[Federal Register Volume 77, Number 188 (Thursday, September 27, 2012)]
[Rules and Regulations]
[Pages 59291-59294]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-23682]


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DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Parts 307 and 381

[Docket No. FSIS-2011-0032]
RIN 0583-AD48


Additional Changes to the Schedule of Operations Regulations

AGENCY: Food Safety and Inspection Service, USDA.

ACTION: Final rule.

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SUMMARY: The Food Safety and Inspection Service (FSIS) is amending the 
meat and poultry product regulations pertaining to the schedule of 
operations. FSIS is amending these regulations to define the 8-hour 
workday as including time that inspection program personnel need to 
prepare the inspection station, if necessary, or retrieve and return 
lot tally sheets; the time necessary for FSIS inspection program 
personnel to sharpen knives, if necessary; and the time necessary to 
conduct duties scheduled by FSIS, including administrative activities. 
The activities are integral and indispensable to inspectors' work and 
are part of the continuous workday as defined by the Fair Labor 
Standards Act. Therefore, they are activities that need to be part of 
the Agency's regulatory definition for the 8-hour workday.

DATES: Effective November 26, 2012.

FOR FURTHER INFORMATION CONTACT: Rachel Edelstein, Acting Assistant 
Administrator, Office of Policy and Program Development, FSIS, U.S. 
Department of Agriculture, 1400 Independence Avenue SW., Washington, DC 
20250-3700, telephone: (202) 205-0495.

SUPPLEMENTARY INFORMATION:

Background

    The Federal Meat Inspection Act (FMIA), 21 U.S.C. 601 et seq., and 
the Poultry Products Inspection Act (PPIA), 21 U.S.C. 451 et seq., 
provide for mandatory Federal inspection of livestock and poultry 
slaughtered at official establishments and of meat and poultry products 
processed at official establishments. FSIS bears the cost of mandatory 
inspection provided during non-overtime and non-holiday hours of 
operation. Official establishments pay for inspection services 
performed on holidays or on overtime.
    On March 19, 2012, FSIS proposed to amend its regulations 
pertaining to the schedule of operations (77 FR 15976). FSIS proposed 
to amend these regulations to define the 8-hour workday as including 
time that inspection program personnel need to prepare the inspection 
station at meat slaughter establishments, if necessary, or to retrieve 
and return lot tally sheets at poultry slaughter establishments; the 
time necessary for FSIS inspection program personnel to sharpen knives, 
if necessary, at meat slaughter establishments; and the time necessary 
to conduct duties scheduled by FSIS, including administrative 
activities at meat and poultry slaughter establishments. The activities 
are integral and indispensable to the principal work of inspection 
program personnel as defined in 29 CFR 790.8, ``Principal'' activities. 
Therefore, these activities need to be part of the Agency's regulatory 
definition for the 8-hour workday.

Response to Comments

    FSIS received one comment within the scope of the rulemaking 
regarding the proposed rule change from an association representing the 
meat industry. The comment raised the following issues:

De Minimis

    The commenter stated that FSIS has ignored the Office of Personnel 
Management (OPM) regulation 5 CFR 551.412(a) that governs the exclusion 
of de minimis actions from compensable activities. The commenter stated 
that the OPM rule excludes preparatory activities that last less than 
10 minutes and also stated that the proposed rule identified two of 
three activities specified in the proposal--administrative activities 
and preparation for inspection--as each taking less than 10 minutes per 
day. Therefore, the commenter asserted that the OPM regulation 
precludes the need for the proposed rule.

Response

    As stated in the proposed rule, FSIS considers these activities as 
integral and indispensable to the principal work of inspection program 
personnel as defined in 29 CFR 790.8, ``Principal'' activities. As 
integral and indispensable work activities under the Fair Labor 
Standards Act, FSIS finds that these activities should be included as 
part of the continuous workday when reading both 5 CFR 551.412(a) and 
the OPM definition of ``workday'' at 5 CFR 551.411(a), together. 5 CFR 
551.412(a) cannot be properly read alone to exclude time spent on 
indispensable work activities during the continuous workday from 
compensable hours of work. Any duties scheduled by FSIS, including 
administrative duties, are integral and indispensable to the essential 
work of inspection program personnel because they enable inspection 
program personnel to carry out their work effectively. The preparation 
of the workstation is an integral and indispensable activity ensuring 
that inspectors have the necessary stamps used to identify condemned 
parts while conducting their inspection duties. Therefore, 
administrative duties and the preparation of the work station in cattle 
slaughter establishments are integral and indispensable to the 
principal work of inspection program personnel as defined in 29 CFR 
790.8, ``Principal'' activities, and thus, these activities need to be 
part of the Agency's regulatory definition for the 8-hour workday.

