[Final Audit Report on the Safety and Health Program, Department of the Interior ]
[From the U.S. Government Printing Office, www.gpo.gov]

Report No. 96-I-609

Title: Final Audit Report on the Safety and Health Program, Department
       of the Interior 

Date: March 29, 1996

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                  ******************************

United States Department of the Interior
OFFICE OF THE INSPECTOR GENERAL

MEMORANDUM

TO:                 The Secretary

FROM:               Wilma A. Lewis

SUBJECT SUMMARY:    "Safety and Health Program, Department of the Interior" (No.
96-I-609)



Attached for your information is a copy of the subject final audit report.

The safety and occupational health programs managed by the U.S. Fish and Wildlife"
Service, the Bureau of Indian Affairs, the Bureau of Land Management, the National
Park Service, and the Bureau of Reclamation were ineffective in providing a safe
employee workplace and in preventing work-related illnesses and injuries.
Additionally, these bureaus did not periodically review Workers' Compensation cases
attributable to work-related accidents and illnesses. Consequently, previously injured
Department of the Interior employees who had apparently recovered from their
work-related disabilities inappropriately continued to receive Workers' Compensation
benefits. Specifically, approximately one-half of the 1,233 Departmental employees
who received long-term benefits during 1994 potentially could have been
rehabilitated and returned to work, resulting in an $11.8 million savings. The
Department agreed with all seven of our recommendations to correct these 
deficiencies.

If you have any questions concerning this" matter, please contact me or Ms. Judy
Harrison, Assistant Inspector General for Audits, at (202) 208-5745.

Attachment











C-IN-MOA-O02-94

United States Department of the Interior
OFFICE OF THE INSPECTOR GENERAL
Washington, D.C. 20240

Memorandum

To:  Assistant Secretary for Policy, Management and Budget

From:   Judy Harrison
     Assistant Inspector General for Audits

Subject:  Final Audit Report on the Safety and Health Program, Department of
             the Interior   (No. 96-I-609)

This report presents the results of our review of the Department of the Interior's
Safety and Health Program for fiscal years 1990 through 1994. The audit objective
was to determine whether the Department and its bureaus: (1) provided a safe and
healthful workplace for employees and volunteer workers; (2) implemented
reasonable corrective measures to reduce incidents of work-related injuries and
illnesses; and (3) adequately accounted for and investigated work-related injuries and
illnesses to enable necessary corrective actions to be made, including adequate
oversight of Workers' Compensation cases.

Our review disclosed that the safety programs managed by the National Park Service,
the Bureau of Land Management, the Bureau of Indian Affairs, the Bureau of
Reclamation, and the U.S. Fish and Wildlife Service were not effective in preventing
work-related accidents and illnesses. This occurred because senior-level bureau
management did not provide sufficient support and resources to emphasize the safety
programs and because existing field-level policies and procedures were not
implemented to ensure reasonably safe workplaces.  As a result, work-related
accidents and illnesses in recent years have risen to unacceptably high levels, along
with the associated Workers' Compensation costs, which totaled nearly $45 million
in 1994.

Further, we found that Workers' Compensation cases attributable to work-related
accidents and illnesses were not periodically reviewed.  Consequently, many
previously injured claimants continued to receive long-term Workers' Compensation
benefits despite having possibly recovered from their disabilities. Moreover,
approximately one-half of the 1,233 Departmental employees receiving long-term
benefits during 1994 potentially could have been rehabilitated and returned to work,
resulting in an $11.8 million savings.

 
We made six recommendations to promote management support and employee
participation in the Department's Safety Program, as well as to ensure compliance
with the Departmental Manual Safety Program requirements, and we made one
recommendation to improve the management of long-term Workers' Compensation
cases.

The October 5, 1995, response (Appendix 3) from the Director of Operations and
Designated Agency Safety and Health Official, Office of the Assistant Secretary for
Policy, Management and Budget, Office of the Secretary, included responses from
four of the five bureaus addressed in our draft report. The Office of the Secretary
concurred in principle with the recommendations.  Based on the response, we
consider four recommendations  resolved and implemented  and three
recommendations resolved but not implemented. Accordingly, the unimplemented
recommendations will be referred to the Assistant Secretary for Policy, Management
and Budget for tracking of implementation, and no further response to the Office
of Inspector General is required (see Appendix 4). Additionally, we considered
other comments in the response and changed the final report where appropriate.

The legislation, as amended, creating the Office of Inspector General requires
semiannual reporting to the Congress on all audit reports issued, the monetary
impact of audit findings (Appendix 1), actions taken to implement audit
recommendations, and identification of each significant recommendation on which
corrective action has not been taken.

cc:  Assistant Secretary for Fish and Wildlife and Parks
  Assistant Secretary for Indian Affairs
  Assistant Secretary for Land and Minerals Management
  Assistant Secretary for Water and Science
   Commissioner, Bureau of Reclamation
  Deputy Commissioner, Bureau of Indian Affairs
  Director, Bureau of Land Management
   Director, U.S. Bureau of Mines
   Director, U.S. Fish and Wildlife Service
  Director, U.S. Geological Survey
  Director, Minerals Management Service
   Director, National Park Service
  Director, Office of Surface Mining Reclamation and Enforcement
  Chief, Division of Management Control and Audit Follow-up
  Director, Office of Audit and Evaluation, Indian Affairs
   Audit Liaison Officer, Fish and Wildlife and Parks
  Audit Liaison Officer, Land and Minerals Management
   Audit Liaison Officer, Water and Science
  Audit Liaison Officer, Bureau of Land Management
   Audit Liaison Officer, U.S. Bureau of Mines
   Audit Liaison Officer, Bureau of Reclamation
   Audit Liaison Officer, U.S. Fish and Wildlife Service
  Audit Liaison Officer, U.S. Geological Survey
  Audit Liaison Officer, Minerals Management Service
   Audit Liaison Officer, National Park Service
   Audit Liaison Officer, Office of Surface Mining Reclamation and Enforcement

 
CONTENTS

Page

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
OBJECTIVE AND SCOPE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
PRIOR AUDIT COVERAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

FINDINGS AND RECOMMENDATIONS . . . . . . . . . . . . . . . . . . . . . . . . . 5

A. MANAGEMENT OF THE SAFETY AND HEALTH PROGRAM . 5
B. MANAGEMENT OF WORKERS' COMPENSATION CASES . ...12

APPENDICES

1. CLASSIFICATION OF MONETARY AMOUNTS . . . . . . . . . . ...15
2. OFFICES AND SITES VISITED OR CONTACTED
  DURING AUDIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...16
3. OFFICE OF THE SECRETARY RESPONSE . . . . . . . . . . . . . ...21
4. STATUS OF AUDIT REPORT RECOMMENDATIONS . . . . . ...29

 
INTRODUCTION

BACKGROUND

The Department of the Interior is required by Executive Order 12196 and the
Occupational Safety and Health Act of 1970 to provide a safe and healthful
workplace for employees, as well as for the visiting public. As the Designated
Agency Safety and Health Official for the Department, the Director of Operations,
Office of the Assistant Secretary for Policy, Management and Budget, has overall
responsibility for administering the Safety and Health Program for the Department.
A Designated Agency Safety and Health Official at each bureau helps administer the
individual bureau safety programs.  Additionally, the Department's Office of
Occupational Safety and Health assists by: (1) providing oversight and guidance for
the safety programs; and (2) representing the Department in safety program matters
that concern other Federal agencies, such as the Department of Labor's
Occupational Safety and Health Administration.

