[Senate Hearing 108-328]
[From the U.S. Government Printing Office]
S. Hrg. 108-328
NOMINATION OF HOWARD M. RADZELY
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON HEALTH, EDUCATION,
LABOR, AND PENSIONS
UNITED STATES SENATE
ONE HUNDRED EIGHTH CONGRESS
FIRST SESSION
ON
HOWARD M. RADZELY TO SOLICITOR OF THE DEPARTMENT OF LABOR
__________
JULY 29, 2003
__________
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COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS
JUDD GREGG, New Hampshire, Chairman
BILL FRIST, Tennessee EDWARD M. KENNEDY, Massachusetts
MICHAEL B. ENZI, Wyoming CHRISTOPHER J. DODD, Connecticut
LAMAR ALEXANDER, Tennessee TOM HARKIN, Iowa
CHRISTOPHER S. BOND, Missouri BARBARA A. MIKULSKI, Maryland
MIKE DeWINE, Ohio JAMES M. JEFFORDS (I), Vermont
PAT ROBERTS, Kansas JEFF BINGAMAN, New Mexico
JEFF SESSIONS, Alabama PATTY MURRAY, Washington
JOHN ENSIGN, Nevada JACK REED, Rhode Island
LINDSEY O. GRAHAM, South Carolina JOHN EDWARDS, North Carolina
JOHN W. WARNER, Virginia HILLARY RODHAM CLINTON, New York
Sharon R. Soderstrom, Staff Director
J. Michael Myers, Minority Staff Director and Chief Counsel
(ii)
C O N T E N T S
__________
STATEMENTS
TUESDAY, JULY 29, 2003
Page
Gregg, Hon. Judd, a U.S. Senator from the State of New Hampshire. 1
Kennedy, Hon. Edward M., a U.S. Senator from the State of
Massachusetts.................................................. 2
Radzely, Howard M., nominee to be solicitor of the Department of
Labor.......................................................... 4
ADDITIONAL MATERIAL
Statements, articles, publications, letters, etc.:
Howard M. Radzely............................................ 32
Response to questions of Senator Kennedy from Howard M.
Radzely.................................................... 34
(iii)
NOMINATION OF HOWARD M. RADZELY TO BE SOLICITOR FOR THE DEPARTMENT OF
LABOR
----------
TUESDAY, JULY 29, 2003
U.S. Senate,
Committee on Health, Education, Labor, and Pensions,
Washington, DC.
The committee met, pursuant to notice, at 10:02 a.m., in
room SD-430, Dirksen Senate Office Building, Senator Gregg
(chairman of the committee) presiding.
Present: Senators Gregg, Enzi, Kennedy, Harkin, Murray,
Reed, and Clinton.
Opening Statement of Senator Gregg
The Chairman. We will get started. Senator Kennedy is on
his way, and I can make my statement and then he can make his
and then we can hear from the witness and that will expedite
the process.
Today, we are participating in a hearing on the nomination
of Howard Radzely to be Solicitor of the Department of Labor.
He is joined today by his wife, Lisa, and his son, Brendan, and
other members of his family. We very much appreciate their
taking the time to come and appreciate Mr. Radzely's
willingness to participate in this hearing and to be willing to
serve his government and his country, which is sometimes a
financial sacrifice, but it is very much appreciated.
The hearing will focus, of course, on the office of
Solicitor, which is an extremely important office in the
Department of Labor because it is basically the office that
protects working Americans.
Mr. Radzely's career is exemplary. I believe he brings to
the office a tremendous amount of knowledge, capability, and
certainly expertise. Prior to joining the Department of Labor,
he was with the Law Office of Wiley, Rein and Fielding,
concentrating on labor and employment law. He graduated summa
cum laude from the University of Pennsylvania, Wharton School
of Business, and magna cum laude from Harvard Law School, where
he was on the Harvard Law Review. Prior to his going into the
Labor Department and his private practice, he was a clerk for
the Honorable Judge Michael Lutek of the Fourth Circuit Court
of Appeals and for Antonin Scalia, of course, of the U.S.
Supreme Court.
We are fortunate, in my opinion, to be able to attract to
public service people of the caliber of Mr. Radzely. As I
mentioned earlier, he makes a sacrifice financially to do this
type of a job, but that sacrifice is to our benefit because he
brings with him such exceptional talent, ability, and
capability.
So it is a great privilege to have a chance to hear from
Mr. Radzely and get his ideas on what the Solicitor's Office
should involve and how it should work.
I would now turn to Senator Kennedy, who I note today has
reached the ultimate in acknowledgment of career success as he
is a question on the Washington Post crossword puzzle.
Senator Kennedy. There you go. [Laughter.]
Depending on what the question was. [Laughter.]
Skilled legislator, bipartisan----
The Chairman. Koppel or Kennedy? [Laughter.]
Opening Statement of Senator Kennedy
Senator Kennedy. Thank you very much, Mr. Chairman, for
calling this hearing on Mr. Radzely's nomination to be the
Solicitor of the Labor Department.
As the number three official in the Department of Labor,
the Solicitor provides advice and guidance on virtually every
policy and enforcement initiative of the Department on issues
of vital importance to working families. Since many of the key
protections in labor laws do not include a private remedy, the
Solicitor of Labor is their lawyer, too. So his decisions on
how vigorously to enforce specific rights affects millions of
workers every year.
Mr. Radzely has been serving as Deputy Solicitor and Acting
Solicitor in the Department for the past 2 years and had key
roles in initiatives of the Department that are a major concern
for working families.
The Department's proposed overtime regulation would deny
overtime protections to more than eight million hard-working
men and women, including 200,000 workers in Massachusetts.
Firefighters, police officers, nurses, retail clerks, medical
technicians, military reservists, tech workers, and many others
would be affected by the regulations. With a failing economy
and more than nine million Americans out of work, with so many
of our other families working to make ends meet, cutbacks in
overtime are a sudden unfair burden that American workers
should not have to bear.
The Fair Labor Standards Act was enacted in the 1930s to
create a 40-hour work week and require workers to be paid
fairly for any extra hours. Especially in times like these, it
is an incentive for job creation because it encourages
employers to hire more workers instead of forcing current
employees to work longer hours.
We know that today's economy is continuing to hemorrhage
jobs. It makes no sense for the administration to propose a
regulation that will discourage new hiring and hurt those who
do have jobs. How can the Labor Department approve a rule that
so clearly benefits employers at the expense of working
American men and women?
The unemployment rate is at a nine-year high. Three-point-
four million Americans have lost their jobs since the
administration took office. Long-term unemployment, those out
of work for more than 6 months, has tripled. The administration
has only grudgingly approved an extension of the unemployment
benefits for some workers, but 1.1 million of the long-term
unemployed are out of work and out of benefits. And despite
repeated attempts in Congress to provide assistance for these
workers, the administration insists on continuing to leave them
out in the cold.
Another important mission of the Department of Labor is to
ensure that workplaces are safe and healthy. Once again, the
administration refuses to face the most serious aspect of that
problem, the ergonomic injuries reported by nearly two million
American workers every year. Five-hundred-thousand lose time at
work because the injuries are so debilitating and cost our
economy $50 billion a year.
The Department's comprehensive plan to deal with these
injuries is supposed to include rigorous enforcement of current
law, but the Solicitor's Office has issued only nine citations
in this area in the last two-and-a-half years. None of them
have been for the meat packing, hospitals, and automotive
parts, three of the industries with the highest incidence of
ergonomic injuries. Particularly online, we could only find
actually six cases that were brought, but maybe you will be
able to clarify. I know you refer to this in your testimony.
In addition, this Department has failed to finalize safety
regulations that have gone through the rulemaking stage. It has
announced plans to withdraw regulations to protect health care
workers against tuberculosis. That has been some 10 years, and
we still have 16,000 people that die from tuberculosis every
year, a very modest decline in that. Just because the CDC
issues a regulation, it is not mandatory for the Department to
withdraw theirs with all of the other kinds of protections on
it. At a time when we are looking at airborne diseases,
pathogens, SARS, and others, I hope the nominee will be able to
talk about the reasons for it.
The Solicitor's job is to oversee and enforce these rules
to protect the health and safety of workers every day. It is
hard to see how withdrawing regulations or failing to enforce
existing protections is in compliance with that responsibility.
There is one area where the Department has not hesitated to
regulate, imposing new reporting requirements on unions. The
Department has asked them to file schedules that could be
hundreds of pages long with itemized lists of all payments
above $2,000. It is absurd to pretend these requests are
supposed to help union members. They are intended to help union
breakers by imposing millions of dollars of new costs on
unions.
Agencies are supposed to issue regulations only after
careful consideration of their burdens and their benefits. For
small entities like local unions, the regulations are supposed
to be the least burdensome way to achieve the goal. The
Department today has ridden roughshod over these protections,
ramming through a regulation to force unions to wallow in red
tape and distract them from seeking better wages, benefits, and
better working conditions.
Issues like these and many others are vital for every hard-
working man and woman. We need to explore them in detail with
the nominee.
Thank you, Mr. Chairman.
The Chairman. Thank you, Senator Kennedy.
Mr. Radzely, we would be happy to hear your thoughts,
however you wish to present them, either in a written statement
or orally.
STATEMENT OF HOWARD M. RADZELY, NOMINEE TO BE SOLICITOR OF
LABOR
Mr. Radzely. Thank you, Mr. Chairman, Senator Kennedy,
distinguished members of the committee. With your permission, I
would like to summarize my written statement and I request that
my written statement be included in the record of these
proceedings.
The Chairman. It will be.
Mr. Radzely. Thank you. It is an honor to appear before you
today as you consider my nomination to be the Solicitor of
Labor. At the outset, I would like to express my gratitude to
the President of the United States for nominating me for this
position and to the Secretary of Labor, Elaine Chao, for the
support and confidence she has demonstrated in recommending me
for this position. I would also like to thank the committee for
considering my nomination and holding this hearing today.
Finally, I would like to thank my wife, Lisa, and three-
and-a-half-year-old son, Brendan, for all the sacrifices they
have made to allow me to serve in the government and for the
sacrifices they will make if I am confirmed to be the
Solicitor.