[[Page 59292]]

Knife Sharpening

    The commenter did not dispute that knife sharpening is a 
compensable activity but did oppose the standardized approach in the 
proposed rule that would give inspectors one 15-minute period for knife 
sharpening if they perform on-line duties in a cattle slaughter 
establishment 3 days or less per week or if they perform on-line duties 
in a swine slaughter establishment, and two 15-minute periods for knife 
sharpening if they perform on-line duties in a cattle slaughter 
establishment 4 or more days per week. The commenter stated that plants 
should be permitted to conduct individualized assessments of the time 
it takes inspectors to sharpen their knives.

Response

    The time estimates FSIS developed in the proposed rule for knife 
sharpening were based on an Agency CD-ROM training video, ``Knife-
Safety and Sharpening Skills,'' and the numbers of times per week for 
knife sharpening were based on a variety of factors, including the 
species being inspected (i.e., cattle or swine) and the number of 
carcasses inspected. The time allocations that FSIS is finalizing are 
necessary to ensure the safe and proper use of knives during 
inspection. The Agency cannot ensure the safety of its inspectors and 
that proper knife sharpening occurs if each establishment determines 
for itself how long it should take inspectors to sharpen a knife 
because each establishment will have a financial incentive to reduce 
this amount of time. Therefore, when FSIS implements this rule, it will 
ensure inspection program personnel have an appropriate amount of time 
to sharpen their knives.

Inaccurate Inspector Time Records

    The commenter stated that because inspectors bill in 15-minute 
increments, all slaughter facilities already pay inspectors for time 
during which inspection work is not being done. The commenter stated 
that a facility should be permitted to review inspectors' time records 
and offer corrections supported by reports and stamped surveillance 
footage, if necessary, before inspectors submit their time records. The 
commenter also stated that during interruptions for line stoppages or 
equipment failures, inspectors should make use of the time that they 
are not on the line for activities such as knife sharpening. The 
commenter also stated that if inspectors choose not to use such time, 
establishments should not have to pay overtime for the activity.

Response

    FSIS supervisors assign work to inspection program personnel. FSIS 
will ensure that its supervisory personnel instruct inspection program 
personnel to complete the activities addressed in this final rule 
during any time remaining in a 15-minute increment of overtime or 
during work times when they are not on the line. However, FSIS does not 
agree that establishments should implement a formal monitoring program, 
such as video surveillance of FSIS employees or checking inspector time 
sheets. FSIS supervisors ensure that employees accurately record the 
time that they work. Establishment management should discuss any 
concerns about the time worked by FSIS inspectors with FSIS 
supervisors.

Line Time

    Lastly, the commenter stated that any additional time inspectors 
need to be compensated for under the proposed rule should not count 
against the 10-hour-per-day limit of actual inspector time permitted by 
FSIS.

Response

    FSIS ensures that the maximum time an employee may work on the 
slaughter line is ten (10) hours per work day. While knife sharpening, 
station preparation, and administrative duties are integral to the work 
and conducted during the continuous workday, they are activities not 
done on the slaughter line itself. Therefore, these activities are not 
subject to the 10 hour per day limit of slaughter line activity.

Amendment to 9 CFR 307.4(c) and 381.37(c)

    After consideration of the comments received and for the reasons 
discussed above, FSIS is adopting the proposed rule as a final without 
revision and is amending the meat regulations to provide that the 8 
hours of inspection service provided to establishments free of charge 
will include activities necessary to fully carry out an inspection 
program, including time for inspection program personnel to prepare the 
work station; the time necessary for FSIS inspection program personnel 
to sharpen knives, if necessary; and the time necessary to conduct 
duties scheduled by FSIS, including administrative duties. When the 
rule goes into effect, FSIS will direct its supervisory personnel at 
livestock slaughter establishments to conduct a new time measurement 
that measures the amount of time it takes to don required gear, walk to 
a work station, prepare the work station, and doff required gear. If 
establishments do not provide a knife sharpening service, the 
establishment will also need to incorporate the times and frequencies 
discussed above in response to comments on knife sharpening into the 8 
hours of inspection or request that knife sharpening be done in an 
overtime period.
    FSIS is amending the poultry products regulations to provide that 
the 8 hours of inspection service provided to establishments free of 
charge will include activities necessary to fully carry out an 
inspection program, including time for inspection program personnel to 
retrieve and return lot tally sheets and the time necessary to conduct 
duties scheduled by FSIS, including administrative duties. Inspection 
program personnel in poultry products establishments do not use knives 
when conducting inspection activities and do not need to prepare the 
work station. When this rule goes into effect, FSIS will direct its 
supervisory personnel in poultry slaughter establishments to conduct a 
new time measurement that measures the amount of time it takes 
inspection program personnel to don required gear, pick up a lot tally 
sheet, and doff required gear.
    In addition, when this rule goes into effect, slaughter 
establishments will need to provide inspection program personnel 1 
minute every day to complete time and attendance activities.
    As with the provisions for donning, doffing, and the associated 
walk time, establishments will need to either incorporate the time for 
inspection program personnel performing on-line inspection duties to 
conduct knife sharpening, to complete the time and attendance 
reporting, and to prepare for inspection into their hours of operation 
or request overtime charges. The regulations provide that FSIS will 
bill overtime in 15-minute increments (9 CFR 307.6 and 381.39). 
Therefore, in situations where establishments have requested overtime, 
FSIS, when possible, will instruct inspection program personnel 
performing on-line inspection duties to do the activities addressed in 
this rule during any time that remains within 15-minutes of requested 
overtime.

