I don't expect that to change.

                         reactions of employers

    Mr. Bonilla. You are aware, I know, we have discussed it 
before, a lot of responsible, and I believe honestly that the 
majority, certainly there is some bad apples in the private 
sector, employers who are not concerned about worker safety, 
and we ought to lower the boom on those employers, but for the 
most part there is a lot of them out there that have dealt with 
the ergonomic issue very effectively because in spite of what 
some feel they are interested in keeping the workers safe and 
productive on the job. It is in everyone's benefit.
    So I just think that I must say, as I have before, that 
there is a real reason out there, Secretary, why almost every 
private employer that you can think of, whether they are with 
electronics manufacturers, computer software manufacturers, 
fast food chains, pharmacists, farmers, ranchers, dance 
studios, you name it, bakers, all of these people out there 
that drive the engine of our private sector have the same 
concerns that I am raising here today. Doesn't that somehow 
resonate within the Department of Labor?
    I know I am out of time and I just want to ask that final 
question.
    Secretary Herman. It does resonate within the Department, 
and I can assure you not only have I been personally involved 
in many of these conversations, I also speak as someone who 
operated and ran her own business for more than 10 years. The 
fact of the matter is there are solutions there, and to the 
extent that we still have over 600,000 lost workday injuries in 
the workplace each year that are the result of MSDs, I think 
that we can provide----
    Mr. Bonilla. I don't think that can be said conclusively, 
Secretary, with all due respect. I know sometimes that all 
these statistics are used, but again, with the way the rules 
are written there is not going to be any way to determine 
whether an injury was received on a work site or on a softball 
game on Friday night, and so I just must state my concern about 
using such a statistic. I don't mean to belabor, Mr. Chairman.
    Secretary Herman. I know you have always had a concern 
about the statistical numbers, and I don't want to debate that 
with you here today either, but I would just make a couple of 
points. First, in the same way that employees are expressing 
concern, we do have a lot of employers who are finding ergo 
solutions in their workplaces, and they can tell us about 
increased instances of productivity, they can tell us about new 
activities in terms of their own practices. This standard is 
not something that is going to mandate or legislate a one size 
fits all approach. It is deliberately a very flexible standard 
that is encouraging employers today to adopt some of these 
practices and begin to put some of these solutions in place.
    The other thing that I think is important and I hear a lot 
of as I am traveling around the country today is what you just 
said in terms of how do we know it didn't happen on a baseball 
field. But you know, employers have to make those kind of 
considerations even today for workers' comp injuries, and this 
standard is not going to take away any of that interface. Those 
decisions will still rest with an employer and so we are not 
talking about interfering with that aspect of decision making 
when it comes to this standard.
    Mr. Bonilla. I know my time is up. I don't want to get----
    Secretary Herman. We will talk more.
    Mr. Bonilla. This is not what the rule as we read it says, 
but again respecting the committee's time, I yield back.
    Mr. Porter. Thank you, Mr. Bonilla. Ms. Northup.

                       IMPACT OF ERGONOMICS RULE

    Mrs. Northup. Thank you. Madam Secretary, I would like to 
pursue the same line of questioning. I am concerned about what 
this means to older workers. I myself have whatever, the carpal 
tunnel syndrome, the injury is here in my hand. It did not 
occur from sitting at a computer, although it acts up some days 
when I am working at my computer. The truth is it hurts every 
time in the kitchen chopping vegetables and so forth. Having 
six kids and fixing dinner for them I am convinced is what 
caused the injury. The point is, people have injuries from 
their early years from sports they played, from competition 
they have had. Almost everybody I know over the age of 50 years 
old is having a reoccurring injury, a stress injury if you 
will, and the fact is they carry those into the workplaces and 
you are the one that points out how much businesses have done 
to try to accommodate those, offset them, buy equipment that 
offsets them and so forth, but the fact is that nothing can 
stop me from going back home as I do every weekend and fixing 
dinner some more and coming back on Monday with my right hand 
hurting again.
    I feel like it doesn't take me one second to figure out 
that if I am worried about a repetitive injury problem that if 
I hire a 24-year-old I am going to be less likely to have 
anybody having that problem than if I hire a 52-year-old that 
probably does have a reoccurring injury.
    Has anybody evaluated what this will mean to our older 
workforce?
    Secretary Herman. We have looked at its impact on all 
workers, first of all, Congresswoman Northup, and I think it is 
important to put the standard also in perspective in terms of 
the industries that it will automatically affect, and that is 
the manual handling and the manufacturing sector that comprises 
about 28 percent of the workforce today.
    Mrs. Northup. What are the groups that are not covered, 
construction?
    Secretary Herman. When we look at construction, the cost 
data is not in there. Basically most of the workplaces do 
nothing under this standard. We attempted to go where we view 
most of the injuries occurring.
    Mrs. Northup. Are Federal and State employees and local 
employees covered?
    Secretary Herman. In terms of the initial standard, no, it 
is manual handling and the manufacturing sectors.
    Mrs. Northup. So you are going to regulate the private 
sector but you are not going to impose the same standards for 
the Federal sector?
    Secretary Herman. OSHA doesn't have the ability to fine the 
Federal sector. What I am saying in regard to where the 
incidences occur, we are talking about 60 percent of our MSDs 
occurring in those two sectors primarily, and that is where we 
expect the biggest results to occur regarding the impact of the 
standard. That is not to say that other employers won't have to 
have a plan if MSDs are reported. We are asking employers to 
take leadership in this regard.
    Mrs. Northup. Well, let me ask you----
    Secretary Herman. But the initial coverage is in those two 
areas.
    Mrs. Northup. And it requires the employer to take whatever 
reasonable action they can take and I guess if you look at any 
office supply manual, anything like that, you see today the 
ergonomics chairs, ergonomics, many of these of course are 
unscientific and so forth, but I guess an employer, the only 
way to protect himself from being liable is he is going to have 
to buy whatever is on the market.
    That is a huge stimulation to the market of the purchase of 
certain equipment, and I have to think that it won't be 2 years 
before the market will come out with a whole new generation of 
these goods because there is nothing like having a forced 
purchase policy that would engender the market to find a new 
set of products, and I just think that employers are going to 
find themselves buying every single new trick on the market 
that can claim to alleviate this type of injury so that they 
will somehow try to mitigate their responsibility when I am 
still going to go home and cook dinner every weekend and 
continue to aggravate the injury that I have.
    Secretary Herman. Well, as I was saying earlier to--I can't 
remember who was asking the question now--the fact of the 
matter is, this is not going to interfere with an employer's 
decision to determine work-related injuries, and we are not 
talking about someone who works at home.
    Mrs. Northup. Madam Secretary, I read the material and I 
thought that there is a presumption if there is any aggravation 
of the injury on the job it is presumed to be a work related 
injury. Isn't that what the rule says?
    Secretary Herman. No. What we are saying is we are 
encouraging employers when they have evidence of a job activity 
that contributes to MSD on the job to take the necessary 
preventive actions, to put a plan in place, but the decision as 
to whether or not the disorder is in fact an MSD is no 
different from the decisions employers have to make presently 
for Worker's Comp. That is the same issue, if you have an 
injury that has been aggravated or for other reasons could be 
taken into account under workers compensation. So that doesn't 
change.
    Mrs. Northup. Madam Secretary, there are two different 
things here. It is cause and benefit. You have to take any 
action, purchase whatever equipment would help offset it in 
terms of an employee that has a problem that is impacted by the 
job. It doesn't have to be caused by the job. It doesn't have 
to have first been originated with the job, if it is impacted 
by the job. Now, it may be that to claim Worker's Comp and to 
be off has to require you to distinguish between it, but in 
terms of taking mitigating actions and the cost responsibility 
to the employer, I think it only has to be a contributing 
factor. The job only has to be a contributing, not a primary 
factor; is that not true?
    Secretary Herman. That is not our interpretation of the 
standard as we are presently evaluating it, Congresswoman 
Northup, but as we go through our own public comment period 
now, that is obviously an area that I think we can clarify.
    Mrs. Northup. Well, could you please get me the language as 
it is currently written that would cause you to conclude that 
it only has to be an aggravating factor to force the employer 
to help alleviate?
    Secretary Herman. I will be happy to do that.
    [The information follows:]

                 Requirements Under Ergonomics Standard

    Employers with manufacturing or manual handling jobs are 
required to implement a basic program that includes the 
following elements: assign responsibility for ergonomics to 
someone in their organization, provide employees with basic 
information on musculoskeletal disorders and their signs and 
symptoms, and set up ways for employees to report that they are 
experiencing those signs and symptoms. Unless an employee 
actually experiences a work-related musculoskeletal disorder, 
employers are not required to do anything else. If an employee 
experiences an MSD, and that MSD satisfies the OSHA criteria 
for recordability under the recordkeeping rule, the employer 
must then determine whether the MSD is a ``covered MSD'' under 
the standard. A ``recordable MSD'' is not necessarily a 
``covered MSD.'' Specifically, a ``covered MSD'' is one in 
which the affected employee is regularly or routinely exposed 
to physical work activities that are sufficient in magnitude 
and duration to have likely caused or contributed to the MSD. 
Thus, an employee report of MSD symptoms will not trigger 
requirements under the standard if the employer determines that 
the employee has not been exposed to physical risk factors on 
the job, regardless of whether the employer must record the 
injury on the OSHA log. For example, if an employee reports 
that they aggravated a back injury from lifting a box of paper, 
and that employee does not usually or regularly lift heavy 
objects as part of their normal job duties, the injury would 
not be regarded as being a ``covered MSD,'' even if the back 
injury is recordable on the log. If the employer does determine 
that the MSD passes the screening test of a ``covered MSD'', 
the employer is expected to ensure that the worker receives 
medical evaluation if necessary; analyze that worker's job; and 
install engineering, work practice, or administrative controls 
to reduce employee exposures to physical risk factors. If a 
health care professional determines that a worker must be away 
from work or placed on restricted duty, employers must provide 
90 percent of the employer's after tax pay (minus any workers' 
compensation or other benefits received by the worker as a 
result of the injury) until the worker recovers or six months 
have passed, whichever occurs first.

    Mr. Porter. Thank you, Ms. Northup. The Chair would advise 
members we are proceeding under the 5-minute rule. I am advised 
that we will not have any further votes before 4:00 o'clock and 
that we should have time for a short second round.
    Ms. DeLauro.

                          EQUAL PAY INITIATIVE

    Ms. DeLauro. Thank you very much, Mr. Chairman, and let me 
say thank you to you, Madam Secretary, for diligently and 
scrupulously trying to meet the needs of American business and 
American workers. We are very grateful for your tenure. Let me 
ask a question about fair pay.
    I am pleased, really delighted that the administration is 
addressing the problem of what is unequal pay for women today. 
As I have talked about this issue across the country, this is 
not a women's issue, but it is a family issue because there are 
so many women who are the primary bread winners of their family 
and families are in the whole shortchanged by bringing home a 
smaller paycheck. It also means less in terms of retirement 
savings and reduced social security benefits.
    If you could just describe the President's equal pay 
initiative, how it will address the issue and what further 
improvements could we make if we had a piece of legislation 
like the Paycheck Fairness Act that were enacted and where 
would you go on this issue.
    Secretary Herman. First of all, Congresswoman DeLauro, let 
me thank you for your leadership in this regard. As you know, 
unfortunately, unequal pay in the Nation for American women 
workers is still a reality, and I believe that the legislation 
that you are proposing and what we have in the President's 
budget request could make an enormous difference in closing the 
gap. Specifically, I believe that we can do that in two ways. 
It is not just a question of enforcement, as much as we need to 
continue to vigorously enforce our laws, but we also still need 
to educate employers and employees to the reality that we still 
have a pay gap in this country.
    The President's budget request would help us to engage in 
these education and outreach initiatives and to talk about ways 
that employers and employees can help engage in self-audits to 
close that gap.
    Secondly, we are also looking at being able to do more with 
funding nontraditional pilot initiatives for women in the high-
tech field, the better paying jobs so that they will be able to 
get those jobs that obviously are paying more. One unique 
aspect of your legislation that I hope ultimately we will be 
able to correct is the reprisal that employees still suffer, as 
you know, when they discuss with one another their own pay.

                            BIOTECH TRAINING

    Ms. DeLauro. Thank you. Last year I talked about the issue 
of vocational upgrades in Job Corps centers with Assistant 
Secretary Bramucci. We talked about new trades for Job Corps 
centers, particularly in the area of biotech. Now, I understand 
that the Job Corps has some pharmacy tech training programs and 
vocational offerings in other health-related fields and that 
under the Workforce Investment Act the new center industry 
councils have to approve those vocational changes. Can you give 
me an update on how Job Corps is addressing training for a 
growing biotech industry.
    This is a critical issue in my State, given a State that 
has been seeing downsizing in defense and consolidation or 
merging in the insurance industry. We are looking at biotech as 
a direction to go, given the assets of the State. So this is of 
particular interest in preparing people for these types of 
jobs.
    Secretary Herman. We are expanding our own internal Job 
Corps skills training cluster to make sure that we are putting 
a greater focus on biotech training in particular. Right now we 
are presently training in the neighborhood of about 13 percent 
of our jobs in the Job Corps skills cluster in that area and we 
are expecting to build on that number and to increase it. And 
there are some exciting new skills initiatives that are taking 
place in that regard. For instance, in Joliet, Illinois, we are 
seeing a new partnership with the Walgreen Pharmacy Company, 
and they are actually working with our Job Corps centers in 
that State to set up pharmaceutical technicians, and I am 
hopeful that we will be able to take that program in particular 
and expand it to other Job Corps centers around the country. 
But we are looking to create those kinds of partnerships in the 
private sector presently with regard to jobs in the biotech 
field.

                      FAMILY AND MEDICAL LEAVE ACT

    Ms. DeLauro. Thank you. On family leave, I understand the 
administration is proposing to expand family and medical leave 
to businesses with 25 or more employees. I think family and 
medical leave by all accounts has been one of the most 
successful efforts that we have undertaken. It is one of the 
first instances where public policy begins to mirror what 
people's everyday lives are about, folks in the workplace. Can 
you describe in more detail the $20,000,000 request to fund 
competitive planning grants for States and, other interested 
entities to explore ways to make parental leave and other forms 
of family leave more affordable and accessible to the 
workforce.
    Secretary Herman. As we look at what is taking place around 
the country today with regard to the use, first of all, of 
family and medical leave, we find more and more workers are 
taking advantage of these provisions, but we are also finding 
interesting initiatives, pilot experiences with State 
governments, with employers who are doing more to find ways of 
expanding on our own notions of how we can help to balance 
family and work responsibilities better, with some combination 
strategies to offer paid leave as a part of those scenarios. I 
just visited one such program myself at the Honeywell 
Corporation in Minneapolis, Minnesota.
    We actually think we can help to stimulate and expand much 
of the fine work that is presently going on today to learn more 
about innovations in giving families better opportunities to 
balance work and family demands. A lot of new and exciting 
experiments focused on elder care. We know that family medical 
leave in particular has been related to the birth or to the 
adoption of children, but by expanding it for an additional 24 
hours we can do things like participate in PTA meetings, and 
increasingly large numbers of Americans, as you know, have a 
responsibility now for elder care as well.
    Ms. DeLauro. That is becoming one of the increasingly 
bigger problems and for lots of folks in our age group as well 
as for younger people, and thank you, Madam Secretary. My time 
is up and let me offer you and your husband our 
congratulations.
    Secretary Herman. Thank you very much. Thank you.
    Mr. Porter. Thank you, Ms. DeLauro.
    Mr. Miller.

                         OVERTIME FOR SALESMEN

    Mr. Miller. Good afternoon, Madam Secretary. As the 
administration is in their final months, it seems like there is 
this unprecedented amount of rulemaking and this kind of below-
the-radar-screen effort to try to change policies; and it is 
bothersome, the in-home office rules, the stock options and 
there is an issue that came up in my district that, again, I 
think is one of those fundamental changes in the way businesses 
practice, and it is the drivers sale issue.
    It is not just a partisan issue, because Congressman 
Hinojosa has the exact same problem. He wrote you a letter also 
concerning this problem, and what it is is unfortunate because 
it has taken drivers salespeople, saying they no longer can be 
paid a commission, they have got to be paid time-and-a-half 
under the--paid an hourly rate plus time-and-a-half.
    Let me describe the situation. Maybe you don't understand 
how wholesale/retail businesses--I mean, I have got a marketing 
background. The way it works, you need to have people who have 
incentives to do things. Driver salespeople--this is a beer 
distributor in my area in Sarasota, Florida. It is not just a 
matter of delivering beer and dropping it off at the loading 
dock and storing it.This is a team effort in sales, and the way 
it works is, you have a salesperson go call on a customer--a grocery 
store or a Seven-Eleven, a bar or a restaurant--to take an order. The 
next day the driver salesperson brings the order.
    The motivation of this driver salesperson, who gets these 
commissions--and these people make $40- to $50-thousand in my 
district; that is high pay in my district, $40- to $50-
thousand, so these are not minimum wage people. The motivation 
is to increase sales as much as you can, and retail space; what 
you want is the maximum amount of shelf space. The more rows of 
cases, boxes of beer in there, the more sales you generate. If 
you get things hanging overhead off the ceiling, if you can get 
a display at the end of the aisle, if you can get something 
right at the checkout counter, that is how you get business. If 
you can get a neon sign placed in the bar, you drum up 
business.
    Well, the driver salespeople, first of all, have to cut 
cash. I don't know if that is true in every State, but in 
Florida your guys get paid when you deliver or else you have to 
have a cash deposit. So most of these people have to handle a 
lot of cash to complete the sale, but the motivation, the 
incentive to them is to get all the sales they can.
    They carry a computer. They can add or change the order 
right there on the spot. These are not delivery people that 
just come and deliver a load of copy paper or office supplies. 
They are motivated, and as an opportunity--these people are not 
necessarily college educated, probably aren't, because they 
have a chance to make a reasonable living at $40- to 50-
thousand in a beautiful place like Sarasota, Florida.
    Well, now you have come through and said, no, we are going 
to change it, and again, maybe you just targeted my district 
and Congressman Hinojosa's district, I don't know, but this is 
common in retail business for soft drinks. Two-thirds of the 
driver salespeople, my understanding is, in the wholesale beer 
business, get reimbursed this way.
    They like to be called salespeople; they go to sales 
meetings. They have the motivation to participate and have an 
opportunity to succeed financially by their own efforts and 
incentives and now you want to take that away. You are talking 
about this company, you will probably bankrupt this company 
because you will have it, going way back, and all this time-
and-a-half--these $40,000 people, paying them time-and-a-half, 
but the thing is, it is fundamentally changing the way a system 
operates under wholesale/retail.
    I know they are not very pleased. This investigator has 
been down there, kind of a Rambo-type guy that is going down 
and flashing his badges and stopping people, which is kind of 
embarrassing; but other than that, the fact this is a 
fundamental change in the way the wholesale/retail business 
operates for people that want to have motivation. You believe, 
as I do, that we want to give people opportunity and you have 
taken it away. I just think that is unfortunate, wrong.
    I don't know if you are familiar enough with the case to 
give me a comment on it or where it stands, and I have got a 
series of other questions to ask on it, but let me give you a 
chance to respond to start with.

                    FLORIDA SALESPERSON/DRIVER CASE

    Secretary Herman. I have just been briefed on the case, 
because I was made aware of your interest, Congressman Miller, 
in this issue. And because, as you know, it is an ongoing 
investigation, I can't comment on the particulars of the case; 
but I can say to you, having been briefed on it, that I have 
asked my staff here in Washington to be particularly vigilant 
in terms of the oversight now of what is taking place at the 
staff level, at the regional level in the field.
    And I do want to take this opportunity to apologize to you; 
I think initially, in the handling of the case, that it did not 
get attention at the high level of the organization that it 
should have gotten in the beginning. But we have corrected 
that, and I have asked to be kept informed of that.
    Mr. Miller. This a policy decision. It is kind of like the 
in-office matter, you know reading the paper, you say, well, 
that was a decision at the local level. That is something you 
should have been involved in or at least somebody at a high 
enough level here. This, to me, is a fundamental change in the 
wholesale/retail operations of how we do that.
    The only other case I know is Congressman Hinojosa.
    Secretary Herman. I am aware that he has a similar issue.
    Mr. Miller. Are there more problems there? Are we the only 
two Members targeted?
    Secretary Herman. Thus far, you are the only two Members. 
You haven't been targeted, but you are certainly the only two 
we have heard from in this regard; and we are taking a look at 
whether there is broader impact. I am aware it is an issue for 
you and for the Congressman from Texas.
    Mr. Miller. Do you know when the decisions are going to be 
made on these? It has been going on for months.
    Secretary Herman. What I would like to do is have our 
office get back in touch with your staff on the timing of where 
we see the investigation presently.
    Mr. Miller. When I sent my letter back in December, I 
understand it was sent down to Tampa. Really, it should have 
been left up here in Washington. It wasn't just this case. It 
is really a fundamental change, and that is what is bothering 
me.
    People want to be salespeople. There is a little more pride 
in being a salesperson than an hourly truck driver, and just 
because a person drives a truck doesn't mean he can't have an 
incentive to drive a truck. I mean, truck drivers deserve the 
same rights other people have to succeed, even if they don't 
have a college education. So I am concerned there is an effort 
to kind of slip underneath the radar screen and pull this one 
off, and that is not right.
    So I appreciate your looking at it. Thank you.
    Secretary Herman. Thank you.
    Mr. Porter. Thank you, Mr. Miller.
    Ms. Pelosi.
    Ms. Pelosi. Thank you, Mr. Chairman.
    Madam Secretary, thank you for your always excellent 
presentation and for your distinguished service to our country. 
I guess this will be--one never knows, but it may be the last 
time you present a budget justification to our committee, and I 
wanted to take the opportunity to commend you for your 
wonderful--your great leadership.
    Secretary Herman. Thank you so much.

                           ERGONOMIC STANDARD

    Ms. Pelosi. I also want to commend you, and the Department 
of Labor's efforts to finalize the ergonomic standard this 
year. There is sufficient scientific evidence, and it is clear 
the solutions are workable, and many companies have indeed 
established and invested in voluntary programs. American's 
working men and women have waited a decade for the final 
ergonomic standard, and we should not allow any more delays. I 
am particularly concerned about the impact on women in the 
workplace who suffer disproportionately in terms of MSD.
    You said in your answer to one of the questions, the self-
interests of business and workers are not always compatible, 
they don't always have the same goal or words to that effect. I 
think in this case, with the proper leadership, that the goals 
can be the same and compatible, because let us say that we 
agree that business is interested in the safety of its workers, 
and stipulating that that is the case, the ergonomic standard 
should be one that they welcome because it is fair and one that 
many people have already implemented.
    You have spent a good deal of time on that, and we will be 
here tomorrow with Assistant Secretary Jeffress, so I will move 
on to other issues.

                          CORE LABOR STANDARDS

    I just wanted to comment that I was pleased to see the core 
labor standard and global AIDS initiative in your statement. I 
would like to see something really happen, though--of course, I 
am very interested in the AIDS issue, but since this is the 
Labor Department, I am going to deal in the core labor 
standards.
    We have heard this is the time of NAFTA, that it was going 
to be the next trade agreement that was going to have core 
labor issues involved. Then on Fast Track, they said itwas 
going to be the next time, and then China; now it is going to be the 
next time with the WTO. It never seems to be about time for us to 
really be doing something serious about the core labor standards.
    As far as China is concerned, just to follow up a little 
bit on the question that our chairman asked, when we would 
follow the administration's suggestion and grant permanent NTR 
and relinquish all leverage that we have about improving 
working conditions for workers in China, we are throwing them 
into the sea without a life raft.
    The only thing that is important for the workers of China, 
as the chairman said, is the basic human right of the right to 
speak and to organize. They only can speak for themselves; we 
can't speak for them, but that is the one thing they want.
    I met with them as recently as December in China--in Hong 
Kong; I guess that is China now--and what they said is don't 
come up with a business code of conduct, that makes matters 
worse for us because it gives people the impression that things 
are okay. We and only we can speak for ourselves.
    So a core labor standard has to be the basic human right to 
speak freely and to organize.
    Now I am going on to my question which is a completely 
different subject, and you can comment on these if there is 
time later.
    Madam Secretary, yesterday we had a presentation from Mr. 
Bob Friedman, who was here to testify for increased funding for 
the Individual Development Accounts under the Assets for 
Independence Act. This program enables people to gain assets, 
gain equity, have some resources. And when we talk now about 
jobs, and that is the Department of Labor's jurisdiction, I 
think we have to move the discussion more into assets for 
people so they can gain equity in business, because what you 
hear our colleagues talk about here is how our policies impact 
business and we want to see more people at the low-income end 
not only have access to jobs but also access to equity.
    It was stunning to me that Mr. Friedman testified that 10 
percent of all families control two-thirds of the wealth, and 
that is probably all of us here. One-half of all American 
households have less than $1,000 in net financial assets. One-
third of all American households and 60 percent of African-
American households have zero or negative net financial assets. 
Forty percent of all white children and 73 percent of all 
African-American children grow up in households with zero or 
negative net financial assets.

                            JOBS AND ASSETS

    Your statement is excellent. I support so much of what you 
have said, and it gives me the time to ask about something 
else, which is, is there any initiative within the 
administration to look not just about jobs for Americans--20 
million jobs is stunning, and it is wonderful and many of them 
came through small businesses, et cetera, but any initiative to 
say that these jobs that are being created, we want them also 
to be created in a way that springs from people gaining assets, 
to give them the latitude to invest in it, to educate their 
children in a way that America is producing not only workers, 
but business owners and entrepreneurs, out of this group of 
people who are living in a situation, as I said, again, where 
73 percent of African-American children grow up in households 
with zero or negative net financial assets?
    Secretary Herman. Well, I think when you look generally at 
many of the policies, Congresswoman Pelosi, of this 
administration, it is about closing the gap between the haves 
and the have-nots; it is about fostering policies to leave no 
one behind in this economy. And I could begin with much of the 
innovation of what has taken place, for instance, at the Small 
Business Administration that has literally tripled the 
involvement of minorities and women as a part of its own loan 
portfolio to make sure that we are creating businesses that can 
have net worth, that can have assets in this country.
    I think the emphasis that the administration has put on 
homeownership and what we are trying to do to close the gap in 
that regard is making a difference in terms of assets, of 
equity positions. But speaking from the parochial point of view 
of the Labor Department, certainly the jobs that we are talking 
about today, the training that is going be necessary for the 
kinds of jobs that we need to create in the future are quality 
high-paying jobs, to make sure that we can begin to elevate 
increasingly the American worker today. Because no longer is 
this an economy that is generating just low-wage, low-skilled 
jobs.
    In addition, because these are high-performance, high-
quality jobs, our emphasis is not just on high-quality 
training, but also on who is getting that training, such as 
out-of-school youth, what we are doing on the initiatives with 
disabilities, employment efforts today, or even our Welfare-to-
Work front. All of this is designed to bring more Americans 
into the mainstream of our economy today.

                             ENTREPRENEURS

    Ms. Pelosi. If I may just say in closing--Mr. Chairman, I 
know my time has expired--I appreciate your statement and the 
excellent work of the Clinton administration in this regard, 
but I just would like to see something and it may be happening 
that says that if somebody is going to start a business, they 
need to attract capital. Talent attracts capital, and investors 
are more likely to invest in somebody who has worked and had 
opportunity in a similar kind of business already.
    So I would just like to see an initiative that recognizes 
that, and as we create jobs and give the opportunity that you 
are talking about, that we are doing it with an eye to not just 
going up the ladder there, but going up the ladder and over to 
business ownership as well. And these poor souls that I am 
talking about here, they don't even have $1,000 if they have 
any money at all. It is hard to imagine the esteem that they 
must have for their ability to deal with their children's needs 
and their education if they can't even put their hands on 
$1,000.
    Secretary Herman. I absolutely agree with that, and I wish 
we did have more time because I think one of the untold 
stories, for instance, of what has happened inside empowerment 
zones, quite frankly, has been the empowerment of more minority 
entrepreneurs. These are people who are attached to that 
community, who are staying in those communities, who want to 
make a difference, looking at greater mentorship opportunities, 
more individuals being sponsored by major corporations, even 
the New Markets Initiative which I know has its own legislative 
thrust. But what is happening, even on a voluntary basis in the 
private sector, I think, is aimed at creating more economic 
infrastructure and viability for communities that have been 
left behind.
    Ms. Pelosi. Thank you, Madam Secretary.
    Thank you, Mr. Chairman.
    Mr. Porter. Thank you, Ms. Pelosi.
    Mr. Istook.
    Mr. Istook. Thank you, Mr. Chairman.

                       LENGTH OF ERGONOMICS RULE

    Ms. Herman, I really find it hard to communicate on certain 
things when I hear a statement such as that the proposed 
ergonomics regulations would not cover most workers because I 
know businesses have a very different understanding, and the 
proposed regulations--and of course, they are in small print, 
fine print, the regulations themselves; when they were 
published in the Federal Register were about 300 pages.
    And let me ask first, Madam Secretary, have you read all 
300 pages?
    Secretary Herman. I have not read all 300 pages.
    Mr. Istook. How much of it have you read?
    Secretary Herman. Well, I have read a lot of it.
    Mr. Istook. Would you say you have read most of it?
    Secretary Herman. I would say I have read most of it over 
the past 2 years.
    Mr. Istook. And I am sure it didn't take you 2 years to 
read it.
    Secretary Herman. No, it didn't.
    Mr. Istook. How long does it take--with as many obscure 
terms and acronyms as it has in those, how long do you think it 
will take someone to read the 300 pages so that they will know 
what they are required to do?
    Secretary Herman. Congressman Istook, I guess I will have 
to answer this contextually for you, and since you have used me 
as an example, I don't look at this as something that we just 
started working on.
    Mr. Istook. Ma'am, you have had a chance to make your 
statement. I just want an answer to a simple question.
    How long do you think it takes someone to read 300 pages of 
jargon?
    Secretary Herman. Depends on how fast you are. You could do 
it in 2 or 3 hours, depending on your reading ability. I don't 
know. It is very individually based.
    Mr. Istook. I would be amazed if anybody could get through 
it that fast with any degree of comprehension whatsoever.
    Secretary Herman. You said 300 pages.
    Mr. Istook. Yes, ma'am, I know that. And how about the 
50,000 pages of accompanying material; has anybody gone through 
that?
    Secretary Herman. I can't give you an estimate of how long 
it would take an individual to go through 50,000 pages.
    Mr. Istook. Which has an 800-page index.
    Now, you are asking whether you believe it is not quite the 
majority or whether, as most people believe, most businesses in 
this country, you are asking people to be subjected to a 
standard that is beyond the ability of anyone to know what it 
is they are really required to do because you haven't read all 
300 pages. I am sure nobody has read all the 50,000 pages of 
material that went with it that is supposed to flesh out and 
explain and tell people what it is. You talk about an 
impossible standard.
    Now, how many people will have to be trained--just within 
the Labor Department, will have to be trained that are supposed 
to be enforcing these standards that we are discussing? How 
many will require that training?
    Secretary Herman. Congressman Istook, I think when we look 
at the ongoing training of OSHA's staff, it is not as though we 
are training new workers in this regard.
    Mr. Istook. But ergonomics here is new, the regulation, 
because the question is not whether they understand common 
sense. The question is whether they understand these 
regulations. They are two different things. So the fact that 
they may have some experience in some things that cross over to 
ergonomics doesn't mean that they understand these regulations.
    So, you know, you have a budget in front of us with a 
significant increase, but I am asking, I want to understand, 
you know, how long is it going to take and how much is it going 
to take to train how many people?
    Secretary Herman. Let me answer that on two levels. You 
asked about understanding and the level of training.
    I was saying with regard to the understanding, we have had 
a staff in OSHA for a number of years that have worked on this 
issue, and so the understanding of the issue is very deep.
    But with regard to training----
    Mr. Istook. I am asking if you understand these 
regulations.
    Secretary Herman. I would submit to you that they do 
understand it, that we have had training internally on the regs 
within OSHA. I would expect going forward, as we do with all of 
our standards, that we would have training, as we do on how we 
give compliance assistance, how we give technical assistance; 
that is a part of it.
    And with regard to the 300 pages of background material----
    Mr. Istook. You are saying --you are guessing because you 
are not asking whether they understand ergonomics. We are 
talking about whether they understand 300 pages of legal 
requirements of what has to happen under what circumstances.
    Secretary Herman. I believe we have the staff in place that 
understands that, yes.
    Mr. Istook. So how many of those staff do you think have 
read all 300 pages?
    Secretary Herman. I believe the staff that is involved in 
putting together those 300 pages of supporting documents have 
read them. We have had a lot of documents. I am only saying 
that because I like to be candid for the record.
    I can't say to you because I have not asked that question 
directly, but I would be happy to get back to you in writing 
with the specifics. But I can tell you that I am confident that 
the staff who are directly involved have been sufficiently 
trained on what we have in writing there.
    Mr. Istook. How then on budgeting for your Department, even 
if such regulations like this went forward, how can we possibly 
understand how many people it will take to implement, enforce 
the regulations, to do the training?
    You are telling us you don't know those things.
    Secretary Herman. I am not telling you that.
    Mr. Istook. Why should we budget a blank check that could 
be enormous, as well as the expense is enormous?
    Secretary Herman. I thought you were asking me, with the 
existing staff of OSHA, what do we have in place today that 
meets the capacity for the budget request, if you would allow 
me to answer your question.
    We have 324 people engaged in compliance assistance. I 
thought you were speaking to the existing capacity as opposed 
to what this budget request is.
    Mr. Istook. For this type of unimaginably detailed 
training, how long will it take to train 300 people in 300 
pages, plus 50,000 supporting pages of detailed, technical, 
obscure, jargon requirements?
    Secretary Herman. Well, based on my knowledge of what we 
have done in the past with regard to regulations and just what 
it takes to get a compliance officer up and running in the 
field, I would not think it would take beyond 30 days to be 
able to provide the necessary training, but it is not a one-
shot deal. This is ongoing technical assistance and compliance 
assistance that we do give.
    Mr. Istook. Yes. Well, good luck finding even a Nobel 
laureate that could try to comprehend all of this in 30 days.
    Thank you, Madam.
    Mr. Porter. We will have a second round.
    Ms. DeLauro, will you have questions?
    Ms. DeLauro. No, I will submit them for the record.
    Mr. Porter. We will have time for a second round, and we 
will do 7 minutes then.
    Mr. Istook. I am going to pass, Mr. Chairman.
    Mr. Porter. We will have a second round. I get 14 minutes.
    Mr. Istook. I yield my time.
    Mr. Porter. Thank you, Mr. Istook.