Prior to joining the Department of Labor, I was in private
practice here in Washington, DC. The main focus of my practice
was advising clients, primarily employers, how to comply with
the various labor and employment laws, such as the Fair Labor
Standards Act, Executive Order 11246, the Family and Medical
Leave Act, the Occupational Safety and Health Act, the Service
Contract Act, and many others.
Since coming to the Department in June 2001, I have had the
opportunity and privilege of working with the employees of the
Solicitor's Office, some of the finest attorneys and public
servants I have known. In my view, the Solicitor's Office has
two distinct but vitally important roles.
First and foremost, the Solicitor's Office has the
important responsibility of working in tandem with the
individual agencies of the Department to vigorously enforce the
laws under the Department's jurisdiction. Unlike most cabinet
agency general counsel's offices, the Solicitor's Office has
the authority to litigate cases in a wide variety of areas.
Second, the Solicitor's Office provides legal advice to the
Secretary and the agencies in the Department on a wide array of
legal matters that arise under the nearly 200 laws that the
Department administers and enforces.
With regard to enforcement, it is important for the
Solicitor's Office to vigorously prosecute cases and to use the
full range of legal tools at its disposal. Through judicious
use of all of its enforcement tools, the Department can obtain
justice for those who have been treated unfairly in violation
of the law and can deter those who might choose to violate the
statutes and regulations enforced by the Department.
For example, I have urged Solicitor's Office attorneys to
make expanded use of Section 11(b) of OSH Act, a provision
which had been rarely used. This statutory authority allows the
Department to seek contempt and significantly greater
sanctions, rather than filing a failure to abate proceeding, in
the event the employer violates a Commission order.
I also believe that it is especially important for the
Department to focus enforcement efforts on employers who
exploit, among others, low-wage and vulnerable workers, as well
as on employers who repeatedly violate the laws enforced by the
Department. Low-wage and vulnerable workers are the workers who
most need our assistance and who can most benefit from the
Department's aggressive actions to protect their rights.
In the 7 months since I became Acting Solicitor in January
of this year, the Solicitor's Office has initiated a number of
major enforcement actions in various program areas. For
example, last month, the Department filed suit against Enron
and various individuals for breach of fiduciary duty. In the
OSHA area, since I became Acting Solicitor in January of this
year, the Department has issued nine ergonomic citations in a
variety of industries under the OSH Act's General Duty Clause.
To take one other example, from the civil rights area, as
Acting Solicitor, I recently authorized the filing of the
second systemic compensation discrimination case by the
Department in over 25 years. The only other systemic
compensation discrimination case filed by the Department in the
last quarter-century was one that I authorized while Acting
Solicitor in 2001.
In addition to approving enforcement actions and working
with attorneys to strengthen those actions, I have also
intervened in cases when such intervention would facilitate
reaching favorable settlements. For example, I worked with
career civil servants in the Solicitor's Office and Wage and
Hour Division to negotiate one of the largest wage and hour
settlements ever, a $10 million settlement with Perdue for
failing to compensate employees for donning and doffing.
Regarding the second important mission of the Solicitor's
Office, the legal advisory functions, I believe that attorneys
must provide their clients with clear, concise, easy-to-
understand legal advice that is based on a careful review of
all relevant legal authorities. Whether it is legal advice on a
newly-passed statute, an ethics issue, a proposed or final
regulation, or any other question, attorneys must inform their
clients of the range of options that are legally available and
the legal risks attendant to or prohibitions on a particular
course of action.
In conclusion, the Department of Labor's Solicitor's Office
has a long and proud tradition of protecting America's workers
and providing sound legal advice to its client agencies. I
appreciate the great responsibility that I will bear if
confirmed for the difficult and challenging job as Solicitor
and understand the need to carry on the office's great
tradition.
Thank you again for considering my nomination and I would
be pleased to answer any questions that you may have.
The Chairman. Thank you, Mr. Radzely, for that excellent
statement.
I am going to reserve my questions and yield to Senator
Kennedy.
Senator Kennedy. Thank you very much, Mr. Chairman.
I would first like to get to the issue on the development
of the overtime regulations. As we know, going back to 1938
when the Fair Labor Standards Act was enacted, the basic read-
through of the history on this, the basic application of the
overtime was virtually for all the workers except for the very
high management group that was defined, that was put in sharper
focus later on in the 1940s and 1950s. This is the area of the
duties test. You had the two different aspects. One, you had
what the salaries are going to be in terms of eligibility for
overtime, then in the duties.
It was quite clear that the spirit of that act was very
clear, and that is that the great numbers of workers who are
going to be working ought to be entitled for the overtime, and
what has happened now is under the current administration,
under the rules which have been accepted by the Department of
Labor which you have been involved in now, the levels have been
raised to some extent, but the duties have been redefined,
which some estimates report will affect up to eight million
workers. I know the Department of Labor doesn't accept those
figures because they look at the figures of only those that are
receiving overtime, as I understand it, not those that are
eligible.
But the message that is going out to all those workers,
those eight million workers, they better understand that if
this rule goes on through, the day after, school is going to be
out and employers are going to be able to raise the
requirements of those workers and they are not going to get it.
They are not going to be able to get the overtime. These are
scores of different kinds of occupations, and I think the eight
million, quite frankly, is an underestimation of the total
number.
So this has major, major impact in terms of the workers in
this country, and all this is at a time when workers in America
are working a lot harder and a lot longer. We work, average
workers are working 12.5 weeks more a year than the Germans,
6.5 weeks longer than the Brits, 5 weeks longer than the
Canadians, 3.5 weeks longer than the Japanese, 2.5 weeks longer
than the Australians. American workers are working longer,
harder, and they are not only working, but their wives are
working longer and harder now.
And now, along comes the administration with their
proposal, which I think is a serious undermining of this
commitment that was made years ago in terms of assuring both
workers that they were going to be treated fairly on the issue
of the 40-hour work week and undermines the commitment that
those that are going to have the management skills would be
excluded but others would be covered.
I think it is very clear what the direction is, and that
effectively, at least as far as I am concerned--as far as I am
concerned--is the emasculation of the 40-hour work week. We
have seen it come in other forms, comp time, other ways, but
clearly, this is where it is going.
Now, I am interested, did the Department follow the
requirements of that Regulation 12866?
Mr. Radzely. Yes, Senator. The Department did follow
Executive Order 12866.
Senator Kennedy. Which requires that you review the cost
assessments both in terms of business and workers?
Mr. Radzely. Yes, Senator, the Department did.
Senator Kennedy. Do you have that material with you? Can
you share that with us?
Mr. Radzely. Senator, I don't have the material with me,
but that was--the Department's analysis was laid out in the
analysis as part of the Notice of Proposed Rulemaking.
Senator Kennedy. But can we have that in this committee?
Will you submit that for us to review?
Mr. Radzely. I would be happy to, Senator.
Senator Kennedy. And did you also follow that in terms of
your issuing of your regulations on the L2?
Mr. Radzely. Yes, Senator. We followed all applicable
statute, rules, and regulations----
Senator Kennedy. And you gave what the impact was going to
be on business and workers?
Mr. Radzely. Yes, the Department--the Employment Standards
Administration for both regulations did do that analysis.
Senator Kennedy. Do you remember what you did with regard
to workers, because I have gotten a record with regard to what
the implication was going to be in terms of the overtime to
businesses, but I wasn't able to find anything on what the
impact was going to be for workers.
Mr. Radzely. Senator, again, this would have been analysis
prepared by the Employment and Standards Administration, but I
believe the analysis indicated that 1.3 million low-wage
workers would be guaranteed overtime under the Department's
proposal.
Senator Kennedy. I am talking about the L2 regulations now,
the L2, which requires you to get the impact on both the
employers and the workers. I am familiar with what your
submission was in terms of how it would reduce the burden on
employers, but I didn't find the analysis of what the impact
would be on the workers.
Mr. Radzely. Senator, with regard to the LM2, and I
apologize if I misunderstood your question earlier, the
Department did prepare a detailed analysis as part of the
Notice of Proposed Rulemaking. Again, that would have been
prepared by the Employment Standards Administration. And in
addition to that, there was a separate Paperwork Reduction Act
analysis prepared, both of which were published in the Federal
Register for comment.
Senator Kennedy. Now, as I understand, you referred to the
materials that you submitted with written responses, but those
materials only included the unsupported numbers from the Office
of Labor Management Standards. They don't have any information
obtained directly from the unions about their finances or their
technological or accounting abilities.
Mr. Radzely. Senator, the Department's analysis was based
on the best available information at the time. The Department,
as this committee is aware, has received a substantial number
of comments on the LM2 proposal. We are currently in the
process of analyzing those comments, the Employment Standards
Administration----
Senator Kennedy. That is not my question. I know they are
getting a number of comments. I am talking about when you
issued it, what efforts you made in terms of it. We have seen,
for example, in the SEC, before the SEC began its electronic
filing, it spent 5 years developing the system, tested the
system through a pilot program, finally adopted a phased-in
schedule over 2 years. The process took nearly 10 years from
adoption to final implementation and the SEC's implementation
period after the software was already completed still took 4
years.
I want to know what you did or the Labor Department did.
The only previous agency that has followed these kinds has been
with the SEC and this is the extent that they went to. I can't
find in reviewing the documents where you made any survey at
all or any assessment about the capability or the competency of
unions to be able to deal with these areas in terms of the
computers.
Mr. Radzely. Senator, the Employment Standards
Administration and the Office of Labor Management Standards did
an extensive outreach to unions prior to promulgating the
Notice of Proposed Rulemaking, invited in a number of unions,
many of whom took up the Department and met with the Department
in a series of meetings in an effort to obtain information.
Senator Kennedy. So the point is that you don't have--your
answer is that they did, Employment Standards did outreach to
them, but you don't have any of the kinds of surveys that were
done about the number of unions and the rest, about how many
unions are affected. I think it is 5,500 that are affected, 141
of them are national. You are talking about reports in the L2
of $200,000 or more. Do you know whether these regulations were
consistent with the Generally Accepted Accounting Principles?