Executive Order 12866 and the Regulatory Flexibility Act

    This rule has been designated non-significant under section 3(f) of 
Executive Order 12866. Accordingly, the rule has not been reviewed by 
the Office of Management and Budget.

[[Page 59293]]

Cost to the Industry

    Under this final rule, the most direct cost to the industry will be 
the overtime fee that the Agency will need to charge slaughter 
establishments for the time inspection program personnel spend in three 
groups of activities: (1) Sharpening knives, (2) completing 
administrative activities, and (3) preparing for inspection. As we 
explained in the cost analysis of the Final Rule on Changes to the 
Schedule of Operations Regulations (76 FR page 33979), if meat and 
poultry slaughter establishments want to maintain their normal shift 
length of operating for 8 hours, they would incur some overtime 
fees.\1\ Although the choice is voluntary, the Agency expects that most 
meat and poultry slaughter establishments will choose to maintain their 
current shift-time, as shortening the shift-time will decrease 
production and revenue while idling existing capacity. However, FSIS 
does not expect the overtime fee from these three groups of activities 
to be significant because (1) the establishments have options, as we 
will discuss later, besides paying overtime for some of these 
activities, and (2) the time for carrying out administrative activities 
and preparing for inspection (including preparing an inspection station 
and picking up and dropping off lot tally sheets) is small--one minute 
or two per day--and will probably not push the overtime over the 15-
minute threshold to incur more over-time charge than are currently 
assessed for donning and doffing activities.
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    \1\ This regulatory change should not impact the schedule of 
operations for meat and poultry processing establishments and egg 
product plants because those establishments can begin operations 
without FSIS inspection program personnel being at an on-line 
inspection work station.
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    Similar to donning and doffing, the actual time FSIS inspection 
program personnel will take to perform these activities will vary in 
each meat and poultry slaughter establishment depending on plant-
specific variables. FSIS developed estimates on the amount of time it 
takes for inspection program personnel to perform these activities and 
requested public comments. FSIS did not receive any comments on the 
estimates, so FSIS's estimates remain the same in this final rule.
    Knife-sharpening:
    a. Two 15-minute periods per week for inspection program personnel 
who perform on-line inspection duties in beef slaughter operations for 
4 or more days per week.
    b. One 15-minute period per week for inspection program personnel 
on the beef slaughter line for 3 days or less per week or in a swine 
slaughter establishment.
     One minute per day to complete administrative activities.
     Two minutes or less for preparing for inspection.
    Agency personnel data \2\ show that there are 3,053 inspection 
program personnel performing on-line inspection duties in poultry and 
meat slaughter establishments--2,037 in poultry, 1,000 in meat, and 16 
in establishments that slaughter both meat and poultry. Data from an 
Agency survey \3\ indicates that among the meat slaughtering 
inspectors, 56 percent work in beef establishments that operate 4 or 5 
days per week, 4 percent work in beef establishments that operate less 
than 4 days per week, 36 percent work in swine establishments, and 4 
percent work in lamb, sheep, and goat establishments. Because lamb, 
sheep, and goat establishments are small or very small establishments, 
inspection program personnel would be able to complete the activities 
addressed in this final rule within the 8-hour day, and, therefore, 
there are no related cost calculations for these establishments in this 
final rule. Applying the percentages to the total of 1,016 meat 
slaughter inspectors,\4\ we have 573 inspection program personnel 
working in beef establishments that operate 4 or 5 days per week, and 
409 working in either beef establishments that operate less than 4 days 
per week or swine establishments. The overtime fee that the Agency 
charges for each 15-minute interval is $17.08 for FY 2012. Multiplying 
this number by the Agency-estimated knife-sharpening time, we estimated 
the annual cost for knife sharpening time to be about $1,776.3 ($17.08 
per quarter-hour x 2 knife-sharpening periods per week x 52 weeks per 
year) per inspection program personnel in beef slaughter establishments 
that operate 4 days or more a week, and $888.2 ($17.08 per quarter-hour 