        BIRTH AND ADOPTION UNEMPLOYMENT COMPENSATION REGULATIONS

    Madam Secretary, this question was initially raised by Ms. 
DeLauro, and she was talking about the substance of it. I want 
to talk about the process.
    I understand you are proposing a rule which would permit 
States to pay parents on voluntary leave from work to care for 
a newborn or newly adopted child; is that correct?
    Secretary Herman. You are speaking of the--not the parental 
leave but the UI regs now?
    Mr. Porter. It is parental leave, actually; it is under----
    Secretary Herman. This is the unemployment insurance?
    Mr. Porter. Yes, unemployment comp, yes. Is that correct?
    Secretary Herman. If you could restate the question.
    Mr. Porter. Are you proposing a rule which would permit 
States to pay parents on voluntary leave from work to care for 
a newborn or newly adopted child?
    Secretary Herman. No, we are not proposing a requirement.
    Mr. Porter. What are you doing there?
    Secretary Herman. The President has issued an Executive 
Order to give States the flexibility, if you will, to adopt 
programs that they would choose to execute in that regard; but 
the Department is only proposing a guidance in this area for 
States, so that they would not be in conflict with existing UI 
laws if they take this option.
    So our rule is not a rule that would result in any direct 
action that States would take which the Department of Labor is 
giving them. We are responding to an Executive Order from the 
President that would allow States to take voluntary action in 
this regard, should they choose, and not be held liable by the 
Department. That is essentially what our rule would say.
    Mr. Porter. But you see it as a Federal program, correct?
    Secretary Herman. It is a State initiative, not a Federal 
initiative. Basically, the President directed us to issue a 
proposed rule that----
    Mr. Porter. You administer the program?
    Secretary Herman. But it would give States the flexibility 
to use their UI systems in this regard to give a mother time 
off to have a baby if they so chose to do that. It is not 
unlike other----
    Mr. Porter. Do the States have flexibility like that for 
other initiatives they might want to adopt?
    Secretary Herman. Yes. For instance, States right now can 
use the unemployment insurance program to pay someone who is on 
jury duty.
    Mr. Porter. And that has been done by executive order 
previously?
    Secretary Herman. States have adapted their UI systems in 
this regard. We allow this presently under the Unemployment 
Insurance Compensation.
    Mr. Porter. So you allow it by law or by executive order?
    Secretary Herman. We allow that, I believe, by guidance and 
letters, but with the birth and adoption UI issue, it is 
similar guidance we are giving to the States if they choose to 
do this, because there are States right now that are seeking to 
do this. The State of Vermont and the State of Massachusetts 
are presently engaged in these kinds of experiments, and we are 
asking, essentially, would they be in violation of any Federal 
law if they chose to apply UI principles in that way?
    Mr. Porter. All right. I will call on Mr. Wicker. Again, it 
is a question not on the substance, but on the process by which 
it is to be allowed.
    Mr. Wicker.
    Mr. Wicker. I want to thank my colleagues on the 
subcommittee for filibustering long enough so that I could get 
over here and ask my questions of the Secretary.

                             APPRENTICESHIP

    Secretary Herman, you and I discussed this briefly in a 
private conversation before your testimony began; and I know 
you have been here for quite a while now, but I want to talk to 
you about skilled workers and apprenticeship. I was delighted 
that you mentioned your desire to develop more skilled workers 
at the very beginning of your testimony; that is very 
encouraging. You and I very much share that interest.
    Let me just state for the record that at a recent hearing 
of the House Committee on Education and the Workforce, it was 
mentioned that there is a significant shortage of skilled 
workers in craft and trade industries. According to the Bureau 
of Labor Statistics, the demand for skilled workers has gone 
from 20 percent of the labor force in 1950 to 65 percent of the 
labor force today. A study last year by the National 
Association of Counties found that 75 percent of the largest 
counties in America report that they face a shortage of skilled 
workers; 85 percent of those counties said their shortage has 
increased over the last 5 years, and 97 percent of those 
answering in that fashion characterized this shortage as 
serious to very serious. So we have a problem.
    Specifically with regard to construction and carpenters, 
according to a study by the Harvard University Joint Center for 
Housing Studies, the construction industry needs to replace 
18,000 carpenters a year, but apprenticeship programs produce 
only 5,000 new carpenters per year, 5,000 produced as opposed 
to 18,000 that we actually have a need for.
    According to this same study, the demand for carpenters in 
the past 5 years is up about 20 percent. So despite our strong 
economy, if we do not address this shortage, it could create 
problems for future production in both construction and in 
manufacturing, which brings us to apprenticeship programs.
    They are designed to meet this need by providing both on-
the-job training and classroom instruction. Graduates of 
apprenticeship programs are typically more educated, work more 
safely, are more productive, better skilled and are more likely 
to become supervisors, earn high salaries and experience less 
unemployment. So that leads me to my series of questions.
    Given the strong economy in recent years and the great need 
for skilled workers, why has there not, do you think, been a 
corresponding increase in this number of apprenticeship 
programs? And secondly, it is my understanding that an approval 
process for apprenticeship programs, which is both costly and 
lengthy, is preventing the apprenticeship system from reaching 
its full potential.
    Do you agree with this and to what do you attribute the 
delays and the lack of the number of apprentices that we need?
    Secretary Herman. Well, as we were discussing earlier, 
Congressman Wicker, I am a big believer in skilled 
apprenticeship programs. I got my own start, as you know, in 
the shipyards of Pascagoula, Mississippi, working to increase 
skilled opportunities in apprenticible occupations there in the 
yard. I think we need to do more in this regard, quite frankly.
    One of the things that I have done as Secretary of Labor is 
to put greater emphasis on our own efforts at the Department of 
Labor to create more skilled, apprenticed jobs, because as you 
have correctly pointed out, they are typically high-quality 
jobs and offer us the opportunities to get more skilled 
workers. So we, in fact, are putting a greater emphasis on 
increasing apprenticible occupations through the expansion of 
our own Bureau of Apprenticeship and Training throughout the 
country.
    I am also aware of the particular issues that you have 
raised in the State of Mississippi regarding the perhaps slower 
than desirable pace to certify those occupations; and I will 
certainly commit to you, as a part of this hearing, to take a 
clear look at what is going on in the State to see if we can't 
do more to speed up the rate of certification for skilled 
apprenticeship jobs in Mississippi.
    We used to do a pretty good job of that, and I am not 
exactly sure, in terms of recent years, where we are in terms 
of the pace of accreditation, but I will get back to you 
personally on that.
    Mr. Wicker. Okay. Maybe you could supply something on the 
record about those particular data, as far as the speed.
    [The information follows:]



    Mr. Wicker. But let me just say, Mr. Chairman, if I might--
--
    Mr. Porter. Mr. Wicker, we can have a second round here, 
and you can take additional time if you wish.
    Mr. Wicker. Okay. I do appreciate that, Mr. Chairman, and I 
assume I am the first questioner in the second round.
    Secretary Herman. Looks like you are the only one. Well, I 
know the Chairman is still here.

                SPEED OF APPRENTICESHIP PROGRAM APPROVAL

    Mr. Wicker. Well, let me just say that because I am 
concerned with the level of approval of potential 
apprenticeship programs, I am working to develop legislation. 
It would, among other things, set time constraints for the 
apprenticeship application process. It would also set up an 
appeals process from the States to your Department, the 
Department of Labor, and then, in the worst case scenario, to 
an administrative law court if an application languishes for 
too long.
    We hear anecdotal stories, about applications in our 50 
States--and it is not my State in this instance, but one has 
been in the process for 20 years, an astonishing allegation if 
it is true. So I just wonder what would be your take on 
legislation that would work with the Congress on setting in law 
a time constraint for saying yes or no to an apprenticeship 
application just rather than leaving it in abeyance for months 
and months and years?
    Secretary Herman. Obviously, I wouldn't want to comment on 
legislation that I have not had a chance to talk with you more 
in detail about. I just think generally in terms of the 
principle what you are essentially calling for is a more 
efficient and a responsive system that can move more 
expeditiously than perhaps we are moving. As you know, we 
really have 50 different States, and not all of those States 
obviously are involved in certifying apprenticeship programs. I 
think we need to perhaps consult with you and get back to you 
on what is the current state of play with regard to where and 
when and how we are accrediting apprenticeship jobs around the 
country.
    I have taken a look, for instance, at some of the better 
States, in my view, that are very effective in this area and 
chose to single out those States to build on expanded 
apprenticeship opportunities. One of the new pilots that we are 
working on in some of those key States where they are doing a 
very good job of certification and accreditation is with child 
care workers. We are working on getting more child care workers 
into skilled apprenticeship jobs, so that we can upgrade the 
quality of child care workers, as well, in this country, and 
are beginning to look at whether or not there are skilled 
apprenticeship opportunities there.
    But I would be happy to have the staff get with you more 
generically on what we are doing in this regard.
    Mr. Wicker. Wonderful. I do look forward to working with 
your Department, and I want to emphasize to you, I am not at 
all proposing that we change any guidelines that your 
Department currently has with regard to what makes up a good 
apprenticeship program. I simply want to work with you--and I 
think we can do it this Congress, Madam Secretary, to remove 
bureaucratic roadblocks through the creation of more programs, 
to put people in these positions that right now are going 
unfilled because we don't have the skilled workers.
    So thank you, and I look forward to working with you on 
that.
    Secretary Herman. Thank you, Congressman Wicker.
    Mr. Porter. Thank you, Mr. Wicker.

              LEGISLATIVE REQUIREMENT ON USE OF UI FUNDING

    I want to go back to the question we were discussing 
earlier and put this in the form of a statement and then ask 
you if you will answer the question for the record. But it 
seems to me--and again, I am talking about process not 
substance--that the Federal law on unemployment compensation 
requires an individual to be available for work; and if there 
is a variation to be made to that standard, it ought to be 
made, it seems to me, by law and not by executive order. We 
have seen so many instances, not necessarily in your 
Department, but in many other Departments of government where 
the administration looks at something they want to do and 
decides that an executive order is appropriate, when I think 
any good lawyer would say, wait a minute, this is way beyond 
the scope of authority of the executive branch to interpret the 
law and is required to be changed only by the legislative 
branch passing legislation in this regard.
    Again, the substance may be fine, and yet I worry a lot 
about the process. But if you could answer that for the record, 
I would appreciate it.
    Secretary Herman. Thank you for clarifying the question, 
and I understand it fuller in the sense that you are posing it 
now.
    The President did direct the Department to examine this 
issue as to whether or not States could use the unemployment 
insurance system for paid parental leave. It was the 
administration's position that since this was an effort 
designed to allow for voluntary actions on the part of the 
States that we did not see it as necessitating a legislative 
fix. We simply sought to clarify that in the same way that 
States can use the UI system for other issues, like someone 
taking time off for jury duty and getting paid for that, that 
we would not oppose States who wish to use the UI system to 
encourage paid parental leave.
    So the proposed rule, essentially--which we are now 
considering for public comment--is being issued in that regard.
    Mr. Porter. I think that jury duty, which is a requirement 
by law in States, is an entirely different question than a 
person taking voluntary time off for other purposes. And I 
don't think the executive branch has the authority on the face 
of it--and I could be wrong--to vary this policy simply by 
writing an executive order; and it concerns me.

                       FUNDING FOR AIDS IN AFRICA

    You have $10 million in your budget for AIDS in Africa; am 
I correct?
    Secretary Herman. That is correct, Congressman.
    Mr. Porter. I think this is very, very important money, and 
I commend you for it. I am trying to find out, because my 
initial--or my recollection was that the Vice President at some 
point in time had announced an administration initiative of, I 
think it was $1.6 billion for AIDS in Africa, where obviously 
there is a tremendous crisis happening right now, and we find 
it in your budget at $10 million. We find it in CDC at $26 
million, or a total of $61 million this year, 26 million new 
dollars; but I can't find it in the Foreign Operations budget 
at any figure, and I can't find it anywhere else at any figure.
    I am wondering if you can, for the record--and I realize 
this is out of your direct area--but determine where the rest 
of this money is going to be. And I am worried that at the end 
of this process someone will say, well, the money hasn't been 
put in, why not, and there hasn't been any engagement on the 
issue and attempt to really get the job done. So I think it is 
important money.
    I offered the first amendment to the World Health 
Organization's funding by the United States back in 1986 for 
AIDS in Africa, and we haven't done very much at all as a 
country, and I think it is a great blot on our caring about 
other people in the world that we haven't done a great deal 
more, recognizing how desperate the situation in Africa is.
    [The information follows:]



                        OSHA'S HOME WORK POLICY

    Let me ask about the home work policy and very frankly, 
Madam Secretary, I think the way this came out was kind of a 
disaster for the Department because it seemed to come out and 
then get taken back and changed; and I wonder if you could tell 
us how that came about. Was that a miscommunication with Mr. 
Jeffress, or what happened that--was it a misinterpretation by 
the press of what was being attempted? How did this all come 
about?
    Secretary Herman. I certainly think it was taken out of 
context by the media.
    But having said that, what essentially happened was, the 
communication regarding the home work issue was guidance that 
was given to one employer who had required his staff to work at 
home and was essentially asking the Department for appropriate 
guidance on a number of issues. That letter went to that 
employer, and subsequently, it came into the broader public 
domain and was viewed as, quote, ``new policy.''
    It was never intended to communicate new policy, and it was 
guidance to that one employer. It was not a letter that I had 
seen, nor quite frankly, under normal circumstances, would I 
have seen that letter; but once it became a front-page story 
that day, obviously it became an issue that I immediately did 
take a look at.
    It was very clear to me that the letter in the manner that 
it was written caused widespread confusion, and had unintended 
consequences. It certainly had the inappropriate consequence of 
communicating new policy when that was not at all the intent of 
the Department, and so I took immediate action and I withdrew 
the letter within 24 hours; and I did that on purpose because I 
did not wish to leave it in the public domain for it to become 
more of a football than it had already become, in my view, by 
distorting the policy of OSHA regarding work at home.
    And essentially OSHA has never had a policy of going into 
homes to conduct inspections. OSHA had only gone into homes 
when called, and that involved hazardous work.
    What the issue itself did raise--and it was certainly 
instructive for me and the Department--was what lessons could 
we glean from the process of commenting on existing policy. I 
think it also led to needed and further clarification of 
whether or not the enforcement aspect of OSHA would apply to 
work at home.
    And so we used that as an opportunity to clarify our 
existing policy: that we would not hold employers liable for 
work that was done at home, as we defined ``home work,'' not 
including the hazardous work historically regulated. I also 
used that internally, quite frankly, to review our process not 
just for new policy, which is typically what comes to the 
Office of the Secretary, but even as we are commenting on 
existing policy. And it certainly has a broader application 
today. In these new work arrangements that we have, how do we 
make sure in the future that we build in better safeguards? I 
believe that we are well on our way to using our own internal 
management council review process to achieve those objectives.
    Mr. Porter. Thank you, Madam Secretary. I will have some 
questions for the record about how to interpret that policy, or 
the way you would interpret that policy in certain instances, 
but I want to call on Mr. Dickey, give him a chance.
    Mr. Dickey. Hi, Secretary Herman. How are you doing?
    Secretary Herman. I am fine.
    Mr. Dickey. I have one question, and I think I know the 
answer.
    Secretary Herman. That is good. Let us hope I do.
    Mr. Dickey. Would you come into my district and campaign 
for me in the next election? No more questions.
    Mr. Porter. She didn't answer that one.
    Secretary Herman. We will have a private conversation, Mr. 
Chairman.

                    FEDERAL ACQUISITION REGULATIONS

    Mr. Porter. Mr. Wicker.
    Mr. Wicker. Might I ask one final softball?
    Mr. Porter. Yes, absolutely.
    Mr. Wicker. Madam Secretary, your Department has proposed a 
regulation which would disqualify businesses from receiving 
Federal contracts if their record of compliance with labor, 
employment, tax, antitrust, environment and consumer laws is 
unsatisfactory--``blacklisting'' in the common lexicon. As I 
understand it, the proposed regulation was issued on July 9th 
of last year and the comment period closed last November.
    Let me just ask you, it is my understanding that under 
existing law any dispute concerning labor standard provisions 
must be decided by the Labor Department.
    Is that your understanding and would this regulation change 
that?
    Secretary Herman. I was looking puzzled, Congressman 
Wicker, because that is actually not our regulation. That is a 
regulation that is under the purview of the Federal Acquisition 
Council, FAR. That is a reg that has been there, as you have 
indicated, for a long time, and we don't have direct 
jurisdiction over that.
    I don't even believe the Department of Labor would be the 
agency that would be principally impacted. I think we would 
have some advisory role, but I think the practical effects of 
the reg would not impact us as directly as it would other 
Federal agencies.
    Mr. Wicker. Okay. Well, in that case, I will direct my 
question to that agency. Thank you, ma'am.
    Mr. Porter. Thank you, Mr. Wicker.

                     INTERNATIONAL LABOR STANDARDS

    Madam Secretary, let me go back to something I started with 
because I think it is a very important subject, and that is 
international labor standards and how we get from where we are 
in respect to other countries to where we want to go. It seems 
to me that China is a very good example.
    I used to look at this process of MFN renewal, which is now 
NTR renewal, as an annual chance to beat up on China for their 
egregious human rights record; and wasn't this a good thing, 
knowing as we all knew, that what we were doing is sending 
messages because we knew that the Senate would never take away 
MFN, or NTR, and even if they did, the President of the United 
States, this President or his predecessors, would never sign 
the bill anyway. So we could beat up on China with impunity, 
they deserved it, and we could tell the world what bad guys 
they are.
    The problem with that approach is, it never does anything 
to change China, and I came to the conclusion 5 or 6 years ago 
that this is a wasted effort in many respects. It is not a true 
effort, it is posturing; and while it may provide some good and 
some hope for people in the gulags in China, it really does 
nothing to change what, in fact, China does.
    And we put forward, in fact, at that time a piece of 
legislation that was adopted creating Radio Free Asia, and we 
now broadcast in all the Chinese languages 24 hours a day in 
China with a message of truth about what is happening in their 
society, a message about what free labor means and the right to 
join a union and the right to strike, among other human rights; 
and I think it is doing something to change the situation 
within China. And we have increased the funding fivefold in the 
last five or six years from a very modest beginning. And it 
also broadcasts, I might add, into Burma, into Laos, into North 
Korea, all the repressive societies in that region.
    Now, going back to the labor side, if we grant permanent 
NTR to China, that will make them therefore eligible to joinWTO 
or make us supportive of their application to join WTO, and if they do, 
trade will basically be taken away as any lever at all for 
international labor rights or free labor. It seems to me that this 
administration--and this is not a question, it is more of a statement--
it seems to me that this administration has got to think of other ways 
besides putting money into child labor programs to address this whole 
issue.
    We have to think of new ways to address the other group of 
human rights to change not only China, but so many different 
countries around the world who don't live according to 
standards that we believe people ought to meet in order to show 
respect and dignity for every human being. And if trade is not 
a good place to fight this battle--and I think basically it is 
not a good place to fight this battle--how do we get efforts 
under way that really can make a difference in these societies 
and promote the values that we believe in, that people want to 
see there, and at the same time make the playing field a more 
level one for the trade that we want to engage in with them?
    I agree that there is a great opportunity to change society 
simply by trading with them. I agree that there is a great 
advantage for economic freedom to transition into political 
freedom, and if we look at Taiwan and South Korea, for example, 
you have seen examples of that actually happening in that part 
of the world. But somehow we have to have something beyond 
trade to leverage our values and move them in the right 
direction, earlier rather than later.
    A lot of people will die in the meantime, a lot of people 
will be denied the rights that we think all people ought to 
have, and a lot of people will end up in the Chinese gulag if 
we don't do this. That is just a statement.
    Madam Secretary, thank you so much for your appearance 
today. You have been very patient with us. You have done a 
marvelous job. I hope that even though I may be retiring and 
leaving, you will stay as long as you like. Thank you so much.
    Secretary Herman. Thank you very much, Mr. Chairman, and 
let me just say that I have appreciated the opportunity to 
appear before you and this committee, and I concur 
wholeheartedly with everything that you have just said in your 
statement for the record.
    I want to thank and applaud you again for your work on 
child labor initiatives. For the first time, although it may be 
a small amount in relative terms of this Federal budget, we are 
requesting funds to support, in very practical terms, the 
advancement of core labor standards with key countries. These 
new initiatives deal directly with infrastructure issues of 
labor departments and labor ministries, not just to talk the 
talk about freedom of association and collective bargaining, 
but offer proactive solutions of how to get there.
    And so again I thank you.
    Mr. Porter. Thank you, Madam Secretary. The subcommittee 
will stand in recess until 10 a.m.



                                         Wednesday, March 22, 2000.

    PENSION AND WELFARE BENEFITS ADMINISTRATION AND PENSION BENEFIT 
                          GUARANTY CORPORATION

                               WITNESSES

LESLIE B. KRAMERICH, ACTING ASSISTANT SECRETARY, PWBA
ALAN LEBOWITZ, DEPUTY ASSISTANT SECRETARY FOR PROGRAM OPERATIONS
DAVID M. STRAUSS, EXECUTIVE DIRECTOR, PBGC
EDWARD L. JACKSON, DIRECTOR, OFFICE OF BUDGET

                       Introduction of Witnesses

    Mr. Wicker. Good morning. The hearing will come to order. 
Today we are joined by the Pension and Welfare Benefits 
Administration, acting Assistant Secretary, Leslie B. 
Kramerich.
    Did I pronounce that correctly?
    Ms. Kramerich. You did, thank you.
    Mr. Wicker. And from the Pension Benefit Guaranty 
Corporation, Mr. David M. Strauss. We are delighted to have you 
also, and we will be joined by several other members of the 
subcommittee later on. There are many conflicts this morning, 
as you can quite imagine, but we will begin with testimony from 
acting Assistant Secretary Kramerich. Glad to have you.

                           Opening Statement

    Ms. Kramerich. Thank you, Congressman.
    It is a pleasure to be here before you today to discuss the 
budget request for the Pension and Welfare Benefits 
Administration. I am accompanied by my colleague, Alan 
Lebowitz, our Deputy Assistant Secretary for Program 
Operations.
    As you know, our primary mission is to promote and protect 
the pension, health, and other benefits of over 150 million 
participants and beneficiaries in over six million private-
sector benefit plans, which hold more than $4.3 trillion in 
assets. Safeguarding and promoting the benefit security of 
American workers is an enormous challenge for all of us, but 
one we face with a strong resolve to succeed and a growing 
sense of pride in the results we have achieved so far.
    We are happy to be here today to tell you about the return 
on the taxpayers' investment in our programs and to bring you 
up to date on one of our newest programs.
    In fiscal year 1999, our agency corrected civil violations 
either through voluntary compliance or litigation that resulted 
in monetary recoveries to employee benefit plans of nearly $492 
million. Our enforcement actions in criminal cases resulted in 
the restoration of over $2.5 million to plans and the 
indictment of 81 persons for fraudulent behavior related to 
employee benefit plans.
    As part of our enforcement strategy, we have designated 
certain areas of special emphasis, including the Employee 
Contribution Project designed to curb and prevent abuse in 
401(k) and health plans, both those that are self-funded and 
those that are insured. As you know, this ongoing project was 
initiated in early 1995, and from the inception of the project 
through just last month, we have recovered almost $99 million 
for 401(k) plan and health plan participants.
    Last year, our customer service staff responded to 
approximately 155,000 inquiries and recovered $62 million in 
individual benefits for participants who were involved in 
benefit disputes. Another $12 million was recovered 
forparticipants as a result of our investigations.
    In fiscal year 1999, we published 16 new or revised 
brochures, pamphlets and other educational materials and 
distributed over 630,000 copies of these publications through 
our field offices around the country and through our toll-free 
publications hotline contractor. We have 46,000 users a month 
who access the educational materials on our Web site.
    We led a multiagency effort with our colleagues at the IRS, 
the PBGC, and the Social Security Administration to develop a 
new Form 5500, as well as requirements for the new Form 5500 
reports processing system known as EFAST. We are very grateful 
for this committee's support over the past several years in 
giving us the resources needed to get this new system in place.
    I also want to mention that we understand from some of the 
folks who will be filing these new forms with us this year 
through the new system, for the first time, that they still 
have questions and may need additional time for the filing 
deadlines. We have consulted with our colleagues at the PBGC 
and the IRS and do believe it is appropriate to grant them some 
additional time. So we will be looking into that and being more 
specific about what kind of one-time transition relief we can 
give very soon.
    We are also publishing guidance for filers who have asked 
for permission to use certain non-standard formats when filing 
their 1999 computer-scannable Form 5500 reports with us.
    The newest program I want to mention to you is our 
Voluntary Fiduciary Corrections Program (UFCP) which will be 
implemented shortly. This is an announcement that we published 
in the Federal Register on March 14. It will become effective 
30 days after that date. We have published and asked for 
comments so that we may consider ways to improve the program as 
we go along.
    The important change about this is that currently most of 
our investigations are resolved by plan sponsors taking 
corrective action after we identify a violation. What we are 
hoping to achieve through this program is the identification in 
advance of things that sponsors can identify on their own, come 
to us with, report to us the corrections that they have made, 
and get in return from us a no-action letter that tells them 
they have successfully corrected the program and they will not 
be at risk of financial penalties from the Department.
    We will consider VFCP applications from sponsors so long as 
neither the plan nor the applicant is already under 
investigation by our agency, and so long as the application 
does not provide any evidence of a potential criminal violation 
that we would need to pursue.
    While the program has some necessary restrictions, we 
believe it will be very helpful to plan sponsors and their 
advisers by providing an easy mechanism for correcting problem 
transactions. We are anxious to get this program underway, and 
we hope to recover as much as $12 million per year for 
participants under this new initiative.
    The way in which our budget request for 2001 will build on 
this is that our total request is nearly $108 million, provides 
for a total of 850 FTE, and, in conjunction with our annual 
performance plan, reflects our priorities for next year. The 
request includes nearly $10 million and 27 FTE for program 
enhancements; over 42 percent of the amount relates to five 
one-time increases. The $10 million increase we are requesting 
includes approximately $3 million and 15 FTE for pension 
security initiatives, $1 million and six FTE for health care 
initiatives, and nearly $6 million for initiatives that will 
cover both areas.
    I would like to mention a few of the individual items 
within that total: $4.1 million and three FTE are for 
information technology requirements that will go to supporting 
our enforcement, compliance, customer service, research, 
education, and outreach programs. Of that $4.1 million, $3.5 
million relates to three one-time increases.
    We are also requesting $1.2 million and 10 FTE that will 
allow us to implement a new program called the Rapid ERISA 
Action Compliance Team (REACT). This is important because we 
want to be able to get in as soon as possible when sponsors are 
facing bankruptcy and be able to take steps necessary to 
protect pension assets.
    We are requesting $950,000 to expand our research program 
to include pension finances, health care issues, and other 
economic analyses that are a part of our regulatory actions. 
And finally, we are requesting $500,000 to expand our Health 
Benefits Education campaign to include new publications that we 
want to put out so that folks understand their health care 
rights and the obligation they have to know certain information 
and to act in a timely fashion to protect their access to 
employer health care.
    We believe our budget request reflects the strong 
commitment of this administration, and this Congress, to 
improve the lives of American working families by promoting 
their economic security and their employee benefit security, 
and that our GPRA plans and our budget request will help us to 
accomplish this mission effectively and efficiently.
    I am happy to take any questions.
    Mr. Wicker. Thank you very much.
    [The information follows:]



                           Opening Statement

    Mr. Wicker. I think we will proceed at this point with Mr. 
Strauss' testimony.
    Mr. Strauss. Thank you, Mr. Chairman. I appreciate the 
opportunity to appear before you today. I want to report 
briefly to you on PBGC's financial condition and very briefly 
discuss our budget request.

                          FINANCIAL CONDITION

    Mr. Chairman, I am happy to report that the PBGC ended 
fiscal year 1999 with a growing surplus. After 21 years of 
deficits, this is the fourth consecutive year that we have 
ended in the black.
    In the early 1990s, many feared that the PBGC would be the 
next savings and loan crisis. We were on both the GAO and OMB 
high-risk lists. Our books were not auditable and the PBGC 
Single Employer Insurance Program had a large deficit. Today, 
as a result of improvements in our financial management, I am 
pleased to report that the PBGC is off the GAO and OMB high-
risk lists, that our financial statements have received their 
seventh consecutive unqualified opinion from 
PricewaterhouseCoopers and that we are building a cushion to 
protect the insurance program in the event of an economic 
downturn.

                             FY 2001 BUDGET

    Mr. Chairman, PBGC's operating budget for fiscal year 2001 
calls for $176.7 million. This is an increase of $12 million 
over our fiscal year 2000 budget. About 4.4 million of this $12 
million increase will go for pay increases and inflation, and 
the remaining $7.6 million will go for faster benefit 
processing, enhanced computer security, and increased 
management fees for our growing investment portfolio.
    Mr. Chairman, our budget request includes an increase of 
$2.7 million for faster benefit processing for participants in 
the plans we take over. Unlike the Social Security 
Administration, which generally pays benefits in accordance 
with a single formula, the PBGC pays benefits based on the 
provisions of each of the plans that it takes over. This means 
that, in effect, we are operating almost 2,800 different 
pension plans, no two of which are exactly alike.
    As part of this process, we set up a completely new 
database from scratch for each plan we take over. For each 
participant in those plans we must verify wages, work history, 
age, and marital status. This is not always easy because 
financially troubled firms often have incomplete, inaccurate, 
and missing records. Because auditing a plan and calculating 
each participant's individual benefit often takes several 
years, we pay retirees estimated benefits until this work is 
complete. Although there is usually not much difference between 
estimated and final benefit amounts, our participants have told 
us that they want faster benefit determinations.
    The budget before you today will allow us to obtain the 
additional actuarial support and improved computer technologyto 
speed up the time it takes us to process these benefits.
    Mr. Chairman, the PBGC's budget request also includes an 
increase of $2.1 million for information technology. The bulk 
of this is for computer security to protect our participant 
records and payment systems. Seven years ago, the biggest 
threat to participants' records was a fire or natural disaster 
because virtually all of our databases were on paper and we had 
no backup records. Today, with computerized databases, we face 
a different problem, protecting participant records from 
hackers, viruses, and other dangers of the electronic age. This 
request will allow us to adopt the best information security 
practices of government and industry, including a process for 
continuous evaluation and improvement.
    Finally, Mr. Chairman, the PBGC's budget request includes 
an increase of $2.8 million to manage our growing investment 
portfolio. The PBGC has $19 billion invested in a diversified 
portfolio. This is up from about $11 billion as recently as 
fiscal year 1995. Because our investment fees are based on the 
assets under management, these fees will continue to increase 
as our portfolio grows.
    In closing, I want to thank you again, Mr. Chairman, and I 
also want to thank the committee for the courtesy and the 
support they have shown us in the last 7 years.
    Thank you very much
    [The information follows:]



    Mr. Wicker. Well, thank you very much for your testimony. 
Let me just check on one thing, so I will ask you to withhold 
for a moment.

                         INVESTMENT MANAGEMENT

    Mr. Strauss, why don't you go ahead then? Chairman Porter 
wanted us to ask you to comment about how you invest the 
agency's funds. Do you hire contractors to handle the 
investment funds for you, and if you do, how do you select 
those contractors and how are they compensated?
    Mr. Strauss. We hire professional money managers using the 
government procurement process, and we negotiate fee 
arrangements with each of these managers. Our fees are 
extremely modest.
    Mr. Wicker. Could you be more specific about how modest 
they are? What do you mean by that?
    Mr. Strauss. I could be very specific about how modest they 
are. I can either dig this out of the book for you now or I can 
submit it for the record, but just note for the record these 
fees are extremely modest.
    [The information follows:]

    Fees paid to PBGC's investment managers totaled $11.1 
million in FY 99.
    The current allocation of the Total Fund is 57% Fixed 
Income, 42% Equities, and 1% Cash. The total fees paid to 
investment managers are 6.6 basis points (0.066%) of assets.
    The Fixed Income Composite (57% of the Total Fund) is 
invested in long-term U.S. Treasury securities. The fees paid 
to the manager of this portfolio are 0.6 basis points (0.006%) 
of assets.
    The Equity Composite (42% of the Total Fund) is invested in 
diversified domestic equity portfolios managed by 7 different 
asset managers. The fees paid to the managers of these 
protfolios average 15 basis points (0.15%) of assets.
    Relative to other pension plans, PBGC's fees are extremly 
low. For comparative purposes, in the 1998 survey of 
institutional plan sponsors by Greenwich Associates (a 
prominent investment consulting firm) the average fees paid to 
outside investment managers was 44 basis points (0.44%) of 
assets.

                        PATIENTS' BILL OF RIGHTS

    Mr. Wicker. Ms. Kramerich, one of the overlooked aspects of 
PWBA is its responses regarding health plans offered by 
employers. Chairman Porter wanted me to ask, how would the 
Patients' Bill of Rights, awaiting conference in Congress, 
affect PWBA's responsibilities in this area.
    Ms. Kramerich. The Patients' Bills of Right, that is in 
conference now, any version the President has indicated he 
would sign is going to dramatically increase our 
responsibilities across the board. It will mean a lot of new 
regulatory authority, a lot of new regulations that we would 
need to come up with, propose and implement.
    It will mean a lot of additional work partnering with State 
insurance regulators around the country to coordinate the 
responsibilities that we share. That is something we do now, 
but it would, of course, increase in importance and magnitude. 
It would be a lot of work in educating individuals, so that 
they know how the law would change, who regulates what, where 
they would get answers, and what their new rights are.
    The proposed legislation includes new enforcement authority 
for us, as well.