Mr. Radzely. Senator, again, as I indicated in my written
response, my involvement in the proposed stage was limited. I
don't know specifically----
Senator Kennedy. Well, they weren't.
Mr. Radzely. --whether they are consistent----
Senator Kennedy. They were not. They are not consistent at
all with the Generally Accepted Accounting Principles. These
are the accepted accountability procedures for all the
regulatory agencies and the L2 are not. I am just trying to
understand what the basis for this was. There are some very,
very clear requirements that have to be followed. There are
requirements, for example, unions that have $6 million or less
in terms of total assets. There is also the Small Business
Regulatory Flexibility Act. Did you comply with that, do you
know?
Mr. Radzely. Yes, Senator, we did. The Department did
comply with SBRFA in preparing the LM2 regulations.
Senator Kennedy. Maybe you can distinguish about how the
compliance with the Regulatory Flexibility Act and the rest of
the L2 requirements, what is the distinction that you had in
terms of the compliance figures, the requirements that you had?
Mr. Radzely. I am sorry, Senator. I am not sure I
understand the question.
Senator Kennedy. Well, under the Regulatory Flexibility
Act, that applies under the Small Business Act for entities
that are $6 million or less. That has very specific
requirements. You say that your L2 requirements have taken
those into consideration. I am asking you how.
Mr. Radzely. Senator, the Employment Standards
Administration prepared a detailed regulatory flexibility
analysis which was part of the Notice of Proposed Rulemaking.
Senator Kennedy. We don't have them. They are not up here.
You are the man in charge. You are the man.
The Chairman. No, he is not. Let me just note for the
record that this gentleman is in an acting position right now
and is the Solicitor, not the operational side of the
Department. But I understand the Senator's desire to get these
issues on the record. I have no problem with that and I am
happy for him to continue.
Senator Kennedy. Well, these have enormous impact on
working families at a time, an extremely difficult time in
terms of our economy. When we have the situation where, in
terms of the accounting, we have very specific lessons that
have been learned when there was a similar effort made with the
SEC and the time that they took and the effort they made and
the surveys they followed and the requirements that they had in
order to get an accepted program and how they followed the
Generally Accepted Accounting Principles that are applicable to
all of the agencies, and then to find out that the Department
of Labor went off entirely differently, didn't follow those
Generally Accepted Accounting Principles, didn't follow the
practice on all of these, and it is difficult to find out what
the basis for making these judgments and decisions were.
They said, well, they have complied with the regulatory
Order 12866, which is very specific on what the burdens are
going to be and the benefits are going to be, both on the
employer and the worker. I have asked what they are here today
and I hear that there is some other agency that has done that
in this. It makes it very difficult.
Let me just move to another area, and then I know my time--
I have taken a good deal of time. This is on the citations on
the ergonomic issues and plans. You mentioned that there were
nine examples. I could only find six on the website. I could
only find six. You have got your nine there. This is Alpha
Health Services, Alpha Health Services, Alpha Health Services,
Security Metal Products, Super Value, and Brown Printing. Those
are the six that I found.
Mr. Radzely. Senator, I believe----
Senator Kennedy. You have three others?
Mr. Radzely. Yes. I believe there were three that were
recently issued, one against two nursing homes in Denver,
Colorado, Mariner Health Care----
Senator Kennedy. You have got the times and the dates of
those?
Mr. Radzely. I don't recall the time of Mariner Health
Care. It would have been probably within about the last month,
I am assuming, and there were two citations for facilities in
the Denver, Colorado, area. About 2 weeks ago, I think, there
was a citation issued against Tri-State Coca-Cola, a beverage
distribution facility in Cincinnati, Ohio.
Senator Kennedy. Let me mention these. This is an Alpha
Health Services. This is Alpha Health Services. This is one of
the nine, February 21. Proposed penalty, $900. Final penalty,
$270. Alpha Health Services, second one, $900. Final penalty,
$265. Again, Idaho, Alpha Health Services, $900, again, $265.
Security Metals Products, Oklahoma, $5,600. Final penalty,
$2,800.
I draw the difference between what was done in OSHA under
the general duty ergonomics citation during Bush I, and I would
like to include both of these in the record, Mr. Chairman.
[The information of Senator Kennedy follows:]
Senator Kennedy. You had Empire OSHA penalty, an $640,000
initial penalty. ConAgra Poultry, Missouri, $1 million. Ford
Motor Company, $1.9 million. The list goes down, hundreds of
thousands of dollars, and we are talking about nine cases, six
of which we got online. Three of these were $900 reduced to
$260. Not a strong record.
I do that against a background of changing the forms that
the Department has done on ergonomics, and I would like to put
these in the record, Mr. Chairman.
[The information of Senator Kennedy follows:]
Senator Kennedy. We had the old OSHA on repeated trauma and
they had, even under the--that goes back to--I will put in the
exact date, but it was prior to President Clinton. The Clinton
administration shortened it, but they also had musculoskeletal
disorders and they had the listing down there so that they
would know the numbers of days, the number of incidents. What
they have is the log of work-related injury and illnesses and
that was listed, as it had been listed under the old order,
under the old order. What do you know, the Bush administration
reissued the Clinton with all but one line, musculoskeletal
disorders.
Now, how can we possibly take seriously, as I want to do
and as I do, Secretary Chao indicating to us that she is going
to be serious about dealing with the problem in the workplace,
when we have an enforcement record like we have and when we
have this kind of--and I didn't submit these to you prior to
the record. You may be familiar with it. If not, you can take a
look at it.
How can we be reassured, and more importantly, how can the
workers of this country be reassured that you are serious about
dealing with this when they see this kind of record?
Mr. Radzely. Senator, regarding the recordkeeping, I
believe you are referring to a decision made by OSHA, I believe
in June, regarding whether or not to have a separate column on
the recordkeeping requirement where there would be a check if
the employer thought it was an MSD. I would like to make a
couple comments on that.
First, the column is not needed for enforcement. Under the
recordkeeping, employers are still required, as they have been,
to report all injuries, including MSDs. And when OSHA goes in
to do an enforcement action, OSHA would not have ever looked at
a particular column. OSHA looks very specifically at the injury
and illness logs and makes a very specific determination about
what the particular MSDs are, and that is what OSHA uses and
the Solicitor's Office uses in enforcement.
Moreover, Senator, the data currently kept by BLS allows
for much more data in the sense that you can sort it by
industry, you can sort it by specific body type, and the
checkoff column would not have allowed for that information to
be gathered or analyzed.
Senator Kennedy. Well, it is still the only way for the
public to get information, the aggregation of the data. This
was the only column that was eliminated. It is the only column
that was eliminated from this and I find it troublesome.
On overtime, we have looked at the Federal Register and we
see nothing that fully describes the impact on various job
classifications. You do talk about the effect on businesses,
but not on worker classifications. I mean, what is the effect
on legal aides, lab workers, airline ticket agents? Isn't this
your responsibility?
Mr. Radzely. Senator, again, that analysis would have been
prepared by the Employment Standards Administration and I don't
believe there is any requirement that they analyze specific
industry by industry or State by State under the law, and the
analysis that they would do is within the Employment Standards
Administration.
Also, Senator, I should add that we are currently in the
rulemaking process----
Senator Kennedy. I understand that.
Mr. Radzely. --for analyzing and so it remains to be seen
what the final rule will look like, because under the APA, as
you are aware, it has to be based on the rulemaking record.
Senator Kennedy. I think you are absolutely right, but I am
trying to find out, when you issued it originally, what the
basis of it. You have a requirement under the Regulation 12866
to do the cost to workers, and in looking at the Federal
Register, I don't see it on the cost to workers.
I just have one final question in this area, Mr. Chairman--
I have taken a good deal of time--and that is on the
tuberculosis record. This one was in effect for ten to 11
years. The Centers for Disease Control, Dr. Gerberding is one
of the outstanding public health officials in our country, of
which we have several, and we had them before this committee
recently and she has just done an extraordinary job.
But tuberculosis is a killer. I believe it is 15,000. It
has gone from 17,000 to 15,000 over the last 3 years, but it is
15,000, and in a number of communities, like the District of
Columbia, it is going up.
When you have that requirement about the rule, you have
important kinds of protections that exist in there and you have
enforcement and you have information and the workers get that
information and we have enforcement requirements. The
Department effectively vitiates that rule and says, we are
going to use the Centers for Disease Control, which is not
necessary embraced, not required, accepted in some places, not
accepted in others, as the principal protector for workers.
What was your reaction to that?
Mr. Radzely. Senator, you are, I believe, referring to
OSHA's decision announced in the regulatory agenda that it is
going to withdraw the TB rule. I believe the Department has and
will continue to have a vigorous enforcement in the area of
tuberculosis. Under Directive 2.106, the Department has very
specific means of enforcing this. There have been over 150
citations in tuberculosis over the last, I believe it is--I am
not sure of the exact time, and 40 General Duty Clause
citations.
In addition to that, as part of OSHA's national emphasis
programming in the nursing industry, TB is one of the main
things that they are looking for. In addition to that, Senator,
there are some 80 local emphasis programs that are in place for
TB.
Senator Kennedy. Well, from 1999, 17,531, 16,377 for 2000,
15,989, I mean, it is down a trickle. These are cases, not
deaths. But in 20 States, they have increased. In 20 of the 50
States, they have increased, and increased here in the District
of Columbia. Asthma has increased dramatically. Children dying
of asthma has increased dramatically.
When we have these airborne diseases and pathogens, SARS
out there, monkeypox out there--SARS certainly is--and with all
of the dangers that we are having out here in terms of these
airborne pathogens, the threat is still out there. This agency
is to be protecting workers, protecting workers, both their
health and their safety as well as their wages. These are just
indicators that I find distressing.
We didn't have a chance to go through some of the other
parts of your record which have, I must say, been positive. I
have used a good deal of my time, so I thank the chair.
The Chairman. Thank you, Senator. Senator Murray?
Senator Murray. Thank you, Mr. Chairman. I appreciate the
opportunity, Mr. Radzely.