Injury frequency rates involving the Department of the Interior's 76,000 employees
and 124,000 volunteers annually rank among the highest in the Federal Government.
In fiscal year 1993, for example, the Department reported 7.6 injuries for every
100 workers, which exceeded by 42 percent the 5.4 average injury rate for all Federal
Government agencies. The U.S. Postal Service was the only major Federal agency
with a higher accident rate. Furthermore, the injury frequency rates for certain
Interior bureaus were much greater than the Federal Government average. For
example, in 1994, the National Park Service incurred 14.5 injuries for every
100 workers, while the Bureau of Land Management and the U.S. Fish and Wildlife
Service both reported 8 injuries per 100 workers (see Figure 1).

Although accidents occur in all job classifications, most injuries occur in occupations
that are usually performed outdoors, such as general support work, maintenance
work, biological sciences, forestry, and park management. However, other Federal
agenciesl conduct operations in a similar outside environment but maintain lower
accident rates than the Department.

While employment levels have remained relatively unchanged in recent years, the
Department's accident frequency rates have increased from 7.3 injuries per
100 workers in 1990 to 8.5 injuries per 100 workers in 1994 (a 16 percent increase),
and the number of injured employees increased from 5,543 in 1990 to 6,148 in 1994
(an 11 percent increase). Additionally, Workers' Compensation costs for this period
rose from $35.3 million to $44.7 million (a 26.7 percent increase) as the number of
current and long-term cases grew from 7,545 to 8,932 (an 18 percent increase).

lFor comparison purposes, the "Occupational Safety and Health Summary of Statistics of the
Federal
Government," published by the Department of Labor's Occupational Safety and Health
Administration, reported the following accident frequency rates per 100 workers for fiscal year
1993:
U.S. Forest Service, 6.94; Soil Conservation Service, 2.40; Army Corps of Engineers, 5.31; and
the
Tennessee Valley Authority, 5.56.      1

 
ACCIDENT FREQUENCY RATE

These accidents also resulted in lost productivity. For example, during 1994, the
bureaus reported 3,660 accidents in which employees were injured seriously enough
to lose work time. These accidents involved over 147,000 hours in lost work time
and represented over $2 million in lost productivity. Further, the total amount of
work time lost in 1994 was actually much greater because most of the 1,233 workers
with long-term disabilities from prior years were also unemployed during 1994.

OBJECTIVE AND SCOPE

The overall audit objective was to determine whether the
bureaus effectively managed the Safety and Health Program.

Department and its
Specifically, we were

to determine whether the Department and its bureaus took the following actions:
(1) provided a safe and healthful workplace for employees and volunteer workers;
(2) implemented reasonable corrective measures to reduce incidents of work-related
injuries and illnesses; and (3) adequately accounted for and investigated work-related
injuries and illnesses to enable necessary corrective actions to be made, including
adequate oversight of Workers' Compensation cases.

The original audit scope consisted of the Safety and Health Program managed by the
Department and each bureau from fiscal years 1990 through 1994. Our audit survey
disclosed that five bureaus (the National Park Service, the Bureau of Land

Management,
U.S. Fish and

the Bureau of Indian Affairs, the Bureau of Reclamation, and the
Wildlife Service) accounted for most of the injuries (91 percent in

2

 
1993) and had the highest accident frequency rates in the Department. Accordingly,
our audit emphasis was on determining why the number of injuries and the accident
frequency rates were so high in these five bureaus and to identify recommendations
that would improve workplace safety for these bureaus.

During our audit, we visited or contacted the offices and field locations within the
Department of the Interior and other Federal agencies listed in Appendix 2. We
interviewed safety program officials, as well as other cognizant personnel, from the
Department and its bureaus and other Federal agencies to obtain relevant safety
program data.

Our audit was performed in accordance with the "Government Auditing Standards,"
issued by the Comptroller General of the United States. Accordingly, we included
such tests of records and other auditing procedures that were considered necessary
under the circumstances. As part of the audit, we reviewed the Department of the
Interior's Annual Statement and Report to the President and the Congress for fiscal
years 1990 through 1993, required by the Federal Managers' Financial Integrity Act,
to determine whether any reported weaknesses were within the objective and scope
of our audit.  In all 4 years, the reports disclosed that the lack of proper
maintenance had created safety hazards at schools operated by the Bureau of Indian
Affairs. The 1993 report stated that corrective action for this material weakness
would be an ongoing project through 1999. Our review confirmed that this weakness
existed, and we identified additional deficiencies in the safety programs of the five
bureaus included in our review, which are discussed in the Findings and
Recommendations section of this report. Our recommendations, if implemented,
should improve the internal controls in these areas.

PRIOR AUDIT COVERAGE

The General Accounting Office has not issued any audit reports in the past 5 years
concerning the Department of the Interior's Safety and Health Program. However,
the Office of Inspector General has issued three audit reports in the past 5 years
related to the Safety and Health Program as follows:

- The July 1993 report "Workers' Compensation Program, Department of the
Interior" (No. 93-I-1309) stated that the bureaus did not ensure that injured
employees were placed in light duty assignments or returned to regular work when
they had recovered sufficiently from their injuries. Additionally, the bureaus did not
maintain adequate accountability and control over data contained in Workers'
Compensation reports. The audit report's five recommendations were partially
resolved at the time of our current review.

- The September 1994 report "Safety and Health Program, National Park
Service" (No. 94-I-1287) stated that the Park Service did not provide an adequate
level of protection for its workers and that the Park Service's employee workplace
accident and injury rate was twice the rate of other Departmental bureaus. The

3

 
audit report's four recommendations were resolved but not implemented at the time
of our current review.

- The March 1995 report "Selected Aspects of the Safety and Health Program
of Menominee Tribal Enterprises, Bureau of Indian Affairs" (No. 95-1-690) stated
that the Bureau did not assist the Menominee Tribe in establishing an adequate level
of safety protection for the Tribe's forestry workers.  The audit report's
recommendation was implemented at the time of our current review.

The Occupational Safety and Health Administration of the U.S. Department of
Labor periodically reviews the safety and health programs of the major Federal
agencies. The last evaluation of the Department of the Interior was conducted in
1989, and it disclosed numerous deficiencies in the Safety Program, including the
lack of support from senior-level management and an inadequate occupational health
program. The report noted that the Department's injury frequency rates consistently
exceeded the average for the Federal Government and cited the increasing accident
rates and costs incurred by the National Park Service and the Bureau of Land
Management. Our current review found that the report's 13 recommendations were
only partially implemented and that most of the Safety Program weaknesses
identified by the Department of Labor still existed.

 
FINDINGS AND RECOMMENDATIONS

A. MANAGEMENT OF THE SAFETY AND HEALTH PROGRAM

The safety and health programs managed by the National Park Service, the Bureau
of Land Management, the Bureau of Indian Affairs, the Bureau of Reclamation, and
the U.S. Fish and Wildlife Service were not effective in preventing work-related
injuries. The Department of the Interior is required by Executive order and the
Occupational Safety and Health Act to provide safe and healthful working conditions
for all workers. Deficiencies in the safety programs were primarily caused by the
lack of an adequate level of support for the Safety and Health Program by bureau
managers, who generally were not held accountable for ensuring a safe workplace.
Additionally, field-level policies and procedures that were not fully implemented by
the bureaus contributed to the Program deficiencies. As a result, safety-related
initiatives were not aggressively promoted, and the Department's injury frequency
rates in recent years exceeded the rates for almost all other Federal agencies.
Further, work-related injuries for some bureaus have increased significantly since
1990, along with the associated Workers' Compensation costs, which totaled
$44.7 million in 1994.