                 VOLUNTARY FIDUCIARY CORRECTION PROGRAM

    Mr. Wicker. Okay. Let me ask you, if you will, Mrs. 
Kramerich, then to expand a little on--I believe what you call 
VFCP, the Voluntary Fiduciary Correction Program.
    Ms. Kramerich. Sure.
    Mr. Wicker. This program is intended to strengthen ERISA-
covered plans by getting plan managers into compliance without 
being fearful of penalties.
    In addition to anything else that you would provide to the 
subcommittee as an overview, what is your expected response 
rate to this program, number one, and is this a permanent 
program; or will there be some time limit after which we will 
go back to penalties and fear of prosecution and fines?
    Ms. Kramerich. We have announced the program as a proposal, 
but it will not be a temporary program. We really have high 
expectations for what this is going to produce in terms of 
additional compliance, and we think that it is something that 
is very much desired by employers.
    There are more than 700,000 pension plans out there. We 
know that there are a lot of employers that will have an 
inadvertent failure of some kind, and they truly want to get 
back into compliance. They have been hoping that we would come 
up with a way to tell them exactly how they can best do that. 
If we are able to do that for them, as we are proposing to do 
through this program, in ways that we don't have to enter into 
settlement negotiations, then we are also freed from being 
forced to impose a mandatory penalty of 20percent on the amount 
that they restore to the plan to correct the inadvertent violation.
    So, it is our goal here that employers will very much value 
the opportunity to efficiently correct something that was minor 
and unintended in the first place, and will use the opportunity 
to come into compliance.
    We have listed 13 specific transactions that are eligible 
for correction through the program, and detailed what it is 
they would have to do and what they would have to report to us 
about how they have come into compliance so that we could issue 
them the no-action letter that is going to hold them harmless 
from penalties.
    Mr. Wicker. I see. And these would all be in the nature of 
accidental mistakes, or are there----
    Ms. Kramerich. There are certain things, for example, such 
as, obviously, criminal violations, that we have said are not 
eligible for correction under this program.
    Mr. Wicker. Intentional violations would not be eligible 
for this, Mr. Lebowitz?
    Mr. Lebowitz. ERISA, obviously, is a very complicated 
statute and----
    Mr. Wicker. I'll say.
    Mr. Lebowitz. People can often find themselves 
inadvertently in a situation where there is a violation. It may 
have been, or it may not have been, unintentional, but it 
certainly wasn't intended to be violative of the law.
    So, in that sense, the program is really open to the 
categories of transactions that we have listed in it; and we 
essentially invite people to scrutinize the way their plans 
have been operating, to make whatever corrective actions are 
appropriate, and to let us know. That process essentially 
relieves them of any further liability under ERISA.

                     ERISA FILING ACCEPTANCE SYSTEM

    Mr. Wicker. And then let me turn back to the issue that you 
mentioned earlier on EFAST, Ms. Kramerich.
    Are you--it is your testimony that you are on schedule with 
your stated goal of being complete by the Year 2000?
    Ms. Kramerich. Our system will be up and running and 
available to receive filings on schedule in July of this year. 
What we have recently heard from some employers and employer 
groups is that they would like some additional flexibility in 
the month in which they are required to submit their first 
filing under this new system. They would like to have some time 
to talk to us and work with us about some questions they still 
have about what they have to do to come into compliance with 
the new reporting form; and so we have said that we would like 
to talk to them more and perhaps find a way to give them a 
modest extension. But the system will be ready to receive 
filings on time.
    Mr. Wicker. And then could you comment on the cost-sharing 
concern, and has there been a resolution as to sharing the cost 
with IRS and other agencies?
    Ms. Kramerich. We have been discussing the cost-sharing 
arrangement with the IRS and the PBGC, in terms of, how it will 
be determined now that we have a different division of 
responsibilities under our new reports processing system. We 
expect to complete that discussion and to have all parties sign 
off on, this partnership, within in the next few weeks.

                          GPRA IMPLEMENTATION

    Mr. Wicker. Mr. Strauss, let us--I want to give you an 
opportunity to talk for a moment about GPRA implementation.
    For many Federal agencies, fiscal year 1999 was the first 
year they were able to establish baseline measures for 
implementing GPRA; however, it seems that PBGC has had data 
available and has been able to track performance since the 
first performance plans were sent to Congress.
    Can you tell us how GPRA has affected your management of 
PBGC?
    Mr. Strauss. This is the fourth consecutive budget that we 
have submitted that is based on GPRA principles, Mr. Chairman, 
and I think that GPRA is something that has completely 
permeated our culture at the PBGC. It affects everything that 
we do. I get regular reports on how we are doing on our 
performance measures. All of our significant work within the 
PBGC is quided by GPRA and we take these performance measures 
very seriously.

                       PBGC PERFORMANCE MEASURES

    Mr. Wicker. And what are those performance measures?
    Mr. Strauss. In our written testimony, we list four 
strategic goals and then the performance measures that fall 
under each of those goals; and you know--if you would like, I 
would be happy to go through each of these strategic goals and 
talk a little bit about the performance goals under each, or we 
can just submit this for the record.
    Mr. Wicker. Let me tell you a concern that Chairman Porter 
would like for you to address. There are two areas where 
performance baselines are being developed, one for reliability 
of benefit estimates, and one for timeliness and reliability of 
participant applicants. The Chairman would like you to comment 
on whether you have been able to establish these baselines and 
why you were able to have data for other measures, but not 
these.
    Mr. Strauss. With respect to--would you kindly repeat the 
question about the measures?
    Mr. Wicker. Reliability for benefit estimates and 
timeliness and reliability for participant applicants.
    Mr. Strauss. Well, the reliability of the estimates is 
something that we have been working on; and as I indicated 
earlier, in our history, we have taken in 2,800 different 
pension plans, and we administer these pension plans based on 
the actual provisions of each plan. And so what we are trying 
to do is to develop the computer technology to help us, provide 
reliable estimates; and that is something that we are working 
on. It is a priority for us; it is something that our customers 
are telling us that they want from us, and so we are still in 
the process of developing the computer tools that will allow us 
to do this.
    Because, as you can well imagine, it is an enormously 
complicated process to have to run 2,800 different pension 
plans based on the actual provisions of each plan and to come 
up with a computer tool that can be used to reliably predict 
these estimates so people can have confidence in them. That is 
something we have been working on, and we are still in the 
process of developing that.
    And it is something that I take a great deal of interest in 
personally. I have met with over 60 groups of participants in 
the plans that we are taking over to find out what they would 
like from us, what they would find useful, and then how we 
might go about developing that. But it is sort of analogous to, 
if all of the congressional employees decided that they wanted 
to retire on the same day, and they all went in and wanted a 
reliable benefit estimate, and they each have all these 
different variables--wages, work history, marital status, all 
these things that could affect their pension--so the question 
is how we can develop a tool where, ultimately, someone might 
even be able to get this information through our Web site and 
have it be reliable.
    So I think that is what he is concerned about. Know that we 
share that concern. We are pretty good at providing ballpark 
estimates, but as people get closer to retirement they want 
something mopre precise, and we are trying to develop a tool to 
give them that.
    I think that is what the Chairman is getting at there, and 
I share his concern. I want you to know that it is something we 
are working on.
    Mr. Wicker. Well, there may be further questions submitted 
for the record on that and other areas.
    [The information follows:]



    Mr. Wicker. Mr. Miller. Staff is pointing out to me that 
Mr. Miller is far senior, we need to move him on up to a 
position of prominence, and I am delighted at this point to 
relinquish the chair to my good friend from Florida.
    Mr. Miller [presiding]. Thank you. I apologize for missing 
the early part.

                       ROLES OF PBGC VERSUS PWBA

    Let me clarify something--differentiate the two roles that 
you have, I mean. I have had it explained to me before, and I 
know the board worked on an issue from my district, but would 
you just differentiate the two roles that you perform?
    Mr. Strauss. I will defer to my esteemed colleague to go 
first.
    Ms. Kramerich. I will take a crack at that, and this is 
interesting for me, because I used to work at the PBGC, so 
people still ask me this question all the time and I understand 
the confusion. The PBGC has a vital role in retirement security 
and the Secretary of Labor is the chairperson of their board of 
directors.
    PBGC is responsible for guaranteeing the benefit promises 
that are made by defined benefit pension plans. That is a huge 
population that is promised a benefit by a traditional pension 
plan, a defined benefit pension plan, and if that plan should 
have to terminate while it is underfunded, PBGC--as kind of the 
insurance company, to be a little loose about it--would step 
in, take all the plan records and take over the responsibility 
of paying out checks to all of those retirees when they become 
eligible to retire.
    At the Pension and Welfare Benefits Administration, we have 
a different responsibility. We enforce provisions of ERISA 
involving the fiduciary obligations of the people that are 
managing and administering pension plans; and our scope has to 
do with not only the defined benefit plans that PBGC 
guarantees, but also the defined contribution plans, like 
401(k) plans, for which there is no guaranty program.
    We have a very vital responsibility there because not only 
are we partners in protecting the DB plans, we are also keenly 
aware that for a certain population of pension plans there is 
no guaranty system. Our vigilance and participants' vigilance 
is going to be vital to making sure those promises are kept.
    We have a lot of other responsibilities, too--for 
education, for regulations on health care. PBGC is exclusively 
pensions. We are responsible for both employer pension promises 
and employer health care promises, as well.

                    DECLINE IN DEFINED BENEFIT PLANS

    Mr. Miller. There is a decline of people covered by defined 
benefit plans in this country? Correct me if I am wrong.
    Mr. Strauss. With respect to defined benefit plans, I think 
it is very fair to say that there are few new plans being 
created, that there are few new participants coming into the 
system and that within the next several years the lines will 
cross and there will be more nonactive participants than active 
workers in these plans.
    Mr. Miller. Is that good or bad?
    Mr. Strauss. I think it is bad, and the reason that I think 
it is bad is that one of the statutory mandates for the Pension 
Benefit Guaranty Corporation is to promote the continuation and 
maintenance of the defined benefit pension system in this 
country; and I think that when you look at how many people in 
this country are approaching retirement, unprepared, it 
underscores the value of defined benefit pension plans, which 
provide predictable, secure benefits for life for the 
participants who are in these plans.
    And in this country today, about half of the work force has 
no employer-provided pension plan. Savings have been quite 
modest for most people in this country, and they are 
approaching retirement unprepared; and so I think that defined 
benefit plans have real value for the people in the system.

                       DEFINED CONTRIBUTION PLANS

    Mr. Miller. The people covered by defined contribution 
plans is much greater and growing; is that right?
    Mr. Strauss. That is correct.
    Mr. Miller. Is that good?
    Mr. Strauss. I think that there is nothing wrong with 
defined contribution plans. It is just that when you look at 
the median amount in these defined contribution accounts, it is 
about $14,000, and when you go back and look at the intent of 
Congress when defined contribution plans were established in 
the first place, defined contribution plans were always 
intended to be supplementary; they were never intended to be 
the primary retirement vehicle. And so--over time in this 
country, they really have evolved into something that they were 
never intended to be in the first place; and so an increasing 
number of people now have only defined contribution plans. They 
are not saving early enough in life to have large enough 
account balances to really guarantee them much retirement 
income security.
    Mr. Miller. What percentage of the working population have 
both, defined benefit and defined contribution? Not both, only 
one or the other versus----
    Mr. Strauss. I could tell you trends--we have a really good 
research department, and I would be happy to supply you more 
information for the record. The way the trends are working in 
this country, clearly the trends are overwhelmingly in favor of 
defined contribution plans, and so very few defined benefit 
plans are being set up these days.
    There are a number of people who have both, but 
increasingly there are many workers in this country who have 
only one and that is a defined contribution plan. So the trends 
are overwhelmingly in favor of defined contribution plans away 
from defined benefit pension plans.
    Mr. Miller. You say the average defined contribution 
balance, when they retire is $14,000?
    Mr. Strauss. The median amount is about $14,000.
    Mr. Miller. At retirement?
    Mr. Strauss. As a statistician, you know that that means 
that half of these account balances are less than $14,000. 
Slightly higher, Mr. Chairman, at retirement, but not 
dramatically so.
    Mr. Miller. But the trend is increasing and the balances 
are getting larger, I guess.
    Mr. Strauss. Even when you look at the amounts of these 
balances at retirement, they are not significantly greater than 
the average. Yes, they are higher than the average, but when 
you look at the savings patterns in this country, that people 
tend to wait until later in life, where they are really in a 
position to afford to save, there is not enough time for these 
balances to really grow sufficiently in order to guarantee them 
a secure retirement.

                        NUMBER OF PROBLEM PLANS

    Mr. Miller. I am just trying to learn some more things 
about the whole program.
    I had an experience in my district of a company that had 
gone bankrupt, and I guess that is one of the largest losses 
you got involved in. It got resolved, and this company now is 
going into a new technology, a high-tech area, diversifying, 
and looks like it is doing okay.
    But how many problems do you have now? I mean, a lot of 
problems developed back in the 1980s and different regulations 
and different laws, and the economy went sour in the early 
1980s.
    How many risky plans are out there today?
    Mr. Strauss. Well, the interesting thing about that is that 
we find that even at a time like this, where the economic 
conditions are nearly perfect, we are taking in a certain 
number of plans every year. The difference between now and the 
early 1990s is that in the early 1990s we were taking in very 
large plans, a couple of major airlines went under, and we were 
taking in steel company plans.
    These plans were large; they had huge underfunding, there 
were large numbers of participants. We are still taking in more 
than 100 plans every year. It is just that these plans have 
tended to be much smaller, and I think that with respect to the 
overall funding of defined benefit pension plans, when you 
consider how great the economy has been--the underfunding 
numbers have been pretty constant. You would think, with this 
great economy, these plans would be better funded. But if you 
look at the numbers overthe last 4 or 5 years, there has not 
been that much change over the last 4 or 5 years.
    Mr. Miller. There are still as many underfunded, you mean?
    Mr. Strauss. The underfunding numbers have stayed about the 
same. So despite the improvement in the economy, the 
underfunding has stayed about the same.
    Mr. Miller. You would think, with a booming market and all 
that, that would not be case.
    Mr. Strauss. It is counterintuitive, but that has been the 
case.

                            401(K) AND IRA'S

    Mr. Miller. As people invest more in 401(k)s and IRAs--and 
those are much more common--what percentage of Americans have 
that, do you know--have a 401(k) or an IRA?
    Mr. Strauss. The part of the question I can answer is that 
only half of the private sector work force has any sort of 
employer-provided pension plan. So that means that half does 
not, and I will defer to my colleague here.
    Ms. Kramerich. Fair enough.
    There are more than 632,000 defined contribution plans, and 
if it is all right, we will supplement for the record exactly 
how many of those are 401(k) plans and exactly how many people 
are in them.
    [The information follows:]

             Numbers of 401(k) Type Plans and Participants

    As of 1996, there were a total of 230,808 private sector 
401(k) type plans with approximately 34,935,000 participants.

    Ms. Kramerich. There are a lot of 401(k) plans that are 
offered by small employers, employers of a hundred or fewer 
people; and as David mentioned, there are a lot of folks that--
--
    Mr. Miller. What percentage of the work force? Is it 50 
percent of the work force that has a 401(k)? Do you keep any 
records or does IRS keep records?
    Ms. Kramerich. We would have to get it from the IRS, but we 
can get it.
    [The information follows:]

             Percentage of Workforce With 401(k) Type Plans

    Based on the plan year 1996 Form 5500 Annual Report filings 
on employee benefit plans, about 32% of private wage and salary 
workers participated in 401(k) type plans. A more current 
estimate would be about one-third of the labor force 
participants in 401(k) type plans.

    Mr. Miller. Because 401(k)s and IRAs, people have something 
that is theirs, you get a statement. That was what is nice 
about my IRA before I came to Congress; I got a little 
statement. It is not a huge amount.
    Ms. Kramerich. One of the things that the President's 
budget proposes this year is more frequent statements being 
given to defined contribution participants, so that they get 
exactly what you are talking about, a very frequent reminder 
and a very frequent way to check what is in that account and if 
it is what it should be.
    The President's budget also proposes more frequent 
statements for participants in defined benefit plans so that 
they, too, know what the promise is going to be.
    Mr. Miller. What is the frequency?
    Ms. Kramerich. For defined plans, at least one every 3 
years; for defined contribution plans, at least once every 
year.
    Mr. Miller. I think with a monthly reflection of the 
market, that is not a smart way to look at it.

                 NUMBER OF WORKERS IN RETIREMENT PLANS

    Mr. Strauss. Mr. Chairman, just to supplement what my 
colleague is saying here, she used the figure of 680,000 for 
defined contribution plans. The number for defined benefit 
plans is about 40,000. So the PBGC insures about 40,000 
private-sector defined benefit pension plans.
    But the significance of these 40,000 private-sector defined 
benefit pension plans is that they have about 42 million 
workers and retirees in them. So, for those participants who 
have the good fortune to have one of these plans, this is not 
an insignificant system.
    The problem is that there are very few new plans being 
created, very few new participants coming into the system, and 
so, as the work force has increased, these numbers within the 
private-sector defined benefit pension system have remained 
relatively flat.
    Mr. Miller. And the trend is going to continue that way 
probably?
    Is that what you envision for defined benefit pension 
plans? New companies aren't going into it, and with employment 
changing, it is going to continue to decrease.
    Mr. Strauss. Certainly that trend is likely to continue.
    Mr. Miller. There is no reason why it would change, is 
there? Is there anything on the horizon that would change that?
    Mr. Strauss. Well, as part of our statutory mandate to 
promote the continuation and maintenance of the defined benefit 
pension system, early in my tenure, we surveyed a lot of the 
stakeholders, the plan sponsors, the participants, the 
practitioners who were involved to find out, if we were really 
serious about reversing these trends, and what we would need to 
focus on. And the consensus we got was thatthere was hope if we 
were willing to address three areas, and those three areas were to look 
at the sort of incentives that the government provides to employers to 
encourage them to offer these plans, and to look and see whether, over 
time, those incentives have really been updated.
    The second area was the need to provide employers with 
flexibility to meet the needs of their work force and so to 
provide employers with a type of hybrid design so they could 
offer defined contribution-type arrangements to their younger 
employees who were more mobile, who were moving from job to 
job, who wanted to have an account balance that they could take 
with them from job to job, but also to offer the traditional 
type of defined benefit arrangement for older employees, who 
were closer to retirement, who were interested in having that 
kind of defined benefit.
    And then the third area we were asked to address is the 
overwhelming complexity of all of this, that you could look at 
any one rule here and it might make sense, but that when you 
looked at the sum total, the weight of all of this was really 
killing the system.
    So these were the three areas that we were told that we 
really needed to address if we were serious about revitalizing 
the defined benefit pension system in this country.
    Ms. Kramerich. If I may add something to that, we have been 
working with the PBGC and with our colleagues at Treasury and 
from the other pension agencies to try and come up with ways to 
address these problems; and our Voluntary Fiduciary Correction 
Program is a piece of that. Treasury has also issued guidance 
that goes to a piece of that. We are all sort of looking 
together for ways we can reduce administrative burdens and find 
ways to encourage employers to stay in the system.
    We are also looking for legislative ideas that can 
encourage, especially small employers to come back into the 
defined benefit system, because as David said, a lot of the 
large employers are still staying with the defined benefit plan 
they have, although some have frozen it. It is the small 
employers that aren't offering DB plans with the same frequency 
anymore. As a result we have worked together on legislative 
proposals to tackle that.
    We have worked together to come up with other means, too. 
Our EFAST reports processing system should make some of the 
administrative complexity involved in filing reports every year 
simpler and more efficient for sponsors. We hope that those 
changes also will be a part of the answer.
    We hope our education campaigns to help people understand 
the benefits of their plans will be part of the answer, and of 
course, we would like to see both plans--DBs and DCs--remain 
vital parts of the system, because in a DB plan you are going 
to get a benefit that you don't outlive and you are going to 
have the experience or the expertise of probably an investment 
manager looking out for the assets in that plan, as opposed to 
in the defined contribution system being responsible for 
deciding how much to save and deciding what to do with the 
amount that you are eligible to take at retirement, and whether 
it is going to be enough, and how to manage it as you are 
staying in retirement and continuing to contribute.
    There are a lot of additional challenges there for 
individuals.

                CHALLENGES FACING DEFINED BENEFIT PLANS

    Mr. Miller. With a society that changes jobs--and to future 
generations they say, you are going change careers five times. 
I am on my third career right now; I will have another one 
soon. That is going to be common.
    So it is harder to have a DB plan that is mobile; that is 
the reason defined contribution is more controlled.
    Mr. Strauss. The interesting thing about this, though, is 
that, when you compare, the present with 20 years ago, people 
don't move around any more than they ever did; it is young 
people who move around--young people have always moved around; 
and most people get their significant pension benefit from 
their last job. And so it is not as complicated as it may seem 
in terms of where people actually get their significant 
retirement benefit. Older workers tend to be more stable and 
get their significant retirement benefit from their last job.
    Ms. Kramerich. Just to add to that, we are aware that a lot 
of people are very concerned about portability and mobility and 
are wondering how they can be sure if they move from job to job 
that they can take the benefit they have earned to the new job. 
They find it easier to manage all their money in one account. 
That is something else that we have tried to address in 
administrative guidance. Also, the President's budget proposal 
has some features that are meant to make defined benefit plans 
more portable, so that people will still have the confidence 
that when they move, what they have earned can go with them.
    Mr. Miller. A lot of this ties into the whole concept of 
saving Social Security. This ultimate goal is kind of in common 
there, but with our change in economy, DB plans don't fit as 
flexibly as 401(k)s and IRAs, which offer opportunities.
    I had one experience a few years ago and it turned out, as 
I say, very positive. I don't know enough about the details of 
this one in my district, but it gave a chance for the company 
to get a new start. From everything I read in the paper--I 
didn't really follow it all that closely--it is exactly what 
needs to be done; rather than breaking up a company--
ultimately, I know there was a penalty that had to be paid, but 
from following it, I think y'all handled it well. Thank you.

                    SARASOTA FIELD BENEFIT OPERATION

    Mr. Strauss. Mr. Chairman, you will be pleased to know that 
we actually have a field benefit operation in Sarasota, which 
is a very successful and growing PBGC operation, and we would 
love to give you a tour sometime.
    Mr. Miller. What does that do?
    Mr. Strauss. Part of the role of the PBGC is that we take 
in distressed pension plans and we run them; and in our 
history, we have taken in 2,800 such plans, and we administer 
them based on the actual provisions of each plan. And so we 
have a series of field benefit offices around the country to 
assist us with our benefit administration. We have an office in 
Sarasota, where we have about a dozen employees, who are 
working on a significant number of these plans; and they 
administer the benefits for some of these pension plans. It has 
been a very successful organization there.

                       HANDLING TERMINATED PLANS

    Mr. Miller. So you continue to run that one, and you run it 
out of Sarasota.
    I don't even know how you get a settlement. There was a 
loss that had to be absorbed somewhere.
    Mr. Strauss. That is the purpose of the insurance program. 
We absorb that loss, and then we administer the program.
    Mr. Miller. How do you keep paying the benefits, out of 
regular cash flow or do you kind of fund it?
    Mr. Strauss. Well, the plan sponsors, of course, have to 
pay premiums to us, that is one source of our income; and then 
if there are any assets left in these distressed plans, we 
assume those assets which we, of course, invest. And so then 
the benefits are paid.
    Mr. Miller. What assets do you have when you have a 
bankrupt company? How would that one work?
    Mr. Strauss. Usually there are some assets left in the 
pension plan that we assume, sometimes more than others. If I 
think of what the number is historically, I would say that 
maybe the average plan that we have taken in--historically, it 
might be like 50 percent underfunded. So there are always some 
assets there; they just don't have enough assets to pay all the 
promised benefits, and the part we make up is the difference 
between, whatever assets they have and whatever the promised 
benefits are.
    Mr. Miller. Do you get stock in the new company; is that 
part of the package?
    Mr. Strauss. No. Only occasionally do we get something that 
we can't dispose of promptly.
    Mr. Miller. You want to dispose of it and get it liquid?
    Mr. Strauss. Which was your situation several years 
ago,that was handled so amicably.
    Mr. Miller. Thank you. I would like to say, I don't have a 
large Federal presence in my district, except for lots of 
retirees; but I didn't even know that was there.
    I wouldn't mind stopping by and visiting sometime, so thank 
you.
    Mr. Strauss. We would be happy to set that up for you.
    Mr. Miller. As you know, Mr. Porter, I think, is on his way 
back from Illinois--I guess after a primary yesterday. So, with 
that, we will move on to the--we will just stand in recess 
until 11 o'clock.
    Thank you very much for coming and thank you for answering 
my questions. I learned a lot more today.
    [Recess.]



                                         Wednesday, March 22, 2000.

                       BUREAU OF LABOR STATISTICS

                               WITNESSES

KATHARINE G. ABRAHAM, COMMISSIONER
LOIS ORR, DEPUTY COMMISSIONER
DANIEL J. LACEY, ASSOCIATE COMMISSIONER FOR OFFICE OF ADMINISTRATION
JOHN M. GALVIN, ASSOCIATE COMMISSIONER FOR OFFICE OF EMPLOYMENT AND 
    UNEMPLOYMENT STATISTICS
KENNETH V. DALTON, ASSOCIATE COMMISSIONER FOR OFFICE OF PRICES AND 
    LIVING CONDITIONS
EDWARD L. JACKSON, DIRECTOR OFFICE OF BUDGET

                       Introduction of Witnesses

    Mrs. Northup. We will begin the hearing. Please excuse me 
for being late. I was asking questions in the committee meeting 
across the hall.
    Commissioner Katharine Abraham, welcome. We are glad to 
have you and you can proceed with your testimony.

                           Opening Statement

    Ms. Abraham. Thank you very much, Madam Chairwoman. I do 
have a formal statement, but if I could, I would like to have 
it submitted for the record. What I thought I might do, rather 
than going through that, is just talk very briefly about the 
new initiatives that we have included as part of this budget 
proposal, and then obviously we will be happy to address any 
questions you might have.
    We have requested funding for 2001 for four new activities: 
first, the collection of data on time use; secondly, some 
important extensions to the coverage of our producer price 
index and productivity statistics programs; thirdly, a pair of 
projects related to improving our local area employment and 
unemployment statistics and related data; and fourthly, funding 
for a study that would be done by the National Research Council 
on measurement of discrimination.

                            TIME-USE SURVEY

    Let me start by just saying a little bit about the proposal 
that we have put forward to collect data on time use. I have to 
say when I first ran into people from other statistical 
agencies in other countries who were talking about surveys they 
had done to collect information on time use, I was very 
skeptical that that was something that we at the Bureau of 
Labor Statistics would want to get into. Why would we have an 
interest in collecting information on how people spend their 
time? I guess, over time, I have become a convert to thinking 
that having that sort of information is indeed quite important. 
Maybe I can give a couple of examples to illustrate why I think 
that is so.
    There is a lot of interest in our country in education and 
what we are doing to educate our young people, but you know as 
well as anyone, I suspect, that an awful lot of education 
doesn't go on in schools, in formal settings. It goes on in the 
home in the form of interaction between parents and their 
children. We have no systematic information on the kind of 
time, the amount of time, that parents spend with their 
children and what they are doing with that time. This survey 
would provide information on that.
    Just to take a second example, there is an awful lot of 
interest in health care and what we spend on health care. We 
have good information on the pieces of that that go through the 
market. We know what we are spending on stays in hospitals, we 
know what is happening to spending on pharmaceuticals, and so 
on, but what we really don't know anything much about is the 
piece of health care that, again, goes on in people's homes, 
family members taking care of other family members. I think 
this information that we are proposing to collect on time use 
would help to round out that picture.
    I could give other examples. I have come to think that if 
we are collecting statistics that focus exclusively on what is 
going on in market transactions and we leave out any kind of 
looking at the productive activity that is taking place outside 
of that context, we are missing an important part of the 
picture of what is going on in our economy; and this, in 
essence, is why we have come forward with this proposal to 
begin collecting information on time use.

        SERVICE SECTOR PRICE, OUTPUT, AND PRODUCTIVITY MEASURES

    The second thing that we have proposed as a new initiative 
is some expansions to the coverage of our producer price index 
and productivity statistics programs. In the producer price 
index program, we are proposing to begin producing price 
statistics for the first time in the construction sector. We 
are also proposing to expand our coverage beyond what we 
otherwise have planned in the service sector. Similarly, in our 
productivity statistics program, we are proposing to expand our 
coverage of productivity in the service sector. So that is what 
that proposal is about.

                        WORKFORCE INVESTMENT ACT

    The third initiative we have put forward is an initiative 
related to implementing one of the important provisions of the 
Work Force Investment Act, which calls for us, working with our 
State partners, to come up with plans to improve the labor 
market information available for local areas. There are two 
pieces to what we are proposing. The first thing we are 
proposing is to build the capacity within our organization, 
again working with the States, to develop systematic processes 
and procedures for putting together State employment 
projections, and the second thing that we are requesting 
funding for is some much-needed improvements to our local area 
unemployment statistics.
    We are coming up on the 2000 Census. Once the information 
from the Census becomes available, we need to have plans in 
place to incorporate that data into our local area employment 
and unemployment estimates. We also need to begin working now 
so that data from the American Community Survey, which the 
Census Bureau is planning to conduct on an ongoing basis, gets 
incorporated into our estimation procedures.
    So both of these initiatives are, I think, really very 
important to ensuring that we have high-quality labor market 
information for States and local areas.

                        TRACKING DISCRIMINATION

    And then lastly, the National Research Council Study of 
Discrimination is something that has grown out of the 
President's Initiative on Race and is envisioned as helping to 
move that forward.
    So those are the four new things that we have proposed in 
this year's budget. I would, of course, be happy to take 
questions on any aspect of what we are doing.
    [The information follows:]



                              CREDIBILITY

    Mrs. Northup. Thank you.
    Probably my biggest concern is the legitimacy of the 
studies that are undertaken by the Department of Labor, and 
specifically the Bureau of Labor Statistics. I believe that in 
the past the Department of Labor has suffered because its 
reputation for using ``fake science,'' studies that are not 
peer reviewed, studies that can't be replicated which are 
largely at odds with more valuable studies, studies that have 
been peer reviewed. Instead of reassuring us and giving us the 
information we need to then apply the statistics, this has 
instead been contentious in and of itself.
    What I would like to ask you about is the quality of your 
studies about the peer review, about how you go about, and what 
you all are doing to strengthen the confidence we might have in 
these sorts of studies.
    Ms. Abraham. I guess I have, with respect to the work done 
by the Bureau of Labor Statistics, which is what I can speak 
to, quite a different perspective than I am sensing from the 
question you may have. It is my sense that the statistics that 
are produced by the Bureau of Labor Statistics are viewed as 
highly credible and that the work that we do is held in very 
high repute. I have not heard any of these kinds of questions 
raised about the work that we do.

                   QUALITY AND PROFESSIONAL STANDARDS

    Mrs. Northup. Let me just say I am not talking specifically 
about the Bureau of Labor Statistics. I am talking about the 
Department of Labor, overall--the science that they have 
depended on to write new rules and expand some of the authority 
that they have.
    I realize the rules I have in mind are not ones that have 
depended on, to my knowledge, the Bureau of Labor Statistics, 
but it occurs to me that if a Department has not always 
depended on sound science, it would be very easy to begin to 
compromise. How do I know where the line is drawn? And I think 
that you make a very good point about time use and so forth in 
terms of what is our national policy going to be on education 
and health care and so forth, but none of that is any good 
unless we have sound science.
    Ms. Abraham. We have historically, for exactly that reason, 
placed a very high priority on being very clear with people 
about how the data that we were producing are put together, and 
trying to get that information out into people's hands so that 
they can look at it. I could run through some of the things 
that we do towards that end.
    Our staff are all professional staff. We mainly hire 
economists, but we also have a substantial number of 
statisticians on our staff, so all of the work that gets done 
at the Bureau of Labor Statistics is done by those professional 
staff.
    I am the only person who is appointed, who is on the staff 
at the Bureau of Labor Statistics; everyone else there is a 
career employee. I am, as you may know, appointed for a fixed 
4-year term. The history has been that whoever is the 
Commissioner of Labor Statistics stays on, even though the 
administration may change. We are insulated in a variety of 
ways from the policy process.
    When it comes to our methods, we have technical papers on 
all aspects of our methods that are out there in the public 
domain. We get advice from a variety of quarters about whether 
those methods are appropriate and could be improved. We have a 
Business Research Advisory Council and a Labor Research 
Advisory Council, and are in the process of setting up an 
Academic Advisory Council, although prior to that we had a lot 
of interaction with the academic community. Relevant topics, 
such as credibility among data users, and a commitment to 
quality and professional standards, are discussed in more 
detail in the booklet, Principles and Practices for a Federal 
Statistical Agency. So, we really make an effort and pride 
ourselves on being very professional in the work that we do and 
in soliciting input on our methods from people who might be 
able to suggest ways we could improve it.

                            DECISION-MAKING

    Mrs. Northup. Have you ever been asked by any of the other 
agencies in the Department of Labor, other offices in the 
Department of Labor, to help substantiate a rule or claim that 
has been proposed? Do you have any information in your 
Department that would give us an argument in that direction?
    Ms. Abraham. No. The way that you are putting the question, 
we have never been asked that. Other parts of the Department do 
often come to us to ask whether we have data, that was produced 
as part of our ongoing data collection programs, that would be 
relevant and that they could look at in making an assessment as 
to something or other that they are considering doing. That 
happens routinely.

                              INDEPENDENCE

    Mrs. Northup. Well, my degree is in economics too, and 
statistics is a big part of it. One of the things, you know, 
when you look at statistics is they can be interpreted in a 
variety of ways. I have never found that so widespread until I 
came to Washington where there is the center on this, the 
center on that, and the center on something else; and they come 
to very different conclusions, all basing their information on 
facts that they have called out of statistical information that 
is available.
    You know, I think that this committee would be concerned 
about just how independent--I think the Bureau of Labor 
Statistics is hugely important. Specifically, I would refer to 
the work you did on helpers, and I think I was impressed by it. 
I felt that the Department of Labor didn't follow the 
information and reflect the information that was provided by 
the Bureau of Labor Statistics in sort of promulgating the 
rule.
    If that happens, if you see your statistics sort of bearing 
out a certain idea that would support a particular public 
policy, are you at the table then when the Secretary decides 
what direction to go if she promulgates a rule?
    Ms. Abraham. By design, we are not; and I would not want to 
be at the table when those discussions were taking place. Our 
mission is to provide information that is relevant, useful, 
accurate, and viewed as objective. It is not in our charter, 
and I think it would not be a good practice for us, to then be 
involved in the next step of talking about how that information 
gets translated into policy. By design, by preference, and by 
tradition, we keep at arm's length from the policymaking 
process.

                          COLLECTING WAGE DATA

    Mrs. Northup. Let me ask you specifically, too, about the 
information that you collect, and data, with respect to the 
Davis-Bacon provisions. There are a lot of studies on costs and 
on quality of work, and I notice that you all are undertaking 
an initiative effort related to that this year.
    My memory is--I have asked the Secretary directly about the 
Davis-Bacon provisions, but I was very well aware of them in 
Kentucky when I was a member of the general assembly there--and 
not only the Secretary, but also the Secretary of Education, 
Secretary Riley, has claimed that the evidence is that there is 
no increase in cost from Davis-Bacon provisions and that the 
quality of the work is better.
    The only study I have ever seen that came to that 
conclusion was the study that was funded by the AFL-CIO, and I 
think it was at the University of Utah, and it is widely quoted 
throughout this administration as evidence; and I just wondered 
if you had any studies yourself that would give a better 
insight into that issue.
    Ms. Abraham. That is a good example of the kind of thing we 
would not get into looking at. And let me try to explain why.
    We have done some work in connection with Davis-Bacon. We 
were asked----
    Mrs. Northup. And what it is.
    Ms. Abraham. By the Employment Standards Administration to 
take a look at some possible approaches to collecting data on 
rates of pay for construction workers in local areas, and we 
did two things. One thing that we did was a pilot test, in four 
local areas, of a fairly extensive survey designed to collect 
detailed information on benefits received by construction 
workers.
    The second thing that we did was to look at whether it was 
possible, as part of our Occupational Employment Statistics 
Program, which collects wage data and produces wage estimates 
for local areas, to identify for the construction occupations 
the union folks separately from the nonunion folks.
    So our involvement was purely in assessing the feasibility 
of collecting some different kinds of information, but we would 
not then be involved in trying todo, especially, policy 
analysis of the kind that you are talking about.