Let me start with the personal protective clothing rule
under the Department. For several rules, OSHA has had a rule
pending that would require employers to pay for OSHA-required
personal equipment, such as hard hats, safety gloves,
protective eyewear, those kinds of things. Paying for that kind
of safety equipment is particularly hard, I think we all know,
for a lot of our low-income workers in hazardous industries--
construction, poultry plants, garment shops.
The rulemaking record overwhelmingly supported OSHA's
determination that a rule was needed to protect workers from
the risks posed by their employers' failure to pay for
protective equipment. Workers who are required to purchase and
pay for their own safety equipment are put in a position of
making decisions that may compromise their own health and
safety to avoid personal economic loss. In fact, the agency
found that issuance of a rule requiring employer payment for
protective equipment would significantly reduce the risk of
injuries, preventing over 47,000 injuries and seven fatalities
every year.
In your testimony, your written testimony, you point to the
fact that low-wage and vulnerable workers are the workers who
most need our assistance. We know they need protection because
they often work in dangerous jobs and industries. We also know
that fatalities and injuries have risen 15 percent among
immigrant and Hispanic workers, while the rate decreased by 15
percent for other groups of workers.
So given the overwhelming weight of evidence in support of
a rule, why haven't you been more assertive in your role as
Acting Solicitor to move forward with the policy decision and
rule that has been supported by the record?
Mr. Radzely. Senator, as you are aware, that is a decision
that initially is made by the Occupational Safety and Health
Administration and I have not reviewed the record so I do not
know what the contents of that record are, whether it would or
would not support a final rule. I do know that OSHA is studying
the issue and is working on this----
Senator Murray. Well, to your knowledge, is there a legal
impediment to OSHA's proceeding with the final rule?
Mr. Radzely. Senator, I do not know whether there is or is
not a legal impediment since I am not aware of the comments
that have been made under the rule, and under the APA, any
final rule would have to be responsive to those comments.
Senator Murray. Well, in the past 3 years, has OSHA cited
any employer for failing to pay for required safety equipment?
Mr. Radzely. Senator, I am not aware of any citations.
There may have been, as you may be aware, under--there are
specific standards which do require payment of certain PPE, and
there may have been citations under that, but I am not aware if
there was a citation for failure to pay for PPE, no.
Senator Murray. For the record, could you get responses
back to those questions for me?
Mr. Radzely. Sure.
Senator Murray. Let me then follow up. Senator Kennedy
asked you about ergonomics guidelines, and I think when the
Secretary of Labor announced her plan following the repeal of
OSHA's rule, she committed the Department to a comprehensive
approach. Senator Kennedy focused on some of the reporting and
forms. I wanted to ask you, I thought there were six, too, but
apparently you are saying there are nine Duty Clause citations
by the Department of Labor, is that correct?
Mr. Radzely. Yes, Senator.
Senator Murray. And my understanding is that some of the
highest-risk industries, like meat packing, auto parts, and
hospitals, haven't been included in any of those citations?
Mr. Radzely. Senator, there are no citations. OSHA does
have local emphasis programs in those industries that you
mentioned, but there are no citations.
Senator Murray. In any of the high-risk industries. Can you
tell me how many cases DOL inspected for ergonomic hazards and
considered issuing a citation?
Mr. Radzely. I don't--that would be a question you would
have to direct to OSHA. I am not aware specifically of the
number of cases. I do know that OSHA has reviewed it as part of
its nursing home national emphasis program and a number of
local emphasis programs, but I don't know the number that you
are asking.
Senator Murray. Well, we are asking because we have been
told we are going to have a comprehensive force on this and I
am just trying to get the scope of it from your perspective as
Acting Solicitor.
Can you tell me if the Department is currently conducting
targeted inspections and tell me which industries are being
targeted?
Mr. Radzely. Yes, Senator. In addition to the nursing home
that I mentioned earlier, the targeted local and regional
programs are in auto parts, meat packing, hospitals, and
warehousing.
Senator Murray. But you don't know if any of those have
been issued any citations or----
Mr. Radzely. Senator, the citations that have been issued
since January of this year, when I became Acting Solicitor, are
the nine that I mentioned and I don't believe any of the nine
were in those----
Senator Murray. Do you know how many have been inspected?
Mr. Radzely. No. That would be a question that OSHA would
have the information on.
Senator Murray. OK. Well, you do cite in your statement the
final settlement that was negotiated with the Beverly Nursing
Homes as an accomplishment during your tenure as Acting
Solicitor. Beverly has finally identified the first 60
facilities in the process of adopting ergonomics programs. Can
you tell us why Beverly or the Department of Labor has failed
to provide a copy of the facilities list to the Service
Employee International Union, which represents the workers at
Beverly and was a party to those proceedings and the settlement
of the case?
Mr. Radzely. Senator, I have recently been made aware of
the SEIU's request and have been very supportive of it, and in
fact, we have notified the company about 7 days ago that unless
they file a legal action to prevent us from doing it under a
reverse Freedom of Information Act, that we want to turn that
over. The SEIU has been a full partner in that nursing home
case and we have been very supportive of them getting the data.
Senator Murray. OK. So you are committing to this committee
that you will provide that information to the union, to the
SEIU?
Mr. Radzely. We are, again, just so I am clear, in the
event that Beverly does not file a reverse FOIA lawsuit, we
will provide it probably this week or early next week. If they
do file a reverse FOIA lawsuit, we will have to evaluate their
claims. But I am committed to trying to get the information to
them as quickly as possibly because they were a full partner in
that resolution.
Senator Murray. General Duty Clause cases are often very
expensive and time consuming and difficult. You cited the
Beverly case in your statement. That is a case that took 10
years before the Solicitor's Office was able to reach any kind
of settlement. Would you agree that enforcement under the
General Duty Clause is no substitute for a strong enforceable
standard?
Mr. Radzely. Senator, I believe enforcement of the General
Duty Clause will protect American workers and I believe the
Department has learned a significant amount in terms of its
prior experiences on ergonomics----
Senator Murray. Even though it takes 10 years to reach any
kind of decision on it?
Mr. Radzely. Senator, I think any time you are filing new
cases, it takes longer. Once the case law is developed, it is
much easier and much quicker to file cases. And I have no
assurance under any particular standard that it would go
quicker. There are cases under OSHA standards that take years
to resolve themselves.
Senator Murray. Thank you very much, Mr. Chairman.
The Chairman. Senator Enzi?
Senator Enzi. Thank you, Mr. Chairman, and I appreciate
your holding this hearing. I think it is extremely important
that we get this nominee confirmed. Seldom do we have an
opportunity to have someone come before us that has actually
been doing the job. I have heard no fault with the job that he
is doing. I am pleased with the record he developed in his
previous position and the job that he is doing now.
I do have a complete statement that I would like to be made
part of the record.
The Chairman. Of course.
[The prepared statement of Senator Enzi follows:]
Prepared Statement of Senator Enzi
Mr. Chairman, one of our most important duties on this
Committee is to fulfill our Constitutional duty to provide our
advice and consent to the President's nominees for those
positions that fall under our jurisdiction. Today we will be
reviewing the qualifications of his nominee for the Solicitor
of Labor, Howard Radzely. This position is of great interest
and importance to me personally because of my service as
Chairman of the Subcommittee on Employment, Safety and
Training.
The Department of Labor plays a critical role and has a
great effect on the day to day lives of the American workforce
as well as the operations of our business community. The
Solicitor of Labor serves in a key position that ensures the
Department is functioning effectively, efficiently, and on firm
legal footing. As I reviewed Mr. Radzely's record, I was
pleased to note his outstanding background that makes him
highly qualified to continue to face the rigors of this
position.
Mr. Radzely is a magna cum laude graduate of Harvard Law
School who worked in private practice, concentrating on labor
and employment law, prior to joining the Department of Labor.
He has been Acting Solicitor from June 2001 to January 2002,
and again, since January 2003. During his service at the
Department of Labor, Mr. Radzely has demonstrated his ability
to be an effective Solicitor of Labor.
As our Committee considers this important nomination, we
have to keep in mind the role of the Solicitor and his
qualifications relative to the position he has been asked to
fill. Therefore, we must note what the role of Solicitor is and
is not.
The Solicitor of Labor serves two primary functions. First
of all, the Solicitor is responsible for enforcing the nearly
200 statutes that fall under the Department's jurisdiction.
Secondly, the Solicitor provides legal advice to the Secretary
and agencies within the Department of Labor. The Solicitor
monitors agency activities and provides legal advice to ensure
that the Department's agencies and employees comply with
applicable laws and regulations. The Solicitor advises
rulemaking agencies about the legal implications of the rules
they propose. The Solicitor's position is not a policy
position. The Solicitor does not advise from an ideological
viewpoint, but from a legal perspective.
As we consider Mr. Radzely's nomination, we couldn't have a
better or more complete record. From his previous service we
know the kind of individual Mr. Radzely is, and we also know
how well he handles the responsibilities of a very demanding
job. As Acting Solicitor, he has shown that he is indeed well-
qualified to perform the functions that this position demands.
Mr. Radzely's has demonstrated his commitment to vigorously
enforce the laws within the Department's jurisdiction. I
believe his record speaks for itself on this key point.
During his service as Acting Solicitor, the Department of
Labor filed suit against Enron, the Administrative committee,
Kenneth Lay, Jeffrey Skilling and the outside members of the
Enron Board of Directors for breach of fiduciary duty under the
Employee Retirement Income Security Act (ERISA).
Part of the Department of Labor's comprehensive approach to
reducing ergonomic injuries in the workplace is an enforcement
program under the OSH Act's `general duty' clause. Since
becoming Acting Solicitor earlier this year, the Department has
issued nine ergonomics citations under the general duty clause
against companies in a wide variety of industries.
As I completed my review of the materials on Mr. Radzely's
nomination and his already impressive track record of service,
there was only one conclusion that could be drawn about his
ability to continue to serve in this important capacity. Simply
put, he has done and will continue to do an excellent job if
given the chance. He knows the law and he knows the importance
of enforcing it.
During today's hearing I look forward to evaluating this
nominee based on his qualifications and suitability for office,
not on policies developed outside of the Solicitor's purview.
Our evaluation of Mr. Radzely's qualifications should not be
confused with our evaluation of policies on which the Solicitor
provides legal advice.