In 1980, the President issued Executive Order 12196, which directed each agency to
furnish workplaces that are reasonably healthful and free of hazards. Agencies were
also required to ensure the well-being of employees by establishing an effective
occupational safety and health program in accordance with the Occupational Safety
and Health Act of 1970. The specific safety standards described in the Act are
contained in the Code of Federal Regulations (29 CFR 1960). These safety
standards form the basis of the Department of the Interior's Safety Program and are
incorporated in the Departmental Manual (485 DM).

The Department's Safety and Health Program is intended to function as an overall
plan of actions and initiatives that together will result in overall safe and healthful
working conditions within the Department. Workplace safety should represent an
integral part of bureau operations; therefore, annual action plans and performance
reviews for bureau programs should include specific Safety Program objectives. We
further believe that senior- and field-level managers should be held accountable for
preventable work-related injuries that occur under their supervision and that
implementation of these measures would help management promote initiatives that
ensure safer workplaces.

Safety Program Results

We found that the effectiveness of bureau safety programs was diminished because
senior-level managers frequently were not held accountable for ensuring a safe
workplace. For example, at over 60 percent of the offices we contacted, the job
performance of managers as it relates to workplace safety was not an element in
their job appraisals. Also, the causes of work-related injuries and illnesses often

5

 
were not analyzed so that corrective action to prevent future incidents could be
identified.  Additionally, the bureaus frequently did not seek to identify and
eliminate workplace hazards through standard techniques such as facility safety
inspections, employee health monitoring, and job hazard analysis. These and other
procedures that would promote an effective Safety Program are required by the
Departmental Manual (485 DM). Through proactive management, we believe that
many workplace hazards could be eliminated or at least controlled more effectively.
Although we attributed the overall Safety and Health Program deficiencies to
inadequate management support and a lack of accountability for Program results,
we found other field-level deficiencies that reduced the effectiveness of the Program.

Resource Allocation. We found that safety program funding and staffing were
not applied to the bureau locations where these resources were needed most. For
example, each bureau safety program is managed from a central Safety Management
Office, which usually consists of several full-time safety and health professionals.
Each bureau's main regional office usually has a full-time Safety Manager, who may
be assisted by one or more full-time or collateral duty employees. However, at the
field-office level, where the majority of employees are located, safety program duties
are generally assigned to a single individual as a collateral duty. The regular
positions of these collateral duty Safety Officers cover a wide variety of job
classifications, such as maintenance worker or administrative office worker. This
person typically has neither previous work experience nor an educational background
in the safety and health field. Further, collateral duty Safety Officers generally
devote less than 20 percent of their time to the safety program. Consequently, even
though most accidents occur at remote offices and in field locations as opposed to
headquarters and main regional offices, sufficient safety program resources are not
available at the field level. Therefore, the Department and its bureaus need to
reevaluate the present system of safety program funding in order to emphasize
program efforts at the field locations, where most employees are located.

Safety Inspections. We found that safety inspections were not conducted at all
bureau facilities in accordance with Departmental regulations, which require each
bureau to have personnel who are trained in hazard recognition and inspection
procedures conduct annual safety inspections of its establishments and perform
followup inspections to verify that the problems have been corrected. The safety
inspection process for the Department is an enormous project, as thousands of
bureau-managed facilities and other sites are spread over immense land areas. For
example, the Fish and Wildlife Service manages 488 National Wildlife Refuges, along
with 259 other field sites, and the National Park Service manages 368 park units
containing over 20,000 structures and housing units.

We found that the limited number of bureau safety program officials available could
only partially complete the inspections and the followup verifications. For example,
safety inspections and followup verifications were completed in the past year at only
10 (18 percent) of the 56 sites we visited. The Fish and Wildlife Service's Regions
1 and 3 Safety Management Offices inspected less than 20 percent of their respective
field stations during the 18-month period ended June 1994. Additionally, the Bureau

6

 
of Indian Affairs had not developed abatement plans for 15,200 (35 percent) of the
43,680 safety deficiencies identified and still uncorrected as of May 1994.

Considering the importance of ensuring that all bureau workplaces are reasonably
free of hazards, we believe that bureau Safety Management officials should obtain
assistance to complete the safety inspections. For instance, safety inspections could
be conducted by non-safety program employees stationed at or near each facility or
by personnel employed by other bureaus. The bureaus could provide training in
safety inspection procedures to these employees, and the results of the inspections
could be forwarded to the applicable Safety Management Office for oversight,
review, and followup.

Health Evaluations. We found that occupational health evaluations for most
bureau facilities also had not been performed because of a lack of sufficiently
qualified personnel. The Departmental Manual (485 DM 17) requires each bureau
to establish an occupational health program in which an industrial hygienist or health
physicist inspects workplace facilities for health hazards. However, the bureaus have
only a few staff members who are qualified to perform occupational health services.
Consequently, minimal numbers of health evaluations have been conducted. As a
result, health hazards may not be detected, and employees maybe at increased risks
for work-related injuries or illnesses.

Safety Committees. The Departmental Manual (485 DM 9) recommends that
bureaus establish Safety Committees at headquarters and appropriate field offices
for the purposes of enhancing workplace safety and health and to advise
management on safety issues. The Department's Safety Program, which exists for
the benefit of all employees, functions most effectively when the entire workforce
actively participates in ensuring a safe workplace. One way to ensure employee
participation in the Safety Program is to require bureau offices to form Safety
Committees, which are composed of personnel not involved in safety programs.
However, 52 percent of the bureau offices we visited either did not have a Safety
Committee or the cognizant Safety Program official said that the Committee was
"ineffective" because of inadequate management support.

Workers' Compensation Accountability. Traditionally, Workers' Compensation
costs have been charged to the central budget of the bureaus rather than to the
regional office, field office, or other organizational level where the injuries occur.
As a result, the Secretary of the Interior issued a May 1992 directive requiring
Workers' Compensation costs to be identified to the responsible organizational levels
that incurred the costs to ensure that field-level managers were aware of the cost
impact of accidents and of their responsibility for maintaining viable safety programs.
The Bureau of Reclamation recognized these potential benefits and in 1994 became
the only Departmental bureau to begin charging Workers' Compensation costs to
lower organizational levels.

 
Safety Program Oversight

The Office of Occupational Safety and Health administers the Department's Safety
Program and provides general oversight of the bureau safety programs. One of the
Office's functions is to evaluate the effectiveness of each bureau safety program in
a comprehensive review, known as a Safety Management Evaluation. We found that
these evaluations improved the bureau safety programs; however, bureau officials
have not always concurred with the findings and recommendations for certain
evaluations.  For example, bureau officials objected to the findings and
recommendations in the evaluations conducted in 1992 of the National (formerly
Boise) Interagency Fire Center and the National Park Service's Mid-Atlantic
Regional Office. Consequently, recommendations to improve workplace safety at the
Fire Center were not resolved, and the final safety evaluation report to the Park
Service's Regional Office was not issued. Therefore, certain recommendations that
would have improved the workplace safety at both locations were not implemented.

Since the Office of Occupational Safety and Health serves only in an advisory
capacity to the bureaus, differences in opinion on health and safety issues between
the Office and a bureau sometimes are not resolved. In our opinion, the Safety
Management Evaluation process represents an important function performed by the
Office for the benefit of the bureaus and the entire Department. The process is also
the only objective review of a bureau's safety program conducted by an independent
party within the Department. Therefore, we believe that the Office and bureaus
should refer any concerns reflecting differences in health and safety issues to the
Department's Designated Agency Safety and Health Official for final resolution.
This will ensure that the bureaus fully respond to all Safety Management Evaluation
recommendations.