                 COLLECTING FRINGE BENEFIT INFORMATION

    Mrs. Northup. When you collected the data on wages and the 
information you collected, it is my understanding that you did 
not include the fringe benefit information.
    Ms. Abraham. Our Occupational Employment Statistics Program 
doesn't collect fringe benefits data; if that is the 
information you were looking at, that is correct.
    Mrs. Northup. Do you make that decision not to include 
that--when the request comes to collect that, are you told to 
purely examine the wage information?
    Ms. Abraham. That is the Occupational Employment Statistics 
Survey, a survey that we designed. It was our decision that 
that wasn't going to include benefits questions. Until very 
recently, we didn't collect wage information on that survey at 
all. It was purely a survey to collect information on 
employment, by occupation, to develop a picture of what the mix 
of the workforce looked like.
    We did ask questions on wages. We decided not to try to add 
questions on benefits; and I would be strongly opposed to 
trying to add benefits questions to the survey because of how 
it is done.
    It is a mail survey. We send this form out to employers and 
they are asked to fill in on a grid for each occupation how 
many people they have in each of a number of different wage 
intervals.
    It is a pretty big request that we are making of them 
already. Adding questions those employees--all 400,000 of them 
a year--would have to answer about benefits would make it more 
burdensome. In addition, it is my judgment and my professional 
staff's judgment that the questions we would need answers to 
about benefits are not questions we can get good answers to 
through a mail survey.
    Mrs. Northup. But the fact is, it has a huge impact on what 
the net worth of a job is.
    Ms. Abraham. I believe that is true, and we do have other 
surveys that we do where we collect benefits information. We 
have the Employment Cost Index Program, for which we asked for 
and received an increase in funding last year, that provides 
very detailed information on benefits.
    The way that we collect that data is to send somebody out 
to the employer to sit down and talk with them. We get their 
pension plan and look at it and figure out how much it is 
costing; we get information on their health plan, sit down and 
look at it and figure out how much it is costing. So at a 
national or broad regional level we do have that kind of data.
    It is really just a cost issue as to whether we could 
afford to operate a program that provided that kind of 
information at the local level. It would be very expensive.
    Mrs. Northup. I guess my question is, would it be better to 
do it less often, every other time, believing that accurate 
information that accurately reflects the value--and like I 
said, there is a lot of public policy that is built around the 
Davis-Bacon provisions. We actually now have in Kentucky 
universities buildings that are being built privately, and then 
the university buys it from them to avoid the Davis-Bacon 
requirement. I mean, those are the suggestions, the types of 
suggestions that are being made because of the cost increase of 
Davis-Bacon, while we have as you know, Secretaries that are 
looking at us and saying, no, our statistics show there is no 
difference in the price and there is a higher quality.
    I mean, you know, for the sake of public policy, which is 
what we have the Bureau of Labor Statistics for, it seems to me 
like the value of a job ought to be the total value of the job 
and the total cost to maintain that job.
    Ms. Abraham. We may be talking a little bit at cross-
purposes. What I have in my head when I am answering your 
question is the design of our general purpose data collection 
programs--our Employment Cost Index, our Occupational 
Employment Statistics Program--which serve a whole variety of 
purposes; and the way that they are designed is a way that has 
made sense to me.
    What you are really saying is that you see a need for more 
detailed information on the construction sector, and if someone 
were to come to us and say, there is a need for more detailed 
data than you are currently providing, could you come up with a 
plan and a price tag for providing that, we would be more than 
happy to take a look at it.

                          COLLECTING NEW DATA

    Mrs. Northup. Well, I think my bigger concern is who 
initiates what the collection of data is going to be--who sets 
the parameters. The request that you would get from the 
Department is requested so that they could then base public 
policy decisions on that?
    Ms. Abraham. Right.
    Mrs. Northup. And I just wondered if there is a discussion 
about who makes the decision. Do you have any input if you are 
asked to collect certain data and you believe that more 
information would help give a better picture so that public 
policy has a better base.
    Ms. Abraham. We certainly welcome conversations about what 
it would be possible to do at what level of cost.
    Mrs. Northup. Do you ever see your statistics used by 
somebody in the Department, or anybody in the public, to draw a 
conclusion that isn't a reasonable conclusion that could be 
drawn from that information?
    Ms. Abraham. It is interesting, when there are debates 
about issues related to the labor market, it is often the case 
that people on both sides of the issue may be looking at data 
that we have provided. Data don't lead you to unambiguous 
answers about what the right policy is.
    Mrs. Northup. But what I'm saying is that, as scientists or 
as statisticians, people in your Department must collect data 
and sort of know whether or not it is a good basis or whether 
you can use it to come to conclusions. Do you often see where 
there are more far-reaching conclusions, either within the 
government or outside of the government, based on data you have 
collected; and do you clarify that when you see it.
    Ms. Abraham. When we put data out, we try to be very clear 
about how it was collected, and along with that, what its 
limitations are. That is an important part of what we do.

                               CONCLUSION

    Mrs. Northup. Okay. Thank you. That is all the questions I 
have, Dr. Abraham.
    I want to thank you for your testimony this morning and 
your explanations. I know that the bell rang for a vote in the 
House. In fact, there are two and so, as a result, the hearing 
is going to close. I know that I have some questions to submit 
and Mr. Porter, the chairman, does.
    Thank you very much for your testimony. I really appreciate 
it.
    Committee stands in recess until 2 p.m.



                                          Thursday, March 23, 2000.

                 EMPLOYMENT AND TRAINING ADMINISTRATION

                               WITNESSES

RAYMOND L. BRAMUCCI, ASSISTANT SECRETARY OF LABOR; ESPIRIDION (AL) 
    BORREGO, ASSISTANT SECRETARY FOR VETERANS' EMPLOYMENT AND TRAINING
RAYMOND J. UHALDE, DEPUTY ASSISTANT SECRETARY, EMPLOYMENT AND TRAINING 
    ADMINISTRATION;
EDWARD L. JACKSON, DIRECTOR, OFFICE OF BUDGET, OFFICE OF THE ASSISTANT 
    SECRETARY FOR ADMINISTRATION AND MANAGEMENT

                       Introduction of Witnesses

    Mrs. Northup [presiding]. Good morning. Welcome to the 
Labor HHS Education Subcommittee hearing on the Employment and 
Training Administration and the Veterans Employment and 
Training. First, I think we have Mr. Ray Bramucci, who is the 
Secretary for Employment and Training. Good morning.

                         ETA Opening Statement

    Mr. Bramucci. Good morning. Thanks for the chance to 
discuss the administration's fiscal year 2001 budget request 
for workforce services. On my left is Ray Uhalde, my associate 
and Deputy Assistant Secretary. We have a new Employment and 
Training Administration and a new way of doing business, and I 
am excited to talk about it. First, I would like to pay tribute 
to Chairman Porter, who is retiring. I am glad to have worked 
with him because he was always fair minded and knowledgeable in 
carrying out his responsibilities. I will summarize my 
statement which is presented for the record.
    Our request totals $10.9 billion under current authority, 
an increase of $870 million from last year. It includes $10.1 
billion for discretionary programs and $841.6 million for 
mandatory programs. It builds on previous initiatives, 
including implementation of the bipartisan Workforce Investment 
Act of 1998, which I am proud to be part of. Our request 
supports the Secretary's three departmental cross-cutting 
goals: a prepared workforce, a secure workforce, and quality 
workplaces.
    I would like to tell you something about our major 
accomplishments and discuss key challenges and opportunities 
ahead and how the request relates to these challenges.

                           WIA IMPLEMENTATION

    Implementation of WIA is going well. As you know, this 
legislation was described by the New York Times as, ``one of 
the best, but most underreported, bipartisan achievements of 
the Clinton era.'' We are working as partners to help States 
and local communities design a customer-focused, comprehensive 
delivery system. We issued streamlined, user-friendly regs and 
unified planning guidelines with other Federal agencies to 
encourage States to take an integrated approach. I am proud our 
implementation has been praised. One of our partners, the 
Interstate Conference of Employment Security Agencies, wrote to 
us stating, ``this has been an open, flexible, effective 
process that the State administrators have appreciated.''
    We believe we have tackled tough issues and resolved them 
in a way States see as fair and so do the locals. The job's not 
done though. We have been pushing very hard to make sure all 
the States submit approvable plans so they can start operating 
on July first.
    We have done some remarkable things for America's youth. 
The Youth Opportunity Movement is a national effort to help 
young people become responsible members of our workforce. The 
Youth Opportunity Grants were awarded February 19th after a 
very rigorous process that drew heavily on lessons learned by 
past efforts. Decreasing joblessness and hopelessness in high-
poverty neighborhoods has the potential to help communities and 
taxpayers in several ways: by reducing crime, illegal drug use, 
and welfare dependency.

                            CUSTOMER SERVICE

    And we are making progress in improving services to our 
customers, utilizing electronic tools like the Internet and 
toll-free telephone lines to provide information and answer 
questions. Last year I told you about America's Career Kit, a 
group of Internet tools that helps America's workers and 
employers navigate the labor market. One of these tools is 
America's Job Bank, which now provides the public with access 
to 1.7 million jobs. There are vacancies on a daily basis, and 
it is still by far the largest job bank on the Internet. We are 
flattered that our pioneering success has prompted the 
development of many other Internet job banks in the private 
sector.
    Last year I told you of our plans to establish a toll-free 
number for workers who have questions. Now, 1-877-US-2JOBS is 
operational in 10 States, and we are closing in on about two 
dozen more. After everyone's on board, we will broaden the 
services from a dislocated worker focus to all Workforce 
Investment Act services.
    With Welfare-to-Work we have turned lives around. We have 
made significant progress. These are people who are eager to 
work, and employers are finding many to be great workers. And 
last session's amendments will expand that success. I 
congratulate you on helping get these amendments passed.
    Mrs. Northup. Thank you. I am going to yield the chair to 
the Chairman.
    Mr. Bramucci. I noticed that you were not Congressman 
Porter.
    Mrs. Northup. Close.
    Mr. Porter. Good morning. I apologize for being late. I was 
caught in horrible traffic; and Mrs. Northup, thank you for 
taking the chair. I really appreciate that. Have you completed 
your statement now?
    Mr. Bramucci. Not yet.
    Mr. Porter. Please proceed.
    Mr. Bramucci. I want to say something again that I said 
earlier that I am sorry to see you go. I am sorry that you are 
retiring because you were always fair minded and knowledgeable, 
and that is a quality that is not easy to replicate in the 
world. So good luck and thank you, Congressman Porter.
    I am at the point we were talking about welfare, and I said 
we are turning lives around; and we have seen a great attitude 
out there of people's willingness to work, and we are helping 
them get into the workforce, and employers in an unprecedented 
way are accepting them and utilizing them and finding many of 
these former welfare recipients to be great workers.

                          WORKFORCE EXCELLENCE

    We have also combined a number of continuous improvement 
initiatives and launched a Workforce Excellence Board which 
held its first meeting on Friday, February 25th. The 35-member 
board is a partnership with a chairman from the business world. 
A third of the members are from the private sector, from for-
profit and nonprofit organizations, including schools and 
community-based and labor organizations. Other members 
represent the local, State, and Federal levels of the Workforce 
Investment System. Their vision, simply stated, is for the 
Workforce Excellence Board to help the Workforce Investment 
System better answer the needs of employers and job seekers in 
this rapidly changing world economy. It is a search for 
excellence.
    Another element of excellence is public awareness of the 
services available through our system. Last July, Secretary 
Herman announced a brand name, America's Jobs Network. It is 
used through ETA and adorns every letter that leaves the 
agency. This branding will let our customers know how and where 
to find the help that your funding makes available.

                                NEW ETA

    We also are a new ETA. On August 8, 1999, as required by 
WIA, the Employment and Training Administration reorganizedto 
align its functions and organization with the requirements of the new 
Act. Reorganization is never easy, but I think ours went well. We 
engaged front-line workers and included our labor partners in every 
step. ETA now has major offices responsible for adult services, youth 
services, and workforce security.

                             BUDGET REQUEST

    What do we need to do to continue this? Employers need 
workers, and unskilled Americans are having trouble finding 
jobs. Through this budget request we can give the business 
community the skilled workforce it needs while bringing hope to 
people left behind. Let me highlight these initiatives for you.

                                 YOUTH

    We ask for an increase of $125 million for Youth 
Opportunity Grants. With our first grant competition, we were 
able to fund about 25 percent of the eligible communities that 
submitted applications. Nearly 170 communities put together the 
broad partnerships and developed comprehensive plans for 
meeting the needs of this target population. We have far more 
high-quality applications than we could fund. These additional 
dollars will allow us to reach about 12 to 15 more of America's 
poorest urban neighborhoods and rural communities.
    Secretary Herman spoke of the shockingly high rates of 
incarceration in our Nation today and the need to provide 
positive alternatives and second chances, particularly for 
young offenders. Responsible Reintegration for Young Offenders 
is a $75 million pilot and demonstration initiative, developed 
in partnership with the Department of Justice, that will test 
new approaches to bring young offenders into work through job 
training and placement by creating partnerships between the 
criminal justice system and our system.
    And I will tell you, Mr. Chairman, that in many of our One-
Stop Centers, the criminal justice system is working with our 
workforce boards. We are encouraging that, especially with 
youthful offenders, as an alternative to harsh sentencing.
    Safe Schools/Healthy Students is an ongoing collaboration 
among federal agencies to promote healthy childhood development 
and prevent school violence and the abuse of alcohol and drugs. 
We believe the Department of Labor has something to contribute 
and have proposed $40 million to strengthen connections among 
secondary and postsecondary schools, alternative schools, out-
of-school youth programs, and work-based learning. We believe 
that the local workforce system, locally organized, should have 
some means to influence and stimulate local school boards to 
provide an atmosphere that is more conducive to learning what 
work is about and what community activity is about.

                         UNIVERSAL REEMPLOYMENT

    Though the economy is strong and the unemployment rate is 
very low, there is considerable churning in the job market. 
This last year, States completed nearly 4,000 rapid-response 
visits to plants facing dislocations across the country. The 
budget requests an increase of $275 million above fiscal 2000 
to continue the second year of the President's universal re-
employment initiative which will ensure that by 2004 all 
dislocated workers will have access to the training and 
employment services they need, all unemployment insurance 
claimants will get the re-employment service they need, and all 
Americans will have access to our One-Stop Career Centers.
    We also want to build the skills of people with jobs. That 
is why our budget requests $30 million to allow States to 
demonstrate innovative approaches to train and upgrade the 
skills of nonmanagement workers so they can progress up career 
ladders. Approaches that work will be shared through America's 
Job Network. Grants would be awarded only to assist firms where 
a demonstrated risk of large imminent layoffs or plant closure 
exists because of trade, competition, the widespread 
introduction of new technology, or where firms propose to 
create career ladders through lifelong learning.
    These grants also have the added benefit of creating entry-
level opportunities for unemployed and low-wage workers. The 
grants would require matches of State and employer money, much 
like we have instituted in New Jersey, which was reauthorized 
by a new administration because it was so heavily supported by 
the business community and by the labor movement.

                       FATHERS WORK/FAMILIES WIN

    To reward work and make sure all families benefit from the 
booming economy, the budget includes $255 million for a Fathers 
Work/Families Win initiative. Unlike TANF and Welfare-to-Work 
efforts, Fathers Work/Families Win is not intended to serve 
only welfare recipients. It will focus on helping poor 
noncustodial parents and working-poor families reach long 
lasting employment with decent wages. The Fathers Work/Families 
Win initiative, through competitive grants to State and local 
workforce investment boards, will help keep low-income families 
from ending up on welfare.

                          EMPLOYMENT SECURITY

    We are working with the States, employers, and workers' 
representatives to reform and strengthen the Unemployment 
Insurance and One-stop Employment Services programs, known 
collectively as the Employment Security System. Our aim is to 
ensure that this system continues to meet the needs of a 
dynamic American economy and believe we can produce a plan that 
will help part-time and low-wage workers receive the benefits 
they have earned when they are laid off, help employers by 
making it easier to file UI taxes, cut those taxes, help 
workers get faster jobs to reduce their time on unemployment 
benefits, help the economy, and help with reforming Federal-
State administration of these programs by providing adequate 
funding, needed flexibility, and new tools to prevent fraud and 
abuse.
    On Trade Adjustment Assistance, last year the Congress 
passed a 2-year extension of TAA and NAFTA-TAA programs. TAA 
certifications in fiscal year 1999 increased 78 percent over 
the prior year, the highest level they had been since 1989. The 
administration continues to seek legislation that would 
consolidate and reform these two programs. Such reforms would 
include extending the eligibility for TAA to individuals who 
lose their jobs through shifts in production abroad. The 
consolidated program would harmonize existing requirements 
linking training and income support and would provide support 
of services as needed.

                                 YOUTH

    Let me summarize our youth request. The request for youth 
is $2.905 billion, an increase of $228 million above last year. 
The budget requests $1.022 billion for youth formula grants 
under the Workforce Investment Act. We are requesting an 
increase of $21 million above fiscal 2000 for this consolidated 
youth program that provides comprehensive services and summer 
job opportunities to disadvantaged youth.
    For youth opportunity grants, we are requesting $375 
million an increase of $125 million.
    We request $1.393 billion for Job Corps, a net increase of 
$35.3 million over fiscal 2000. This request will help Job 
Corps maintain high-quality services by including an increase 
of $12.9 million for salary increases, for academic and 
vocational instructors, counselors, residential advisers and 
recreation leaders, which is absolutely necessary. We are out 
of balance with the public school system and with the 
educational establishment. It also includes an inflation 
increase, operating costs for two new centers and a reduction 
of $13.5 million for one-time construction funding.
    I have already addressed the budget requests for two new 
initiatives, Young Offenders and Safe Schools/Healthy Students.
    Our budget reflects a planned decrease of $55 million for 
School-to-Work, as Federal funding commitments for the School 
to Work system are completed in fiscal 2000.

                                 ADULTS

    The budget request for adult programs under the WIA and 
under the Older Americans Act is $3.575 billion, an increase of 
$463.3 million over fiscal 2000.
    The request for Adult Grants in the WIA is $950 million, 
the same level as fiscal 2000. These funds enable the new 
Workforce Investment System to serve approximately 380,000 
adults. The request for dislocated workers employment and 
training is $1.770 billion, an increase of $181.5 million over 
fiscal 2000 which will assist 984,000 dislocated workers. This 
request is part of the President's UniversalRe-employment 
Initiative.
    The Native American and Indian program, the budget includes 
a request of $55 million which is $3.4 million below the fiscal 
2000 appropriation.
    For the Migrant and Seasonal Farmworker program, the budget 
requests $74.4 million.

                            PROGRAM SUPPORT

    The Workforce Investment Act authorizes certain activities 
to help States and local communities succeed in building the 
Workforce Investment System. These include technical 
assistance, State incentive grants, evaluations, pilots, 
demonstrations and research, and other activities. A total of 
$62.1 million is requested for these activities in the fiscal 
2001 budget. These activities are vital to strengthen and 
improve the evolving new Workforce Investment System.

              FEDERAL UNEMPLOYMENT BENEFITS AND ALLOWANCES

    Under Federal Unemployment Benefits and Allowances, which 
includes TAA and NAFTA-TAA, the request is $406.6 million in 
fiscal 2001 under current authority, $8.6 million below fiscal 
2000. I already talked about our legislative proposal to reform 
and consolidate the two programs.

                                 SUIESO

    The request of $3.389 billion for State Unemployment 
Insurance and Employment Service programs is an increase of 
$175.4 million over comparable 2000 funding.
    The fiscal 2001 request for State Unemployment Insurance 
administration totals $2.359 billion, an increase of $92.9 
million for fiscal Year 2000, which is simply the growth in our 
market place in number of employers we are servicing and number 
of workers we are servicing, notwithstanding the unemployment 
rate.
    Mr. Porter. Mr. Bramucci, we are going to have to break for 
this vote, and we will resume as soon as we get back from the 
vote. This subcommittee stands in recess.
    [Recess.]
    Mr. Porter. Subcommittee will come to order. Mr. Bramucci, 
we were on page 14 or 15.
    Mr. Bramucci. I really apologize, especially with the 
traffic jam on 66, I gave you that onslaught, my apologies 
really.
    Mr. Porter. I want you to have a chance to finish however.
    Mr. Bramucci. I am finished.
    [The information follows:]



    Mr. Porter. All right. Assistant Secretary Al Borrego for 
Veterans Employment and Training. Mr. Secretary.

                        ASVET OPENING STATEMENT

    Mr. Borrego. Mr. Secretary, members of the subcommittee, I 
am pleased to present the 2001 fiscal year budget to Veterans' 
Employment Training Service. This is the first budget that 
reflects the full participation of veterans in the Workforce 
Investment Act. Our job and that of our State partners is to 
make sure that we use the best technology available to help 
veterans, especially disabled and economically disadvantaged 
veterans, participate fully in the remarkable growth now going 
on throughout our economy.
    Our budget requests almost $159 million for grants to 
States. The $1.4 million over last year's budget will go 
primarily to further our successful certification and licensing 
pilot programs with States and nationally recognized 
information technology developers and providers. We intend to 
build our Internet Web site, which has been operating since 
January 1st. I want it to become a one-stop source of 
information for certification and licensing information for 
veterans and employers.
    We are also requesting an additional $500 thousand to pilot 
our successful Transition Assistance Program workshops, for 
service members who muster out of the military overseas. In 
recent years more than 23,000 service members leave the 
military from locations overseas. I want them to have the same 
labor market information, the same job search and resume 
writing skills and same access to electronic job banks that is 
available State-side to the more than 124,000 service members 
and their spouses who have gone through our program.
    We are also requesting $500 thousand to gather information 
critical to events and to this Committee, information that will 
enable us to make sure that VETS are spending taxpayer money on 
effective and cost-efficient programs. We must have 21st-
century performance measures to evaluate 21st-century services. 
Many veterans we help into jobs currently fall through our 
data-gathering information net. We will all need to know how 
these veterans found their jobs and how they are faring in the 
labor market. Making good use of available technology can help 
us, but behind that technology must be people, dedicated people 
focused on a mission to serve America's veterans.
    Let me give you a good example of an important VETS 
function that has no line item, that usually does not get 
mentioned at budget hearings. Thousands of men and women are 
giving up their civilian jobs and leaving their families to 
serve as part of U.S. peacekeeping and humanitarian missions 
abroad. The role of the National Guard and Reserves in our 
military and diplomatic obligations around the world has never 
been greater. VETS is responsible for enforcing the law that 
guarantees that their jobs and their employment benefits will 
be waiting for them when they return. While deployments have 
increased the number of complaints under USERRA has declined. I 
like to think that that is due at least in part to our 
technical assistance, employer outreach, and improved 
investigative abilities.
    Finally, I want to thank the committee for approving $10 
million for our homeless veterans projects in last year's 
budget. This is only Federal money specifically earmarked to 
help homeless veterans obtain skills and job placement 
assistance to help them become self-supporting citizens once 
again. But how do you put a price on human dignity? How do you 
measure self-respect? This year, VETS is requesting $15 million 
because even in our vibrant economy, veterans are homeless, and 
that is just plain wrong.
    With this budget, VETS can move into the new millennium 
with the programs and services needed by veterans. VETS is 
about preserving the best we have done and from that solid 
foundation, continuing the ongoing work of making the promise 
of America the practice of America. Our veterans deserve 
nothing less. I look forward to working with this Committee in 
helping America to take full advantage of the unique benefits 
veterans bring to the civilian workplace. Thank you.
    Mr. Porter. Mr. Borrego, that was a very efficient 
statement.
    Mr. Borrego. Thank you.
    [The information follows:]



                               EFFICIENCY

    Mr. Porter. Thank you. When you were testifying Mr. 
Bramucci, I was thinking to myself that isn't it wonderful we 
have this great economy that is allowing us to do a lot of 
things that we probably would be struggling with, without it 
and aren't we doing things a lot smarter than we used to do 
them before. And I personally thank God for the good economy, 
and I also think that, not just from what you have said but 
many of the assistant Secretaries and Secretaries that have 
testified, I really do think we are doing things much smarter 
than we used to. We are putting things together in ways that 
really make a difference in people's lives, and we are because 
of whether it is GPRA or the concept of it, we are really 
looking to see how many people we get from where they are to 
where we need for them and they need to go; and I think it 
really is making a difference. I think we are making a lot of 
progress in how we do things, in putting resources to work much 
better than we used to, and fortunately getting results where 
we didn't used to get results. What do you think about all 
that?
    Mr. Bramucci. I totally agree with you. I think that the 
spirit of the Workforce Investment Act, which encouraged from 
the bottom up reorganization and empowerment of locals, 
eliminated a lot of tensions between States and locals and 
Feds, as well as the old antagonisms and distrust. I think we 
have moved toward a period where we are listening to each 
other, and that is the challenge that I see in getting services 
to people and getting employers to trust the system and getting 
workers into good jobs and moving up the ladder.
    So I think we are seeing an unprecedented cooperative 
spirit out there, and I think that this is critical in 
contributing to the conclusion you have come to. The new 
cooperative spirit is one in which everybody benefits and the 
Workforce Excellence Board is an example, of this.
    We recently had 700 people here in Washington talking about 
excellence, service and cooperation. I can tell you that I go 
around this country talking to State, Federal, and local 
officials and practitioners about cooperation, and I never get 
laughed off the stage because we have kept the faith. We have 
accomplished what we have in the spirit with our partners, real 
partners, and I think we are building trust and that helps the 
country.

                     ETA SOLVING MULTIPLE PROBLEMS

    Mr. Porter. I want you both to comment upon this if you 
will, please. Often we find that people in our society who have 
problems don't just have one problem. It isn't that they just 
need job training to get from where they are into a job and 
steady employment. They have sometimes multiple problems, and 
what we seem to be learning--and correct me if any of this you 
think is not true--what we seem to be learning is we need to 
provide all the services in a close proximity and not bump them 
from agency to agency going from here to there, but have 
something sustained where we work with them through the 
process.
    And you can take an example of a homeless veteran, and you 
can take an example of a homeless person who is not a veteran; 
but sometimes we find a homeless person who also may be 
involved with drug or alcohol dependency; we find a person that 
may have some mental problems; we find some people that may 
have some health problems other than those, and we want to try 
to get that individual from what they are into a position where 
they have skills that are marketable and into a job and into a 
stable situation where they have a home and a future.
    Wouldn't they have to provide for any of the programs, to 
go separately to a SAMHSA program for their drug or alcohol 
dependency; a HRSA program for their health problems; to you 
for the job training and employment opportunities. And how do 
we deal with that in a better way to integrate it more and get 
all the services provided sequentially and hopefully even at 
the same site if possible?
    Mr. Bramucci. Mr. Chairman, that is the raison d'etre of 
the One-Stop system, and it is easier said than done because 
people have a tendency to compartmentalize and not talk to one 
another. I tell my own people that in the State of New Jersey 
when I was commissioner we couldn't get the UI people to talk 
to the Employment Service. We have a challenge, but where it is 
happening in our country--and there are a lot of places where 
it is happening that I visited--you do not have this 
compartmentalization. An example is our new One-Stop here in 
D.C. I would invite you to go take a look at it, and I would 
love to go with you.
    We had a Brazilian delegation there, and we were showing 
them what America does about One-Stops and a woman introduced 
herself as a case manager but she referred to herself as a 
generalist, doing everything. She said, ``If it's a welfare 
recipient, I take care of them. If it is food stamps, I take 
care of them. If it is a job, I take care of them.'' That is 
what we are shooting for, and in some places we have got it and 
it happens. We are trying to spread that around the country 
because citizens, especially at risk-people, get that first 
stiff arm, they get that first ``you are in the wrong line,'' 
and it is over. And in order to get them moving up that chain 
of opportunity, we have got to stay with them and help them, 
not to just hug them, but to push them, and to give them the 
assistance they need to be the best they can be. That is what 
this job is about; and while you were here, you helped to put 
money in the field that allowed us to do that.
    Mr. Porter. Mr. Borrego.

                    ASVET SOLVING MULTIPLE PROBLEMS

    Mr. Borrego. When we look at homeless veterans, we see 
where they have ended up, and a lot of times we forget the 
talents they had before their coping mechanisms broke down. But 
to get them back to that, you are very right, we have to fix 
multiple problems. What we do with our money, when we put it 
out to the community, is we make sure that before we give it 
out that they have linkages to HUD so that there is housing for 
those veterans, so that they have an address, and there is a 
place they can get phone calls.
    We make sure that they have linkages to the Veteran Affairs 
for support services whether it is drug, whether it is 
counselling for a PTSD or any of the service-related problems 
that come with that, and we give points so that the people that 
we give money to have those linkages built in, so that there 
are at least three or more agencies working together in 
homeless shelters to provide those services. We could not do it 
alone with just the money we have. We need their participation 
and their support. When we have it, then they can be put back 
into employment.
    Mr. Porter. And do we have somebody that is a generalist 
that sort of sees them through the whole system, doesn't let 
them drop off at one point or another or through the cracks of 
one program or another?
    Mr. Borrego. Yes, sir. Those are the folks that run the 
homeless programs. So they have--they are the ones that 
coordinate the three pieces, ours, the VA and HUD, to make sure 
once that they are in--and interestingly, because they have all 
been in the service, one of the things that brings them back 
in, is a lot of them are structured like the service. They talk 
about squads and there is that military structure because all 
of us that have been there relate to that, and that is that one 
thing that brings them back from where they were and back into 
the community and gives them enough support until they are on 
their own, and then they are released gradually into the 
community until they are fully capable of supporting themselves 
and their families.
    Mr. Porter. That's great. Thank you, Mr. Borrego. Mr. 
Bonilla.

                           JOB CORPS SUCCESS

    Mr. Bonilla. Thank you, Chairman. Mr. Bramucci, I have some 
questions about Job Corps because, as you probably know, I have 
been a strong supporter of that for some time now; and we are 
just very proud in my congressional area to have the Laredo Job 
Corps Center and the David Carrasco Job Corps Center that are 
perennially ranked among the top in the country.
    I had a young man, a fabulous young man here earlier this 
week, Rudy Garza, who testified as to how Job Corps changedhis 
life. He now has a chance to live the dream that he has had for many 
years of starting his own business, wants to be an architect, and I not 
only spent time with him at the hearing; but we had a great lunch at 
the capitol and spent a good part of the day visiting with him. I tried 
to give him as much encouragement as I could because he is well on his 
way. That is a great success story of the Job Corps.
    I would like to ask you what specifically is Job Corps 
doing to reach out to Hispanic youth like Rudy across this 
country to let them know about the opportunities job corps 
offers?
    Mr. Bramucci. Well, we have a very responsive Job Corps 
operator community that is working very closely with workforce 
investment boards as provided in the Workforce Investment Act. 
We are confident that these community committees on resource 
application in communities are more than adequate to make sure 
that we get to all the at-risk youth.
    I saw that young man yesterday. I saw the video. That 
knocked me off my chair. I was at a meeting of the Job Corps 
Contractors Association meeting. But that is only one story. 
Carrasco also has a dozen of those, and we have kids talking 
that way all over America, and there is a very, very good mix 
of human beings in those Job Corps centers. I am pretty 
confident that we do a top-notch job of keeping the doors wide 
open for everybody who needs our services.

                           JOB CORPS RANKING

    Mr. Bonilla. You know, we traditionally have been able to 
tout the success of some of the Job Corps centers by their 
rankings. Then I learned just recently that there is a new 
system in place, and I am curious as to know whether it was the 
Department of Labor decision, was it a decision made at the 
Department, or was something asked for out in the field, 
because I know many centers have been proud of their rankings 
over the years. Where did this decision generate?
    Mr. Bramucci. Most of this generates among the community of 
operators who are competing sometimes against one another.
    Mr. Bonilla. That is good.
    Mr. Bramucci. I think it is great, and we are encouraging 
it; and I can tell you, Congressman, the Department of Labor 
and the Job Corps community is working ever so much more 
closely together. We are seeing an unprecedented number of 
people in the Job Corps and among the ETA staff volunteering 
and serving on youth councils that are forming up around the 
country and on workforce investment boards, and we want to make 
the Job Corps the flag ship of our efforts to remediate youth. 
When we send money to communities in our YO program, we intend 
to link up; and I will give you a quick example of what the 
world looks like in the future.
    We recently had a situation here in Washington where the 
Potomac center out here in suburban Maryland linked up with a 
PIC leadership academy to become a satellite so that kids that 
could not attend the residential service were taught at the 
center in Baltimore by Job Corps personnel. Equipment was 
shared, et cetera; and we are going to do that more and more 
and more because the story of Job Corps has to be spread 
because it is a great American success story.
    Mr. Bonilla. I just hope that we might look at this ranking 
system again in the future, because I get the feeling that some 
of them got a lot of pride in sharing the success of their 
rankings; and if it is something they want, that is fine; but I 
just hope it is not some kind of effort like at some schools 
you do not have grades any more, and I think it is a good 
competition out there.
    Mr. Bramucci. I think we have rankings within the 
Department of Labor also, but it is a combination of 
ingredients. For instance, community validation in El Paso, the 
center you talked about, is critical. You walk in there and you 
get a feeling that you are in a place that counts. The mayor, 
the council, the business community, everybody respects it, 
everybody visits it, and everybody uses it as a source of young 
labor. So besides the ranking, there is the real world of how 
well does the community accept that facility, and how well they 
use and cooperate with the operators and the staff. Those are 
the things I look for, too.