x 52 weeks per year) per inspection program personnel in beef slaughter 
establishments that operate 3 days or less or in swine establishments. 
If the industry had to pay all the meat slaughter inspectors to sharpen 
their knives, the total cost to the industry would be about $1.38 
million ($1776.3 x 573) + ($888.2 x 409). However, the actual impact 
would be much less because the industry can offer knife-sharpening 
services to Agency inspection program personnel instead of paying 
overtime for it.
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    \2\ As of November 2011.
    \3\ Survey date is March 2011.
    \4\ We count the inspection program personnel in combined meat 
and poultry as meat inspectors so not to underestimate the cost, as 
poultry slaughter inspectors do not currently have to sharpen 
knives.
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    If an establishment provides a knife-sharpening service, FSIS will 
instruct inspection program personnel to use that service. An Agency 
query \5\ found that the majority of the meat-slaughter establishments 
are offering knife sharpening to their employees, and about 91% of 
those also offer the service to Agency inspection program personnel. We 
expect that many other establishments will start offering the service 
to avoid paying overtime charges when this rule becomes effective.
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    \5\ OFO conducted the query in November 2011.
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    As for the other two groups of activities, the time they take is 
minimal. According to the Agency's estimates mentioned above, these 
activities combined will be at most 3 minutes per day. In addition, 
FSIS will permit the establishment to take on the responsibility of 
preparing the inspection station for inspection program personnel in 
livestock slaughter establishments. Given that the Agency charges 
overtime in 15-minute increments, and that it believes the donning, 
doffing, and walking time to be usually less than 15-minutes, time for 
these additional activities can be absorbed in the overtime period for 
donning, doffing, and walking time in most cases, thus not causing any 
additional overtime. In the unlikely, worst-case scenario where these 
activities push the daily overtime beyond the first 15-minute interval, 
the establishments would pay each inspection program personnel another 
$4,441 ($17.08 per inspector x 5 days per week x 52 weeks per year) 
annually. However, the Agency believes this scenario would apply to 
only a very small percentage of the inspection program personnel.
    Comparing the cost to the annual revenue of the meat slaughtering 
industry alone, which is about $67.2 billion,\6\ the costs of this rule 
to the industry will not be significant.
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    \6\ Summary of the Animal (except Poultry) Slaughtering Industry 
in the U.S. and its International Trade [2010 edition,] Supplier 
Relations US, LLC. http://www.htrends.com/report-2700858-Animal_except_Poultry_Slaughtering_Industry_in_the_U_S_and_its_International_Trade_Edition.html, as of 11/16/2011.
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Cost to the Consumer

    The industry is likely to pass the increased costs on to consumers 
because of the inelastic nature of the consumer demand for meat and 
poultry products. However, given that the total volume of meat and 
poultry slaughtered under Federal inspection in 2010 was about 92

[[Page 59294]]

billion pounds,\7\ the increased cost per pound due to the overtime fee 
will be less than $0.0001 on average.
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    \7\ Livestock, Dairy, & Poultry Outlook/LDP-M-209/November 16, 
2011; Economic Research Service, USDA.
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Benefits of the Rule

    This final rule will include integral and indispensible work 
activities (as defined by the Fair Labor Standards Act) into the 
defined inspector ``workday.'' Therefore, this rule will help ensure 
compliance with the law and the improved use of Agency resources.

Regulatory Flexibility Analysis

    The FSIS Administrator has made a determination that this final 
rule will not have a significant impact on a substantial number of 
small entities, as defined by the Regulatory Flexibility Act (5 U.S.C. 
601). There are 263 small and 566 very small meat and poultry slaughter 
establishments (by Small Business Administration standard). In small 
and very small establishments, inspection program personnel typically 
have adequate time during their tour of duty to sharpen their knives as 
well as conduct the other activities under this final rule, because 
they do not have to be on-line for 8 hours. Therefore, the impact will 
not be significant.