Safety Program Initiatives

The bureaus have long devoted considerable attention to protecting the safety of
visitors to public lands, and in the past few years, safety program officials have
implemented certain initiatives on behalf of employees.  The most prominent
undertaking of the Department, known as the Occupational Safety and Health
Strategic Plan, commenced in October 1994 as a 3- to 5-year effort to foster safety
awareness and individual employee participation in the Safety Program.  The
Strategic Plan combines the bureaus' separate capabilities to maximize their
accomplishments and has a stated goal of zero losses of human and material
resources.

In another example, the Office of Occupational Safety and Health has undertaken
a Departmentwide effort to enhance the professionalism and education of safety
program officials. The Office administers a career development program and is
currently producing a video instructional series that will enable employees at remote
locations to receive safety training. These initiatives are seriously needed, since over
half of the safety program officials we interviewed expressed a need for more

8

 
training. Additionally, many bureaus have implemented specific programs designed
to address their unique safety problem areas. For example, the National Park
Service has a program to address the proper handling of explosive materials; the
Bureau of Land Management has a seat belt usage awareness program and an
employee health monitoring program for hazardous materials; and the Bureau of
Indian Affairs has a back injury prevention initiative and a firefighting safety
awareness program. We believe that each of these initiatives will eventually result
in improved working conditions for all employees.

Summary

Our review found that the overall effectiveness of the Department of the Interior's
Safety Program had certain obstacles that could not be overcome solely by Safety
Program officials.  Specifically, managers and employees at every level of the
Department and its bureaus should become more aware of and accountable for
safety issues. Also, the Safety Program should not be considered a separate program
that functions apart from regular bureau operations, nor should the various
components of the Safety Program be considered in isolation of each other. Instead,
Safety Program goals and initiatives should be incorporated into all Departmental
programs, and the various components of the Safety Program should be considered
as interdependent parts of the whole program. Only in this way will significant
reductions in the Department's accident rates be achieved.

Recommendations

We recommend that the Assistant Secretary for Policy, Management and Budget
direct the National Park Service, the Bureau of Land Management, the Bureau of
Indian Affairs, the Bureau of Reclamation, the U.S. Fish and Wildlife Service, and
the remaining Departmental bureaus to take, to the extent practicable, the following
actions to improve their safety and health programs:

1. Include, as part of the annual action plans and performance reviews of
bureau programs, specific and measurable safety and health program initiatives as
determined to be necessary by Departmental and Bureau Designated Agency Safety
and Health Officials,

2. Establish a Safety Committee in each bureau office, as appropriate, for the
purpose of assisting management in implementing Safety Program initiatives.

3. Utilize the Department's Designated Agency Safety and Health Official as
the mediator to resolve differences of opinion on health and safety issues between
the bureaus and the Office of Occupational Safety and Health.

We recommend that the Assistant Secretary for Policy, Management and Budget
direct the Bureau of Land Management, the Bureau of Indian Affairs, the Bureau

9

 
of Reclamation, and the U.S. Fish and Wildlife Service to take the following actions
to improve these bureaus' safety and health programs:

4. Establish a cost-awareness initiative by identifying, distributing, and charging
(in full or in part) Workers' Compensation costs to the operating budget of the
lowest practicable organizational unit of each bureau.

5. Evaluate and determine the appropriate levels of authority, staffing, and
resources that are needed to implement safety and health programs that sufficiently
comply with the safety standards contained in the Departmental Manual (485 DM).

6. Ensure that comprehensive facility safety inspections are conducted and
identified health hazards are abated in accordance with the Departmental Manual
(485 DM 6) and that occupational health inspections are conducted in accordance
with the Departmental Manual (485 DM 17).

Office of the Secretary Response

The October 5, 1995, response (Appendix 3) from the Director of Operations and
Designated Agency Safety and Health Official, Assistant Secretary for Policy,
Management and Budget, Office of the Secretary, generally agreed with all the
recommendations. The Office also stated that the Department's Occupational Safety
and Health Strategic Plan is addressing many of the weaknesses identified in the
audit report.

Recommendation 1.  The Office stated concurrence "in principle" with the
recommendation.  The Office further stated that the action recommended is
currently being accomplished through implementation of the Strategic Plan and that
the individual bureaus take "ownership" of specific (safety and health related) actions
which are developed and implemented.

Recommendation 2. The Office stated concurrence "in principle." The Office
further stated that Safety Committees can be "valuable" at the field level but are "less
effective" at upper management levels.

Recommendation 3. The Office stated concurrence "in principle." The Office
further stated that the Department's Designated Agency Safety and Health Official
is the senior management official in the Department with responsibility and authority
to act on Occupational Safety and Health issues in the Department.

Recommendation 4. The Office stated concurrence "in principle" but the Office
stated that the "real objective" of the Workers' Compensation cost control is to
"create management awareness" of the actual cost of accidental injuries and illnesses.
The Office further stated that Workers' Compensation cost awareness is best
achieved through a performance-based requirement and management cost-reduction
incentives.

10

 
Recommendation 5. The Office stated concurrence ''in principle'' but noted that
it is "unlikely" that additional resources could be devoted to compliance with the
Safety Program and that the Strategic Plan is being used to improve the effectiveness
of existing Occupational Safety and Health resources.

Recommendation 6. The Office stated concurrence. The Office further stated
that the Strategic Plan will improve the Department's ability to conduct facility safety
inspections and that budgetary constraints will make correcting deficiencies "even
more difficult."

Office of Inspector General Comments

Based on the Office of the Secretary's response, we consider Recommendations 1,
3, 5, and 6 resolved and implemented and Recommendations 2 and 4 resolved but
not implemented (see Appendix 4).

11

 


B. MANAGEMENT OF WORKERS' COMPENSATION CASES

Many previously injured Department of the Interior employees who had apparently
recovered from their work-related disabilities inappropriately continued to receive
Workers' Compensation benefits. In a review completed in 1994, the Department
determined that nearly one-half of the employees whose injuries were at least l-year
old had sufficiently recovered and were no longer entitled to receive Workers'
Compensation benefits. The Federal Employees' Compensation Act states that upon
recovery from a disability, an employee must return to work and Workers'
Compensation benefits should terminate.  These claimants received Workers'
Compensation benefits because the Department did not periodically evaluate the
physical condition of each claimant. As a result, approximately one-half of the
Department's 1,233 long-term claimants potentially could be rehabilitated and
returned to productive employment, which would save the Department an estimated
$11.8 million.

The Federal Employees' Compensation Act, as stated in the Code of Federal
Regulations (20 CFR 10.124), states that an employee's entitlement to wage loss
compensation terminates once the work-related disability has ceased. Further, an
employee collecting benefits under the Act must return to work upon recovery from
a work-related disabling injury or illness. An employee is also obligated to cooperate
with the employing agency's attempts to provide vocational rehabilitation or to place
the employee in another position within reasonable work limitations and restrictions.

Workers' Compensation cases in which the claimants sustained a work-related
disabling injury or illness at least 1 year ago are considered long-term cases. The
1,233 employees on the Department's long-term rolls in 1994 made up only one-tenth
of the total Workers' Compensation cases but accounted for $29.7 million
(66.3 percent) of the $44.7 million in costs paid. However, the potential exists for
certain individuals to be returned to gainful employment, which consequently would
reduce Workers' Compensation costs. The Office of Occupational Safety and Health
identified 600 cases (representing 49 percent of the long-term cases) in which
employees potentially could be rehabilitated and rehired in their former positions or,
alternatively, placed in light duty jobs. The salary compensation costs paid to these
individuals totaled $11.8 million in 1994, representing an area for achieving
substantial cost savings.