The President has chosen an individual with excellent
qualifications and sent him to us for our review and
consideration. His choice of Howard Radzely is a good one, and
I strongly support his nomination and confirmation by the full
Senate.
Senator Enzi. I am impressed with your qualifications and
suitability for the job. I do realize that your job is not the
head of OSHA. Your job is not the head of the Department of
Labor. I realize that, or I am pretty sure that you are not the
one who is supposed to develop the policies or come up with
initiating new regulations. Am I correct on that?
Mr. Radzely. Yes, Senator.
Senator Enzi. Can you tell me what role you do play in the
rulemaking process?
Mr. Radzely. Yes, Senator. The Solicitor's Office's role in
the rulemaking process is to ensure that all applicable rules,
regulations, executive orders are complied with in the Notice
of Proposed Rulemaking stage and that in any final rule, those
statutes are complied with and the comments are carefully
considered in developing a final rule.
Senator Enzi. Thank you. I appreciate some of the comments
that the Senator from Massachusetts had earlier. It
particularly caught my attention when he mentioned the
Department of Labor and Generally Accepted Accounting
Principles. I have been a little disappointed in all Federal
agencies in their Generally Accepted Accounting Principles and
with the audits that have been done in agencies and
departments. I think we have a lot of room for improvement
there.
We have subjected the corporations of this country to some
real scrutiny, but we have kind of passed over our own, and by
our own, I mean even the accounting that deals with the budgets
for our offices. I tried doing some things when I first got
here with that and found that that is kind of difficult.
I appreciate your putting the forms into the record. Since
I have been here, I have mentioned that I wished that there was
a lot more done with the forms. I have tried to get some
compiled numbers. We require the businesses to make some
compilations, but when it gets to the Federal level, there is
not much done with them after that. I think that it would be a
tremendous help when you are doing auditing and accounting, you
try and find the worst first and I think there is some
potential there for doing that and pursuing it. But in the 7
years I have been here through two administrations, I think
there could be some room for improvement in that, drastic
improvement.
I am glad you brought up uniformity of fines. I know that
has been a tremendous difficulty. I have asked that there be
some published fines so that we would have some uniformity
across the Nation. Different States, especially State plan
States, have different methods of evaluating it, and then, of
course, in the non-State plan States, there is just a
tremendous range also. I think there ought to be a little bit
more uniformity in that and I think it would help in the
enforcement. It would also help the companies, because they
would have a little better idea of really what they are dealing
with. Sometimes it would be easier to understand the penalties
than it would be the rules, and then we could work backwards
from there.
When you mentioned TB tests, what it brought to mind was
when I was in grade school, we used to get TB tests. They used
to come in and put some little pin pricks on the back of our
hand and then the next week when we went to school, they would
have some nurse there that would evaluate whether the lump had
grown or receded. I do recall that we don't do that anymore. I
suspect that it is because there is less TB. So sometimes if we
change it in the schools, we probably change it in the
workforce, as well, not that it isn't an important thing to
watch out for, but that there are changes.
Of course, the comments by the Senator from Washington
about protective gear, I used to work with some of those safety
issues and the difficulty wasn't as much in getting the safety
gear for the employees as it was getting the employees to wear
the safety gear when they had it. Of course, when an employee
doesn't wear the safety gear, it isn't the employee that gets
fined, it is the employer that gets fined, and if the employee
doesn't wear it twice and they are inspected, then the employer
is the bad actor.
So there need to be some things done on a responsibility
area there, too, that I hope is built in at the same time that
we work on who provides the equipment. I never ran into a
problem with anybody understanding who was buying what, but I
am glad that there is some work being done on clarifying that.
Again, I thank you for being here today to testify. It was
delightful to look at your record and I look forward to your
speedy confirmation.
Thank you, Mr. Chairman.
The Chairman. Senator Harkin?
Senator Harkin. Thank you very much, Mr. Chairman.
Mr. Radzely, I apologize for being a little late. I did
look over your statement earlier, however. I just wanted to
cover a couple of areas with you, one being the issue of
overtime.
Again, before I do that, I again want to stress that the
Solicitor is not only the Department's lawyer but the workers'
lawyer, and you don't disagree with that. You are the
Department's lawyer, but you are the workers' lawyer, also.
Mr. Radzely. Senator, yes. The Solicitor's Office brings
cases on behalf of workers.
Senator Harkin. Exactly. On workplace safety and health,
workers depend on the Department of Labor because the laws do
not provide workers with a private right of action to enforce
their statutory rights. The Solicitor acts as the top legal
advisor to the Secretary on virtually every policy,
legislative, regulatory, and enforcement initiative of the
Department or its agencies.
So again, I have some concerns about the role the
Solicitor's Office has played--not you, since you haven't been
there--but has played, specifically on the law that protects a
40-hour work week and overtime pay.
In March, DOL proposed a new rule that would essentially
take away the overtime pay protection from millions of working
Americans who currently have it. DOL officials said they simply
wanted to simplify and update the rules that were part of the
FLSA in 1938, but it appears they didn't just simplify the
rules, they made them more vague than ever, allowing employers
to easily reclassify workers to disqualify them from overtime
pay protection and require them to work longer hours with pay.
Again, I don't understand how the Solicitor, who is
supposed to be the workers' lawyer, would allow such an extreme
proposal to go forward. Again, I am also concerned with the
dropping enforcement and compliance of civil rights laws on
Federal contractors, and I want to talk about that also.
But again, on the issue of overtime, wasn't it the intent
of Congress and the President in 1938 to establish a 40-hour
work week with few narrow exceptions under the Fair Labor
Standards Act? That is my question. Wasn't that the intent? And
isn't it your job as an advocate for the workers to insist that
any exceptions to the 40-hour work week be narrowly limited as
Congress intended?
Mr. Radzely. Senator, Congress in enacting the Fair Labor
Standards Act gave the Secretary of Labor authority to define
these three particular exemptions, administrative, executive,
and professional. I believe that as such, terms are defined and
delimited from time to time by regulations of the Secretary of
Labor. It is the Office of the Solicitor's job to ensure that
any regulations, both the Notice of Proposed Rulemaking and any
final rule, are consistent both with the Fair Labor Standards
Act and, in particular, the phrase I just read, as well as the
Administrative Procedures Act and some of the other Executive
Orders and statutes that Senator Kennedy mentioned earlier.
Senator Harkin. Let me see if I understand what you just
said. You said you are to make sure that what they are doing is
consistent with the exemptions of administrative, executive,
and professional.
Mr. Radzely. I apologize if I gave a confusing answer,
Senator. No, the job of the Solicitor's Office is to make sure
that any proposed regulation is consistent with the language,
quote, ``as such terms are defined and delimited from time to
time by regulations of the Secretary of Labor.'' In that,
Congress essentially delegated to the Secretary of Labor
decisions as to how those three particular exemptions should be
defined.
Senator Harkin. But again, I go back to what I initially
asked. Was it not the intent of Congress at that time to
narrowly limit--I mean, it wasn't a broad exemption, it was to
narrow them down at that time, and that is the way it has--has
that not been the way it has been implemented since 1938? A
narrow exception is put in there by Congress.
Mr. Radzely. Senator, the exception--the words of the
language give the Secretary of Labor the authority to define
those terms.
Senator Harkin. In your written responses, you said you
reviewed the proposed regulations for compliance with the Fair
Labor Standards Act, is that correct?
Mr. Radzely. Yes, Senator. That is correct.
Senator Harkin. In your written responses, you also say
that the Secretary of Labor has authority to define the terms
executive, administrative, and professional employees, what you
just said here. Are you suggesting that the Secretary has
unlimited authority to define those terms?
Mr. Radzely. Senator, I am not suggesting that the
Secretary of Labor has unlimited authority, but what I did
indicate in my written responses was that the Solicitor's
Office did review the proposed----
Senator Harkin. Mr. Radzely, if the Secretary does not have
unlimited authority to define what is executive,
administrative, or professional, what are the limits?
Mr. Radzely. Senator, again, I would have to react to a
specific proposal. The Solicitor's Office did review the
proposed regulation and determined that it was consistent both
with the Fair Labor Standards Act and other applicable laws,
Executive Orders, and other regulations.
Senator Harkin. Well, again, I have got to figure out, what
are the limitations? If it is not unlimited, you are saying the
limitations are what you define them to be at any point in
time, is that right?
Mr. Radzely. No, Senator. Again, we would have to take a
look at a specific proposal and----
Senator Harkin. Well, we have a specific proposal.
Mr. Radzely. And the Solicitor's Office did look at that
specific proposal and determined that the proposal was
consistent with the Fair Labor Standards Act. And again, we are
in the comment period now. We have received, I believe it is
some 78,000 comments----
Senator Harkin. A lot of comments.
Mr. Radzely. --and the Employment Standards Administration
will be reviewing that and the Solicitor's Office will review
any decisions that they make for consistency with all
applicable rules and regulations, most particularly the
Administrative Procedure Act.
Senator Harkin. I know this is not within your purview, but
this is just my comment, the fact that I find it very strange,
indeed, that a rule that affects so many people in this
country--a proposed rule that affects so many people in this
country, not one hearing was held on it. Not one public hearing
was held by the DOL anywhere in the United States on this. I
find that just astounding. I mean, I can see some rules that
don't affect a lot of people that are minor in nature, you
don't have to have public hearings. But something like this, I
find almost to the point of being bizarre that not one hearing
was held.
But let me get back to the limitations, Mr. Radzely. Isn't
one limitation on this authority, one limitation on the
authority of the Secretary to define this, isn't one limitation
the fact that Congress clearly did not intend for the FLSA's
40-hour work week to be limited only to low-income workers? Do
you agree that it would be inconsistent with the FLSA, for
example, for the Secretary to issue regulations that have the
effect of bringing every worker earning more than $22,100
within the exceptions to the 40-hour work week? Do you want me
to repeat that?
Mr. Radzely. Yes, would you.
Senator Harkin. Do you agree that it would be inconsistent
with the FLSA for the Secretary to issue a regulation saying
that every worker in America who earns over $22,100 a year is
in the exception to the 40-hour work week?