Paperwork Reduction Act

    This final rule has been reviewed under the Paperwork Reduction Act 
and imposes no new paperwork or recordkeeping requirements.

USDA Nondiscrimination Statement

    The U.S. Department of Agriculture (USDA) prohibits discrimination 
in all its programs and activities on the basis of race, color, 
national origin, gender, religion, age, disability, political beliefs, 
sexual orientation, and marital or family status. (Not all prohibited 
bases apply to all programs.) Persons with disabilities who require 
alternative means for communication of program information (Braille, 
large print, or audiotape) should contact USDA's Target Center at (202) 
720-2600 (voice and TTY).
    To file a written complaint of discrimination, write USDA, Office 
of the Assistant Secretary for Civil Rights, 1400 Independence Avenue 
SW., Washington, DC 20250-9410 or call (202) 720-5964 (voice and TTY). 
USDA is an equal opportunity provider and employer.

Additional Public Notification

    FSIS will announce this final rule online through the FSIS Web page 
located at: http://www.fsis.usda.gov/regulations_&_policies/Federal_Register_Notices/index.asp.
    FSIS will also make copies of this Federal Register publication 
available through the FSIS Constituent Update, which is used to provide 
information regarding FSIS policies, procedures, regulations, Federal 
Register notices, FSIS public meetings, and other types of information 
that could affect or would be of interest to constituents and 
stakeholders. The Update is communicated via Listserv, a free 
electronic mail subscription service for industry, trade groups, 
consumer interest groups, health professionals, and other individuals 
who have asked to be included. The Update is also available on the FSIS 
Web page. Through the Listserv and Web page, FSIS is able to provide 
information to a much broader and more diverse audience. In addition, 
FSIS offers an electronic mail subscription service which provides 
automatic and customized access to selected food safety news and 
information. This service is available at: http://www.fsis.usda.gov/News_&_Events/Email_Subscription/. Options range from recalls to 
export information to regulations, directives and notices. Customers 
can add or delete subscriptions themselves, and have the option to 
password protect their accounts.

List of Subjects

9 CFR Part 307

    Government employees, Meat inspection.

9 CFR Part 381

    Government employees, Poultry products inspection.

    For the reasons discussed in the preamble, FSIS is amending 9 CFR 
Chapter III as follows:

PART 307--FACILITIES FOR INSPECTION

0
1. The authority citation for part 307 continues to read as follows:

    Authority: 7 U.S.C. 394; 21 U.S.C. 601-695; 7 CFR 2.17, 2.55.


0
2. In Sec.  307.4(c), remove the second sentence and add two sentences 
in its place to read as follows:


Sec.  307.4  Schedule of operations.

* * * * *
    (c) * * * The basic workweek shall consist of 5 consecutive 8-hour 
days within the administrative workweek Sunday through Saturday, except 
that, when possible, the Department shall schedule the basic workweek 
so as to consist of 5 consecutive 8-hour days Monday through Friday. 
The 8-hour day excludes the lunch period but shall include activities 
deemed necessary by the Agency to fully carry out an inspection 
program, including the time for FSIS inspection program personnel to 
put on required gear and to walk to a work station; to prepare the work 
station; to return from a work station and remove required gear; to 
sharpen knives, if necessary; and to conduct duties scheduled by FSIS, 
including administrative duties. * * *
* * * * *

PART 381--POULTRY PRODUCTS INSPECTION REGULATIONS

0
3. The authority citation for part 381 continues to read as follows:

    Authority: 7 U.S.C. 138f, 450; 21 U.S.C. 451-470; 7 CFR 2.7, 
2.18, 2.53.


0
4. In Sec.  381.37(c), remove the second sentence and add two sentences 
in its place to read as follows:


Sec.  381.37  Schedule of operations.

* * * * *
    (c) * * * The basic workweek shall consist of 5 consecutive 8-hour 
days within the administrative workweek Sunday through Saturday, except 
that, when possible, the Department shall schedule the basic workweek 
so as to consist of 5 consecutive 8-hour days Monday through Friday. 
The 8-hour day excludes the lunch period but shall include activities 
deemed necessary by the Agency to fully carry out an inspection 
program, including the time for FSIS inspection program personnel to 
put on required gear, pick up required forms and walk to a work 
station; and the time for FSIS inspection program personnel to return 
from a work station, drop off required forms, and remove required gear; 
and to conduct duties scheduled by FSIS, including administrative 
duties. * * *
* * * * *

    Done at Washington, DC, on: September 21, 2012.
Alfred V. Almanza,
Administrator.
[FR Doc. 2012-23682 Filed 9-26-12; 8:45 am]
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