February 1, 1984

MEMORANDUM FOR:      JOHN STRANAHAN
                     District Supervisor, Erie

FROM:                LINDA R. ANKU 
                     Regional Administrator

SUBJECT:             Interpretation of 29 CFR 1910.95(k)

In response to your memorandum dated January 24, 1984, Chevron, Inc. requested clarification of 29 CFR 1910.95(k). Namely, who must pay for the time consumed by employees participating in the mandatory training program described in paragraph (k) of the General Industry Noise Standard? Our interpretation is that the employer must be responsible for all expenses incurred in the training program. In the document, "Regulatory Impact and Regulatory Flexibility Analysis of the Hearing Conservation Amendment," issued by OSHA's Office of Regulatory Analysis in February 1983, pages IV-21 through IV-23 discuss the economic costs of operating a training program required by 1910.95(k). This OSHA analysis concludes that the required training will take one-half hour per year per employee exposed at or above the action level and that any lost labor time and fringe benefits must be compensated by the employer. These pages are appended for your reference.

HEARING PROTECTORS

The requirements for hearing protectors remain unchanged and will go into effect as originally published in January 1981. At that time, the record indicated they would cost about $10 per worker per year (January Regulatory Analysis, p. IV-21). The American Iron and Steel Institute (AISI) believed this estimate was too low and submitted an average price of $27 per worker per year (Exh. 349). AISI, however, was unable to provide documentation for its figure (Tr. Vol. III, p. 217, 3-25-82), and a spokesman for the American Paper Institute estimated the cost at $5 per year. OSHA therefore has continued to rely on the majority of the price quotes in the record and has used $10 per worker to calculate the $51.3 million annual cost of providing hearing protectors to all workers exposed to noise at or above 85 dB. To the extent that not all workers exposed to noise of between 85 dB and 90 dB wear the hearing protectors, these costs would be reduced. Using data from a NIOSH survey, the January Regulatory Analysis (p. IV-22) estimated that 20 percent of the workers exposed to noise above 90 dB were already provided with hearing protectors. Accounting for this current compliance, the new annual cost of this provision falls to $45.5 million.

TRAINING

OSHA estimated in the January Regulatory Analysis (p. IV-22) that training, as required by the January provisions, would require approximately 1 hour per year for each employee in a hearing conservation program. OSHA's August Regulatory Analysis assumed that the simplified provisions that were put into effect would take only one-half hour of time. Based on industry comments (Tr. Vol. I-B, p. 283, 3-23-82; Tr. Vol. II, p. 164 3-24-82), the one-half hour estimate appears reasonable. AISI estimated higher training costs than OSHA (Exh. 349) largely because they used a higher cost for lost labor time. OSHA agrees that fringe benefits should be added to the wage rate and has made this adjustment to its calculations.

The cost for time lost by production workers while training takes place, therefore, can be estimated by multiplying one-half of the industry hourly labor cost times the number of workers trained. The cost for the instructors conducting the training will vary with the size of the establishment. Establishments with less than 100 employees may need an instructor for only one training session consisting of one-half hour per year. For establishments with more than 100 employees, it is reasonable to assume that more than one session would be needed and that one individual could train 30 people in each session. Consequently, the cost of training for each SIC was

estimated at:

      $ Tr = (.5W)(PW)(P) + (.5W)e + (.5W/30)(PWE)(P)

where $ tr = the cost of training 
         W = the hourly labor cost 
        PW = the number of production workers 
         P = the fraction of workers exposed greater than 85 dB 
         e = the number of establishments with less than 100 employees 
       PWE = the number of production workers in establishments with less 
             than 100 employees.

Summing over all SIC's, the total cost for training is estimated at $30.2 million per year. Although a number of comments described well-organized training programs that have been in operation for some time, no estimates were available of the total number of such programs already in existence. Therefore, the above estimate overstates the new costs of the provision to the extent that some of this instruction was already being provided. Recalculating the costs of the January amendment by assuming 1 hour of training per worker because of its more extensive requirements yields annual estimated costs of $60.5 million.

RECORDKEEPING

OSHA's January Regulatory Analysis estimated the costs of the January recordkeeping provisions by assuming that it required 10 minutes per worker for exposure measurements, 5 minutes per worker for audiograms, and 20 minutes per large establishment for audiometer calibrations. AISI estimated its recordkeeping costs for the January provision at about double the OSHA cost estimate (Exh. 349, p. 7). The final amendment, however, revokes some of the more detailed requirements. This will lower costs both because the rules have been simplified and because exposure measurements need not be completed every 2 years. OSHA therefore retained its original cost assumptions to compute the $9.4 million total annual cost for the revised recordkeeping provisions of the regulation. Although the recordkeeping requirements published in January were more extensive, OSHA has not estimated the extent of the change and has retained the $9.4 million value for its reestimation of the costs of the January amendment.