                             JOB CORPS GED

    Mr. Bonilla. Well, keep up with the good work in that area. 
I have one last thing I would ask about the job corps because I 
also sit on the defense appropriations subcommittee. Military 
is proposing a new program that would help 6,000 high school 
dropouts earn their diplomas so they could enter the military. 
Does the Job corps help students earn diplomas or the GED, 
because I consistently hear about GED?
    Mr. Bramucci. Both. We have just signed an agreement with 
the Army where they have recognized a number of hours that a 
student would have served in a Job Corps to be the equivalent 
of a high school diploma. So we have been very actively 
marketing these kids for military service because the bar had 
been the high school diploma bar, and many of the kids in Job 
Corps do not have a high school diploma because they are so far 
removed from the academic requirements, that we have to resort 
to the GED. But where students are close, we get them a 
diploma. Where they are distant from the finish line in terms 
of the requirements, we get them a GED; but the Army has just 
signed this agreement with us, and we are very proud of it.
    Mr. Bonilla. Very good. We will look forward to greater 
success in the future, if that is possible.
    Mr. Bramucci. It is, thank you.
    Mr. Porter. Thank you, Mr. Bonilla. Ms. DeLauro.
    Ms. DeLauro. Thank you very much, Mr. Chairman. Both 
assistant Secretaries, thank you very, very much for being here 
this morning; and I just might say that the focus of--it is 
really gratifying to listen to really the vision and the 
commitment but the enthusiasm for wanting to help to try to 
make a difference in the lives of young people who have so much 
potential and to try to help those who have lost their jobs 
through no fault of their own, for people who have fallen on 
hard times and need to have to know that they can reach out and 
something will be there.
    I think that to follow up what the Chairman has said, this 
is kind of a new spirit of regeneration in this area. For the 
first time, I think we are looking at a government that is 
responding to the needs of working people, people who do want 
to work and people who need help getting into the workforce. 
And from my part, that is not only a programmatic issue; but I 
think it is reflective of the values we stand for as a country, 
and I think for too long the people that you have been trying 
to assist have felt in fact that there is no connection with 
their government, and so we applaud all the efforts that you 
make and what you are doing and want to try to help to continue 
with you.

                        JOB CORPS CISCO TRAINING

    I too have a Job Corps question, Mr. Bramucci. I had a 
staff member who went out to Phoenix, and she spoke with 
students who were participating in the Cisco training, which as 
you know is a high-technology training program, gives young 
people the opportunity to enter a high-tech field, network 
engineers, system operators, these are links to good jobs, good 
money. Tell us a little bit more about the program and how many 
Job Corps centers are collaborating with Cisco or other kinds 
of high-tech partners.
    Mr. Bramucci. We have agreements with a number of high-tech 
firms and a number of centers as well as having agreements in 
ETA with, for instance, Bell Atlantic and AOL. They represent a 
customized service concept of saying, look we are going to have 
X number of jobs in 12, 15 communities. We are going to go 
through you to recruit the workers and to prepare them for the 
test they have to take to become a member of that firm, and 
those things are moving right along.
    As to the specifics of the Job Corps situation, I am going 
to ask Mr. Uhalde to respond to that.
    Mr. Uhalde. Congresswoman, several Job Corps centers have 
reached agreements and are teaching Cisco networking courses. 
It is usually a four-semester course. We have been able to, in 
Job Corps, compress this into about 6 months. We are able to 
have Job Corps members able to reach a certification of Cisco 
networking and pass the exam. While wages vary around the 
country obviously by geography, a certified Cisco networking 
person can earn $40,000 a year. It is one of the examples of 
where Job Corps is continuouslylooking to the new economy, new 
jobs.
    As was mentioned yesterday, in the health care sectors with 
pharmaceutical technicians, we are doing that jointly with CVS 
and other pharmacies. So where there are the hot jobs, if you 
will, we are moving.
    Mr. Bramucci. Can I just add this, not to ever forget the 
other essential thing we are doing and that is we are 
reclaiming human lives.
    Ms. DeLauro. Amen.
    Mr. Bramucci. Besides getting them ready for work, what we 
are doing is reinstituting the human spirit. That sounds pretty 
heavy, but we are doing it, and the first thing that has to 
happen to a kid before they get ready for work is to get a 
sense of self-respect, self-purpose, and worth, and that is not 
automatic. Very often we are dealing with damaged goods because 
we are not creaming. We are not looking for kids that are going 
to be big success stories.
    So whenever there is an enterprising center that makes an 
arrangement with Cisco or anybody else, it happens after the 
kid is prepared for being a good person and being a plausible 
worker. I frequently have sent little notes to the Chairman 
about places where this has been happening and how difficult it 
is to measure this by strictly looking at a wage record or 
whatever. We just opened a new center in Chicago, and while the 
ceremony was going on, the Director, a guy named Martinez, 
leaned over to me and said, ``You know, it was not too long ago 
that I was graduating from the Job Corps center in El Paso.'' 
Now, I don't know what his wage record showed in 2 years or a 
year and whether he was retained, but we turned a human being 
around who is now a leader. We have got to find a way of 
measuring that, too, in order to address community regeneration 
and reclaiming human lives.

                     JOB CORPS LINK WITH EDUCATION

    Ms. DeLauro. A further question on this, to what extent do 
you work with the Department of Education, if you will, in this 
kind of training, like dealing with community colleges, et 
cetera, that it is another avenue here but a way in which we 
can look at the whole high-tech area? I ask because of my own 
community in Connecticut in the New Haven area where we have a 
tremendous number of assets, both health and educational and to 
try to link those up and the jobs are there at the moment.
    We just don't have the qualified people to take the jobs, 
which is, you know, seems better than we didn't have any jobs 
in Connecticut about 4 years ago; and again, this is the 
direction that we are trying to move in, into this high-tech 
area, a new technology because the money is there and the jobs 
are there. Is there cooperation or collaboration with the 
Department of Education in terms of some of these, the industry 
people moving in to community colleges and using that route as 
well to increase our numbers? Because it is a question of 
scale. How can you get to scale on this?
    Mr. Bramucci. We are trying real hard. It is not as much as 
I would like because public education is basically local, and 
the funding stream is so important and so definite. There are 
very few consequences of a lack of cooperation. It is a 
challenge. If we did a better job of cooperating with public 
school systems, we would do better for the kids; but I think 
that these systems that we are putting in place are really 
alternatives to systems that failed, failed kids. It is a K to 
12 system that did not connect with a kid that we capture. We 
should be interacting with them, and we try and we should be 
doing better. I think we do very well with the community 
colleges, and with WIA, Congresswoman. I think we have an 
opportunity because community college presidents and staff have 
taken part vigorously in the WIA implementation. That is the 
future.
    Ms. DeLauro. Many thanks. My time is up. Thank you very, 
very much for what you are doing.

                         COST OF YOUTH SERVICES

    Mr. Porter. Mr. Bramucci, in your budget for the Workforce 
Investment Act youth activities, the per-participant cost is 
$1,670, while the cost for serving youth under the Youth 
Opportunities grants is $4,400. Why does it cost so much more 
to serve this population in the Youth Opportunities program, 
and what do we do differently perhaps?
    Mr. Bramucci. You know, I want to ask my colleague to see 
if he can respond to that because I do not want to filibuster 
you again. I am not sure I know.
    Mr. Porter. We appreciate that.
    Mr. Uhalde. Mr. Chairman, the Workforce Investment Act 
numbers, about $1,600, include a combination of youngsters in 
summer jobs programs, which average about $1,300 and then year-
around activities; and there is a 60/40 split between those 
two. Whereas the Youth Opportunity grants are intended to all 
be year around, fairly intensive services for youngsters, and 
to follow them, as required by law, for up to 2 years in terms 
of sticking with them, keeping mentors. So it is a much more 
intensive set of services.

           MEASURING THE SUCCESS OF FATHERS WORK/FAMILIES WIN

    Mr. Porter. Okay. The ETA budget for training and 
employment services in the ETA budget for training and 
employment services, the performance goals for Fathers Work/
Families Win and incumbent workers are not really outcome goals 
as intended under GPRA. Mr. Bramucci, you have listed your 
goals for this program as funding goals to serve approximately 
40,000 noncustodial parents and 40,000 low-income parents. What 
is the outcome purpose of this program, and when can we expect 
specific outcome measures, baselines, and projected 
programmatic incomes?
    Mr. Bramucci. We have found that we have a population out 
there in local communities that are not always on welfare, but 
they are at risk in that they have responsibilities, whether 
they are a custodial father or families that have a husband 
working for them but who are poor. We thought that it was 
extremely important to give those local workforce systems an 
opportunity to designate those populations in those towns and 
cities that they see as at-risk, and find ways to get them up 
the ladder so that they do not fall backwards.
    Now, I am not sure that we have mapped out all of those 
performance goals and where we are going to be in a year or 2 
years or 3 years, but we know the population and we know the 
need. This is in response to employers who tell us that workers 
show up for work but are not plausible workers because they 
don't have the basic skills. I do not want to be vague with 
you, but I am more convinced of the need to invest in that area 
since there is a population of people way below the knowledge 
needs of our expanding economy. We have got to do something 
locally to remedy that situation.
    Mr. Porter. Yes, sir, but what I am saying is--and I agree 
with you--but what I am saying is we have to decide what that 
something is so we know whether we are achieving it or not, and 
we do not see in your standards the kind of standards that lead 
to the kind of outcomes we are looking for. What you are giving 
us is the old thinking, how many people we are serving, but we 
are not saying what we are doing to serve those people and what 
we expect to accomplish by serving them.
    Mr. Bramucci. We have obviously got to give you benchmarks, 
a beginning, a middle and an end; and I agree to do that.
    Mr. Porter. All right. I have been called to a meeting with 
the chairman of the appropriations committee, and I am going to 
ask Mr. Miller to please take the Chair. Thank you, Mr. 
Bramucci and Mr. Borrego.
    Mr. Bramucci. Mr. Chairman, could I please do something 
here?
    Mr. Porter. Sure.
    Mr. Bramucci. We are both going to be needing employment 
services at the end of this term, and this is a CD-ROM, 
America's Job Network, showing us how to file, how to go after 
a job, and how to write a resume.
    Mr. Porter. Thank you.
    Mr. Miller [presiding]. Mr. Porter's not running for 
election. He'll be looking for a job in January. I thinkthat 
will be helpful. I have no questions. Mrs. Northup, do you have any 
questions?
    Mrs. Northup. No, I do not. I do have a number of 
questions. I am going to submit them for the record so that I 
can save time and ask questions of the next panel.
    Mr. Porter. We will keep the record open, and we have 
another panel. So thank you very much for being here today.



                                          Thursday, March 23, 2000.

                  EMPLOYMENT STANDARDS ADMINISTRATION

                               WITNESSES

BERNARD ANDERSON, ASSISTANT SECRETARY
T. MICHAEL KERR, ADMINISTRATOR, WAGE AND HOUR DIVISION
EDWARD L. JACKSON, DIRECTOR, OFFICE OF BUDGET

                       Introduction of Witnesses

    Mr. Miller. Mr. Anderson, Mr. Kerr. Good morning. We will 
go ahead and proceed. We have votes shortly after noon so what 
we would like to do is ask you to keep your opening statement--
you have the only opening statement; is that right, Mr. 
Anderson?
    Mr. Anderson. That's correct, Mr. Chairman.
    Mr. Miller. If we can keep it on the short side, because of 
the vote, we can complete this and not have to return later 
today. We have your written statement. I have looked at it; and 
if you would just give a brief opening statement, we will 
proceed.
    Mr. Anderson. I think I can keep my opening statement to 5 
minutes, if that is fine with you.
    Mr. Miller. We will even set the timer for 5. We live with 
the timers around here.

                           Opening Statement

    Mr. Anderson. Well, let me say, Mr. Chairman, I am 
delighted to be here again to present the fiscal 2001 budget 
request for the Employment Standards Administration. The ESA, 
as you undoubtedly know, includes four operating programs: the 
Wage and Hour Division, the Office of Federal Contract 
Compliance programs, the Office of Workers' Compensation 
programs, and the Office of Labor Management Standards. And 
together, these four programs administer dozens of laws enacted 
by Congress that cover nearly every worker in America.
    ESA is the Department of Labor's largest agency with over 
4,000 employees, 90 percent of whom are located in offices 
throughout the country where they provide direct services to 
American workers. ESA's work is vital to the Department's 
success in achieving two of Secretary Herman's three strategic 
goals for the Department of Labor, the goal of a secure 
workforce and the goal of quality work places.
    ESA's two strategic goals which support the Department's 
goals are: number one, to create better workplaces by assuring 
fair wages and equal employment opportunity, minimizing the 
impact of work-related injuries, and safeguarding union 
democracy; second, to secure public confidence through the 
excellent management and delivery of ESA's programs and 
services. And our fiscal year 2001 budget request of 
$393,869,000 for the Salaries and Expenses account not only 
supports this agency and Departmental strategic goals but 
builds upon our accomplishments of the past 7 years.
    We have worked hard, Mr. Chairman, to achieve labor law 
compliance in child labor, the garment and agricultural 
industries and in equal employment opportunity. We have 
resolved over 90 percent of valid Family Medical Leave Act 
complaints, most with a phone call to the employer explaining 
requirements of the act and the steps needed to remedy the 
situation. We have worked to improve the management of workers' 
compensation programs and have made great strides in reducing 
the number of days lost due to workplace injuries and 
illnesses. We are also moving ahead with our initiative to 
provide electronic filing and Internet-based public disclosure 
of union financial reports.
    Our experience with strategic and performance planning has 
helped us to focus our efforts where they can provide the most 
benefit, but much remains to be done.
    The Fair Labor Standards Act, which establishes the minimum 
wage, sets overtime standards and child labor restrictions, 
protects the most vulnerable workers, like the farm workers who 
pick the fruit and vegetables we eat, the restaurant workers 
who prepare and serve most of the food we eat, the janitorial 
workers who clean up after we eat, the garment workers who make 
the clothes we wear. These are the workers who are the object 
of much of the work we do.
    Even in today's prosperous economy, we still see far too 
many violations of the law. Survey investigations indicate that 
fewer than 40 percent of employers met the minimum-wage and 
overtime requirements in Los Angeles and New York in the 
garment manufacturing industries. The same low level of 
compliance with FLSA and the Migrant Seasonal Agricultural 
Worker Protection Act was found in a national survey of poultry 
processing plants, and only 70 percent of nursing home 
employers, and 57 percent of residential care facilities are in 
compliance with the FLSA.
    The Wage and Hour Division has a long-term goal of 
increasing compliance with the labor laws, especially in low-
wage industries like garment manufacturing, agriculture, health 
care, restaurants, hotels and motels, guard service, janitorial 
service. We are focusing on the low-wage industries because 
they have a historically high level of noncompliance, and they 
employ vulnerable workers who often will not complain about 
violation of their workplace rights.
    It is a difficult challenge to realize lasting changes in 
compliance behavior in these sectors of the economy.
    Our Office of Federal Contract Compliance programs is a key 
participant in the President's equal pay initiative. Reliable 
labor market data reveal that pay inequality still exists even 
when adjusted for differences in education, experience and 
other relevant factors. While the trend is definitely moving in 
the right direction, there is still substantial progress to be 
made. To help close the pay gap, OFCCP will, among other 
things, encourage Federal contractors to self-audit their pay 
systems to prevent pay discrimination, help women find and keep 
employment in nontraditional jobs, increase outreach, education 
and technical assistance to Federal contractors on equal pay 
issues, and develop and implement industry partnerships.
    Mr. Chairman, I spoke last year about the thriving American 
economy and how despite the economy there were thousands of workers who 
get little benefit from the Nation's prosperity. Today, unemployment 
and inflation remain low and the economy has produced more than 20 
million new jobs in the last 7 years. Despite all this, many of the 
vulnerable workers I spoke of earlier--the agricultural workers, 
garment and custodial workers and others--are still not sharing in the 
prosperity. These workers are not asking for handouts but only to 
receive the wages they rightfully earned and to enjoy the protection of 
economic opportunity which they deserve, opportunities which are 
protected by the Nation's laws. One can only wonder if these workers 
are left out now in this era of prosperity, what will happen to them if 
the economy slows down.
    Secretary Herman has made youth workplace safety a 
priority----
    Mr. Miller. We are well past 5 minutes by the way.
    Mr. Anderson. How many minutes do I have, 1? Let me wrap 
up. I am an old university professor programmed for 50 minutes, 
and you know that is unusual punishment; but I will restrain 
myself.
    Let me say that it is the mission of our Wage and Hour 
Division to put an end to abusive workplace practices, and our 
OFCCP is working hard to end discrimination in hiring and pay 
practices. We are also working hard in the workers' 
compensation program to reduce the incidents of injuries to 
workers and to get them back to work as quickly as possible.
    Let me say we are using the funds that we have been given 
by the Congress to pursue this work very vigorously, and we 
would hope that we would have your support for the programs 
that were created by the Congress to protect all American 
workers.
    Let me stop there. You have the full statement, which is 
far more comprehensive than what I have presented here; and we 
would be happy at this point to answer any questions. Let me 
say, Mr. Chairman, also that I am accompanied by Mr. T. Michael 
Kerr to my left, who is the administrator of the Wage and Hour 
Division; Mr. Ed Jackson to my right, who is the budget 
director for the Department of Labor. Thank you.
    [The information follows:]



    Mr. Miller. As a former college professor, I know the 50-
minute increment. I have that problem when I give public 
speeches. I know I have some questions; but, Mrs. Northup, if 
you would like to go first, go right ahead.

                          BLACK LUNG PROPOSALS

    Mrs. Northup. Thank you, Mr. Chairman. I appreciate it. Mr. 
Anderson, I would like to go back to something I have asked you 
in previous years about the black lung proposals. Specifically, 
I think I would like to start with the questions I have asked 
you in both the previous years about the increase in costs that 
would be expected to you all rewriting the black lung proposals 
or the definitions of black lung.
    We all thought that there are miners that have suffered 
from black lung and believe that they should be fairly 
compensated and be part of the black lung disability program. 
The question I have has to do with the new definitions of black 
lung that would allow far more miners from the past to apply 
for these benefits and be to receive them. I thought it was 
fairly illogical, some of the answers I have gotten before. I 
would like to quote one of them. Where you said as we noted in 
last year's response to a similar question, ``We continue to 
expect little, if any, financial impact on the trust fund with 
the implementation of the revised proposed regulation.'' And 
you go on to say that your current staffing load and the cost, 
the payouts would not increase.
    Now, I guess that you are about to finalize the rules--and 
all that has changed. In fact I think what you expect is an 
increase in claims of 45 percent. I just wondered how the 
committee can conduct business when we are told year after year 
that this proposed rule is not going to cause an increase and 
then in fact you have estimates that it is going to cost almost 
a 50 percent increase.
    Mr. Anderson. Well, as you know, Mrs. Northup, the rule was 
sent out in a proposed NPRM. We received many comments from the 
industry and from others who were interested in the rule. We 
even extended the length of time at your suggestion to allow 
more of those who were interested in this to comment on the 
content of the rule.
    We also conducted an economic analysis. We commissioned an 
economic analysis of the expected cost of the rule. I am not 
aware of the figure that you just cited of 45 percent increase. 
It is been a little while since I read the economic analysis, 
but I would like to be able to go back and look at that and 
find out where you obtained the 45 percent increase figure. My 
recollection about the economic analysis is that it would not 
significantly increase the cost of this program, but we are 
looking at it.
    Mrs. Northup. First of all, I think what you expect is a 45 
percent increase in the number of claims that would be filed. 
Do you expect that none of these would be accepted and that 
they would all be turned down?
    Mr. Anderson. I really hesitate to get into much of the 
substance of this; the comment period of rulemaking is done. 
Now that the comment period has ended, we have to await the 
issuance of the final rule. The specific cost or the estimated 
cost of the rule is indicated in the economic analysis that we 
had conducted on the rule.
    Mrs. Northup. Is your economic analysis complete?
    Mr. Anderson. The economic analysis is complete, and the 
economic analysis was shared with you and members of your staff 
when we submitted that information to you before the 
publication of the NPRM.
    Mrs. Northup. The education and workforce committee has 
requested a GAO study to study the impact of the proposed black 
lung regulations on the trust fund. Considering that your 
estimates up until now have been that there would be no impact 
and now that seems to be changed, don't you think it is wise 
that we wait to finalize this rule until the GAO study is done 
so that maybe we can get an independent analysis that maybe we 
could depend on?
    Mr. Anderson. No, I do not think that is wise. I think we 
have spent a good deal of time over the past 3 years thinking 
about the content of this rule. We have consulted with 
virtually everyone who had anything of significance to offer, 
and we are prepared to issue the rule as soon as the final 
draft of the rule is available.
    Mrs. Northup. I assume you mean after the analysis you just 
told me about that you are waiting to have completed.
    Mr. Anderson. The analysis is complete. The economic 
analysis which was done by one of the main experts in this 
field is complete and the analysis was made available with the 
NPRM that was circulated for comment. In fact, we have received 
comments on the economic analysis, and so I think that there is 
not much that can be added to this with respect to another 
study of the issue. The issue has been studied extensively, and 
I would hope that we could move forward and issue the rule in 
final form based on all of the information that we have 
obtained over the past 3 years.
    Mrs. Northup. Let me ask you before my time is up. It is my 
understanding that you provided NIOSH with comments received 
during the public comment period and asked for a review and 
evaluation of the points made in the comments. Did you provide 
all the comments to NIOSH or just selected ones, and could you 
tell me how you determined which comments you were going to 
supply to NIOSH to get comments from them?
    Mr. Anderson. Under the statute in which the black lung 
program operates, when rulemaking is done, we are obligated to 
consult with NIOSH on those questions in which NIOSH's 
information on medical conditions, for example, might be 
helpful in answering questions or illuminating the issue; and 
on those issues in which NIOSH information might have been 
helpful. We submitted questions to NIOSH asking for their 
comments.
    Mrs. Northup. Could you supply my office with a copy of 
those questions you specifically asked NIOSH.
    Mr. Anderson. We would be happy to do that. Mr. Kerr, prior 
to his current responsibilities, was the head of OWCP; and I 
think he wants to say a word on this point.
    Mrs. Northup. Well, if you could be brief, please.
    Mr. Kerr. Very quickly, one of the things that we did 
listen to last year and think about was there is a trust fund 
and then there is regulatory proposal; the regulatory proposal 
is intended to look at the current system, which is an 
insurance system. We also this year did listen when you and 
others asked this about the trust fund. The regulations do not 
affect the trust fund except for where we cannot find a 
responsible operator. We did go to Treasury and say we have a 
deficit here that is ongoing, that is only going to rise. We 
would like to work with Treasury on a proposal to reduce the 
deficit in the trust fund, and this year's proposal from the 
administration says that we intend to do that; and we are now 
working with Treasury on how to write that up.
    Mrs. Northup. That is really a different issue, and I am 
going to lose my time here. Let me just say that in my meeting 
in the staff, with my meeting the Department of Labor, 
personnel indicated that the regulations were based on NIOSH 
research, yet NIOSH has never done any research on black lung 
or the effect of coal mining dust. NIOSH has only reviewed 
previous studies. In fact, there are no new studies on this. 
There is a big difference between doing research and reviewing 
research done many years ago, research I might add that was 
reviewed before these regulations were written the last time 
and many of these were done in countries where mining is quite 
different than mining in this country.
    I guess and might add that when you look at the e-mails 
that we secured that went between you all and NIOSH, it was 
pretty clear that what the Department of Labor was looking for 
was some statement from NIOSH that would give them some sort of 
medical backup for regulations that they were eager to write. I 
just wondered if you would comment on the legitimacy of 
deciding on regulations, asking for supporting material, 
getting material that is years old that was already reviewed 
with the past regulations to support your wish to rewrite.
    Mr. Anderson. I think, Mrs. Northup, that you perhaps are 
misinterpreting the nature of the communication between the 
Department of Labor and NIOSH. I think if you look at that 
communication very carefully you will not find any indication 
of an attempt on the part of anyone in the Department of Labor 
to obtain from NIOSH a prejudgment of the issue. I did review 
the e-mail traffic on that; and there is nothing in it that 
suggest that NIOSH give the Department of Labor a particular 
answer.
    Now some of the e-mail to which you refer is really e-mail 
between people within NIOSH in which they are apparently 
attempting to understand the questions that the Department of 
Labor asked them and, of course, the appropriate thing for them 
to have done in that case was simply to contact the Department 
of Labor for a clarification of the questions. So I do not want 
to leave the impression that there was any attempt whatever on 
the part of anyone in the Department of Labor to obtain a 
specific outcome from the comments of NIOSH. But NIOSH is the 
Federal Government's principle research organization for 
occupational diseases and so that is the place where one would 
expect the Department to go in the process of the rulemaking 
process to seek information, and NIOSH has an outstanding 
record of professionalism and expertise on a number of these 
questions.
    And I just hope that you might take another look at that 
information and be perhaps more broadly informed about the 
nature of the communication. But while you were speaking, I was 
given some additional information by the current head of the 
workers' compensation program to say that with respect to the 
impact of the rule, that we do not expect a significant 
increase in the rate of approval of claims under this rule. The 
purpose of the rule is to make the process one that is more 
streamlined with respect to appeals, and to create a more level 
playing field for the claimants so that those who are 
legitimately entitled to get the benefits will get them and so 
that they won't have to be delayed for an inordinate length of 
time before a final decision is made as to their eligibility. 
That is what the rules are intended to do, and we would 
certainly expect that that would be the outcome of the rule.
    Mrs. Northup. Thank you, Mr. Chairman. I have additional 
questions, but I will include them in my submission. Thank you 
very much.

                       OVERTIME PAY FOR SALESMEN

    Mr. Miller. Thank you. Let me follow up with some questions 
I asked Secretary Herman yesterday. I didn't get much of an 
answer yesterday; but maybe since we have both of you all here, 
I can get some answers or a little bit of clarification. And I 
find it interesting your statement and all, Dr. Anderson, and 
your written statement and other statements about the wage and 
hour and the focuses on low wage, most vulnerable members in 
our society--because you get this concern that as this 
administration is winding down that there is a rush to do 
things that, to establish some precedents, you know, to do a 
lot of rulemaking.
    And one area is this issue of wage and hour that you might 
be familiar with is this case in my particular district--and it 
also is in Congressman Hinojosa's district in Texas--these are 
drivers salespeople that--I am a college professor. I used to 
teach marketing, but I also have an investment part time in a 
restaurant, too. So I know a little bit about this work in 
retailing. If you want to sell beer or orange juice in my area, 
the amount of shelf space is important, if you can get displays 
at end of the aisle, if you can get signs hanging and do things 
like that. They have a team approach. This is the standard in 
this industry--it is my understanding--a team approach where 
you have a salesperson, and the driver is a salesperson. In 
Florida, you get your pay, too. I do not know if that is true 
in every State. You can't have a monthly account for beer in 
the State of Florida.
    So these driver salespeople do more than deliver goods, and 
I am understanding they are making the $40,000 range. These are 
not college-educated people. I mean, this is to me great. They 
have the opportunity to make 40 or $50,000 a year, and they 
have some incentive and opportunity to do better than minimum 
wage. But for the past 10 months or so, you have been very 
overzealous in going after this industry. I mean, it is not 
just this wholesale beer distributor. It affects a lot of other 
wholesale drivers.
    First of all, why are you going after this type of firm? 
Maybe you cannot talk about the specific case, I understand 
that; but if your focus is on lower wage, these are not minimum 
wage people, and you want to give people an opportunity, I 
hope, to make a good living; and if you say we have got to work 
hourly time and overtime only, then you take away incentives 
and such and that is hurting these people. I am baffled why you 
are going after these people because this is policy area.
    When I sent my letter--you sent it down to Tampa--you said 
it was an investigation issue. It is not an investigation 
issue. It is a policy issue that has been decided up here. So 
go ahead and explain.
    Mr. Kerr. For the first question, we all know I cannot talk 
about an open investigation, so I will be a bit careful about 
that. We have specific regulations on ``outside sales''. Let me 
see if I can break this down a little bit, but I am perfectly 
willing to provide you in writing or to come up and talk in 
detail about how these procedures work.
    But I would say a couple of things. One is we have moved 
toward targeting low-wage industries. We have moved the focus 
under our GPRA operation in Wage and Hour towards the kinds of 
industries that Dr. Anderson talked about. We still have about 
70 percent of what we do which is complaint driven. We still 
have an act that asks us to look at minimum wage and overtime 
in all industries in the Nation.
    So we have a fairly detailed outside sales exemption, and 
it applies to people who do outside sales. If somebody is 
primarily doing something besides outside sales, we cannot 
extend the exemption to them and all of these investigations 
end up being----
    Mr. Miller. The fact this guy drives a truck means he has 
to be covered by minimum wage, is that the logic? He is a 
deliverer?
    Mr. Kerr. The exemption is for outside sales. So if 
somebody does something other than outside sales, the question 
is how much and what is it; and all of these investigations end 
up being fact specific.
    On the point of whether we are doing this nationwide and 
whether there is some sort of target for this kind of business 
nationwide, I have no evidence that that is what we are doing. 
I do not have these kinds of cases in every district. So I 
would assure you that the targets that we are talking about for 
wage and hour are the ones Dr. Anderson mentioned and that that 
is not what is going on here.
    Mr. Miller. What bothers me about that is you, not you, but 
the Department of Labor said these home offices, we are not 
targeting that, that was just one office. That is kind of under 
the radar screen trying to do something.
    The policy of these driver sales is, my understanding, 
fairly standard in this industry. The driver sales are 
motivated by incentive. They make 40 or $50,000 a year in 
Sarasota, Florida. That is good wages in my area, and the 
motivation is they work together with the outside--one full-
time salesperson and this driver. He has a computer, he takes 
orders, he takes the cash. He is the one who tries to get those 
neon signs in the bar. He has got the incentive and opportunity 
to do better than a minimum-wage job. If you want to make him 
strictly a delivery man and get paid minimum wage or $10 an 
hour, if that is your motivation, you can move it that way; but 
these guys want the opportunity to do better.
    Mr. Kerr. There is nothing in the act that prevents an 
employer in this industry from paying somebody who is a driver 
or somebody who is not exempt incentive bonuses or paying them 
by commission. I do have the letter from the gentleman from 
Texas. We are preparing a response to you about the overall 
policy, but there is nothing that prevents incentive payments. 
There is nothing that prevents commission payments in these 
cases. We can talk about that in more detail, and I will write 
that down; but there is that misunderstanding in this 
circumstance.
    Mr. Miller. So right now there are only two cases, the one 
in Texas and the case in Sarasota, Florida?
    Mr. Kerr. I believe that there is not a case in Texas. I 
believe we were written about the policy.
    Mr. Miller. The policy, okay. So maybe just targeting my 
district only. But it really is a precedent. I mean, this is 
the norm for an industry that has been going on for decades. I 
know it works in other than the beer business. You want people 
to get that shelf space, you want those displays on there, but 
now you are saying we are only going to pay them by hourly 
rates, and you are going to change the whole industry because 
you have established----
    Mr. Kerr. No.
    Mr. Miller. You are. You do it in Sarasota, Florida; you 
are going to make it a nationwide thing.
    Mr. Kerr. These gentlemen or women, can be paid by 
commission, and they can be paid incentive bonuses.
    Mr. Miller. But you have got to do an hourly overtime 
first, and then you have to have a bonus on top of that.
    Mr. Kerr. If they are not exempt employees.
    Mr. Miller. It has taken 30 years to figure this out. 
Right? This has been going on for decades. My understanding is 
the majority of the industry is this way, and it has been going 
on since the 1960s, anyway. I was learning this back in college 
days. No? Am I wrong?
    Mr. Kerr. No. I do not know if you are wrong. Every case is 
fact specific, and there is not a rule that says you have to 
pay them in a certain way; but there are rules that say outside 
sales are exempt. And if that is what somebody's doing the 
majority of their time, they are outside salesmen and they are 
exempt.
    Mr. Miller. So if that person drives the truck and does 
something else----
    Mr. Kerr. It is a question about how much of the other they 
do, yes.
    Mr. Miller. Well, it is one thing when you say, Dr. 
Anderson, we focus on low wage, and at least in my area the 
only one I have had a complaint about is one Anheuser-Busch 
distributor.
    What regulation does Congress need to change to make this 
type of driver sales exempt? Is there a regulation we need to 
that?
    Mr. Kerr. I do not have the citation in my mind, but we 
will get you the regulation.
    Mr. Miller. Is this a new interpretation of the regulation? 
Obviously, this is new because you have not done it in 30 
years.
    Mr. Kerr. This is long standing.
    Mr. Miller. What have they been doing it for? Do it right 
before the elections so you can get away with it? This is 
bothersome to me. It is kind of like the home office issue, 
kind of sneaking under the radar just to try and get it, get 
that precedent set.
    Mr. Kerr. We will get you a copy of the regulation and a 
copy of the law for these cites that you ask me about.
    Mr. Miller. Well, I find it of much concern the way you are 
approaching this because I just think you are denying people 
the opportunity to hope. I understand the low wage when you get 
the people that you know they need to do that, but these guys 
or gals are making 40 or 50,000 a year. Hey, we want these 
people to have an opportunity. I guess you are not focused on 
opportunity. That is too bad.
    Let me switch to another issue, the LM 2 forms. Actually it 
is something we have been talking about for a while, and 
actually I want to thank you for working on that. It has taken 
a little longer than we thought it might take, but it is a big 
job. How is it going? Give me an update on the issue of the LM 
2 form.
    Mr. Anderson. We think it is going very well, Mr. Miller. I 
want to thank you for the funding that you provided to us to 
develop and ultimately to implement the electronic filing and 
the Internet disclosure of the union reports. We are on 
schedule. We are on track to have the system up and running by 
the middle of next fiscal year. We have provided reports to 
your office, to the committee about the progress that is being 
made. We have developed early a plan that laid out over the 
next several years from the point of beginning how we would 
proceed. We have consulted widely on the nature of systems of 
that type and what might be most appropriate for this purpose, 
and we have made significant progress. Things are going well, 
and we are optimistic that we will have the system up and 
running at the time that was originally promised.
    Mr. Miller. Thank you. I think you have worked with the 
office and I appreciate that. Are you getting any feedback from 
the unions that are going to be contributing to this?
    Mr. Anderson. We are getting feedback in the sense that we 
did consult with unions to find out, for example, how many 
might have the technological capability to file the forms 
electronically and for those who might not have that capability 
what alternative means might be found to have them file the 
reports. There will be a continuing obligation to file the 
reports whether that is done electronically or in other ways, 
and we have had full cooperation from the unions in advising us 
on the systems in place and how this might be done in a way 
that would not be overly burdensome.
    Mr. Miller. Actually, it should be a benefit to them, you 
know, where everything is done with technology now. When we 
started a few years ago, it has been moved a long way in the 
past few years; and so most of them have that data probably on 
some type of PC in their office.
    Mr. Anderson. A lot of them do.
    Mr. Miller. Certainly will be over the next several years. 
How would y'all utilize this data? Would it make any difference 
in what you are doing, having the data computerized and having 
a database to work with? Does that affect anything y'all are 
doing, investigations, other things y'all would do, for 
example?
    Mr. Anderson. I think that having the data on a computer, 
having it assembled in that way could possibly allow it to be 
analyzed more conveniently than doing it by hand, which is the 
present system. So I think that it would help, that you can do 
more. You can massage the data more easily when it is 
electronically filed, and you can do more with it to try to 
identify areas where a further look at the completeness of the 
report might be necessary.
    Mr. Miller. You do not need any more resources? You are 
online to take care of it? You do not need anything else?
    Mr. Anderson. We think that if you continue to put into the 
base for the agency the funding that we have now that we will 
be able to implement this system once it is up and running 
fully. Now, if we need additional resources we will not 
hesitate to come and ask for it.
    Mr. Miller. Thank you very much. We have a vote going on so 
I am going to proceed over to vote. Thank you both for being 
here today.
    [Recess.]