The Department completed a review in 1994 which supported the Office of
Occupational Safety and Health's assessment that a large number of long-term cases
could be removed from the Workers' Compensation Program. In this survey, the
Department of Labor assisted in selecting 132 Departmental employees who had
collected Workers' Compensation benefits for over 1 year. The survey indicated that
certain employees had fully recuperated and could be returned to their former
positions, others had sufficiently recovered and could be placed in light duty jobs,
and some could retire with a medical disability. The survey also found that some
employees had died but that benefits continued to be paid. Additionally, other

12

 
claimants voluntarily withdrew from the Program immediately after the initial
notification of the review. The Office of Occupational Safety and Health estimated
that a $1.3 million cost savings could have been realized if these claimants had been
removed from the Workers' Compensation Program.  In our opinion, the
Department should implement an inspection program whereby the eligibility of each
long-term Workers' Compensation claim is formally evaluated on a periodic basis.

In a May 14, 1992, memorandum to the bureaus, the Secretary of the Interior
expressed concern about the Department's high accident rates and directed the
bureaus to initiate improved management controls over the Workers' Compensation
Program. The Secretary also established a goal for each bureau to reduce the costs
associated with current and long-term cases by 2 percent annually over a 5-year
period. However, in the past 2 years, the bureaus have generally been unsuccessful
in reducing these costs. We believe that the cost containment goals set by the
Secretary could be achieved with proactive management of Workers' Compensation
cases. For example, the Bureau of Indian Affairs initiated a cost reduction program
in early 1994 in which a full-time coordinator was assigned to examine the eligibility
of Workers' Compensation claimants. In the first year of this program, Workers'
Compensation claims decreased by almost 5 percent, and the cost savings totaled
$345,000.  We believe that if all the bureaus established a proactive case
management system, similar improvements in gaining control over Workers'
Compensation costs would be realized throughout the Department.

Recommendation

We recommend that the Assistant Secretary for Policy, Management and Budget
establish an inspection program whereby the Department and its bureaus periodically
review the case of each long-term Workers' Compensation claimant to determine the
claimant's continued eligibility for benefits. To facilitate the inspection program,
consideration should be given to establishing a Workers' Compensation case
management position within each bureau.

Office of the Secretary Response

The October 5, 1995, response (Appendix 3) from the Director of Operations and
Designated Agency Safety and Health Official, Assistant Secretary for Policy,
Management and Budget, Office of the Secretary, concurred with the
recommendation, stating that the recommendation will provide necessary justification
to support the obtaining of resources to implement a Workers' Compensation case
management and inspection program. Additionally, the Office "suggested [that the]
recommendation be modified to indicate that a [new case management] position
should be established in each bureau," that an existing position should be
reprogrammed, or that the function should be contracted out.

13

 
Office of Inspector General Comments

Based on the Office's response, we consider the recommendation resolved but not
implemented (see Appendix 4). With regard to specifying that new positions should
be established, we believe that the bureaus are in the best position to determine their
staffing requirements and to determine what resources are available to meet those
requirements.

14

 
APPENDIX 1

CLASSIFICATION OF MONETARY AMOUNTS

                         Funds To Be Put
   Finding Area                  To Better Use

Workers' Compensation Costs for 1994            $11.8 million*

*The Office of Occupational Safety and Health estimated $11.8 million in costs associated with
long
-

term Workers' Compensation claimants who could potentially be rehabilitated and returned to
work.

Additional unquantifiable Workers' Compensation costs result from the weaknesses in the bureau
safety programs identified in this report, and these funds could also be put to better use.

15

 
                    APPENDIX 2
                      Page 1 of 5
    OFFICES AND SITES
VISITED OR CONTACTED DURING AUDIT

   OFFICES AND SITES

Department of Health and Human Services

U.S. Public Health Service, Region 8,
Division of Federal Occupational Health

Department of the Interior

Office of the Assistant Secretary for Policy,
Management and Budget
  Director of Operations
  Division of General Services
  Office of Budget*
  Office of Occupational Safety and Health

Bureau of Indian Affairs
Division of Program Development and
  Implementation*

Division of Safety Management

Aberdeen Area Office
  Cheyenne River Agency
  Turtle Mountain Agency

Albuquerque Area Office
  Northern Pueblos Agency
   San Juan Day School
   Santa Clara Day School
  Southwestern Indian Polytechnic
  Institute

Billings Area Office
  Crow Agency

Minneapolis Area Office
  Great Lakes Agency
  Menominee Tribal Enterprises

  LOCATION




Lakewood, Colorado

Washington, D.C.
Washington, D.C.
Washington, D.C.
Lakewood, Colorado

Washington, D.C.

Albuquerque, New Mexico

Aberdeen, South Dakota
Eagle Butte, South Dakota
Belcourt, North Dakota

Albuquerque, New Mexico
San Juan Pueblo, New Mexico
San Juan Pueblo, New Mexico
Santa Clara Pueblo, New Mexico

Albuquerque, New Mexico

Billings, Montana
Crow Agency, Montana

Minneapolis, Minnesota
Ashland, Wisconsin
Neopit, Wisconsin

*Contacted only.

16

 
APPENDIX 2
Page 2 of 5

OFFICES AND SITES

Navajo Area Office*
Fort Defiance Agency
  Hunters Point Boarding School
  Pine Springs Boarding School
  Rough Rock Boarding School

Phoenix Area Office*

Portland Area Office
Wapato Irrigation Project
Yakima Agency

Sacramento Area Office
Northern California Agency

Bureau of Land Management
Support Services-Office of Safety

Denver Service Center

California State Office
Ukiah District Office
  Clear Lake Resource Area

Colorado State Office

Idaho State Office
Boise District Office

Montana State Office
Billings Resource Area
  Pompeys Pillar National
   Historical Landmark

National Interagency Fire Center

Nevada State Office
Carson City District Office

New Mexico State Office*
Albuquerque District Office
  Taos Resource Area
Farmington District Office*

LOCATION

Gallup, New Mexico
Fort Defiance, Arizona
Hunters Point, Arizona
Pine Springs, Arizona
Rough Rock, Arizona

Phoenix, Arizona

Portland, Oregon
Yakima, Washington
Yakima, Washington

Sacramento, California
Redding, California

Washington, D.C.

Lakewood, Colorado

Sacramento, California
Ukiah, California
Ukiah, California

Lakewood, Colorado

Boise, Idaho
Boise, Idaho

Billings, Montana
Billings, Montana

Montana

Boise, Idaho

Reno, Nevada
Carson City, Nevada

Santa Fe, New Mexico
Albuquerque, New Mexico
Taos, New Mexico
Farmington, New Mexico

17

 
APPENDIX 2
Page 3 of 5

OFFICES AND SITES

Oregon State Office
Roseburg District Office

Wyoming State Office
Casper District Office
  Platte River Resource Area
Rawlins District Office
  Great Divide Resource Area

U.S. Bureau of Mines
Division of Organization and Management,
  Office of Safety

Bureau of Reclamation
Reclamation Service Center
  Management Services

Great Plains Regional Office
Montana Area Office

Lower Colorado Regional Office*
Phoenix Area Office*

Mid-Pacific Regional Office
No. Central California Area Office

Pacific Northwest Regional Office
Snake River Area Office

Minerals Management Service
Support Services-Safety Office

National Park Service

National Park Service Headquarters
Safety Office

Mid-Atlantic Regional Office
Gettysburg National Military Park
Shenandoah National Park

National Capital Regional Office
George Washington Memorial Parkway

LOCATION

Portland, Oregon
Roseburg, Oregon

Cheyenne, Wyoming
Casper, Wyoming
Mills, Wyoming
Rawlins, Wyoming
Rawlins, Wyoming

Washington, D.C.