Mr. Radzely. And thus would not be entitled to overtime?
Senator Harkin. Yes.
Mr. Radzely. You are saying every worker earning over
$22,100?
Senator Harkin. Yes.
Mr. Radzely. Senator----
Senator Harkin. Would that exceed her authority or his
authority?
Mr. Radzely. I would want to think about it more, but yes,
I believe it likely would. If it were just anyone over $22,100,
that probably would exceed the Secretary's authority.
Senator Harkin. So that would be a limitation. Isn't
another limitation the fact that Congress clearly did not
intend for these exceptions to be based solely on income?
Again, do you agree that it would be inconsistent with the
FLSA, for example, for the Secretary to issue regulations that
disqualify from overtime protection every worker earning more
than, say, $65,000, regardless of the worker's job duties?
Mr. Radzely. Again, Senator, I would want to specifically
study any particular proposal, but my initial reaction is if
the only requirement were making $22,100 or whatever the dollar
figure was, that likely would be inconsistent with----
Senator Harkin. So someone earning more than $65,000 a year
is not just automatically disqualified from overtime? It
depends, again, upon what their job is?
Mr. Radzely. Yes, Senator, I think that likely is right.
Again, I would want to look at----
Senator Harkin. So that would be a limitation. OK. I have
just one more. Isn't another limitation the fact that Congress
intended for these exceptions to apply only to a narrowly-
limited class of individuals? Again, do you agree, Mr. Radzely,
that it would be inconsistent with the FLSA, for example, for
the Secretary to issue regulations that disqualify from Federal
overtime protection 90 percent of workers earning more than
$22,100 a year? Again, do you agree it would be inconsistent
for the Secretary to issue regulations that would automatically
disqualify from overtime protection 90 percent of workers
earning more than $22,100 a year?
Mr. Radzely. I am sorry, Senator. I am not sure I
understand how you get to the 90 percent of workers over
$22,100----
Senator Harkin. Well, what I am saying, Congress intended
for exceptions to apply to a narrowly-limited class. I am
asking you, do you agree that it would be inconsistent with
FLSA if the Secretary were, for example, to issue regulations
that would just disqualify 90 percent of people earning more
than $22,100 a year?
Mr. Radzely. Again, Senator, I am not sure I understand
your question. I believe, and again, I would want to study it
more, but I think that a pure salary test, accepting the
hypothetical of your earlier questions, $22,100 or whatever it
is, would likely be inconsistent with the authority in the Fair
Labor Standards Act. But I am not sure I understand----
Senator Kennedy. Would the Senator yield?
Senator Harkin. Yes.
Senator Kennedy. He is talking about the duties
requirement. You can emasculate the overtime provisions by
altering and changing the duties requirement. You have two
different items. One, you have the level of the wages, and two,
you have the duties requirement, and if you redefine those
duties requirements, you can redefine overtime right out of the
Act. That is what I think is beginning to happen. I mean, we
have a difference on that, but at least that is what I thought
that the Senator was trying to ask.
You say that you have the authority to issue the
regulations. You have the power to do it. You have compliance
requirements, which I don't think have been myself lived up to,
which we have been over earlier and I won't go over now. But if
you keep redefining the duties requirement, you can effectively
emasculate the whole overtime issue.
I apologize----
Senator Harkin. No, the Senator correctly sort of
embellished what I was saying, and he is right. If the
Secretary issued a rule that redefined these duties to the
point where 90 percent of the workers making more than $22,100
a year were barred from overtime, do you feel that would be
inconsistent with the FLSA?
Mr. Radzely. Senator, again, accepting the premise of your
hypothetical, I would need to look at how that rule was
defined. The Fair Labor Standards Act isn't in terms of
percentages. It talks about as the terms executive,
administrative, and professional are defined and delimited from
time to time, so I would need to know how the proposal
attempted to define those----
Senator Harkin. But if we looked at the effect of it, I
think that is what we were saying. If we looked at the effect
of it and the effect was to exclude 90 percent or 80 percent or
70 percent or whatever automatically, again, it is my feeling
that it would be inconsistent with the FLSA. The rule sort of
swallows up or does away with the FLSA by changing the rule, as
Senator Kennedy said, and I just wanted to get your thoughts on
that.
Again, I think you see where I am coming from. I just think
that the proposed rules that came out and the reason they got
so many comments on it is an overreaching. It is something that
Congress never clearly intended. We limited the power of the
Secretary. And by changing this, it just basically makes her
power, or his power, whoever the Secretary is, unlimited in
this area. And yet, you say, and my question to you did say
that there were limitations. It is not an unlimited power. But
if the Secretary redefines the duties so that it exempts 90
percent of the workers, that is almost an unlimited power.
The Chairman. I think he responded to your point and I
think you made the point.
Senator Harkin. I appreciate it. Thanks, Mr. Chairman.
The Chairman. And I think you have got a hearing to make
your point again on Thursday.
Senator Clinton?
Senator Clinton. Mr. Chairman, I think, Mr. Radzely, that
you understand our concerns, because clearly, we are a nation
that believes in the rule of law. It is very difficult to
follow the logic behind this rule change, which seems to be a
grab for power by the Secretary, albeit on behalf of the
administration, with respect to issues that have not been
legislatively addressed.
The Fair Labor Standards specific language seems to run
absolutely counter to what the implications and effects of this
rule change would be in the real world, and that is very
troubling, because if you look at the people who do work
overtime in our country, police officers and firefighters and
health technicians and EMTs and paralegals and all kinds of
people, millions and millions of people, for people who do work
overtime, their overtime pay constitutes 25 percent of their
wages.
I don't think anyone in this Congress believes we should in
any way diminish the income by 25 percent of literally millions
of people on the basis of a rule change. That is not the
appropriate province of the Secretary, and as the nominee for
Solicitor, we view your responsibility in this matter to be
paramount. I mean, you are the Secretary's lawyer, in effect,
as well as the defender and enforcer of workers' rights.
We are talking about eight million people being affected by
this rule, and I know that the Department has put out other
figures, but any independent analysis about who will be
affected with, in effect, these changes is as high as eight
million people, and I don't think any of us want to face our
firefighters and our police officers, to say nothing of
reporters, who are going to have 25 percent of their income at
risk.
So this is an incredibly serious matter, and as the
questioning from both Senators Kennedy and Harkin suggested, it
is very difficult to understand where the Secretary is getting
the authority to do this, to, in effect, through rule changes,
redefine executive, administrative, professional, the duty
test, the salary limits. It is just not in there.
So we will look for cooler heads to prevail on this matter,
although I suppose if you want the administration and the
President to stand for reelection with eight million folks,
including a lot of police officers and firefighters, being told
their income has been cut by 25 percent, I suppose that is a
choice you can make. I would not advise it.
I have a very specific question, and that is concerning the
New York City Employment and Training Administration Office,
which oversees job training programs for approximately 200,000
people annually at one-stop job centers and manages as many as
400,000 unemployment insurance claims per week. The Department
of Labor has decided to subsume this office into the Boston
office, and with all due respect to my colleague, the ranking
member, I am not at all convinced that this will be the best
decision on behalf of the people and the workforce in New York.
It seems inefficient and inexcusable to relocate the ETA
office that serves New York City more than 200 miles away.
There are a lot of people who are dependent on public
transportation in that city. There are people who cannot
possibly afford to get on an airplane, a train, or a bus to go
to Boston to deal with their unemployment claims.
I have written to Secretary Chao twice to ask her to
reconsider this ill-conceived idea. She has responded that the
move will not affect service but instead will make the offices
more effective, but she does not cite any analysis to really
back up this point.
Now, I realize you may not have been directly involved in
this decision, but I would appreciate it if you would explain
to me in writing, in response to this question, how this move
could possibly make the office more effective for the people of
New York City, the hundreds of thousands of them who are under
the supervision or at least required to deal with this
Department, and I would like to know why the Department thinks
it is an appropriate move, given that New York City has been in
recession since September 11, has an employment rate of 8.1
percent citywide, higher than that in several of our boroughs,
and directly and direly needs the employment and training
services provided by the ETA. So I would appreciate that
response in writing, Mr. Radzely.
And on another issue, with respect to the LM2 regulations,
you have said that lawyers in the Solicitor's Office have been
working with the Office of Labor Management Standards on the
LM2 rules to ensure that any decisions regarding the final rule
consider all the comments in the record, that they are
supported by the record, consistent with the Labor Management
Reporting and Disclosure Act, the Administrative Procedures
Act, and all other applicable statutes, regulations, executive
orders, and case law.
I assume the Regulatory Flexibility Act, which looks at the
impact of rules on small entities, and Executive Order 12866,
which requires agencies to describe the costs and benefits of
proposed rules for rules with an economic impact of $100
million or more, the Executive Order requires a formal economic
analysis, are two of those laws. So I would look to you to
assure that the Regulatory Flexibility Act and Executive Order
12866 are part of your analysis.
Let me ask you, why hasn't the final rule been issued? Any
insight you could give us on that?
Mr. Radzely. Yes, Senator. The Department is currently
reviewing the some 36,000 comments that it received on the
rulemaking and is carefully analyzing them. The Office of Labor
Management Standards and the Employment Standards
Administration are working on that, and I don't have a
timetable for when they are going to complete that.
Senator Clinton. Do you know if the proposed rule has been
reviewed for its conformance with the Regulatory Flexibility
Act or the Executive Order I referred to?
Mr. Radzely. Yes. Attorneys in the Solicitor's Office did
review that analysis prepared by the ESA for compliance with
those acts and the Executive Order.
Senator Clinton. And will you provide that analysis to this
committee so that we could also review it?
Mr. Radzely. Senator, I believe in response to a written
question from the committee, I did provide the analysis that
the Solicitor's Office reviewed from the Employment Standards
Administration.
Senator Clinton. But in our review of that, there were no
specific studies or estimates on the economic impact of the
rule on small entities, so perhaps there is some additional
information that has been developed that could be provided.
Mr. Radzely. Senator, there undoubtedly will be additional
information prepared with the final rule because there were a
significant number of comments, obviously, on some of the
analyses that you mentioned.