                                          Thursday, March 23, 2000.

             OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION

                               WITNESSES

CHARLES N. JEFFRESS, ASSISTANT SECRETARY
EDWARD L. JACKSON, DIRECTOR, OFFICE OF BUDGET

                           Opening Statement

    Mr. Bonilla [presiding]. The committee will come to order. 
Chairman Porter will be here very soon, Mr. Jeffress; and we 
are delighted that you are here to testify today. We have a lot 
of questions as well, and so we would be happy to go ahead and 
proceed.
    Mr. Jeffress. Thank you, Mr. Chairman. I am pleased to be 
able to appear today on behalf of the Occupational Safety and 
Health Administration to present the President's fiscal year 
2001 budget for the agency. I come before you again today with 
good news. The overall occupational injury and illness rate 
measured by the Bureau of Labor Statistics is the lowest since 
OSHA was created. Most interesting is the comparison of the 
injury and illness rate from the last 6 years with the first 20 
years of recorded injuries and illnesses. During the first 20 
years the rate came down about 19 percent. In the last 6 years 
the rate has come down 21 percent, with an intense 
concentration, I think, by employers and employees with the 
assistance of OSHA looking at health and safety. I am delighted 
to report to you that is a significant decrease in rates and 
improvement in the injury and illness experience of American 
workplaces.
    I am especially encouraged that we are seeing improvements 
in the hazards and the industries that are targeted by OSHA's 
strategic plan adopted pursuant to the GPRA passed by you and 
Congress. Over the last 3 years there have been significant 
reductions in the lost workday rates in the five industries 
that we targeted in OSHA. Shipyards, food processing, 
construction, logging, and nursing homes were five industries 
with particularly high rates where we promised to make a 
difference and have dedicated a significant part of our 
resources.
    In addition, silica exposures--one of the health concerns 
that we targeted--have been reduced by 39 percent in the last 3 
years. I am also pleased to report to you the overarching goal 
that OSHA set, in addition to reducing injuries and illnesses, 
is to help 100,000 workplaces reduce their injuries in their 
workplaces by 20 percent by the year 2002. So far, our progress 
report shows that 25,000 workplaces have reduced their rates by 
20 percent. I am happy to report to you that the report 
prepared for OSHA by independent academics shows that 50,100 
workplaces have, in fact, reduced their injuries and illnesses 
by 20 percent following an OSHA intervention. So I am very 
pleased to report to you that the program that you all are 
providing funds for, that the public has authorized, is 
accomplishing its goal of injury and illness reduction.
    While we are making real progress in reducing on the job 
injuries and illnesses, it is important to recognize in 1998 
there were still almost six million injuries and illnesses 
occurring on the job. To continue our success in reducing 
injuries and illnesses, the President is requesting a budget 
for OSHA for fiscal year 2001 of $426 million. The budget 
proposed by the President strikes an appropriate balance 
between enforcement and compliance assistance programs.
    To achieve the goals of our strategic plan we are 
continuing to emphasize the priorities which I discussed with 
you last year: expanded outreach and training, creative 
partnerships, strong enforcement and improved rulemaking. With 
respect to expanded outreach and training, our goal is to have 
a compliance assistance specialist in each local OSHA office. 
With your support we have created 34 compliance assistance 
specialist positions in the current year's budget, and we hope 
to add 33 more with fiscal year 2001 funds. This would give us 
a compliance assistance specialist in every field office.
    In addition we are requesting to hire 10 ergonomics experts 
next year, one for each region of the country who will be 
available to assist employers and employees in establishing 
effective ergonomics programs.
    We are also requesting, as a part of our outreach and 
training emphasis, an additional $3 million for Susan Harwood 
Training Grants and an expansion of the on-site consultation 
program run by States which continues to be popular with small 
businesses. We are asking for an additional $4 millionfor that 
program which will increase the number of free consultative visits to 
30,700 per year.
    In addition, in this area, OSHA is seeking $2.5 million for 
technology-enabled training, including computer or Web-based 
training and satellite teletraining to allow us to train more 
Federal and State compliance officers and deliver training to 
employers and employees at their job sites.
    In another effort to capitalize on technology, we continue 
to use our Web site to provide information to the public. Last 
year, we had 7 million visitors to the site, if you will, 
resulting in 177 million hits on that site. We have launched a 
portion of that Web site dedicated solely to small businesses 
which has been praised by a number of small business 
associations.
    The second area of emphasis for us is creative 
partnerships. One of the hallmarks of the new OSHA has been the 
partnerships we have established with industry and labor. We 
have now 66 active partnerships covering more than 4,500 
employers and 131,000 employees, some of these with specific 
companies, some industry-wide. Last month, we signed a 
partnership agreement with Associated Builders and Contractors 
and a similar agreement with a business-labor group in St. 
Louis in the construction industry. These agreements will be 
industry-wide models for OSHA and construction employers to 
improve safety on construction job sites.
    Another form of partnership, of course, with which you are 
familiar, the Voluntary Protection Program, our premier 
recognition program for exemplary performers, has almost 600 
sites at present, and the program is growing at nearly 20 
percent per year and recognizing the best performers in the 
country.
    In addition to our request for Federal compliance 
assistance funds, we are also asking for an additional $3 
million in fiscal year 2001 to assist State programs.
    Finally, the budget includes $1.8 million for a public 
employee protection program for the State of New Jersey where 
there are more than 500,000 State and local government workers.
    Our third area of emphasis is strong enforcement. Last 
year, OSHA initiated our site-specific targeting program which 
focuses our inspections on the work sites with the highest 
injury and illness rates. Last spring, as you recall, we sent 
letters to about 12,000 sites letting those sites know that 
they had very high rates. We anticipate placing about 3,000 of 
those sites on our inspection list this year. We need to reach 
more of them; and in an attempt to do that, we are requesting 
for next year an additional $5.4 million and 63 FTE so we might 
visit more of these most dangerous work sites in America.
    Our site-specific targeting program covers only general 
industry, however, not construction. Six percent of our 
Nation's workers are employed in construction, but nearly 20 
percent of our fatalities occur there. And we have no way at 
present of identifying which contractors have the highest 
rates. Our budget includes $1 million to begin a construction 
data initiative that will help us identify the contractors with 
the highest rates of injuries and illnesses.
    We are also placing additional emphasis on protecting 
Federal workers. In July of last year, the President announced 
the Federal Worker 2000 initiative. The initiative's goals 
include reducing the overall occurrence of injuries to Federal 
workers by 3 percent per year.
    Finally, we are also requesting additional resources for 
more staff to respond to the increasing number of whistleblower 
complaints under the OSH Act and the other whistleblower 
statutes enforced by OSHA, and incidentally, you all have just 
passed a Federal Aviation Administration reauthorization which 
will include yet another whistleblower statute for OSHA to 
administer. Strengthening whistleblower protections is one of 
the Administration's highest priorities for OSHA.
    The final area of emphasis for us is improved rulemaking. 
Our budget request seeks an additional $2 million for standards 
setting. We propose to use $1.5 million of that for two major 
surveys: one, to examine current industry safety and health 
practices, and second, a study of high-risk workers which we 
will support in conjunction with NIOSH.
    Our priority standards for rulemaking are ergonomics, 
revision of the record-keeping rule, occupational exposure to 
tuberculosis, a steel erection rule and personal protective 
equipment. With respect to ergonomics, which we have discussed 
before in this committee, musculoskeletal disorders remain the 
single largest cause of work-related injury and illness in this 
country, comprising about a third of all lost-time cases. Many 
companies in general industry are already implementing 
effective ergonomic programs to protect their employees. We 
believe a standard is needed to bring this protection to the 
remaining employees in general industry who are at significant 
risk of harm but who are not yet protected by ergonomics 
programs.
    The President's budget request reflects the Agency's 
balanced approach to assuring worker safety and health. We 
continue to develop partnerships with those who are committed 
to improving workplace safety and health. We continue to target 
more inspections towards the most dangerous workplaces, and we 
continue to promulgate effective standards to deal with 
emerging problems. I am proud of the results delivered by the 
new OSHA since 1995. I believe our budget request will enable 
us to make continued progress in protecting America's workers.
    Thank you, Mr. Chairman. I would be delighted to answer 
questions.
    Mr. Bonilla. Thank you, Mr. Jeffress.
    [The information follows:]



                   COMMENT PERIOD FOR EGRONOMICS RULE

    Mr. Bonilla. Before we begin questioning today, Mr. Obey, 
would you like to make any kind of opening statement?
    Then I will begin, Mr. Jeffress, with some questions about 
a subject I am sure you are expecting today. Same subject I 
talked to the Secretary about yesterday and that is the 
ergonomics regulation. Once again, let me express my concern, 
and I would think that it would concern you as well. We have 
almost across the board concern expressed by small business, 
medium business, large business in America ranging from 
software manufacturers, hardware manufacturers, bankers, 
drugstores, farmers, ranchers, shipping companies, energy 
companies, retailers, you name it. They are all very, very 
concerned that this regulation is going to do more harm than 
good to the employees and employers out in the heartland. I 
would think you would agree that these aren't bad people. These 
are people who have, in many cases, already started good 
ergonomic programs in the work environment.
    It is also something that cuts across party lines. No one, 
at least in my part of the country, is receiving any phone 
calls, no mail with a clamor from the public saying, we have 
got toget this rule on the books as soon as possible. It is 
just not something that you are hearing out there from the workers out 
in the heartland.
    So it is just puzzling why there is a resistance by OSHA to 
have more time for input from folks around the country given 
the volume of pages involved, and the volume of comments 
involved. There seems to be a reluctance to hold off until that 
NAS study is done so we can have something to say at least here 
is some scientific substance. Now, we have gone back and forth 
about this over the years. I know you probably feel there is a 
lot of substance, and research, medical research as well behind 
what you are trying to do, but you know one of the concerns we 
had is there were no hearings below Washington, DC, 
geographically.
    The Secretary expressed her concern yesterday about this 
and seemed to leave the door open to having some more hearings 
in some of the southern parts of the country. I would hope that 
that would be something you would be concerned about as well.
    You took 2\1/2\ months to respond to a letter, Mr. 
Jeffress, that I wrote you in January and OSHA took 2\1/2\ 
years to respond to the gentleman who wrote regarding home 
workplaces. Yet OSHA gave the public only 3 months to comment 
on one of the most significant rulemakings in OSHA's history. 
Then those who were lucky enough to get a slot had only 3 
minutes to examine each OSHA witness at the public hearings. Do 
you think that is fair, Mr. Jeffress?
    Mr. Jeffress. Mr. Chairman, you have raised lots of issues 
in that question. The time period for comment is important to 
us so that we be fair, that people have the opportunity to 
evaluate what is going on in their workplace, how they might 
change that, what a rule might do in terms of changing their 
behavior, and what kind of costs and burden it might put on 
them.
    In 1992 OSHA announced that it would begin a rulemaking in 
ergonomics. Employers have had quite a bit of time to start 
looking at what they can do, what they should do, and what 
might work for them.
    In 1995, OSHA issued a draft rule on ergonomics.
    Mr. Bonilla. We remember.
    Mr. Jeffress. With your assistance, we reevaluated that 
1995 draft, and then in February of 1999 put out a new draft 
that is very close to what our current proposal is.
    Since February of 1999 employers have had quite a bit of 
time, over a year, to evaluate the impact of that rule on their 
business, and how it might apply. During the first part of last 
year we did this process where we had small businesses 
commenting on the impact of that proposal, what it might mean 
for them, reviewing the information we developed to support 
that rule.
    Based on the input we got from those small business 
representatives, we, in fact, made some modifications. We 
designed a quick fix program as a part of the rule so you don't 
have to put a whole ergonomics program in place, you can fix 
the job and be done with it. We changed our economic analyses. 
We have an incremental process now for responding to MSDs 
instead of putting a whole program in place all at once. So 
there has been a long history here of people understanding 
where we are headed and what the concerns might be and 
preparing for how it might impact them.
    Once we published the proposed rule in November, there were 
first 70, then a hundred days for people to comment prior to 
hearings. There are 9 weeks of hearings, another 63 days. There 
will be another 90 days for comments after the hearing. So even 
after the publication of the proposed rule in November there 
are 250 days----
    Mr. Bonilla. So the bottom line is you think it is fair?
    Mr. Jeffress. The bottom line is I think there is a lot of 
time for people to evaluate the impact, to look at what it 
means to them, and to give us their advice on how we can best 
proceed.
    Mr. Bonilla. Would you consider reopening the period for 
initial comments?
    Mr. Jeffress. Again, we have a period right now during the 
hearing where we are taking comments. There will be another 
period after the hearing for post hearings comments, another 90 
days afterwards. I don't believe there is a need at this point 
to reopen the initial comment period. I believe there has been 
a lot of time for people to respond, but I want to assure you 
the very reason we did this is because we are looking for how 
to do this better. We welcome the advice, we welcome the 
suggestions we are getting. We will listen very carefully at 
the hearings.

                            LENGTH OF DOCKET

    Mr. Bonilla. Is the docket complete now?
    Mr. Jeffress. Well, the information that OSHA put into the 
docket is complete. During the course of the hearings, we will 
have people coming in every day presenting their views, 
presenting information. So during the course of the hearings, 
people will be adding to the docket.
    Mr. Bonilla. So then I guess if it is still coming in you 
couldn't say exactly how many pages are in the docket or could 
you?
    Mr. Jeffress. I can't tell you exactly how many pages. We 
got about 7,000 comments prior to the beginning of the hearing, 
ranging from a page to several hundred pages.
    Mr. Bonilla. Is that available on the Internet or how does 
an employer go about reviewing the docket?
    Mr. Jeffress. The information which OSHA put into the 
docket to begin with, that is, our justification, the economic 
analysis, the health effects, the significant risks, that is 
available on CD-ROM from OSHA. We can send people a CD. The 
basic information is on the Web, but all the full supporting 
information is available on a CD-ROM which we can provide to 
people.

                REACTION OF EMPLOYERS TO ERGONOMICS RULE

    Mr. Bonilla. My timer hasn't gone off yet so I am going to 
make one last comment, and maybe I will have a second round 
later. Does it ever trouble you, Mr. Jeffress, again I read off 
a list earlier of employers kind of cover--pretty much go 
across-the-board in this country covering everything from 
retailing to farming, ranching, manufacturing, bottlers, energy 
companies. Does it concern you at all that there is across-the-
board opposition to what you are trying to do?
    Mr. Jeffress. There has always been opposition to virtually 
every rule OSHA's proposed.
    Mr. Bonilla. Because you would acknowledge these aren't bad 
people.
    Mr. Jeffress. I understand and I would refer you to the 
bottlers, the manufacturers, the shippers, the florists, the 
bakers who have good ergonomics programs.
    Mr. Bonilla. Exactly. That is one of the points we made 
earlier is that there is a lot of good going on out there 
already.
    Mr. Jeffress. That is right, and we are trying to and have 
tried with this standard to take the good programs that are in 
place out there and say this is what is working for people, let 
us take what the best of American business is doing and spread 
it to the rest of American business. That is really what we are 
trying to do with this proposal.
    Mr. Bonilla. Thank you for your time today and at this time 
we will recognize Mr. Obey.

                       DELAYS TO ERGONOMICS RULE

    Mr. Obey. Thank you. Speaking of all those good people out 
there has that well-known defender of worker health W.R. Grace 
and Company been involved in this issue at all? You don't have 
to answer that.
    Mrs. Northup. Well I would like to know the answer.
    Mr. Obey. Well, you can ask on your time. Let me ask this. 
I noted yesterday that a couple things. We were told by some of 
our Members that they are unhappy because you didn't have an 
actual hearing south of Washington and that it would be awfully 
difficult for some of these lawyers to get all the way up to 
some of these other hearings in order to testify.
    I notice any time there is a nice tax break on the table, 
they don't have any trouble jumping on a plane and coming to 
Washington in one heck of a hurry. I would also ask you this 
question in light of the implication that somehow the public 
and business are not getting a significant amount of time in 
which to deal with this issue. As I understand this 
issue,didn't you first start to develop this 7 years ago?
    Mr. Jeffress. Yes, sir. In 1992 we issued the first notice 
we were going to do that.
    Mr. Obey. Isn't it true that you are providing more than 6 
months for public comment on what is essentially an eleven page 
proposal?
    Mr. Jeffress. That is correct.
    Mr. Obey. Isn't it also true that congressionally-induced 
delay in the production of this regulation occurred in 1995, 
1996, and 1998?
    Mr. Jeffress. Yes, sir.
    Mr. Obey. Do you have any idea how many workers were 
injured during that period----
    Mr. Jeffress. More than 600,000.
    Mr. Obey [continuing]. From ergonomics?
    Mr. Jeffress. More than 600,000 every year are injured from 
musculoskeletal disorders.
    Mr. Obey. So we are probably talking about over two million 
people have been injured during congressionally-induced delay 
in this regulation; is that right?
    Mr. Jeffress. Yes, sir.

                   RESOURCES OF ERGONOMICS OPPONENTS

    Mr. Obey. I have one other question for the record at this 
point, and then I would like to ask you this. You are dealing 
with a tough question, and I think Congress and every business 
and every American has every right to question every sentence 
of this regulation. That is their God given right in a 
democracy. But I would note there is a certain lack of symmetry 
in the consequences. If the rule winds up being too tough, it 
costs employers money unnecessarily. If the rule winds up being 
too soft, it costs workers their health and in some cases their 
livelihood. I think when we talk about cost-benefit ratios it 
is always good to remember who bears the cost and who gets the 
benefit.
    I would also ask you this. I have been watching on C-SPAN 
some of the appearances before your agency. A lot of very well-
trained and very well-paid lawyers traipsing up there. What is 
the average salary of an OSHA employee working on this 
regulation?
    Mr. Jeffress. Our standards writers in OSHA average a 
little over $70,000 a year.
    Mr. Obey. How many of those lawyers you think have been 
traipsing up arguing against the rule trying to pick it apart, 
how many of them do make less than 100,000 bucks a year?
    Mr. Jeffress. I don't know their salaries, but I have my 
suspicions. I doubt that many of them make less than that.
    Mr. Obey. How many of them you think make less than a 
million bucks a year?
    Mr. Jeffress. I suspect that several of them make less than 
a million dollars a year.
    Mr. Obey. I do, too, but I bet there are some who do make a 
million bucks a year. I just think when we are considering 
this, it is good to consider also the balance in the resources 
available between the folks who are interested in promoting 
this rule and the folks who are interested in stopping it.
    It is very apparent to me that the folks in this economy 
with the overwhelming preponderance of resources are those 
folks who are bucking the rules. I don't think that should 
prevent you from in any way rejecting any legitimate argument 
that they make, but we do remember that this is, in terms of 
economic power and financial power, this is a David versus 
Goliath situation, and you are supposed to be acting as a 
neutral referee between David and Goliath, and I just wish you 
well.
    I have indicated that like every other member of this 
panel, we probably have some questions about some aspect of the 
rule. I want to make sure for instance that the rule does not 
inadvertently muck up the way workmen's compensation programs 
work in States where they have good programs. States where they 
don't have good programs, tough luck. If they haven't been able 
to develop good programs by this time, they deserve to get run 
over.

                   DETERMINATION OF WORK RELATEDNESS

    Just one other question. In our hearing yesterday, there 
were concerns raised with regard to the determination of work 
relatedness of an ergonomics injury. Can you explain for us how 
the present workers' compensation system deals with this issue 
and whether a similar method of determination would be applied 
to the ergonomics regulation?
    Mr. Jeffress. Yes, sir. State workers' compensation laws 
require employers to make determinations about whether an 
injury is work-related or not. They have done so since the 
1930s when the workers' compensation laws generally were passed 
by the various States, and the employer has the obligation from 
his or her own knowledge and observation to determine whether 
the injury that the employee reports was caused or contributed 
to by an activity at work. That is a general statement of 
current State law.
    That does not change at all should OSHA adopt an ergonomic 
standard. Our standard in no way changes the authority of the 
employer to make the determination about whether something is 
work-related and the responsibility of the employer to make 
that determination. The employer would make that determination 
the same way once this standard is adopted that they have been 
making it for 50 years. The employer will have to decide if an 
injury is work-related, and if so, what is the appropriate 
response to it. That has been their obligation, and it will 
continue to be their obligation.
    Mr. Obey. Thank you, Mr. Chairman.
    Mr. Porter [presiding]. Thank you, Mr. Obey. Ms. DeLauro.

                      COSTS OF ERGONOMICS INJURIES

    Ms. DeLauro. Thank you very much, Mr. Chairman. Just to 
follow up on one of Mr. Obey's comments, you said that there 
were about 600,000 injuries a year.
    Mr. Jeffress. Yes, ma'am.
    Ms. DeLauro. And the delay, the congressional delay has 
probably resulted in over two million injuries. Do we have any 
sense--does OSHA have any measure of how much money the delay 
has cost business in terms of workers compensation costs during 
this time?
    Mr. Jeffress. We know from our research into workers 
compensation payments that employers this year will spend about 
$20 billion just on the medical costs and compensation costs 
for MSDs. When you add the productivity problems, the down 
time, it generally triples that. We expect it will be about a 
$60 billion cost this year for American businesses because of 
MSDs.
    Ms. DeLauro. So $60 billion and two million injuries could 
have been prevented if we stopped stalling in putting these 
safety measures in place?
    Mr. Jeffress. $60 billion is an annual cost and the two 
million injuries is over several years. We do estimate that 
ergonomics programs, given the ones that are in place in 
businesses in this country, will be at least 50 percent 
effective at reducing MSDs. The actual experience reported to 
us is higher than 70 percent, but as a conservative estimate we 
are estimating it will be about 50 percent effective. So we 
believe employers can eliminate half of their MSDs and save $30 
billion a year.

                    SCIENTIFIC STUDIES ON ERGONOMICS

    Ms. DeLauro. You know, what are we about? Talk to me about 
the scientific literature and any evidence on ergonomics and 
can you discuss two comprehensive reviews of the literature?
    Mr. Jeffress. Yes, ma'am. In the 20th century we know of 
about 2,000 studies that were done on MSDs in particular. If 
you take all the studies that referred to them, there were over 
10,000 studies that referred to MSDs. Two thousand is exactly 
on point. Early in this process OSHA asked NIOSH to review 
those studies and make a determination of the state of the 
literature: are MSDs work-related? Are there solutions to these 
or things employers can do? NIOSH did an extensive review of 
some 600 studies and concluded that MSDs clearly are work-
related and that there are solutions that work.
    That was the basis most recently for OSHA's going forward 
again in 1997. That study was questioned by some. The National 
Academy of Sciences at the urging of Members of Congress did a 
further review. I have a copy of their review here. This is a 
study the National Academy of Sciences did in 1998 of 
musculoskeletal disorders and whether or not they are work-
related and whether or not there are solutions atwork. Their 
conclusion was that MSDs are real, they are real people with real 
injuries. They are work-related and there are solutions that work.
    Based on these two highly respected research organizations' 
conclusions, we believe the science exists, that there are 
solutions to our MSD problems, and it is time for OSHA to move 
ahead with the rule.
    Ms. DeLauro. I think in my prior question, the information 
about the dollars and cents on one side and the injuries that 
have been prevented on the other side--if I could just have 
that information. I think that is worthy information to get out 
and around as far wide as we can make it known in terms of what 
congressional delay can cause in terms of fiscal 
responsibility.
    Mr. Jeffress. We will be happy to provide it to you. Once 
again, I say that as far as costing $60 billion a year, the 
rule could save as much as $30 billion. Again being 
conservative, we have estimated in our rule a $9 billion 
savings. But I can show you injuries have cost $60 billion a 
year, and we can do better.
    [The information follows:]

                              Cost of MSDs

    OSHA has estimated that MSDs cost $15-20 billion in 
workers' compensation costs each year. If all of the lost 
production and related costs of MSDs are counted, this would 
bring the total costs for lost production, administrative and 
medical costs to $45-54 billion per year. The agency estimates 
that each year the standard is delayed yields an unnecessary 
$9.2 billion in lost production, medical and administrative 
costs for preventable MSDs.

                          LENGTH OF REGULATION

    Ms. DeLauro. Also, to follow up on something Mr. Obey 
mentioned. You were talking about 11 pages of regulations 
because there was lots of discussion here yesterday about a 300 
page ergonomic regulation. So it is 11 pages of regulation and 
the rest is background information.
    Mr. Jeffress. This is the rule.
    Ms. DeLauro. If I am a small-business owner, do I need to 
read the 300 pages to know how to implement the regulation?
    Mr. Jeffress. No. The 300 pages include health effects, 
descriptions of MSDs, economic impacts. They include a lot of 
justification as to why we are going ahead, and we do this for 
every rule OSHA ever issues. There is an extensive preamble to 
the rule itself, but in terms of employers' compliance with the 
rule, we publish a set of OSHA standards where what we publish 
is the rule itself and that is what employers use.

                  COMPLIANCE ASSISTANCE ON ERGONOMICS

    Ms. DeLauro. How do I find out what I need to know, is 
there an Internet site?
    Mr. Jeffress. A Web site is available. This proposal is on 
it and educational materials related to it are on our Web site.
    Ms. DeLauro. What kind of compliance assistance is offered?
    Mr. Jeffress. In addition to the electronic information, we 
have on-site assistance available to small- and medium-sized 
employers free of charge to help them analyze their problems 
and develop programs. State consultation programs offer that 
ergonomics assistance; and in our proposal for fiscal year 
2001, we are asking for some additional funds to supplement 
that compliance assistance to employers.
    Ms. DeLauro. I just have a final comment at this juncture. 
You know sometimes the American public feels that there is a 
disconnect between themselves and the government that is 
supposed to serve them, and if they took a look at the activity 
in this issue the last several years, I think it is a prime 
example of that kind of a disconnect, where the needs and the 
concerns and the priorities of working men and women and even 
businesses in this country are not responsive to what is 
happening out there, and I think it leads them to ask that what 
difference does it make if those folks sit where they do in 
Washington, D.C., it is certainly not relevant to what my life 
is all about. I think we ought to take a hard look at what we 
have been doing here since 1995, 1996, 1997, 1998 and et 
cetera, and get this done and be done with it. Thank you, Mr. 
Chairman.
    Mr. Porter. Thank you, Ms. DeLauro. Mrs. Northup.

              BENEFITS OF ERGONOMICS PROGRAMS TO BUSINESS

    Mrs. Northup. Thank you, Mr. Chairman. I would like to ask 
you about the ergonomics rule, too. First of all, American 
businesses have been exceedingly competitive internationally. I 
assume that means they know how to save money. Most of us would 
agree that they are very able to do that. Don't you find it 
surprising that you would tell them that they could spend $30 
billion and then that would save $60 billion and that they 
wouldn't all be rushing to support this rule?
    Mr. Jeffress. I think American businesses are beginning to 
invest in ergonomics programs. They are seeing the benefits 
from them, and this rule will hasten the day when every 
American business sees the advantage of these programs.
    Mrs. Northup. Well you know I think it is a tribute to the 
American businesses that not only for financial benefit but 
also for employee benefits and workplace environment, that they 
are investing in ergonomics equipment, chairs, everything they 
possibly can to keep their workers healthy and able to come to 
work and be prosperous and happy themselves. I think that their 
concern is with OSHA and the way they administer rules, their 
reasonable standards or their unreasonable standards.

                      CAUSES OF ERGONOMIC PROBLEMS

    I guess, you know, the first, you said you believe that 50 
percent of all musculo----
    Mr. Jeffress. MSDs.
    Mrs. Northup [continuing]. Will be protected. So I guess 
does that mean that you think hip operations, knee operations, 
all those replacement operations won't be necessary for our 
seniors? I mean the bodies just won't deteriorate any more like 
the aging process sort of has worked all these years, that just 
won't happen?
    Mr. Jeffress. I don't think we have made that claim, Mrs. 
Northup. I do think avoiding MSD problems in the course of work 
will improve people's health generally.
    Mrs. Northup. The fact is that probably still joints are 
going to begin to deteriorate. As you get older are going to 
begin not to work as well and there are probably still going to 
be knee replacement and hip replacements and that sort of 
thing.
    Mr. Jeffress. I don't believe we are going to be able to 
reverse the effect of the aging process.
    Mrs. Northup. My question is how do you distinguish between 
what is an age-related question and what is caused by work? I 
mean the fact is that if you have a knee, a back, a hand 
injury, you know, what is causing it? Is it the age process? 
And you know, when the Secretary of Labor was in here, I 
mentioned that I know how I have carpal tunnel because every 
time I pick up a paring knife, you know it goes right to the 
injury. Yes, working the computer causes a few problems, but 
the cutting is when the pain really comes back. So my employer 
couldn't stop me from going home every weekend and picking up a 
paring knife and using it all weekend and reinjuring it, could 
they?
    Mr. Jeffress. No, and this rule is very clearly focused 
onwork-related problems and not those problems that occur outside of 
work.
    Mrs. Northup. But my employers could be held responsible 
for still purchasing every new product that comes on the market 
because there is a difference between prevention and being held 
accountable. Prevention says if the work is a factor in it at 
all, that the employer is responsible for taking every single 
action they can to prevent it. Isn't that true?
    Mr. Jeffress. What the proposal says is that, number one, 
the injury has to be work-related. So if it is something that 
occurs outside of work then it does not trigger the standard. 
Even if there is an injury which is contributed to by something 
in the work environment, the employer can look at what are the 
physical activities that this employee engages in.
    Mrs. Northup. Can they come into my home and watch whether 
I cook or not?
    Mr. Jeffress. No, we don't go into the homes.
    Mrs. Northup. I will get to that. I am talking about the 
employer. I am talking about the employer. Can he follow my 
husband to the tennis court and see whether he leans over and 
picks up tennis balls?
    Mr. Jeffress. The obligation of the employer is to look at 
what is going on in the work environment. If there is nothing 
in the work environment that is contributing to that, if there 
is nothing in the work environment, there is no regular part of 
the employee's job that causes this type of injury, then the 
employer has no obligation under the standard to do anything.
    Mrs. Northup. I am talking about sitting at a computer. I 
have a pain here, and I say, ``Mr. Employer, you are 
responsible'' but really I know that what aggravates it is 
every Friday, Saturday, and Sunday when I am in the kitchen 
using a paring knife, but I can hold my employer responsible. I 
am not going to volunteer that information to him, now I know 
when it really got bad, you know, cooking dinner on Saturday 
night. I mean I am not going to volunteer that. So the employer 
is going to have to purchase whatever mitigating products come 
on the market; isn't that correct?
    Mr. Jeffress. Well, I guess I have confidence in the basic 
honesty of the American people. There will be some fraud. There 
is some fraud in every program out there whether it is private 
sector or public sector. Are there some people that lie and 
don't tell the truth? Yes, there are. But primarily I expect 
people to be honest. I expect the employers to make an honest 
effort to assess if there is something in this work environment 
that is contributing to this problem. If so, it is their 
obligation to respond.

                       FEDERAL EMPLOYEE COVERAGE

    Mrs. Northup. You have indicated that the President wants 
to develop a 5-year initiative to reduce injuries and illnesses 
in the Federal workplace. Why would this ergonomic standard not 
apply to Federal employees?
    Mr. Jeffress. The coverage of Federal employees under the 
OSH Act is that Federal agencies are responsible for complying 
with OSHA requirements.
    Mrs. Northup. Without any penalties.
    Mr. Jeffress. We are not able to penalize them. So when the 
Secretary talks about us not having coverage, she means we can 
cite folks but we can't compel action. We don't have the 
penalty force against Federal employees and Federal agencies. 
However, Federal agencies do have the obligation to abide by 
OSHA standards and the President has now said to every Cabinet 
Department and every agency of the Federal Government, we will 
do better in the Federal Government, we will improve our safety 
and health programs, we will reduce our injuries and illnesses. 
Ergonomics will be one way of doing that.
    Mrs. Northup. Mr. Jeffress, the whole workplace in this 
country would like to be treated like the Federal Government. 
They would like to be given challenges, they would like to be 
advised, they would like to be given every single bit of 
evidence and effort that they possibly can use in order to keep 
their employees healthy and at work, every one of them, and 
what they don't want is OSHA who can come in with the heavy 
stick and go about it in an entirely different way.
    I mean it is totally different; and if you ever want any 
evidence of it, go look at the U.S. Postal Service that in 
every way claims they are not a Federal agency and they don't 
have to abide by Federal standards except when it comes to OSHA 
being able to inspect them. And they want to be a Federal 
workplace in that case because they don't want you coming in 
and treating them like a private workplace. The way you treat 
private workplaces and Federal workplaces is entirely 
different; and if we think this is so good for all the workers 
in this country, by God, we ought to start right in our own 
agencies and hold them exactly accountable and make them pay 
exactly the same penalties and provide the same benefits that 
we provide to every private employer.
    Mr. Jeffress. This Administration is on record saying that 
OSHA should apply to public sector employees, State, local and 
Federal.
    Mrs. Northup. Have they now allowed you to go into the post 
office and enforce our rules?
    Mr. Jeffress. Yes, ma'am. Congress authorized that last 
year, and we are in the Post Office this year issuing citations 
with penalties.
    Mrs. Northup. Well, it was this Congress that did that over 
and above objections from the administration and the U.S. 
Postal Service.
    Mr. Jeffress. Actually, the Administration supported that 
bill.