Lakewood, Colorado

Billings, Montana
Billings, Montana

Boulder City, Nevada
Phoenix, Arizona

Sacramento, California
Folsom, California

Boise, Idaho
Boise, Idaho

Herndon, Virginia

Washington, D.C

Philadelphia, Pennsylvania
Gettysburg, Pennsylvania
Luray, Virginia

Washington, D.C.
McLean, Virginia

18

 
APPENDIX 2
Page 4 of 5

OFFICES AND SITES

LOCATION

Harpers Ferry National Historical Park   Harpers Ferry, West Virginia
National Capital Parks - Central      Washington, D.C.
Rock Creek Park            Washington, D.C.

Pacific Northwest Regional Office      Seattlej Washington
Mount Rainier National Park       Ashford, Washington
North Cascades National Park       Sedro Woolley, Washington
Lake Chelan National Recreation Area**  Sedro Woolley, Washington
Ross Lake National Recreation Area**   Sedro Woolley, Washington
Olympic National Park         Port Angeles, Washington

Rocky Mountain Regional Office
Bighorn Canyon National Recreation Area
Bryce Canyon National Park
Cedar Breaks National Monument
Glen Canyon National Recreation Area
Rainbow Bridge National Monument***
Mesa Verde National Park

Rocky Mountain National Park
Theodore Roosevelt National Park
Wind Cave National Park
Yellowstone National Park

Lakewood, Colorado
Fort Smith, Montana
Bryce Canyon, Utah
Cedar City, Utah
Page, Arizona
Page, Arizona
Mesa Verde National Park,
Colorado
Estes Park, Colorado
Medora, North Dakota
Hot Springs, South Dakota
Mammoth Hot Springs, Wyoming

Southwest Regional Office         Santa Fe, New Mexico
Bandelier National Monument      Los Alamos, New Mexico
Carlsbad Caverns National Park      Carlsbad, New Mexico
Chaco Culture National Historical Park   Bloomfield, New Mexico
Guadalupe Mountains National Park    Salt Flat, Texas
Pecos National Historical Park      Pecos, New Mexico

Western Regional Office         San Francisco, California
Grand Canyon National Park       Grand Canyon Village, Arizona
Kings Canyon National Park       Three Rivers, California
Lake Mead National Recreation Area   Boulder City, Nevada
Sequoia National Park****        Three Rivers, California
Yosemite National Park         Yosemite National Park,
                   California

**Serviced by North Cascades National Park.

***Serviced by Glen Canyon National Recreation Area.

****Serviced by Kings Canyon National Park.

19

 
APPENDIX 2
Page 5 of 5

OFFICES AND SITES

Office of Surface Mining Reclamation
and Enforcement
Division of Administrative Services

U.S. Fish and Wildlife Service
Office of Safety and Health

Region 1 Safety Office
Coleman National Fish Hatchery
Malheur National Wildlife Refuge
San Luis National Wildlife Refuge
William L. Finley National
  Wildlife Refuge

Region 2 Safety Office
Bosque del Apache National
  Wildlife Refuge
Mescalero National Fish Hatchery

Region 3 Safety Office
Minnesota Valley National
  Wildlife Refuge

Region 6 Safety Office

U.S. Geological Survey
Administrative Division

Department of Labor

Bureau of Labor Statistics*

Occupational Safety and Health
Administration
  Headquarters*
  Atlanta Regional Office*
  Denver Regional Office*

Office of Workers' Compensation Programs*

National Safety Council*

LOCATION

Washington, D.C

Lakewood, Colorado

Portland, Oregon
Anderson, California
Princeton, Oregon
Los Banes, California

Corvallis, Oregon

Albuquerque, New Mexico

Socorro, New Mexico
Mescalero, New Mexico

Fort Snelling, Minnesota

Bloomington, Minnesota

Lakewood, Colorado

Reston, Virginia

Washington, D.C.

Washington, D.C.
Savannah, Georgia
Denver, Colorado

Washington, D.C.

Itasca, Illinois

20

 
APPENDIX 3

Memorandum

United States Department of the

OFFICE OF THE SECRETARY
WASHINGTON, D.C. 20240

    Pag
Interior

I





To:     Marvin Pierce, Acting Assistant Inspector General for Audits

From:


Subject:   Response to Draft Audit Report on the Safety and Health Program, Department of
     the Interior (Assignment No. C-IN-MOA-002-94)

I am pleased to respond for Bonnie Cohen, Assistant Secretary for Policy, Management and
Budget, to your memorandum of August 9, 1995, on this subject. We have reviewed the draft
report and comments are provided at Attachment 1.

In preparation of a response to the draft audit report, we shared the draft with a wide range of
interested parties. These included the DOI Occupational Safety and Health Council, consisting
of bureau safety and health managers, the DOI DASHO Council, consisting of bureau DASHOS,
and the DOI Workers' Compensation Council, consisting of bureau personnel, safety and health,
and management representatives. The attached response reflects their input, with that of the
Office of the Secretary.

In addition to the Office of the Secretary response, we have included responses from four of the
five bureaus specifically addressed in your report. Correspondence from the Bureau of
Reclamation (Attachment 2), Bureau of Land Management (Attachment 3), National Park
Service (Attachment 4), and the U.S. Fish and Wildlife Service (Attachment 5) is attached. The
Bureau of Indian Affairs chose not to respond.

Though we understand the problems your schedule posed, I think I speak for the other DASHOs
when I express some disappointment in the general nature of the draft report and the length of
time to reach this point in the process. As a result, the information has lost some currency. Our
response identifies a number of areas where substantial progress has been made in dealing with
Program issues. Despite this, I want to express my overall appreciation for the efforts of the
Audit Team on this assignment. Besides performing the tasks related to the primary audit, they
undertook two supplemental audits at the request of the Assistant Secretary, examining
occupational safety and health issues in the National Park Service and in the Menominee Tribal
Enterprises, Bureau of Indian Affairs. The results of those audits are proving to be especially
valuable in addressing described safety and health concerns in those organizations.

I look forward to receiving the final audit report. Please contact Jim Meredith, Acting Director,
Office of Occupational Safety and Health, (303) 236-7128, or me, (202) 208-6254, if further
discussion is necessary.

Attachments
[ATTACHMENTS 2-5 NOT INCLUDED BY OFFICE OF INSPECTOR GENERAL.]
                  21

 
APPENDIX 3
Page 2 of 8

          Response
            to
Office of the Inspector General Draft Audit Report,  C-IN-MOA-002-94
       Safety and Health Program
       Department of the Interior
          August 1995

General Comments

The findings and conclusions contained in the report mirror those previously identified by
Departmental management in ongoing Occupational Safety and Health (OSH) Program

evaluations. We are somewhat disappointed in the lack of specificity in the report. Through
implementation of the DOI Occupational Safety and Health Strategic Plan we have addressed
or will be addressing many of the weaknesses identified in the report. This draft report has been
formally discussed with the Occupational Safety and Health Council, consisting of bureau safety
managers, the DASHO Council, consisting of the bureau DASHOs, and the Workers'
Compensation Council, consisting of bureau personnel, safety, and field representatives. Their
input has been incorporated into this response.

A. Management of the Safety and Health Program

o Use of Overall Injury Rates

We disagree with the use of overall injury rate information in the report. While any
injury/illness is important we believe that lost time injury rates are more reflective of OSH
Program effectiveness, as they represent an identifiable loss of resources and productivity. To
this end, the Department is officially adopting lost time injury rates as one of five indicators of
OSH Program performance. A chart showing the identified bureaus' lost time injury rates is

22

 
APPENDIX 3
Page 3 of 8

Regarding the statement on page 2," ...other Federal agencies...maintain significantly lower
  accident rates.. .", we believe that these agencies should be identified in the report for
comparison
purposes. We have included lost time injury rates for the U.S. Forest Service and the U.S. Army
Corps of Engineers in the previously mentioned chart. While there maybe agencies with lower
injury rates, we do not believe there is sufficient information to support the statement as written.