Senator Clinton. We have no evidence in your testimony or
in any other submission from the Department that there was an
economic analysis conducted in conformance with Executive Order
12866.
Mr. Radzely. Senator, I believe the determination by the
Employment Standards Administration was that it would not have
an effect of more than $100 million, and therefore----
Senator Clinton. But there are two different standards, Mr.
Radzely. There is a small firm or entity impact standard and
then there is a larger standard.
Mr. Radzely. Yes, Senator. I believe the larger standard
you are referring to would be the Regulatory Flexibility Act
and the Regulatory Flexibility Analysis, which the Department,
and the Employment Standards Administration in particular, did
prepare. I believe there were specific costs and estimates in
those and we did receive comments on whether those estimates
were consistent with what the experience of the commenters.
Senator Clinton. Well, if I could, I would like to submit
in writing our assessment and analysis of what we have received
from you and on behalf of the Department raising some
additional questions, because that is not my perspective on
what has been done. So we will submit that to you and expect to
have answers with respect to our questions.
[The information was not received by press time.]
Senator Clinton. Thank you.
The Chairman. Senator Reed?
Senator Reed. Thank you very much, Mr. Chairman. Welcome,
Mr. Radzely.
I just want to go back to some of the regulatory analysis
that is underlying the overtime rule that Senator Clinton, and
I think others have talked about also. First, is it your view
that, generally, people who work overtime should receive
additional compensation and that exceptions to that general
rule should be narrowly construed?
Mr. Radzely. Senator, the Secretary of Labor, as defined in
the Fair Labor Standards Act, has the authority and
responsibility to delimit from time to time the terms
administrative, executive, and professional.
Senator Reed. Thank you, but that doesn't respond to the
question. Do you think the presumption is that most people
should be granted overtime if they work over 40 hours a week
and that there are certain limited exceptions, so those
exceptions have to be narrowly construed? It is this issue of
construction, not what her authority is.
Mr. Radzely. Senator, again, it is the Congress
specifically stated that the Secretary of Labor needs to define
and delimit executive, professional, and administrative, and
those positions are exempt from the overtime requirements.
Senator Reed. So the Secretary can say, anyone who makes
over $50,000 a year basically must be an executive, since I
would suspect that is high above the average wage in America.
Mr. Radzely. Senator, again, I think that there would need
to be--a pure salary test likely would not be consistent with
the Secretary's statutory authority because that is limited to
defining administrative, executive, and professional employees.
Senator Reed. So someone who supervises one other person
can be an executive?
Mr. Radzely. Senator, I believe under the Department's
proposal, which didn't change this requirement, it is one of
the tests for executive is supervise two or more individuals.
Senator Reed. So you could be making $35,000 a year,
supervising two people, a wage earner, and be denied overtime.
Mr. Radzely. Senator, there are other requirements in both
the current rule and the proposed rule.
Senator Reed. OK. Very good. That just goes back to the
question I asked initially. How broad is the ability of the
Secretary to include people as executives or exclude them,
which goes to the basic sort of premise, is this a narrowly
construed exception that deals with very special cases where
someone has all of these characteristics, relatively high
salary, significant responsibilities, or is this something that
is so amorphous the Secretary can sort of at whim say, well,
that is an executive, that is an administrator----
Mr. Radzely. Again, Senator, any decisions made by the
Secretary are reviewed--would be potentially reviewable in
court----
Senator Reed. That is obvious, but what is the answer to
the question? What is your view about whether this is an
exception that should be narrowly construed or whether it is
one that should be broadly construed, because that is at the
heart of what the Secretary is doing.
Mr. Radzely. Senator, I believe that Congress, in drafting
the statute and this particular exemption, gave the Secretary
the authority to define those terms.
Senator Reed. Broadly.
Mr. Radzely. Those terms were not defined. Senator, I
believe legally, the Secretary could define it broadly, again,
accepting the hypothetical. Obviously, the Department believes
there are substantial benefits to its proposal by employees.
Senator Reed. Well, I would think the Department might find
that for thousands and thousands of wage earners, they would
find that to be very unattractive. Senator Clinton mentioned
firefighters and police officers, many of whom supervise
several people. Many of them have reasonably good compensation
levels but see themselves as protected by this law. In my view,
you keep referring to what Congress says, in my view, this
should be a narrowly construed exception generally providing
that people who work for wages and who work overtime, past 40
hours a week, should get overtime pay, and obviously, you don't
think the Secretary has that view.
Mr. Radzely. Senator, I think as the Secretary has
indicated and the Department has indicated, the Secretary
believes that the proposal has substantial benefits for
employees. And again, I should caution----
Senator Reed. For the employees who lose their overtime?
Mr. Radzely. Senator, the Department did an analysis and it
determined that 1.3 million low-wage workers would be
guaranteed overtime under this proposal.
Senator Reed. All right. According to your analysis, as I
read it, there are 645,000 paid hourly workers working overtime
in occupations with exempt administrative and professional
duties that could be converted to salaried employees. Is that
correct?
Mr. Radzely. I believe that is part of the Department's
analysis, yes, Senator.
Senator Reed. Right. But it just strikes me in terms of
just the analytical approach here is that those are the people,
as I read this, that are currently receiving overtime. Isn't
there a logical category of people that are entitled to
overtime that don't receive it, and why shouldn't that number,
rather than the 644,000, be the figure that you use to do your
analysis?
Mr. Radzely. Senator, I am not sure I understand
specifically what all of these numbers mean. Again, that
analysis would have been prepared by the Employment Standards
Administration.
Senator Reed. OK. As I understand, also, in terms of the
analysis, Deputy Assistant Secretary for ESA Mark Wilson and
Fred Reuter, the chief analyst for CONSAD, which is the DOL
contractor that prepared the regulatory analysis of the
proposed rule, claim that the Solicitor of Labor prevented them
from answering questions about the rule's regulatory impact,
talking about numbers. Can you tell us why you or your staff
prevented the agency and CONSAD from answering factual
questions such as which occupations are included in the
estimate of professional employees who would lose overtime
protection?
Mr. Radzely. I am sorry, Senator. I am not sure I
understood your question. Can you repeat it?
Senator Reed. Certainly. Deputy Assistant Secretary for ESA
Mark Wilson and Fred Reuter, chief analyst for CONSAD, the DOL
contractor that prepared the regulatory analysis of the
proposed rule, claim that the Secretary of Labor--Solicitor of
Labor, excuse me, prevented them from answering questions about
the rule's regulatory impact. Can you tell us why you or your
staff prevented the agency and CONSAD from answering factual
questions such as, quote, ``Which occupations were included in
the estimate of professional employees who would lose overtime
protection?''
Mr. Radzely. I am sorry, Senator. I am just not aware of
what they are referring to. That was--I don't believe that was
any advice that I personally gave.
Senator Reed. Well, can you make yourself aware of what
they are talking about and inform the committee of why you
would, at least under their view, interfere with the simple
fact gathering?
Mr. Radzely. I would be happy to, Senator.
Senator Reed. Thank you.
The Chairman. Thank you. Senator Kennedy has a couple of
follow-up questions and then we will finish the hearing up.
Senator Kennedy. Just in response to the question of
Senator Clinton, you said that the effect would be less than
$100 million, so a full economic analysis is not necessary. But
your submissions to OMB indicate that this is an economically
significant rule. I have got it right here, economically
significant rule.
Mr. Radzely. Senator, are you referring to the LM2?
Senator Kennedy. Yes. This is on the L2.
Mr. Radzely. Well, Senator, I may have misspoken. Again, I
didn't prepare that analysis. My recollection was that it was a
significant rule, which there are two--my understanding is
there are two criteria under which under 12866 there would be
OMB review. One is an economically significant rule, which I
believe is $100 million or more standard, and another is just
if it is a significant rule under certain standards.
My understanding was, and I could be mistaken, was that it
was the latter of those two categories, not the $100 million,
but if you have that document, then I must have been mistaken
and----
Senator Kennedy. Well, this gets to what we are talking
about, and that is whether the Department did fully comply with
the Executive Order.
The Chairman. Is that $100 million?
Senator Kennedy. This says economically significant, and he
is defining that as--he is saying it is $100 million. All the
other analysis indicates it is much more than $100 million, but
on his application, he recognizes that it is economically
significant on this, and if it is economically significant,
then there has to be a full analysis, which they had not
provided.
Mr. Radzely. Again, Senator, as I think I indicated
earlier, I had limited involvement in the preparation of the
rule, but the rule was reviewed by the Solicitor's Office and
whatever the Employment Standards Administration did was
consistent with SBRFA and--was consistent with SBRFA.
Senator Kennedy. Well, just to come back to points that
have been asked here about the power, the authority, this has
been really the most distressing part of your testimony, quite
frankly. We went through some of these related areas, but I
have a lot of difficulty certainly supporting you if you think
that power is unlimited in terms of the Department of Labor to
define what are these areas of overtime.
Historically, it has been about 80 percent of the workers.
It has been 80 percent of the workers. That has been since the
Fair Labor Standards Act. I am not going to support a Solicitor
or anybody else that thinks that you have an opportunity to go
far beyond that in terms of their definition. Your testimony is
that whatever the Secretary decides is executive or
professional or administrative, anything, school is wide open.
I don't hear you saying anything that there has been a long-
time historical balance, and it has basically been about 80
percent. I think you are changing that significantly with these
other rules and regulations.
That has been the figure. It has been now for whatever
number of years it has been in there, 70 years. And you are
telling this committee you think, well, wait a minute, it might
have been 80 percent for 70 or 80 years, but my understanding
as the principal advisor for the Secretary is that it is open-
ended.
Mr. Radzely. Senator, I apologize if I left any
misimpression, but I believe in response to Senator Harkin's
questions I said that it was not open-ended, and clearly, I
think I said that, likely, the salary, just a salary, $22,100,
would not be consistent with the Act.
Also, again, I would need to look at a specific proposal
and the Department's Notice of Proposed Rulemaking, based on
the analysis the Department did, and I understand there is a
disagreement between you and the Department over that analysis.