                 COSTS AND BENEFITS OF ERGONOMICS RULE

    Mr. Porter. Thank you, Mrs. Northup. Mr. Jeffress, I wasn't 
here earlier so I might be asking, probably will be asking a 
couple of things that have been asked before. Have you 
estimated the economic impact on the economy of the proposed 
rule?
    Mr. Jeffress. Yes, sir, we have.
    Mr. Porter. What was that?
    Mr. Jeffress. $4.2 billion.
    Mr. Porter. Now is it $4.2 billion in costs?
    Mr. Jeffress. Right, $4.2 billion in costs on an annual 
basis.
    Mr. Porter. Annually. And is that net?
    Mr. Jeffress. No, sir, that is costs. We estimate a $9 
billion benefit to the economy annually.
    Mr. Porter. And how is that benefit going to arise?
    Mr. Jeffress. The benefit arises in a number of different 
ways: the reduced payments for compensation, the reduced 
medical payments, the increased productivity, and reduced down 
time that employers experience when people stay on the job.
    Mr. Porter. Okay. You said there were 600,000 ergonomic 
injuries a year on average.
    Mr. Jeffress. That cause people to lose time from the job, 
yes, sir.
    Mr. Porter. Okay. And when these regulations are adopted 
have you estimated what kind of reduction would occur in the 
number of injuries?
    Mr. Jeffress. We are estimating 300,000 reductions per 
year.
    Mr. Porter. So half, half of the injuries, and is that half 
the costs also roughly? I know you can't do these things 
precisely.
    Mr. Jeffress. It is difficult to say in that the American 
businesses we know from compensation insurance reports are 
spending $20 billion just on compensation costs. We know the 
productivity costs are far beyond that. So we believe our 
estimate of benefits is very conservative.
    Mr. Porter. I have no idea about this, but insurance 
companies in recent years have taken it upon themselves to 
engage in risk-reduction programs to try to hold down the claim 
incidents. Does that happen from workers' compensation 
insurers? Are they into companies saying you ought to be doing 
this a different way because we are getting claims and we could 
save this money?
    Mr. Jeffress. To some extent. Where an insurer has a long-
term client that pays a significant premium, they do invest in 
providing that kind of service. With many small businesses, 
particularly those that tend to change providers every 2 or 3 
years, insurers have told me they generallydon't find it cost-
effective to invest in that kind of work.
    Mr. Porter. We know that large businesses have departments 
of compliance that can work these things out. It is simply an 
added cost. They can pass the cost along to their established 
customers. We are not so worried about them very frankly. They 
will make it. They will comply. They will do fine. What about 
small businesses, is there any differentiation in your rule 
about time of compliance, cost of compliance? How do they 
handle this cost that maybe in many cases they can't pass along 
and particularly understanding how to comply which may take 
expertise they don't have?
    Mr. Jeffress. Right. We have assumed significant costs for 
the reading and understanding of the rule in preparation for 
the ergonomics program. And we do expect and we have analyzed 
industry by industry what will be the impact, cost impact on 
each industry. The important thing from an industry perspective 
is the investment pays benefits.
    A lot of the cost analyses that have been done of the 
ergonomics costs--and there are many programs out there that 
have costs far in excess of what OSHA has projected--most of 
them, and I want to say all of them but there may be one I 
haven't seen, the ones I have seen do not ask questions about 
benefits. They do not ask employers what will be the effect of 
reducing your MSDs by 50 percent. They do not ask what is the 
effect of reducing productivity by some percentage amount. They 
only ask about costs. So they ignore the benefits side of the 
equation.
    Based on the employers that have programs in place and the 
information that they have reported to us, we believe that 
there is a net benefit. So rather than having to pass the cost 
along, we believe over a period of time that this will, in 
fact, benefit employers. It will be a good investment. Now that 
doesn't mean the first year, that it will be a pay back the 
first year.

                     WORKERS' COMPENSATION PREMIUMS

    Mr. Porter. The Federal Government doesn't regulate 
workers' compensation insurers.
    Mr. Jeffress. That is correct.
    Mr. Porter. The States do. Is there anything anywhere that 
will assure that if there is a significant improvement, that 
is, fewer claims made because of ergonomic injuries that the 
premiums, in fact, will go down? Do States regulate it to the 
extent of saying you only get a certain percentage of profits? 
In other words, what is to prevent workers' compensation 
insurers to keep the premiums high and let the businesses 
absorb the cost?
    Mr. Jeffress. Of course, every State operates differently. 
In some States, the rates are controlled by the States and the 
State actually operates the compensation program; but in most 
States the employers are experience rated. So if employers 
reduce their injuries and illnesses, their premiums fall 
because they are experience rated.
    Mr. Porter. So they have already got an incentive in the 
system to do better on the ergonomic side?
    Mr. Jeffress. There are some incentives. Of course, this 
system has been in place for years and years. It was in place 
in 1970 when Congress decided it wasn't enough and created 
OSHA, but there is some incentive in the system at present.

                          INJURY RATES BY SIZE

    Mr. Porter. Do you have any idea what percentage of 
injuries come in the large businesses as opposed to smaller 
companies? I mean is there a breakout by size anywhere in the 
system or do you have any anecdotal evidence of it?
    Mr. Jeffress. There is some information about that. It is 
conflicting. The Bureau of Labor Statistics information 
suggests that businesses with 50 to 250 employees tend to have 
the highest rates of injuries. The fatalities information 
suggests that the smallest businesses have the highest fatality 
rates.
    Mr. Porter. And the larger businesses have the situation 
more under control, in other words?
    Mr. Jeffress. That is correct.

                          REQUESTED INCREASES

    Mr. Porter. Now when you started as the Assistant 
Secretary, we talked about how you were reinventing this agency 
following on the philosophy of your predecessor Joe Dear to 
emphasize compliance, cooperative compliance rather than 
breaking down the doors and rushing the inspectors in and 
fining everybody in sight. And we have encouraged you to do 
that as much as we possibly can because we think that is a far 
better way of getting the results you are seeking than the 
strong arm way that has been the hallmark of the agency in the 
past and has led to so much ill will between the agency and a 
lot of business enterprise.
    This year you are requesting an increase in FTEs, and most 
of those FTEs, at the least the majority of them, are going 
into enforcement rather than into compliance assistance. Why 
are you doing that? Why aren't you emphasizing compliance 
assistance which you told us was far more important in the 
beginning, and are you changing your philosophy?
    Mr. Jeffress. No, sir. The dollar amounts in terms of the 
total increase are about the same between Federal compliance 
assistance and enforcement. FTE only measure Federal employees 
and, as you know, a large amount of our compliance assistance 
is provided through State consultation programs. That is a 
significant part of what we are doing. Those are State 
employees so they don't count as Federal FTE, but in terms of 
the dollar amount of the increase, not counting the 
mandatories, it is about a $12.9 million increase for 
compliance assistance--Federal and about a $12.1 million 
increase for Federal enforcement. Given that, historically the 
bulk of our program has been in enforcement, this represents a 
percentage increase about twice as high on the compliance 
assistance side as it is on the enforcement side. So we are 
continuing to live by this philosophy.

                         TRENDS IN INJURY RATES

    Mr. Porter. This is my last question. As you move to this 
new philosophy, has this shown higher rates of injury and 
health problems among workers; or are we making progress?
    Mr. Jeffress. Well, I can report that the injury and 
illness rates continue to decline and decline at a pretty steep 
rate. I am pleased with that. I think the credit for that goes 
to employers and employees for doing what needs to be done on 
the job.
    I do think that OSHA is reaching more people than ever 
before with information, with compliance assistance materials. 
I agree with you that that kind of incentive is important and 
is useful in focusing attention on safety and health. I still 
believe strongly that it is important to have a strong 
enforcement program out there to reassure people that OSHA is 
on the job, occasionally get the attention of some folks who 
need to get attention; and I am pleased with the site-specific 
targeting with our enforcement program.
    We went, as you know, from a random selection of where to 
inspect to focusing inspections where the injuries are the 
highest. That has turned out to be a very important direction 
for OSHA to go. It is getting us where we need to be. We are 
finding in these places with high rates more hazards than you 
might expect, and much of the credit for the reduction--and we 
had an academic report just recently that showed 50,100 
workplaces where we had an intervention had brought their rates 
down by more than 20 percent--the bulk of that comes from our 
targeting the high-hazard workplaces and getting their 
attention to safety and health issues.
    Mr. Porter. Yes, sir, and I commend you for that. I think 
that is exactly the way you should be going; and if it is 
working and the numbers are coming down, obviously you are 
doing something very right.
    Mr. Cunningham.

                     ORIGINS OF ERGONOMICS PROPOSAL

    Mr. Cunningham. I don't have too much, Mr. Chairman. I want 
to tell you, I personally feel that your Department is 
partisan. I believe it is political. At least I have that 
perception. It may not be reality, but I have got a very strong 
perception that that is the case.
    I think in some cases you have done good, but I think you 
are a front for the labor unions and I think you are anti-high-
tech and anti-small business to put it up front. And when 
asked, the University of Michigan and you knowMichigan is a 
large part of the labor unions, you were ranked dead last of all the 
government organizations, even IRS, which I don't think is viewed very 
good. And when my colleagues on the other side talk so eloquently about 
delays costing injuries, the delays in national security that this 
administration has delayed has cost us lives, it has cost us men and 
women, it has cost the loss of equipment. So I don't like being 
lectured on losses and delays in this thing.
    In this I am reading where grocery store owners were, from 
your own statistics, 130,000 grocery store owners who operate 
at about a one percent margin, that only 30,000 of them have 
manual handling jobs and 75,000 would be covered the first year 
by a risky ergonomic scheme to gore small business. My dad 
owned a small chain of five and dime stores. I handled 
equipment every single day, and I look at these things and I 
look at under your own statistics on table 8-5, OSHA estimates 
more than 31 thousand small grocery stores will lose 35 percent 
of their profits; credit unions would lose their profits; while 
commercial banks would lose nine percent of their profits; 
family clothing stores would lose 36 percent of their profits; 
mens and boys clothing stores would lose 161 percent of their 
profits. In our new economy, that means jobs as well.
    My colleagues talk about supporting working men and women. 
They talk about only the unions, not small business. Ninety 
percent of the jobs in my district are small business. And I 
know you are going to say, well, we don't care, safety in the 
unions or the workplace; but your risky ergonomics plans 
threatens those jobs and those businesses by your own 
statistics.
    Now, I don't disagree that you have done some very good 
things in small business and saved injuries and lives, but I 
think this plan is partisan. I think it is political. I think 
it is inspired by the labor unions and this White House. You 
are free to comment.
    Mr. Jeffress. The first proposal, the first announcement 
that OSHA would go forth with an ergonomics proposal was made 
by Secretary Elizabeth Dole in a Republican administration.
    Mr. Cunningham. I have no further questions, Mr. Chairman.
    Mr. Porter. Thank you, Mr. Cunningham. I don't know whose 
phone that was. We have a rule in here that you cannot have 
cell phones on. So please observe the rule. Ms. Pelosi.

                     PUBLIC OUTREACH ON ERGONOMICS

    Ms. Pelosi. Thank you very much, Mr. Chairman. Welcome, Mr. 
Jeffress. I apologize for not being here for the first part of 
your testimony; but I had to act as ranking in the absence of 
our true ranking, Mr. Dixon, in the Intelligence Committee. And 
unfortunately the timing went over. Only that would have 
prevented me from being here for this very important 
presentation. I have read your presentations. And I was just 
getting briefed about some of the questions that preceded my 
arrival, and I want to go over some of them again.
    First, Mr. Jeffress, I want to commend you for your 
excellent leadership and dedicated efforts on behalf of 
workplace safety and health for America's working men and 
women. I commend you and the administration for working to 
protect working Americans. In addition, I want to state my 
strong support for the Department of Labor's efforts to 
finalize its ergonomic standard this year. The scientific 
evidence is clear. The solutions are workable. Many companies 
have already established and invested in voluntary programs. 
America's working men and women have already waited a decade 
for a standard, and we must not allow any more delays.
    On that subject, Mr. Jeffress, I know that OSHA has 
provided the public with an ample opportunity for comments. 
Yesterday the Secretary said that she was considering and 
waiting for a report from her staff about the possibility of 
other hearings in different parts of the country, and we will 
see what she decides.
    OSHA has also had ample time to review the existing 
scientific evidence that demonstrates a clear link between 
ergonomic risk factors and the resulting injuries and 
illnesses.
    I am fond of saying around here that the plural of 
anecdotes is not data, but there is a great deal of data that 
the anecdotes of which are very illustrative of the problems 
that American workers face, many of them not very far from 
Washington, D.C., and many of which I have seen since my 
childhood as a native of Maryland and spending my summers on 
the Eastern Shore, some of those problems still exist with all 
the advances in technology, the way you cut off the wing of a 
chicken over and over and over, and maybe I should do this 
[holds up hand to simulate cutting off chicken parts] in the 
course of my whole questioning time, if you do this all day, 
you are going to eventually have a problem.
    Please describe the outreach you have done to receive 
public comment in current ongoing hearings. Could you describe 
the overwhelming evidence supporting OSHA's proposal?
    Mr. Jeffress. Yes, ma'am. In terms of the public outreach, 
as you point out, this is an area where we have sought to ask 
people what works for them, what makes a difference in their 
workplaces. We have held 13 different stakeholders' meetings in 
different places around the country on ergonomics where 
employers, associations, workers could come to us and talk 
about both the problems in their jobs and the successful 
solutions they have put in place and to provide comment early 
on where those had been put in place around the country. We, in 
fact, have had meetings in Houston and San Antonio and Atlanta 
and various other places in the South as well.
    Ms. Pelosi. Is Mr. Bonilla aware of those?
    Mr. Jeffress. I am not sure he was. He mentioned it 
earlier.
    Mr. Bonilla. I beg your pardon.
    Ms. Pelosi. For your benefit I wanted you to hear Mr. 
Jeffress' presentation about where these meetings have taken 
place.
    Mr. Bonilla. He did review that earlier.
    Mr. Jeffress. I was commenting on stakeholder meetings in 
Atlanta, Houston, and San Antonio where people could come in 
and talk about ergonomics prior to these rulemaking hearings.
    Mr. Bonilla. That is different.
    Mr. Jeffress. Those are the stakeholder meetings. We had 
outreach throughout the country in 13 different places where 
people could come in and provide us information on how they do 
ergonomics well. We had best practices conferences in every 
region of the country where employers came and said, this is 
what we are doing and this is what works for us, and to share 
with each other as well as with us about what works.
    We probably had more input on this rule than any other rule 
that OSHA has ever done. For the hearing itself, more than 
7,000 people have been able to provide written comments to us 
following a notice that we gave for this hearing, and more than 
1,000 will come and testify at our hearings in three locations 
in this country this spring. So we have had the opportunity to 
do extensive outreach.

                    SCIENTIFIC STUDIES ON ERGONOMICS

    In response to the data, as you point out, the National 
Academy of Sciences has done a study that concluded that MSDs 
are work-related, that there are solutions that make a 
difference. The National Institute of Occupational Safety and 
Health did a previous study of the existing literature, again 
concluding that MSDs can be reduced by actions taken at work.
    Based on those analyses, based on thousands of studies 
done, and most importantly based on the real-world experience 
of businesses that have put programs in place, we know that 
these programs make a difference. We know they can reduce MSDs 
by up to 50 percent or more, and we believe it is time to take 
the experience of these companies and extend it to other 
companies in the country.
    The one criticism I would have of some of the critics who 
have questioned whether these programs will work and whether 
there is any science is that in our preamble to the proposal we 
give case histories, we give case studies, we give information 
on real programs that have been put in place and what the 
impact has been. Most of the criticisms of us and most of the 
speculation about the costs did not name any employers that 
have put programs in place that haven'tworked. There are not 
studies out there that say these programs don't make a difference. All 
of the real-world experience that has come to us that we have put in 
our preamble shows the programs do make a difference, and that is the 
kind of data that our standard is based on.
    Ms. Pelosi. I want to commend you for your leadership on 
this issue, but I also want to commend the businesses who have 
taken the lead on this. I want to cite two particularly in 
California, one in San Diego. In 1990, AT&T global workers' 
compensation costs reached $400,000. Analysis of the situation 
showed that 90 percent of these costs and 80 percent of lost 
work days at this site were accounted for by back and shoulder 
injuries arising from repetitive tasks. And ergonomic programs 
for both 800 desk- and computer-bound office staff and 
mainframe assemblies were introduced, employees trained and 
pneumatic drivers were replaced by lighter electrical units, an 
awkward conveyor system was replaced, lift manipulators were 
purchased, office ergonomic training was instituted, and early 
reporting to allow for improved medical management was 
encouraged. The impact was that the workers' compensation cost 
which had been $400,000 in 1990 fell to $8,600 in 1994.
    And in San Francisco, Data Processing and Accounting 
Service, headquartered in San Francisco with approximately a 
hundred employees at four locations in California, 80 percent 
of DPAS's work is highly repetitive data entry for which its 
employees are paid on a performance basis. To address 
potentially serious ergonomic stresses in the workplace, DPAS 
implemented an informal yet effective employee-driven ergonomic 
program. The impact--and I will put more of it into the 
record--but a review of DPAS workers' compensation data for the 
last 4 years showed ergonomics-related claims rated less than 
.1 percent of 100 employees. This and other information is 
available in CTD News or Office Ergonomic Solutions: Six Case 
Studies of the Center for Office Technology.
    I want to commend these and many, many other companies who 
have seen the wisdom of having a safe workplace for their 
employees, that it is not only good personally but that it 
saves money in the short run, certainly as well as in the long 
run. So thank you again for your leadership on this and I hope 
we won't have any further delays in issuing the standard.
    Thank you, Mr. Jeffress. Thank you, Mr. Chairman.
    Mr. Porter. Thank you, Ms. Pelosi. Now, the Chair will 
advise Members that we also are considering MSHA this 
afternoon. We have some time left. I will ask whether any 
Members would like a second round.
    Any other Members have questions, Mr. Obey? And Ms. Pelosi, 
would you be here for a second round?
    Ms. Pelosi. No, I don't have any questions for a second 
round.
    Mr. Porter. All right. We will have a second round, and we 
will have 6 minutes for each questioner. Mr. Bonilla.

                        SCOPE OF ERGONOMICS RULE

    Mr. Bonilla. Thank you, chairman. One thing I wanted to 
clarify Ms. Pelosi made, I am sure she was present yesterday 
when I was just delighted that Secretary Herman did acknowledge 
that there was perhaps an oversight in not including any of the 
southern region of the country in this hearing process. So I 
didn't know whether the gentlelady from California had been 
present for that, but I wanted to point that out.
    And also earlier, Mr. Obey pointed out, was talking about 
salaries and who may or may not be for this depending on your 
income. I have got a congressional district that has an income 
of about $15,000 on average, and there is not a clamor for any 
expediting this rule in an income area like that as well. I 
don't know that we can correlate income categories with concern 
about the ergonomics regulation at this point.
    Mr. Jeffress, I have got a comment here from one of my 
constituents in one of these areas. In some of my areas, some 
of my areas are doing well, but others are really, some of 
these jobs are, we need more jobs in some of the areas I 
represent as well. It is not a place where, especially along 
the Mexican border that I represent, where there is an 
abundance right now of jobs for folks.
    One of my constituents had a concern about how they would 
know when they are in compliance. One grocery store manager who 
employs many people in my district and across south Texas wrote 
me saying, and I will read this quote from the letter, ``The 
proposed regulation does not take into account the fact that 
each employee has different characteristics and reacts 
differently to physical activities. The regulation is written 
so vaguely that we believe it will be extremely difficult for 
us to determine what steps we should take to reduce any 
possibility of musculoskeletal injuries, and every time an 
injury occurs our program will have to be redesigned. The 
standard has no specific criteria by which to measure if 
compliance is achieved and leaves the definition of control, 
feasibility, and effectiveness up to the compliance officer.'' 
and let me assure you that this is an employer who is very 
concerned about workers' safety. So the question is how does 
this grocer know if he is in compliance with this standard? 
Does he have to wait till the OSHA inspector comes along and 
says he is doing fine or does this broad rule leave an enormous 
amount of discretion to OSHA inspectors? I mean, is there a 
finite way to know?
    Mr. Jeffress. This is a performance rule so that the rule 
specifies that the obligation of the employer is to put a 
program in place that eliminates MSDs or materially reduces the 
MSD hazards that may exist. So that is the obligation of the 
employer. Eliminating MSDs is fine, but we do not expect that 
we will be able to eliminate all MSDs. We are only projecting a 
50 percent success rate there. So we anticipate there will be 
some MSDs that continue. If the employees are experiencing 
MSDs, the rules state the employer's obligation is to 
materially reduce the MSD hazards that exist.
    Because every workplace is different, it is the employer's 
obligation to, if they are having injuries, assess what the 
hazards are in their workplace that are causing them. We did 
not want a one size fits all. We want something that is 
tailored to the individual workplace that you take and apply to 
your workplace so the small machine shop doesn't have to do the 
same thing that the large auto assembly plant does.
    So the employer's obligation then is to assess what the 
problems are and to put fixes in place to reduce those hazards.
    To the extent that people are uncertain or unclear or need 
reassurance as to them being in compliance, I think OSHA has 
the obligation to reassure people that in fact if you are 
putting fixes in place, if you are acting in good faith, then 
you are in compliance. The rule does not demand an end to MSDs. 
We have heard a number of people that say we need to be clear 
about when you are in compliance and we will listen very 
carefully during these hearings that are ongoing on how we can 
word this compliance-end point to give that reassurance to 
employers. It is not to be left to the discretion of the 
compliance officer. It should, in fact, be a test whether I am 
acting in good faith here, whether I am doing the right thing, 
and we should be able to define that to give people that 
reassurance.

                      COSTS OF ERGONOMIC INJURIES

    Mr. Bonilla. I only have one final question. I believe 
sometimes, Mr. Jeffress, that figures are used to create, that 
are alarmist, frankly; and I wonder sometimes where one gets 
numbers to argue their case. My only final question is where do 
you get that $60 billion that it is costing business out there 
right now? I think cumulatively with benefits lost and all 
those things, it kind of has a ripple effect. I know that is 
what you referred to, but it would just seem to me that you 
know the folks out there who are in compliance offices are 
really making a sincere effort in good companies around the 
country that are trying to keep their workers safe on the job.
    I just don't understand why you would think that with all 
the intellect that they have in these places that are well 
intentioned why they would have--be unable to deal with worker 
safety in their work environment and your folks would be. I 
mean is there a greater intellect level? Is there a greater 
expertise at OSHA that you feel is superior to someof these 
compliance offices out there? I guess my question is two pronged. Do 
you feel that and also where do you get that $60 billion figure?
    Mr. Jeffress. In response to the first, I have never met 
the employer who wants to hurt somebody. So I don't think there 
is any superiority on OSHA's part about being more concerned 
about people's welfare than an employer's concern. I believe 
there is a genuine concern on the part of employers to protect 
employees.
    Mr. Bonilla. I am glad you acknowledge that, Mr. Jeffress.
    Mr. Jeffress. I also am very much aware that the 
consequences of injuries and accidents are usually not 
observable until they occur. So investing in the preventive 
aspects of safety, it is something that takes an act of faith. 
I have to believe that putting a dollar down today is going to 
save me $4 tomorrow in order for me to put that dollar down 
today, and there are still lots of people that don't make that 
investment. They either don't believe the investment will pay 
off or defer it, or for other reasons find other places to put 
those dollars.
    Insurance companies can show you, and part of our data 
comes from these insurance companies, can show you that the 
average cost for a back injury in a business, small or large, 
is over $22,000. If you take our projected cost per workstation 
to fix the job, which is $153, or if you take the National 
Association of Manufacturers' projected cost to fix a 
workstation, which is $781, either way you can make a lot of 
those fixes and still save money compared to one back injury, 
but it takes faith that safety pays.
    I believe it does. We can show you statistically it does. 
Admittedly, folks will question that data. We can give you 
testimonials that it does. We can show you from the Voluntary 
Protection Programs that like to invest big money in their 
safety and health programs, that in fact they have 
significantly fewer injury and illness costs, workers' 
compensation costs, and significantly less down time than other 
people in their industry of similar size who don't make those 
investments. So I think we can show you that safety pays, and 
that is where our data comes from, the workers' compensation 
experience, from insurance companies, from compensation 
programs, and from the multiplier effect that people apply to 
those kinds of costs.
    Mr. Bonilla. Thank you, Mr. Jeffress.
    Mr. Porter. Thank you, Mr. Bonilla. I will advise the 
gentleman from Mississippi that we have his first round time 
reserved. I am going to call on Mr. Obey and then on him. Mr. 
Obey, second round.

                     Cost of Ergonomics Compliance

    Mr. Obey. First of all, I simply want to stipulate that in 
my judgment the overwhelming majority of businessmen in this 
country and businesswomen want their workers protected and will 
try on their own to see to it that they are protected.
    In my judgment, many times you have two problems. Number 
one, a lot of them don't know how, and they can use some 
guidance in plain English to help figure out how. And secondly, 
there are always the bad apples in every barrel that would 
spoil it for everybody. If we were all saints we wouldn't need 
a government, we wouldn't need umpires in baseball games, we 
wouldn't need regulators.
    I would also like to say that while you have seen that this 
panel is, I think, very strongly divided on the advisability of 
proceeding with this rule, I think the questions you got from 
the Chairman were right down the middle. And I think that in 
putting together your final rule, I think the rule is going to 
need to be able to be responsive to the questions that he asked 
because they were all legitimate questions; and if answered the 
right way, then that rule will be able to stand without 
political kibitzing once it is finalized.
    Also, I couldn't help when I heard Mrs. Northup ask about 
the difference between back injuries and knee injuries and the 
way you might approach your job. I am reminded of my old friend 
Harvey Dueholm who used to serve in the legislature. He had a 
face like a Basset hound and the heart of a lion, and he would 
have said that at least when it comes to politicians, the bulk 
of knee injuries suffered by politicians come from genuflecting 
to special interests with too great a repetition. And I think 
you would have said that the bulk of back injuries occurred by 
politicians comes from the lack of spine in standing up to the 
big boys in this society. And I think he would have said that 
most of the heart trouble of our constituents comes from broken 
hearts watching elected representatives putting somebody 
besides the average working people and the most defenseless 
people in this society at the head of the line when we make 
choices like this. That would be my own personal observation 
for whatever it is worth.
    Thirdly, if we are to talk about inflated estimates, as Mr. 
Bonilla did, I note in a statement put out by Representative 
Ballenger, I note that he quoted the Employment Policy 
Foundation that estimated the cost of this regulation to be as 
much as $100 billion annually for businesses as opposed to the 
$4 billion that you indicated.
    I think in determining who is most accurate, we ought to go 
back to the Office of Technology Assessment. In 1995, before 
this Congress ill-advisedly abolished them, they compared 
OSHA's cost estimates prior to rules being promulgated to 
actual costs once those rules went into effect. In six of the 
eight cases examined by OTA, the industry argued that 
compliance would pose unworkable problems. They said 
requirements would not be technically feasible, would pose 
unworkable cost increases, would force companies out of 
business, and would impose a significant inflation penalty in 
the national economy.
    What OTA found by comparison was exactly the opposite. In 
fact, in many cases they found that the actual burden of 
compliance wound up being considerably less than OSHA's final 
estimate, about one quarter of the estimate in the case of 
vinyl chloride, one third in the case of cotton dust, one half 
in the case of formaldehyde, and in half of the eight cases the 
standard stimulated changes in production technology that 
benefited industries beyond the mere question of protecting 
people on health and safety considerations.
    And just one last point. When Mr. Porter asked you about 
whether or not your standard did take into account the 
difference between the ability of small business and large 
businesses to deal with this, I think that is an important 
point. When OSHA was first created, they were required by the 
Congress to adopt consensus standards that have been developed 
by industry because they didn't trust the pointy-headed 
bureaucrats to do that. So for a long time, you had standards 
that were easy for a lawyer with a large Fortune 500 company to 
understand but not for a guy running a hardware store. And it 
is my understanding that the OSHA standard which you are now 
developing has a number of provisions that are trying to 
minimize the impact on small business, and correct me if I am 
wrong.
    Mr. Jeffress. That is correct.

                        Plain Language Standard

    Mr. Obey. That you would for instance exempt from record-
keeping requirements for businesses with 10 or fewer employees, 
that you have an extended phase in of requirements for job-
hazard analysis, that you have an option to use quick fix in 
lieu of adopting full ergonomics programs for a problem job and 
a variety of other actions, and I think it is important that we 
know that, and that the final rule comes out the way you 
indicate on this point when all the dust settles.
    Mr. Jeffress. Thank you, Mr. Obey. We have also made an 
effort to write this rule in question and answer format, in 
language that is easy to understand and, at the President's 
direction, trying to use plain language, and plain language to 
you and me that makes common sense and is understandable. It is 
sometimes attacked by lawyers as being vague or nonspecific, 
but when we say things like significant risk, you and I can 
assess I think what a significant risk is. I believe the plain 
language will be an advantage. I think it will be a success. 
OSHA has received an award for plain language in one of the 
previous standards we wrote. We are doing our best to make sure 
this is understandable to the typical businessman regardless of 
size.
    Mr. Porter. Would the gentleman yield?
    Mr. Obey. Sure.

                     Provisions for Small Business

    Mr. Porter. Mr. Jeffress, there isn't a provision however 
to phase in compliance dates for smaller businesses. They would 
be just as liable to comply the day the regulation is set as a 
large business; is that correct?
    Mr. Jeffress. Well, there is a phase-in date for everyone. 
There is a year before the training is required. There are 2 
years before the next level is required. There are 3 years 
before the actual fixes and an evaluation are required.
    Mr. Porter. But nothing longer for small businesses as 
opposed to larger ones?
    Mr. Jeffress. There are some provisions that will hopefully 
be easier to comply with, but there is no special phase in.
    Mr. Porter. I thank the gentleman. Mr. Wicker.

                        Tuberculosis Rulemaking

    Mr. Wicker. Thank you very much and welcome back, Mr. 
Jeffress. I just want to talk about one subject and that is 
tuberculosis. You and I have talked a number of times in person 
about this issue. We have taken testimony, discussed it on the 
record, also. As you know, the House has placed language in 
legislation concerning this matter, and I appreciated what you 
said about no one wants their employees to be harmed or to be 
subject to injury or disease. Mr. Obey made a reference to 
pointy headed bureaucrats. I think in this case it is a 
question of which set of pointy headed bureaucrats will be 
providing regulations and oversight to health care facilities 
with regard to tuberculosis.
    As you know, it has been at least my preliminary assessment 
that the Centers for Disease Control and Prevention, the CDC, 
is a very appropriate agency to police the tuberculosis issue, 
and that the guidelines that they have had in place seem to be 
doing an excellent job. Tuberculosis in the workplace is going 
down. It is actually a fact that it is more likely that a 
health care worker will contract tuberculosis outside the 
workplace than it is inside a health care facility, and I know 
that OSHA reopened the issue. So I would like for you to just 
bring the subcommittee up to date if you will, first of all, 
about the status of the tuberculosis rule and where we are.
    Mr. Jeffress. Yes, sir, be happy to do that. The 
information presented in terms of the incidence of tuberculosis 
declining is accurate. Because of that and because of concerns 
expressed about that, over the past year OSHA has conducted a 
new risk assessment, if you will, of what that means, what the 
significant risk is for the population of people who might 
potentially be exposed to tuberculosis. We will be submitting 
that new risk assessment to a peer review and will be reopening 
our record to put that peer review into the record. So that the 
new risk assessment that will be done with the updated 
information on the significant risk of tuberculosis will be 
peer reviewed and entered into the record.
    Some of the information we have on tuberculosis that may be 
of interest to you is that the CDC guidelines are proving 
themselves effective. We have done an analysis of a number of 
locations where the CDC guidelines are reported both by the 
hospital and by the employees to be in place and followed and 
find substantial reductions of exposures and of conversions, if 
you will, to TB sensitivities----
    Mr. Wicker. That is good news.
    Mr. Jeffress [continuing]. Amongst employees where they are 
put in place. We have also found only about 50 percent of the 
hospitals have put these guidelines in place. So the good news 
is that the guidelines do make a difference, they do work. The 
unfortunate news is that they are not yet in place across the 
board, and we think that right there is a suggestion that a 
rule would be important in extending the protections.
    The other piece of information I think that is being 
reported and you have probably seen in the press recently is 
that increasingly the largest percentage of tuberculosis cases 
that are being diagnosed are among people who are born outside 
the United States. Immigrants to our country are the biggest 
source, if you will, biggest percentage of diagnosed TB cases 
today. So the incidence of TB amongst our American citizens who 
are born here is low, but we continue to face people coming in 
from other countries with TB. These strains of TB are multidrug 
resistant. They are increasingly hard to deal with, and 
probably the biggest risk at the moment is amongst workers in 
health care, detention facilities, public service facilities 
that deal with new immigrants; but our current risk assessments 
continue to show a significant risk, continue to show that the 
CDC guidelines are effective when they are put in place. We 
will submit that to a peer review and insert that in the 
record. We are proceeding based on that information with our 
rulemaking.

                   Scientific Studies on Tuberculosis

    Mr. Wicker. All right. Now as you are well aware, in 
November of 1999, this language was inserted into legislation, 
without any intent to delay pending regulations. The conference 
agreement includes $450,000 elsewhere in this bill for the 
National Academy of Sciences study of the proposed standard on 
tuberculosis. I think we made it clear we are not trying to 
slow this thing down, but we wanted to provide you with some 
sound science. Is that the risk assessment to which you 
referred in your testimony?
    Mr. Jeffress. No, sir. We did an assessment of the risk 
ourselves. OSHA did that, and we are submitting our risk 
assessment for peer review to other reviewers.
    Mr. Wicker. All right. Now the National Academy of Sciences 
has had the Institute of Medicine reviewing this issue pursuant 
to the appropriation which we made. Now where are we with 
regard to that study, and are you planning to use the 
information that is provided by the Institute of Medicine also?
    Mr. Jeffress. Our rulemaking is, as you know, past the 
hearing stage, past the comment stage. Our rulemaking I expect 
to be finished probably before that study is finished. Like 
everything else, whenever we get new information, we always 
take it into account. If it causes us to revise what we are 
doing, we can do that; but my expectation is that study is not 
likely to be finished before our rulemaking is complete.
    Mr. Wicker. Can you tell me what the new risk assessment 
has revealed to you, the one that you have done internal?
    Mr. Jeffress. It continues to show a significant risk, more 
than one in 1,000 people who are working in these settings will 
contract TB or have the positive skin test for TB. The one in 
1,000 is a significant risk level that was used by the Supreme 
Court in decisions affecting OSHA health standards, and that is 
the number we use.
    Mr. Wicker. Well, so could I assume from what you are 
saying is that in spite of reopening the issue it is likely 
that you are going to go forward with an OSHA supervision of 
health care agencies, hospitals, nursing homes, homeless 
shelters, and things of that nature?
    Mr. Jeffress. We will reopen the rulemaking to put this 
risk assessment out for comment. If people find this risk 
assessment is flawed and fatally flawed, obviously that would 
change the direction we are going. If the comments reaffirm the 
risk assessment that is out there, we are likely to go forward, 
yes, sir.
    Mr. Wicker. It seems to me, we didn't tell you to wait, but 
you know that the information provided by NAS will be 
excellent, sound science. You know they are going to call it by 
the numbers, and they are going to tell it the way they see it. 
You have already testified that we are doing a good job in 
reducing TB and that the numbers are coming down and that my 
statement earlier, preliminary to my question, is correct. It 
just seems to me that when you know that some important 
information authorized by the Congress in response to concerns, 
when that information is headed your way, it just seems to me 
that you do yourself harm by proceeding headlong toward a rule 
without having the benefit of that information.
    I have no idea what the NAS is going to say, Mr. Jeffress. 
It may be that they will come square down on the side of 
proceeding with this rule, but I would just urge you to 
consider what I have said today and to consider making 
thedecision with all of the information that you have available to you. 
Our health care facilities are under severe financial constrains even 
now. A lot of them are having hard times making ends meet, nursing 
homes, hospitals, you know that; and if we can do just as good a job by 
making the other 50 percent that aren't complying with CDC rules, if we 
can do just as good a job in reducing the disease, it would seem to me 
that we would want to do that rather than placing potentially expensive 
and undue regulatory burdens on these facilities when the numbers are 
coming down even as we speak.