Regarding the statement on page 8, first paragraph, "Deficiencies in the safety programs were
caused by a lack of policies and procedures . . . to analyze workplace accidents.. .", we believe
that
additional information and substantiation are needed to support this statement. Program
deficiencies are not a question of policies and procedures, which our evaluations have indicated
to be generally adequate. Nor is it a question of failure to analyze accidental injuries and
illnesses, which will only identify potential areas for management attention. Instead, there is a
clear need to better implement existing programs and policies, and to ensure that safety and
health considerations are incorporated into everyday work decisions. For this reason we have
adopted the Occupational Safety and Health Strategic Plan to address just these issues.

Lastly, we believe it is important to note that the majority of the bureaus have accident rates well
below both the overall and lost time Federal Government rates, reflecting effective OSH
Program management.

. Collateral Duty Safety Officers

Collateral Duty Safety Officers (CDSO) are the backbone of the OSH Program. The remote
nature and small size of many of our field operating activities make it impossible to provide full-
time OSH expertise at most of those locations. The CDSO seine as an immediate resource to
managers and employees in dealing with local OSH matters. Lack of adequate CDSO training
and support is a recognized weakness which we have been addressing through Strategic Plan
implementation efforts.

Notable among those efforts is the FY 96 OSH Training Initiative. This initiative will develop
exportable training packages targeted toward four audiences: employees, supervisors, managers,
and CDSO. Of these, the CDSO training has been identified as the highest priority for
development. We expect to have these products complete and ready for distribution by the end
of FY 96.

During FY 96, we will also be conducting a focused examination of the CDSO role, to identify
ways in which their visibility and the support they receive can be increased.

o OWCP Chargeback

We agree with the importance of increasing management awareness of the true cost of employee
injuries and illnesses as it is borne by OWCP costs, and that the most effective way of doing so
is through some distribution of those costs. However, what has become clearly apparent is that a
simple across-the-board chargeback as directed in the May 1992 Secretarial Order, is not
feasible due to the accounting and organizational complexities in the bureaus. As a result the
FY 96 Strategic Plan implementation includes an action asking bureaus to develop OWCP cost

3

23

 
assessments and/or develop and implement budget incentives based on OWCP

APPENDIX 3
Page 4 of 8

costs. We believe

this performance-based approach will achieve the management awareness outcome identified in
your report.

. Safety Committees

The statement on page 11 of the report regarding a requirement in 485 DM 9 for bureaus to
establish safety committees is incorrect. 485 DM 9 recommends, but does not require, safety
committees. Safety committees are a valuable tool, when properly used and supported, to utilize
employee involvement to identify and address operating level OSH issues. We believe that they
become less effective at higher levels of organizations. We strongly agree that management
support is critical for their success at any level.

o Facilities Inspections

We agree with the findings on this subject. We believe this issue will be partially addressed
through the FY 96 OSH Training Initiative and other Strategic Plan actions. However, we
believe that facility OSH deficiencies will remain a major problem even if the inspection
situation is addressed. With increasing budget constraints, facility managers may be forced to
reduce preventive maintenance activities and to defer correction of safety deficiencies, at the risk
of their employees and others. Additional recommendations on this subject would be welcome.

o Safety Management Evaluations

We agree with the findings on this subject; however, we believe the mechanism for the DASHO
to seine as the mediator for disagreements is, in fact, already in place. As the transmitting
official of the Safety Management Evaluation reports, the DASHO generally resolves these
issues prior to publication of the final report. In any case, bureaus may still choose to nonconcur
with findings and recommendations resulting from the evaluation process.

. Occupational Safety and Health Strategic Plan

The OSH Strategic Plan is the Department's tool for long-term Program improvement. With
strong support of the executive leadership of the Department and bureaus, this mechanism is
highly visible and provides a basis for the development and launch of initiatives to address
Program weaknesses, including those identifed in the audit report. Many of these initiatives are
highly innovative and hopefully serve as a means for continuous Program improvement.

We would like to see expanded discussion of the Strategic Plan in the final report perhaps with
a recommendation for continued long-term management support and commitment to its
objectives and outcomes.

4
24

 
APPENDIX 3
Page 5 of 8

. Safety Management Information System (SMIS)

Though mentioned only briefly in the draft report SMIS is a critical element for future OSH
Program improvement. We believe it is the key to quality accident analysis, identification of
causal factors, and development of effective Program initiatives. SMIS has been identified as an
essential Departmental administrative system and we are developing SMIS to become a part of
the so called DOI Desktop for use throughout the Department. When completed this
development will greatly improve the ability of users to analyze their accidents and allow easy
access to a wide range of safety and health information sources. It is critical that adequate
resources continue to be allocated for ongoing SMIS development and operation.

We would like to see expanded discussion of SMIS in the final report perhaps with a
recommendation for long-term management support and resources for development and
operation.

Section B. Management of Workers Compensation Cases

Over the past two years, the Department has seen a decrease in the growth rate of workers'
compensation costs. Prior to FY 94 the average growth rate was approximately 7o/0 per year. In
FY 94 the rate decreased to 5.5% and in FY 95 the rate will be approximately 1%. In monetary
terms, the reduction has been from $2,000,000 annually to approximately $500,000 this year.

We believe much more can be done to further reduce costs, The IG recommendation of
establishing workers' compensation positions within each bureau will provide needed resources
to expand and enhance continuing efforts toward aggressive active case management and return-
to-work initiatives within the bureaus.

Because the Department of Labor (DOL) is solely responsible for determining eligibility for
benefits, the statement on page 19, paragraph 1, indicating "ineligible claimants received . .."
should be reconsidered and the word "ineligible" deleted. A second alternative could be
providing additional clarification indicating that DOL is responsible for determining eligibility.

In regards to the data stemming from a medical review of the long term roll by the Division of
Medical and Health Services, we have been unable to substantiate the validity of that data.
Inferences that reductions in the long-term rolls were a direct result of actions taken by the
Division during the review should be verified. The two employees responsible for the review
have retired and most specific medical supporting documentation was either destroyed or
returned to OWCP-Department of Labor, before they retired. Therefore, it is recommended that
all results from the review be deleted unless validated on a case by case basis to verify that any
changes to the long term roll were indeed a direct result of that medical review. The
Department's medical services staff has met with the Department of Labor's OWCP medical
staff and has made significant changes to the OWCP medical review initiative to enhance this

5
25

 
APPENDIX 3
Page 6 of 8

program. The current initiative takes advantage of the DOL-OWCP long term roll review
process which made the transition from pilot to fully implemented program this past year.
DOI's program, instead, is concentrating on reducing new accessions to the long term roll by the
45th day post injury.

There is no question the Department can do more to bring employees on the long-term rolls back
to light/limited duty positions. However, in order to bring the 600+ employees described in the
report back to work and to realize an $11.8 million savings, the Department's budget and FTE
ceiling would need to be increased a like amount. To encourage bringing employees back from
the long-term rolls, PMB has established a pool of 50 unfunded FTEs. Additional efforts under
consideration include charging back the cost of OWCP to the lowest organizational level,
encumbering the injured employee's position indefinitely, promoting a proactive safety program,
and implementing a Departmental pilot nurse intervention program to minimize new accessions
to the long-term rolls.

