by Charles W. Baird
Emeritus Professor of Economics and Director of the Smith Center
California State University, East Bay
There are about 16 million employees who do some work at home for their employers, and that number is growing rapidly. Increasingly sophisticated computers, software, faxes and modems have made telecommuting a realistic and desirable option for many employers and their workers.
On November 15, 1999 Richard Fairfax, the Occupational Safety and Health Administration's Director of Compliance, issued an advisory letter stating that employers were just as responsible for the safety and heath of employees who work in their homes as they are for employees who work at their premises. OSHA personnel had been working on this letter for two years before its release. If implemented, the letter could mean that any employee who did work at home for an employer would be subject to unannounced OSHA inspections of his private home. An inspector could go from room to room checking such things as lighting levels, doorway dimensions, bathroom facilities, storage of household chemicals, and whether desks, chairs and other equipment were conducive to employee safety. Before Mr. Fairfax's letter telecommuting was not considered hazardous.
The Response
We have been lulled into accepting many governmental intrusions into our privacy, such as government's annual inspection of our incomes and expenditures, but it seems we aren't yet ready to be coerced into opening our homes to OSHA inspectors. To the chagrin of Mr. Fairfax, his letter caused a maelstrom of protest. On January 4 Secretary of Labor Alexis Herman forced OSHA to retreat for now. Seeing an opportunity for political gain, Peter Hoekstra, the Republican head of the House subcommittee responsible for oversight of OSHA, scheduled a hearing to publicize this extraordinary bureaucratic blunder.
On February 25 the head of OSHA issued a directive that explicitly exempts "home offices," but not "other home-based worksites," from job safety inspections. Lest you think this is a victory for privacy and individual rights, remember that bureaucrats always seek to expand their empires, and this is merely an agency directive. OSHA bureaucrats are unlikely simply to discard two years of work merely because the public doesn't agree with them. In their minds they are anointed to lead, not follow, the public. They may have to modify and delay their encroachment into private homes, but they are very unlikely to discard the idea. Any agency directory can be modified, interpreted and reinterpreted to fit the opportunities of the moment.
The directive states that "Employers are responsible in home worksites for hazards caused by materials, equipment, or work processes which the employer provides or requires to be used in an employee's home." Inasmuch as OSHA is currently promulgating an ergonomics rule ostensibly to protect workers against "work-related musculoskeletal disorders" such as carpel tunnel syndrome, it isn't hard to imagine that OSHA could soon classify computers as hazardous equipment. Since computers are central to telecommuting, the "home office" inspection exclusion would inevitably break down.
Senator Robert Wagner, the author of the National Labor Relations Act (NLRA), coined the phrase "camel's nose under the tent" to characterize his strategy of expanding government regulation just a little bit at a time until conditions were right to finish the job. Inspections of "other home-based worksites" are OSHA's camel's nose under the tent. If people are seduced into accepting this idea, inspections of all home worksites will soon follow. If Representative Hoekstra is serious about keeping OSHA out of homes he should pursue congressional enactment of a law that explicitly excludes OSHA from all home worksites. At the behest of labor unions President Clinton would veto such a bill, but he isn't going to occupy the White House much longer. Besides, it would be refreshing to see Congress take a principled stand on something as basic as privacy at home.
The Unions' Stake
Union officials are delighted at the prospect of OSHA inspections of home worksites because they are opposed to most telecommuting. This episode has created a cloud of uncertainty concerning employer liability for work-related injuries and health problems at home. In response, fewer employers will choose to implement telecommuting and many of those who already do will decide to do less of it. Telecommuting is anathema to unions for at least two reasons. First, at-home workers are difficult to organize. The NLRA makes it almost impossible for workers to avoid union organizers on employers' premises, but workers are still free to exclude union organizers from their homes. Second, telecommuting is an example of mutually beneficial arrangements between individual workers and their employers. Unions depend on the myth that labor and capital are natural enemies in a class struggle. If more and more workers come to recognize that employees and employers are not natural enemies, and that mutually beneficial deals can be worked out without unions, they may also come to doubt that unions are necessary at all.
Who Needs OSHA?
Labor unions were principal proponents of the original OSH Act in 1970. They argued that workers needed government protection from workplace fatalities and injuries because greedy capitalists would otherwise sacrifice the wellbeing of workers on the altar of profits. It didn't matter to them then that workplace fatalities had been steadily declining since 1937 due to improvements in safety technology and changes in the occupational distribution of workers. It doesn't matter to them now that OSHA has not had any measurable effect on that continued decline. Nor does it matter to them that OSHA regulation has not had any effect on workplace injuries and illnesses. To unions OSHA is not about worker safety and health. It is about preventing union-free workplaces from gaining any competitive advantages over union-impaired ones.
It is in the interest of employers to discover and implement changes in work processes and work environments that improve worker safety and health. First, an employer with a good safety and health record is charged lower worker compensation premiums than an employer with a bad safety and health record. Second, workers are willing to work for less in safe and healthy work environments than they are in unsafe and unhealthy ones. In 1993 total workers compensation premiums amounted to $55 billion, and wage premiums received by workers in risky jobs amounted to $200 billion. Employers are eager to decrease these expenditures as much as possible while still getting their work done.
Unionized firms are typically impaired in their ability to discover and implement improvements in work processes and work environments. It is an unfair labor practice for an employer unilaterally to implement such changes. All work conditions and processes are stipulated in formal contracts. Experimentation is impossible without the consent of union officials, and that consent is rarely given, especially when any workers may feel threatened by changes in the status quo. Every change will seem to harm some workers.
Command and control regulation stifles entrepreneurial discovery of better ways to do known things and of new things to do. Unions count on OSHA to impose workplace regulations on union-free firms that will make it as difficult for them to innovate as it is for union-impaired firms to innovate. If it weren't for OSHA, it is likely that at least union-free firms would have better worker safety and health records than they do. Without OSHA, the uninterrupted decline in workplace fatalities since 1937 may have accelerated after 1970. Without OSHA, instead of unchanged rates of worker unjuries and illnesses those rates may have declined.
In short, far from allowing OSHA to extend its reach into private homes
Congress ought to abolish the agency. Its official annual budget is now
$348 million, and it imposes billions more in compliance costs throughout
the economy. In return it confers zero or negative general benefits. Apart
from its bureaucrats and the unions they serve, who needs it?