                          REINVENTION OF OSHA

    Mr. Porter. Thank you, Mr. Wicker. Two questions to end 
this second round, Mr. Jeffress. Last year's hearing you and I 
talked about the process of reinventing OSHA, and you said at 
that time there were 16 field offices that had not gone through 
the reinvention process yet. Have they now?
    Mr. Jeffress. Yes, sir. I am glad to report to you we 
completed that process in September of last year. All of our 
field offices have now been reinvented. We had a conference to 
celebrate that and talk about how do we keep this spirit alive 
so that it isn't just a one-time event.
    Mr. Porter. We talked earlier that about how you can change 
policy in Washington but to change mindsets out in the field it 
is difficult. What is your feeling about where you are now in 
terms of changing those mindsets?
    Mr. Jeffress. It's probably best represented by the 
emphasis on problem solving. The reinvention process told the 
area offices to look at what is causing injuries, illnesses, 
fatalities in your area, work with employers, put a program in 
place that fits your area to solve that. I emphasized that last 
year in saying I would like to see a partnership in every area 
office which really requires them to analyze what their 
problems are, and to find people to work with to solve it. I am 
happy to say there are 66 such partnerships alive out there 
now. It continues to be a requirement for every area office 
that they keep partnerships alive, that they look for 
opportunities for that. So I believe we are maintaining that 
spirit in the area offices.
    Once we finish with the reinvention, we do not shut down 
our reinvention office. We are maintaining the training and 
emphasis because we always have new folks coming in. We will 
occasionally have people who want to go back to the old ways of 
working. So we are continuing that kind of training for our 
office folks.

                       SAFETY AND HEALTH PROGRAMS

    Mr. Porter. All right. Now, the cooperative compliance 
program was shot down by the court of appeals for the District 
of Columbia because they said this was a standard and you 
hadn't gone through the rulemaking process. What have you done 
with this program or this concept? Are you going to go through 
the rulemaking process or are you doing it in a different way 
or are you dropping the whole idea?
    Mr. Jeffress. The CCP had a quid pro quo, if you will, if 
companies would invest in safety and health programs, then we 
would give them a reduced chance of inspection. Since we hadn't 
gone through the standard setting process for the safety and 
health program rule, the court said we could not tie the two 
together. So we decoupled them. We have gone ahead with, as we 
have talked about earlier, targeting the high-risk workplaces, 
places with the high rates of injury and illness without giving 
them any consideration for whether or not they have a program.
    We continue to encourage employers to have safety and 
health programs. We have advisers on our Web site about it. We 
have information on that. We have a safety educational program 
that we put on around the country, and we are in the midst of a 
rulemaking on safety and health programs. Frankly, because of 
the extensive comment and extensive effort required on 
ergonomics both on the part of employers and employees, as well 
as OSHA, we expect safety and health programs to require 
extensive comment and effort. We are holding on that rulemaking 
until we complete the ergonomics.
    Mr. Porter. Thank you very much. You have answered all of 
our questions. I think you are doing a good job there. Yes, 
there are some differences, but this is what the process is 
about to try to--we are sending you messages and you are 
sending us messages and we work out our differences hopefully.
    Mr. Jeffress. Thank you, Mr. Chairman, and may I say this 
has been my third opportunity to appear before you as Chairman 
of this committee. I appreciate very much the way you have 
handled this committee and I appreciate your holding me to the 
task that I should be held to, and we will miss you here in the 
future.
    Mr. Porter. Thank you for saying that. Thank you very much. 
We will take a brief recess and then begin with the statement 
of Mr. McAteer on MSHA and then we will have to go vote.
    [Recess.]



                                          Thursday, March 23, 2000.

                 MINE SAFETY AND HEALTH ADMINISTRATION

                               WITNESSES

J. DAVITT McATEER, ASSISTANT SECRETARY FOR MINE SAFETY AND HEALTH
EDWARD L. JACKSON, DIRECTOR, OFFICE OF BUDGET

                           Opening Statement

    Mr. Porter. Subcommittee will come to order. We continue 
our hearings on the budget of the Department of Labor with the 
Mine Safety and Health Administration (MSHA). We are pleased to 
welcome J. Davitt McAteer, Assistant Secretary for Mine Safety 
and Health. Mr. McAteer, it is good to see you.
    Mr. McAteer. Good to see you, Chairman Porter. Thank you 
for the opportunity to present the fiscal year 2001 
appropriations request for the Mine Safety and Health 
Administration (MSHA). MSHA is proposing a budget of $242.2 
million and 2,357 full-time FTE positions, a net increase of 
$14.2 million and 40 FTE.
    First let me say that I appreciate the opportunity to have 
worked with you over the past several years, and I believe you 
have served the public well, sir. Special thanks go for your 
leadership in bringing together labor, industry and government 
to develop a new training requirement called Part 46 for the 
miners working in the more than 10,000 surface nonmetal mines, 
eliminating a rider which had existed for some 19 years. Also, 
you have been very supportive of our program to eliminate black 
lung. Over a 3-year period, since 1998, MSHA has requested and 
received 94 FTE and $6.3 million.
    Sadly to say in another area, however, we have to report 
last year the number of fatalities increased in coal and metal 
and nonmetal mines, reversing a downward trend for total mining 
fatalities that began in 1995. Some 88 miners diedlast year, up 
eight from the previous year of 80. That previous year number was a low 
for this country.
    We have made special efforts to try to address this 
increase. We have directed our districts to focus on accidents 
and accident prevention. Our technical support people attend 
every fatality accident investigation, and we are taking a 
systematic approach to looking at causes by mines, by 
companies, by type of operation as well as by individual 
causes.
    For 2001, MSHA is requesting an additional $3.2 million and 
40 FTE for the metal and nonmetal mining program. In 1999, 
according to the USGS, total aggregates production was the 
highest ever in this country. During the past 5 years, we have 
seen an increase of 6 percent in the number of mines and 5 
percent in the number of miners in the metal and nonmetal area. 
For fiscal year 2001, MSHA is also requesting an increase of 
$1.5 million for the State grants program bringing it to a 
total of $7.6 million. States provide valuable training 
assistance and Part 46 will increase their participation and 
therefore, they need an increase to enhance their capabilities.
    MSHA is also requesting a contingency fund to be available 
when accident recovery obligations exceed $1 million and up to 
$300,000 to upgrade our mine emergency operations equipment 
program. That is to replace, for example, the bore hole cameras 
that we use when there are mine emergencies.
    In the area of health, we have three emphases: dust, noise, 
and diesel. In the area of dust, we are working on 
pneumoconiosis, silicosis, and asbestosis. Much has been 
accomplished in the area of dust since we began in 1994 and 
1995 with improvements in the drill dust standard. We impaneled 
an advisory committee in 1995 to give us guidance made up of 
management, labor, and the academic community. Those 
recommendations serve the basis of our proposals for the last 3 
years. We are currently developing regulations that are soon to 
be proposed which will change the dust system in this country.
    We also are conducting a national pilot program which 
offers free chest X-rays to miners so that we can increase our 
understanding of the level of the disease that exists in the 
current mining community. We are pleased that during the first 
6 months, about 7,400 eligible miners participated. For fiscal 
2001, we are requesting an additional $500,000 for this X-ray 
screening program.
    Finally, we are beginning a bimonthly sampling program at 
the underground mines starting April 1st. This will increase 
from just once a year in 1997 to, in the year 2001, six times a 
year; this, coupled with soon to be proposed regulations that 
will comprehensively change the way dust control is done in 
this country. We believe this approach will enable us to 
eradicate black lung as a disease in this country.
    Thank you, Mr. Chairman.
    Mr. Porter. Thank you, Mr. McAteer.
    [The information follows:]



    Mr. Porter. We will stand briefly in recess for these 
votes.
    [Recess.]

                         MINING FATALITY RATES

    Mr. Porter. Subcommittee will come to order. Mr. McAteer, 
what are the fatalities per thousand last year? Can you give 
me--a thousand miners?
    Mr. McAteer. I cannot give you that. That is a tough 
answer, I am sorry. Our rate is by 200,000 hours.
    Mr. Porter. That is fine, any measure that you have.
    Mr. McAteer. And I don't have that in front of me. I can 
submit it for the record.
    [The information follows:]

    The 88 fatalities in calendar year 1999 equate to .028 
fatalities per 200,000 mining employee hours. If a work year is 
figured at 2,000 hours, then this rate approximately equates to 
fatalities per 100 workers which works out to be .28 fatalities 
per 1,000 workers. However, the rate varies depending on the 
mining work environment. Production workers at underground 
mines had a rate of .54 fatalities per 1,000 workers compared 
with .25 fatalities for production workers at surface mines, 
preparation plants, and other surface operations.

    Mr. Porter. I see. Okay. It wouldn't necessarily have gone 
up as a result of larger number of fatalities if there were 
more hours?
    Mr. McAteer. That is correct, sir.
    Mr. Porter. But it probably went up?
    Mr. McAteer. It went up slightly.

                          COAL DUST MONITORING

    Mr. Porter. You mentioned a new sampling method and a 
single shift sampling method for coal-dust monitoring; right?
    Mr. McAteer. That is correct, Mr. Chairman.
    Mr. Porter. I think that the 11th Circuit Court of Appeals 
prevented the implementation of this technique and said that a 
formal rulemaking had not occurred, very similar to the 
situation with the rulemaking on the compliance, voluntary 
compliance program that OSHA had; is that correct?
    Mr. McAteer. That is correct.
    Mr. Porter. What are you doing then to institute this; have 
you done a rule?
    Mr. McAteer. We have a rule, sir, that is in the final 
stages. It has completed review at the Department of Labor. It 
is a comprehensive redo of the regulation scheme that deals 
with both the sampling system and the fact that we believe that 
it is appropriate for the agency to take samples as opposed to 
the mine operators to be taking the samples. We shift from an 
averaging of five samples to a single full-shift sample. The 
difficulty with averaging five shift samples is that it has a 
tendency statistically to bring down the high exposure. If you 
average five samples, the low exposure will bring down the high 
exposure; and you, in fact, get a skewed result where the 
individual who was at the high level is not being properly 
identified as having high exposures. The single-shift sample 
will fix that particular flaw, and we have tried to address 
that in the formal rulemaking.
    Mr. Porter. And your investigators will do this rather than 
the operators?
    Mr. McAteer. That is correct. That is our proposal.

                       COAL MINERS' X-RAY PROGRAM

    Mr. Porter. The x-ray program, does this continue as a 
pilot?
    Mr. McAteer. Well, we began a pilot last year. We started 
with two halves, a 6-month program and now a second 6-month 
program. We will begin the second half the first of April, and 
we have proposed in our budget to continue this program. What 
we are doing is to divide the mining population up, offering x-
rays to 20 percent a year. At the end of 5 years we will have 
been able to sample all the miners in the underground and 
surface coal mines in the country.
    Mr. Porter. In other words, the pilot will have included 
everyone over a 5-year period?
    Mr. McAteer. That is correct, sir.
    Mr. Porter. And what is the ultimate--do you know yet what 
the ultimate goal will be in a permanent program?
    Mr. McAteer. Well, the idea--and we have had support from 
both labor and industry on this--is that we need to have a 
picture of where we are today among current miners as well as 
those miners who have worked in the past. Other programs have 
dealt with the miners who are retired, but our program deals 
with the current working population. The purpose of it is to 
identify if we have areas where problems are occurring and also 
to help us design our prevention program. If we know, for 
example, that a particular job classification has a problem 
with it, then we will address that job classification; or a 
particular piece of machinery creates particular problems, we 
would work with the manufacturer to reduce the dust levels with 
that particular piece of machinery. So we think we can refine 
and modify our prevention program at the mining level and then 
be able to eradicate the disease from the industry.
    Mr. Porter. And when we are saying the disease, are we 
talking about black lung?
    Mr. McAteer. We are, sir. Coal workers pneumoconiosis, as 
well as silicosis which is related because of the sand that 
occurs with the mine.
    Mr. Porter. Isn't there also a benefit from getting people 
who need medical attention earlier, getting it through this? In 
other words can't you identify earlier the onset of these 
diseases by taking x-rays?
    Mr. McAteer. Certainly, although medical attention would be 
up to the individual. What we have done in our pilot is to 
ensure that x-ray results are confidential documents; we give 
that information to the individual miner. There has been a 
perception in earlier programs that the mine operator was 
involved in, that miners were concerned that information was 
being given to the mine operator, that is, the results of their 
x-rays, and that some mine operators were finding reasons to 
discharge individuals because they had a potential for black 
lung or because they had the early stages of the diseases. The 
miners felt that this was unfair because they were being 
discharged so that the mine operator could avoid liability 
under the black lung benefits program.
    To avoid that particular problem and to build confidence in 
it, we designed a confidential program where the miner goes to 
a clinic that has been predesignated, takes an x-ray at that 
clinic, then gets a copy of the x-ray results. We get a copy of 
the results compiled together, and we do our improvement based 
upon the copy of the results. The miners can take action based 
upon that x-ray of their own lungs.

                         OCCUPATIONAL DISEASES

    Mr. Porter. It sounds like there is almost an incentive to 
get the disease to get to the program, which obviously there 
isn't, but it is an incentive to stay on the job. I mean, it is 
a very bad choice here it seems to me.
    Mr. McAteer. It truly is. The problem with black lung, as 
with many health problems, is that the impact is not felt 
immediately. The impact is felt later. It is not this cigarette 
that is going to cause me to get cancer, and I will stop before 
I smoke the next cigarette that is going to cause me to get 
cancer.
    And similarly with dust. Any time you have dust problems, 
silicosis, pneumoconiosis, asbestosis, well, I am healthy; I am 
fine, everything is going to be all right; I am not going to 
get it; I won't take that risk, because otherwise if I show an 
early sign of it, then I would have to leave this good-paying 
job. And it is a Hobson's choice, and a very difficult place to 
put people in. We can't dictate what people do about such 
choices but we can give them the information.
    Mr. Porter. And the increased investment in technology that 
allows this to be done with fewer people means that fewer 
people ultimately will be at risk.
    Mr. McAteer. That is correct.
    Mr. Porter. On the other hand, it is another Hobson's 
choice because you won't have a job if you live in that areaor 
may not have a job.

                   NON-MINER FATALITIES AT MINE SITES

    Abandoned mines, there was a drowning death in an abandoned 
mine last year. You have been working to get out the message on 
the potential danger of these by issuing an annual warning 
press release and using the outreach of stay out, stay alive 
program in local schools; correct?
    Mr. McAteer. That is correct, sir.
    Mr. Porter. Do you keep statistics on injuries and deaths 
in inactive mines, and how large a problem is this actually?
    Mr. McAteer. We keep statistics that involve active mines 
and some statistics that were reported to us involving inactive 
mines as well. We estimate that the number may run into the 
hundreds, but we can't verify because we don't have a system to 
collect the data.
    I think what we are seeing, though, is as the population of 
the country as a whole increases, people moving out into 
suburban and outer areas, and they get nearer and nearer to the 
mine operations. Tragically, one of these accidents happened 
near my home, out in Hagerstown, Maryland, where a new 
community had been developed just adjacent to a quarry that had 
existed for some years; and a young boy 6 years old fell a 
hundred feet to his death. The new development had moved in 
upon the quarry. The quarry hadn't just moved in there. It was 
the reverse, and that is what is happening. So the mine 
operators are finding themselves in a dilemma of having to try 
to take a new approach to try to keep people off. But this has 
happened over and over across the country.
    With our program, we are trying on a volunteer basis--and I 
must commend both the mine operators and the mining union as 
well as the other Federal agencies and the State agencies who 
have joined with us--to get a national campaign going. This 
year we are being joined by the Boy Scouts, as well as the 4-H 
programs throughout the country to try to get this program 
enhanced and improved so that we get people learning about the 
problem.
    Mr. Porter. When a mine is shut down, are there MSHA 
regulations that require them to do certain things to make that 
site more safe?
    Mr. McAteer. There are requirements dealing with 
abandonning mines, and those requirements have to do with 
placing stoppings over portals and placing stoppings over 
shafts, et cetera. Over time, these things break down. We don't 
have the manpower nor does the industry have the manpower to go 
out and regularly check these items. We had quite a sad 
unfortunate thing happen recently where a group of teenagers, 
one 16, the same age as my son, had gone out to a mine, and 
they were bouncing on top of the wire mesh that the mine 
operator had put there to stop people from falling in the hole. 
He bounced too hard one time and went down 400 feet and died, 
and it is just one of these things with which you say we have 
got to come to grips. We are looking also at whether or not we 
can do a national survey to identify these locations; but they 
are in every part of the country, in every State, and the 
question is can we get in some voluntary way a scheme so that 
we can identify these sites.

                         SURFACE MINER TRAINING

    Mr. Porter. You discussed in your testimony the new 
training requirements for surface miners. Can you tell us when 
will you begin enforcing the new requirements and what outreach 
activities have you engaged in for this purpose or will you 
engage in and what has been the reaction from the mining 
community?
    Mr. McAteer. Well, I again commend you for your 
participation in the development of a coalition of labor, 
management, and government agencies to come up with a 
regulation. As part of that, the regulation has an effective 
date of October 2, 2000. We have begun an outreach program in 
all parts of the country. We have had very good participation. 
Nearly 7,000 miners and mine operators have come to these 
various meetings.
    We are having meetings and are particularly trying to 
emphasize the program with regard to small operators. We have 
what we think is an effective Web-site presentation that gives 
the rule, that gives how the rule will be applied, and gives 
information on training assistance. We have had a large number 
of hits or requests and downloading of that information.
    Again, I want to commend the associations and the various 
groups who have worked with us because they too have taken the 
materials that we have developed and put those materials in the 
hands of individual mine operators as well as miners to show 
them what the new requirements are.

                 ALTERNATIVE CASE RESOLUTION INITIATIVE

    Mr. Porter. In 1994, you began an alternative case-
resolution initiative that would reduce costs by having 
nonlawyers present contested violations with penalties less 
than $1,000. Can you tell us the status of that initiative?
    Mr. McAteer. I can tell you the status. I, unfortunately, 
am not prepared to answer the numbers of cases that are in that 
program last year. I will be happy to get those for you and 
submit them for the record.
    I can tell you it has been a highly effective program. We 
have anecdotal evidence from both mine operators, miners, and 
our own people who feel that it has really worked effectively. 
As a lawyer, I hate to say this, but it has taken the lawyers 
out of the play.
    [The information follows:]

    MSHA's Alternative Case Resolution Initiative (ACRI) is a 
highly successful program that involves specially-trained MSHA 
inspectors as conference-litigation representatives to resolve 
simple, low-penalty cases previously handled by a government 
attorney. ACRI began in 1995, and in its first year, MSHA's 
conference-litigation representatives handled 15 percent of the 
civic penalty cases contested by mine operators. By 1999, the 
number of cases handled by the conference-litigation 
representatives had more than doubled to over 36 percent of the 
total Agency caseload--627 out of 1732 contested cases.
    The ACRI program saves mine operators both money and time. 
Operators avoid the formal, often intimidating, litigation 
process and have an opportunity to discuss their point of view 
with an agency representative who brings practical field 
knowledge of mine safety and health to the conference. Most 
importantly, we believe this program improves the mining 
community's understanding of the safety and health issues that 
result in citations.
    MSHA inspectors who are assigned conference-litigation 
responsibilities receive 4 weeks of highly specialized training 
by some of the most experienced personnel from the Office of 
the Solicitor, as well as representatives from the Federal 
Mediation and Conciliation Service, and administrative law 
judges from the Federal Mine Safety and Health Review 
Commission. Some mine operators have even imitated MSHA's 
training program by providing their representatives with 
information on alternative dispute resolution techniques. The 
program is a model of how an agency can work cooperatively with 
a party it regulates to resolve issues related to violations 
without compromising the agency's ability to enforce the law.

    Mr. Porter. As a lawyer I am happy to hear that.
    Mr. McAteer. What has happened is that we have really taken 
the issue to the people who understand the issue and are able 
to resolve it. We did a very extensive training program for our 
people and have had very good success in bringing the folks up 
to a level where they can really deal with some of the 
fundamental due process questions that need to be addressed. 
The mine operators are happy because they don't have to pay a 
lawyer. They can walk into a room, talk to another 
knowledgeable person about a contested violation, and we have 
had good resolutions. And we have had a tremendous amount of 
success, and I am invariably stopped at conferences or public 
meetings and mine operators say that is a good program, it 
makes government work effectively.
    Mr. Porter. I am very concerned about the high costs in 
many areas of our society where we have lawyers involved. If 
you look at child support cases and what it costs someone to 
get a deadbeat dad or mom to pay child support, there is so 
much disincentive for people to be responsible for their own 
children, that it is in many cases ineffectual. People can't 
get to the system because of the high cost of legal services.
    Mr. McAteer. Exactly. Our program actually has worked to 
break this down. It has made us better in terms of explaining 
what our citations are and why they are issued. It has also 
helped the mine operator better understand how he or she can 
deal with contested citations. One mine operator recently 
suggested that he does a better job of doing this because he 
now understands the system quite a bit better and he can deal 
with the individuals on a first-name basis, in fact, and get 
resolution.
    Mr. Porter. Well, Mr. McAteer, you are doing a fine job 
there. We appreciate your testimony. We apologize for the 
interruptions and keep up the good work.
    Mr. McAteer. Thank you, sir.
    Mr. Porter. Thank you. Subcommittee stands in recess until 
10 a.m. on Tuesday.





                           W I T N E S S E S

                              ----------                              
                                                                   Page
Abraham, K.G.....................................................   177
Anderson, Bernard................................................   273
Bramucci, R.L....................................................   209
Dalton, K.V......................................................   177
Galvin, J.M......................................................   177
Herman, Hon. A.M.................................................     1
Jackson, E.L...............................143, 177, 209, 273, 315, 375
Jeffress, C.N....................................................   315
Kerr, T.M........................................................   273
Kramerich, L.B...................................................   143
Lacey, D.J.......................................................   177
Lebowitz, Alan...................................................   143
McAteer, J.D.....................................................   375
Orr, Lois........................................................   177
Strauss, D.M.....................................................   143
Uhalde, R.J......................................................   209


                               I N D E X

                              ----------                              

                           Secretary of Labor

AIDS:
                                                                   Page
    Funding for AIDS in Africa...................................    44
    Global HIV/AIDS..............................................   141
    Government Wide HIV/AIDS Initiatives.........................    46
    HIV/AIDS Workplace Initiative................................     5
At-Risk Youth....................................................   139
Apprenticeship:
    Pace of Accredition of Jobs..................................    41
    Skilled Workers..............................................    39
    Number of Annual Program Approvals...........................    62
    Speed of Program Approvals...................................    43
Blacklisting.....................................................   126
Biotech Training.................................................    29
Birth and Adoption Unemployment Compensation....................38, 127
Budget Increases.................................................    82
Child Labor:
    Domestic.....................................................     4
    International................................................     5
Core Labor Standards.............................................    33
Delays in Rulemaking.............................................    20
Digital Divide...................................................   137
Entrepreneurs....................................................    35
Equal Pay Initiative......................................4, 28, 54, 78
ERISA Claims and Appeals Proposed Rule Overhaul..................    56
Ergonomics:
    Docket.......................................................    59
    Cost Estimates...............................................    59
    Federal Agency Comment on Proposed Rule......................   126
    Geographic Distribution of Activities........................   129
    Impact of Ergonomics Rule...................................25, 124
    Length of Comment Period.....................................    23
    Length of Ergonomics Rule....................................    35
    Location of Hearings........................................22, 123
    MSD Definition...............................................    60
    Proposed Grandfather Clause..................................   126
    Reactions of Employers.......................................    24
    Requirements Under Ergonomics Standard.......................    27
    Rulemaking...................................................     5
    Standard.....................................................    32
    Timing of Ergonomic Rulemaking...............................   122
Family and Medical Leave Act.....................................29, 68
Family and Medical Leave Expansion/UI............................    72
Fathers Work/Families Win....................................3, 77, 134
Federal Acquisition Regulations..................................    48
Florida Salesperson/Driver Case..................................    31
Grants for Family UC Program.....................................    56
High-Tech Training Funds.........................................    81
Homeless Veterans................................................     3
Incumbent Worker Initiative......................................   133
International Labor Standards....................................    48
Introduction of Witness..........................................     1
Jobs and Assets..................................................    34
Job Corps Centers................................................    77
Job Training Programs............................................   129
Letters vs. Regulations..........................................    67
Mother's Day Card................................................    78
National Skills Summit...........................................     4
New Programs.....................................................60, 73
Office of Disability............................................19, 131
Opening Statement................................................     1
OSHA:
    Budget Request...............................................    51
    Consumer Satisfaction Survey.................................    83
    Home Work Policy.........................................47, 58, 80
    Pilot Project................................................    80
    Requested Increase in Enforcement...........................52, 122
    Work at Home Definitions.....................................    66
    Work at Home National Dialogue...............................    66
    Work at Home Process.........................................    64
Overtime for Salesmen............................................    30
Persons With Disabilities........................................     3
Prohibited Transaction Exemptions................................   128
Quality Workplaces...............................................     4
Reintegration of Young Offenders.................................   139
Request for New Training Programs................................    51
Save School/Health Students...................................... 3, 75
Secure Workforce.................................................     4
Skills Shortage..................................................   130
Stock Options....................................................20, 79
Taylor V. Barram.................................................    63
Ticket to Work Implementation....................................    55
Trade Policy.....................................................    19
Universal Reemployment...........................................     4
Welfare to Work Implementation...................................    53
Written Statement................................................     6
Youth Opportunity Movement.......................................     3

                 Pension Benefits Guaranty Corporation
              Pension and Welfare Benefits Administration

Pension Benefits Guaranty Corporation:
    Annual Performance Report....................................   164
    Budget Justification.........................................   475
    Financial Condition..........................................   152
    Fiscal Year 2001 Budget......................................   152
    GPRA:
        Implementation...........................................   162
        Performance Measures.....................................   162
    Introduction of Witnesses....................................   143
    Investment Management........................................   160
    Opening Statement............................................   152
    Operations...................................................   174
    Pension Plans:
        401K and IRAs............................................   168
        Challenges Facing Defined Benefit Plans..................   171
        Decline in Defined Benefit Plans.........................   166
        Defined Contribution Plans...............................   167
        Handling Terminated Plans................................   172
        Number of Problem Plans..................................   168
        Number of Workers in Retirement Plans....................   169
        Numbers of 401K Type Plans and Participants..............   169
        Percentage of Workforce with 401K Type Plans.............   169
    Performance Plan.............................................   516
    Roles of PBGC versus PWBA....................................   166
    Sarasota Field Benefit Operation.............................   172
    Written Statement............................................   154
Pension and Welfare Benefits Administration:
    Budget Justification.........................................   402
    ERISA Filing Acceptance System...............................   162
    Health Benefits Claims Regulation............................   175
    Introduction of Witnesses....................................   143
    Opening Statement............................................   143
    Patients' Bill of Rights.....................................   160
    Performance Plan.............................................   448
    Roles of PBGC Versus PWBA....................................   166
    Staffing Increases...........................................   174
    Voluntary Fiduciary Correction Program.......................   161
    Written Statement............................................   146

                       Bureau of Labor Statistics

Annual Performance Plan.......................................187, 1039
Budget Justification.............................................   941
Budget Request...................................................   182
Collecting:
    Fringe Benefit Information...................................   197
    New Data.....................................................   199
    Wage Data....................................................   197
Conclusion.......................................................   199
Credibility......................................................   195
Decision-Making..................................................   196
Fringe Benefit Information, Collecting of........................   197
Grants to States.................................................   205
Independence.....................................................   196
Introduction of Witnesses........................................   177
Labor Market:
    Discrimination...............................................   201
    Information Centers..........................................   203
New Data, Collecting of..........................................   199
North American Industry Classification System....................   206
Ongoing Initiatives..............................................   185
Opening Statement................................................   177
Quality and Professional Standards...............................   195
Security Concerns................................................   188
Service Sector Price, Output, and Productivity Measures..........   178
Time-Use Survey................................................177, 201
Tracking Discrimination..........................................   179
Use of BLS Statistics............................................   181
Wage Data, Collecting of.........................................   197
Workforce Investment Act.........................................   178
Written Statement................................................   181
    Closing......................................................   188

                 Employment and Training Administration
                   Veterans' Employment and Training

Employment and Training Administration:
    Adults.......................................................   214
    Budget Justification.....................................1092A-1422
    Budget Request.............................................211, 212
    Combination of Unemployment Compensation Line Items........258, 259
    Cost of Youth Services.......................................   253
    Customer Service...........................................210, 211
    Disabled Entering the Workforce............................267, 268
    Efficiency...................................................   247
    Employment Security..........................................   213
    ETA Solving Multiple Problems..............................247, 248
    Fathers Work/Families Win....................................   213
    Federal Unemployment Benefits and Allowances.................   214
    Individual Training Accounts.................................   255
    Job Corps:
        Center Staff Salary Increases..........................262, 263
        Child Care Centers.....................................269, 270
        CISCO Training.........................................251, 252
        Construction Report on Four New Centers..................   262
        Funding Level............................................   269
        GED....................................................250, 251
        Graduate Service System................................265, 266
        Link With Education....................................252, 253
        Placement System.......................................264, 265
        Ranking..................................................   250
        Regional Directors.....................................259, 260
        Small Business Contracting.............................263, 264
        Success................................................249, 250
        U.S. Army................................................   260
        Vocational Training Upgrades...........................261, 262
    Measuring the Success of Fathers Work/Families Win.........253, 254
    New ETA......................................................   211
    Opening Statement......................................209, 215-236
    Performance Plan.............................................  1423
    Program Support..............................................   214
    Research...................................................271, 272
    Responsible Reintegration of Young Offenders.................   256
    Safe Schools/Healthy Students..............................268, 269
    SUIESO.......................................................   215
    Unemployment Insurance.....................................270, 271
    Universal Reemployment.....................................212, 213
    Welfare-to-Work..............................................   267
    Workforce Investment Act:
        Implementation...........................................   210
        One Stop Centers.........................................   257
        Performance Measures...................................257, 258
    Workforce Excellence.........................................   211
    Youth.......................................................212-214
Veterans' Employment and Training:
    ASVET Solving Multiple Problems............................248, 249
    Budget Justification.........................................  1549
    Opening Statement...........................................237-246
    Performance Plan.............................................  1512

                  Employment Standards Administration

Black Lung:
    Black Lung Disability Trust Fund.............................   301
    Black Lung Fraud.............................................   303
    NIOSH Research...............................................   312
    Proposals....................................................   288
    Proposed Regulations.........................................   304
    Regulations on Physicians....................................   312
    Staffing Levels..............................................   313
Enforcement in the Northern Mariana Islands......................   299
Introduction of Witnesses........................................   273
Opening Statement of Bernard Anderson, Assistant Secretary.......   273
Overtime Pay for Salesmen........................................   291
Protective Equipment Under FLSA..................................   300
Targeted Enforcement Tools Initiative............................   296
Technology for Excellent Customer Service........................   297

             Occupational Safety and Health Administration

Annual Performance Plan..........................................   792
Budget Justification.............................................   727
Ergonomics:
    Benefits of Programs to Business.............................   332
    Causes of Ergonomics Problems................................   332
    Comment Period Extension.....................................   355
    Comment Period for Rule..........................325, 351, 359, 365
    Compliance Assistance........................................   331
    Cost of Compliance...........................................   344
    Cost of Injuries/MSDs.................................329, 331, 343
    Costs and Benefits of Rule...................................   334
    Delays.......................................................   327
    Docket.....................................................326, 351
    Docket Access................................................   356
    Effects:
        On Medical Providers.....................................   370
        On Postal Service........................................   371
    Employer Responsibilities....................................   368
    Federal Employee Coverage..................................333, 370
    Obligations for Standard.....................................   366
    Opponents' Resources.........................................   328
    Origins of Proposal..........................................   338
    OSHA's Ergonomics Program....................................   366
    Plain Language Standard......................................   345
    Public Outreach..............................................   339
    Questioning of OSHA Panel..................................362, 365
    Reaction of Employers........................................   327
    Regulation Length............................................   331
    Review Time..................................................   373
    Schedule Changes.............................................   364
    Schedule of Hearings.........................................   362
    Scientific Studies....................................330, 340, 372
    Scope of Rule................................................   341
    Small Business:
        Impact of Rule...........................................   368
        Provisions...............................................   346
    Testimony Availability.......................................   360
    Time Allotted for Questions..................................   363
    Workers' Compensation Premiums...............................   336
    Work Relatedness Determination...............................   329
Home Work Policy and Review Process............................367, 371
Injury Rates:
    By Size......................................................   336
    Trends.......................................................   337
Opening Statement................................................   315
Priorities for FY 2001:
    Creative Partnerships........................................   321
    Expanded Outreach and Training...............................   320
    Improved Rulemaking..........................................   323
    Strong Enforcement...........................................   322
Reinvention of OSHA..............................................   348
Requested Increases for FY 2001................................337, 367
Safety and Health Programs.......................................   349
Tuberculosis:
    Rulemaking...................................................   346
    Scientific Studies...........................................   347

                 Mine Safety and Health Administration

Alternative Case Resolution Initiative...........................   391
Annual Performance Plan..........................................   911
Budget Justification.............................................   853
Coal Dust Monitoring.............................................   387
Coal Miners' X-Ray Program.....................................382, 388
Contingency Funding..............................................   383
Diesel Rulemaking................................................   397
Enforcement vs. Training.........................................   396
Fatalities.......................................................   378
    Mining Fatality Rates........................................   387
    Non-Miner Fatalities at Mine Sites...........................   389
Fee Retention....................................................   384
Metal and Nonmetal Initiatives...................................   382
New Rules on Dust Sampling.......................................   393
New Training Regulations.........................................   380
    Part 46 Safety Training Rule.................................   395
Noise Standard...................................................   381
Occupational Diseases............................................   389
Opening Statement................................................   375
Respirable Dust Program..........................................   379
Respiratory Equipment............................................   394
Surface Miner Training...........................................   390

                                
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