Finally, better management and oversight of workers' compensation cases and costs area
Government-wide concern. The benefits offered to employees under the program exceed
anything available in the private sector. As such, consideration should be given to reevaluating
program legislation with an eye toward eliminating the tendency of retiring under OWCP. For
example, require an injured employee to retire under OPM rules as soon as he/she reaches
eligibility in terms of years of service and age, or place a limit on the number of years that
compensation can be received. This change would save the Department millions of dollars
annually. It is requested that a copy of the final report be sent to the Department of Labor along
with a recommendation from the Inspector General that consideration be given to reevaluating
program legislation.

Recommendation Comments

We understand that due to the scope of the OSH Program, it is difficult to identify specific areas
for improvement. Nonetheless, we are disappointed in the lack of meaningful and significant
recommendations coming from this audit. We also believe there are areas not addressed in the
audit recommendations which warrant attention and provide comments as appropriate.

A. Management of the Safety and Health Program

Recommendation 1. Include, as part of the annual action plans and performance reviews of
bureau programs, specific and measurable safety and health program initiatives as determined to
be necessary by the Departmental and Bureau Designated Agency Safety and Health Officials.

Response. Concur, in principle. We believe that this action is currently being accomplished
through implementation of the Occupational Safety and Health Strategic Plan. Implementation
proposals in support of the Plan are developed in a cooperative effort between the OSH Council
and the Office of Occupational Safety and Health for the upcoming fiscal year. The proposal is
submitted to the DASHO Council for consideration and approval. Individual DASHOs take
"ownership" of specific actions which are developed and implemented. Also included in the

6
26

 
APPENDIX 3
Page 7 of 8

implementation proposals are a variety of measures requiring individual bureau action. We
suggest that this recommendation be modified to indicate this, with encouragement for its
continued use and support for the Strategic Plan.

Recommendation 2. Establish a Safety Committee in each bureau office, as appropriate, for the
purpose of assisting management in implementing Safety Program initiatives.

Response. Concur, in principle. As noted in the general comments on this subject we believe
that Safety Committees can be valuable at field operating levels, if appropriately used and
supported. They are less effective at upper management levels. We believe this
recommendation should be reconsidered to reflect this.

Recommendation 3. Recognize the Department's Designated Agency Safety and Health Official
as the mediator to resolve differences of opinion on health and safety issues between the bureaus
and the Office of Occupational Safety and Health.

Response. Concur, in principle. We believe this is already the case, as established in the
procedures for Safety Management Evaluations and other Program issues. The DASHO, as
defined by 29 CFR 1960, is the senior management official in the Department with
responsibility and authority to act on Occupational Safety and Health matters on behalf of the
Secretary.

The Safety Management Evaluation process is a valuable tool for identifying safety and health
issues requiring management attention. It not only helps identify individual bureau Program
weaknesses and strengths, but from a Departmental perspective, helps identify cross-cutting
issues affecting several bureaus. Expanding on this recommendation, we believe there is a need
to review the overall SME process, to improve its value and effectiveness for both the bureaus
and the Department as a whole. It is our intent to perform this review in the near future.

Recommendation 4. Establish a cost-awareness initiative by identifying, distributing, and
charging (in full or in part) Workers' Compensation costs to the operating budget of the lowest
practicable organizational unit of each bureau.

Response. Concur, in principle. We believe the real objective is to create management
awareness of the true cost of accidental injury and illness. As noted in the general comments on
this subject we have concluded that a Departmental chargeback directive is not realistic. We
now believe that OWCP cost awareness is best achieved through a performance-based
requirement with bureaus developing appropriate measures for their organization to create
management cost reduction incentives. This item is identified as an FY 96 implementation item
for the Strategic Plan. We believe this recommendation should be reconsidered to reflect this.

Recommendation 5. Conduct a study of each bureau to determine the levels of authority,
staffing, and resources that are needed to implement safety and health programs that sufficiently
comply with the safety standards contained in the Departmental Manual (485 DM).

7
27

 
                                   APPENDIX 3
                                  Page 8 of 8

Response. Concur, in principle. We believe it is extremely unlikely in the current budget
environment that significant additional resources could be devoted to Program compliance. This
recommendation should be reconsidered to emphasize the need to improve the support and
quality of the current resources; e.g., fill-time and collateral-duty safety personnel. AS was
identified in our general comments, we are using the Strategic Plan as the mechanism for
initiatives to improve the effectiveness of existing Occupational Safety and Health resources. As
examples, the FY 96 Training Initiative; the review of the Collateral Duty Safety Officers' role,
and continued development of the Safety Management Information System. Additionally, it
should emphasize the need for management to place high priority on safety and health issues
when allocating overall resources.

Recommendation 6. Ensure that comprehensive facility safety inspections are conducted and
identified health hazards are abated in accordance with the Departmental Manual (485 DM 6)
and that occupational health inspections are conducted in accordance with the Departmental
Manual (485 DM 7).

Response. Concur. We are obligated to provide safe and healthful work places for our
employees. We believe that through the Strategic Plan initiatives we have identifed in this
response, we can improve our ability to conduct these inspections. As noted in our general
comments on this subject budgetary pressures will make it even more difficult for managers to
correct identified deficiencies.

In the Occupational Health area we are currently developing, in cooperation with the Public
Health Service, a model Occupational Health Protocol for facility managers' use in evaluating
Occupational Health needs. Also, our Occupational Health work group, consisting of bureau
representatives working with the Office of Occupational Safety and Health is evaluating the 485
DM to determine if appropriate policy measures are in place.

B. Management of Workers' Compensation Cases

Recommendation. We recommend that the Assistant Secretary for Policy, Management and
Budget establish an inspection program whereby the Department and its bureaus periodically
review the case of each long-term Workers' Compensation claimant to determine the claimant's
continued eligibility for benefits. To facilitate the inspection program, consideration should be
given to establishing a Workers' Compensation case management position within each bureau.

Response. Concur. We share your concern regarding better management and oversight of
claimants on the long-term rolls. Your recommendation to establish case management positions
will provide necessary justification to support resources to implement an inspection program.
The benefits to the Department will be reduced compensation costs, increased concentration by
safety officials on safety issues and a deterrence to filing fraudulent claims because employees
know claims are being monitored and investigated. However, given the current budget/FTE
constraints it is suggested this recommendation be modified to indicate that a position should be
established in each bureau via a new position, reprogramming an existing position (not
impacting existing Occupational Safety and Health Program resources) or contracting.

8
28

 
APPENDIX 4

STATUS OF AUDIT REPORT RECOMMENDATIONS

Finding/
Recommendation
Reference       Status          Action Required

A.l, A.3, A.5,   Implemented.       No further action is required.
and A.6.

A.2, A.4, and B.1   Resolved; not implemented.  No further response to the Office
                    of Inspector General is required.
                    The recommendations will be
                    referred to the Assistant Secretary
                    for Policy,  Management and
                    Budget for tracking of
                    implementation.

29

 
ILLEGAL OR WASTEFUL ACTIVITIES
   SHOULD BE REPORTED TO
THE OFFICE OF INSPECTOR GENERAL BY:

Sending written documents to:             calling:

Within the Continental United States

U.S. Department of the Interior         Our 24-hour
Office of Inspector General           Telephone HOTLINE
1550 Wilson Boulevard             1-800-424-5081 or
Suite 402                  (703) 235-9399
Arlington, Virginia 22210

TDD for hearing impaired
(703) 235-9403 or
1-800-354-0996

Outside the Continental United States

Caribbean Region

U.S. Department of the Interior         (703) 235-9221
Office of Inspector General
Eastern Division - Investigations
1550 Wilson Boulevard
Suite 410
Arlington, Virginia 22209

North Pacific Region

U.S. Department of the Interior
Office of Inspector General
North Pacific Region
238 Archbishop F.C. Flores Street
Suite 807, PDN Building
Agana, Guam 96910

(700) 550-7279 or
COMM 9-011-671-472-7279