But the Department believed that 1.3 million workers would be
guaranteed overtime who didn't have it and something on the
order of, I believe it was Senator Clinton said 645,000 could
potentially lose it. Thus, the Department believes under its
proposal more workers will actually gain overtime, so----
Senator Clinton. Mr. Chairman, since I have been referred
to, could I ask you to yield for just a second, Senator?
Senator Kennedy. Yes.
Senator Clinton. I want to be really clear about this,
because it was actually Senator Reed who specified it. This is
where I think the Department's actions just don't inspire
confidence. You are, I understand, in a tough spot, because you
are not the person promulgating these rules, but you are the
person who we look to to make sure that what is done in that
Department is done legally.
The 644,000 number, if you take your analysis at face
value, refers to people who are currently receiving overtime.
That does not count the millions of people who are eligible if
they are asked to and have to work overtime. The difference is
that some people on a regular basis work overtime who fall in
that 645,000 number, but there are up to eight million people
who have historically been eligible for overtime who, by the
rule's wording, would no longer be eligible for overtime.
So it is just not a fair statement to say that this rule is
going to give more people overtime. That is not a fair
statement. You are going to be taking away a right that, as
Senator Kennedy has said, has been accepted as precedent for 70
years and you are going to say that even if you never got a
chance to work overtime or never were asked to work overtime,
if at any time in the future you are, you are no longer
eligible.
So that is a very significant difference, and I think it is
quite disingenuous for the Department or for you on behalf of
the Department to say that, well, we think because we are going
to add low-wage workers, we have a net increase. You have a net
decrease of the people eligible for overtime. That is our
point.
The Chairman. I think the Senator has made that point. I
think all the Senators on that side have made that point ad
nauseam.
Senator Kennedy. Mr. Chairman----
The Chairman. We are not going to just continue to debate
for the sake of debate. I yield to Senator Kennedy for a couple
of additional questions. He can ask those questions and then we
are going to wrap the hearing up. I didn't have any time limit
on questioning. People have had lots of time to ask questions.
Senator Kennedy. I think we are really getting----
The Chairman. We are replowing the ground rather
extensively here.
Senator Kennedy. I just wanted to cover the civil rights
area in one area, if we can and then we will wind it up.
Senator Harkin. Mr. Chairman----
Senator Kennedy. We give you assurance that in 10 minutes,
that we will be----
The Chairman. We will give Senator Harkin one last
question, but first, Senator Kennedy, complete your
questioning.
Senator Kennedy. Is it on this point?
Senator Harkin. It is on--just one clarification.
Senator Kennedy. And then I will just do the civil rights.
Senator Harkin. It is a very simple question. It is my
understanding that, periodically from 1938 to now, that the
income level has been raised but the duties test has always
remained the same. Is this the first time that there has been
an expansion of the duties test?
Mr. Radzely. Senator, I don't believe that the duties test
has been revised in probably 50 years. I am not sure it is the
first time. There may have been some revisions in 1938. But I
think that is probably correct.
Senator Harkin. OK. That is the only question I had. Thank
you.
Senator Kennedy. Just in the area of civil rights
enforcement, why has the Department's civil rights enforcement
declined under your watch and how do you plan to improve the
enforcement of affirmative action nondiscrimination
requirements for Federal contractors? As I understand, your
office has filed only six administrative complaints against
Federal contractors for violating civil rights. It is down
between 50 and 80 percent from complaints filed during the
previous administration. Your reaction?
Mr. Radzely. Yes, Senator. I am very committed to civil
rights enforcement. As I indicated in my opening statement, the
first two systemic compensation discrimination cases filed in
nearly a quarter century were filed while I was Acting
Solicitor. In addition to that, Senator, recoveries by OFCPP
and the Solicitor's Office this year are up 40 percent based on
where we were this time last year.
In addition to that, I understand that this calendar year,
we filed six cases against six different companies, which is--
we are on pace to equal or exceed a number of years during the
prior administration. For example, in 2000, I believe, the
OFCPP filed cases against four companies. In one of the four, I
think there were multiple cases against.
In addition to that, Senator, something that I have
personally insisted upon since becoming Acting Solicitor is
that when there have been violations of conciliation agreements
entered into by OFCPP, I have insisted that there be
substantial penalties paid by the companies in resolving any
violations of conciliation agreements with consent decrees up
to and including debarment of the contractor.
Senator Kennedy. Just in this one last area, the target of
the administration has been the delay of the Equal Opportunity
Survey, as I understand it, a data collection instrument that
requires contractors to provide data on the demographic
composition of the workforce, including data on compensation
practices broken down by sex and race. Such information is
obviously critical to uncovering illegal pay disparity and
remedying wage discrimination.
The survey was finalized after a lengthy and comprehensive
review process. It represents a balanced approach to further
the purpose of the OFCPP without unfairly burdening the
employers. I believe that any change in the survey would
undermine enforcement efforts. It would be highly premature,
given that the survey has not been fully implemented, and it
would send a troubling signal about the administration's
commitment to fundamental equal opportunity principles. I
strongly support the survey, and just your reaction.
Mr. Radzely. Yes, Senator. The Department and this
administration does, as well, support the survey, and, in fact,
has contracted with Apt Associates from Cambridge,
Massachusetts, to provide a detailed study of the ability of
the EO survey to target individual companies. We are interested
in improving our enforcement targeting mechanisms and we are
very hopeful that the study will tell us what parts of the EO
survey are, in fact, useful in targeting companies.
Senator Kennedy. Well, to whatever extent you can keep that
on the move. I understand it had been slowed down, but if you
can look into that.
Could we welcome your wife, Lisa, and I understand you have
got a three-year-old son Brendan.
Mr. Radzely. Running around----
Senator Kennedy. We want to tell him what a patient and
well-behaved young man he is. [Laughter.]
Senator Kennedy. I will tell you, to have to go through
this and listen to your father be questioned by all of these
older grumpy people up here-- [Laughter.]
Senator Kennedy. But we are very glad to see you and we
welcome you here to the committee.
I thank the chair for all of the time that you have given
us on these kind of things.
The Chairman. Thank you, Senator, and I want to thank you,
Mr. Radzely. I think your presentation today has reflected your
expertise and your professionalism and has reinforced why you
should be confirmed. You certainly have the talent and the
ability to do the job. Your answers were very professional and
on point.
You got caught, unfortunately, and you have been caught,
unfortunately, and the only reason we are having this hearing,
unfortunately, is because you are in the middle of a cross-fire
between some of my colleagues on the other side and the
Secretary of Labor and the administration, which is--that is
the way it works. But I think it does not reflect on your
talent and ability, which I greatly admire and I think we are
fortunate to have you as a nominee. Thank you very much.
[The prepared statement of Mr. Radzely may be found in
additional material.]
Senator Kennedy. Thank you very much.
[Additional material follows.]
ADDITIONAL MATERIAL
Prepared Statement of Howard M. Radzely
Thank you Mr. Chairman, Senator Kennedy, and distinguished Members
of the Committee. It is an honor to appear before you today as you
consider my nomination to be the Solicitor of Labor. At the outset, I
would like to express my gratitude to the President of the United
States for nominating me for this position and to the Secretary of
Labor, Elaine Chao, for the support and confidence she has demonstrated
in recommending me for this position. I would also like to thank the
Committee for considering my nomination and holding this hearing today.
Finally, I would like to thank my wife Lisa and my 3\1/2\-year-old son
Brendan for all the sacrifices they have made to allow me to serve in
the government and for the sacrifices they will make if I am confirmed
to be the Solicitor.
Prior to joining the Department of Labor, I was in private practice
here in Washington, D.C. The main focus of my practice was advising
clients, primarily employers, how to comply with the various labor and
employment laws such as the Fair Labor Standards Act, Executive Order
11246, Family and Medical Leave Act, Occupational Safety and Health
Act, Service Contract Act, and many others.
Since coming to the Department in June 2001, I have had the
opportunity and privilege of working with the employees of the
Solicitor's Office--some of the finest attorneys and public servants I
have known--on a wide range of legal issues. In my view, the
Solicitor's Office has two distinct but vitally important roles.
First, and foremost, the Solicitor's Office has the important
responsibility of working in tandem with the individual agencies of the
Department to vigorously enforce the laws under the Department's
jurisdiction. Unlike most cabinet agency general counsel's offices, the
Solicitor's Office has the authority to litigate cases in a wide
variety of areas including the Occupational Safety and Health Act, Mine
Safety and Health Act, Employee Retirement Income Security Act, Fair
Labor Standards Act, Davis-Bacon Act, Service Contract Act, and
Executive Order 11246, to name a few.
Second, the Solicitor's Office provides legal advice to the
Secretary and the agencies in the Department on rulemakings, ethics
laws, procurement, permissible interpretations of various statutes and
regulations, and the wide array of other legal matters that arise under
the nearly 200 laws that the Department administers and enforces.
With regard to enforcement, it is important for the Solicitor's
Office to vigorously prosecute cases and to use the full range of legal
tools at its disposal. Through judicious use of all of its enforcement
tools, the Department can obtain justice for those who have been
treated unfairly in violation of the law, and can deter those who might
choose to violate the statutes and regulations enforced by DOL. For
example, I have urged Solicitor's Office attorneys to make expanded use
of Section 11(b) of the OSH Act, a provision which had rarely been
used. This section of the OSH Act allows the Department to have orders
of the OSH Review Commission (including settlements) entered as orders
of the courts of appeals. This statutory authority allows the
Department to seek contempt and significantly greater sanctions, rather
than filing a failure to abate proceeding, in the event that the
employer violates a Commission order. To take one other example, since
I became Acting Solicitor, I have refused to settle cases in which
employers have violated OFCCP conciliation agreements without obtaining
additional penalties--which has included debarment from contracting
with the Federal Government.
I also believe it is especially important for the Department to
focus enforcement efforts on employers who exploit, among others, low-
wage and vulnerable workers as well as on employers who repeatedly
violate the laws enforced by the Department. Low-wage and vulnerable
workers are the workers who most need our assistance and who can most
benefit from the Department's aggressive actions to protect their
rights. For example, the Solicitor's Office has been aggressively using
the Fair Labor Standards Act's hot goods provision, which prevents the
shipment of goods in interstate commerce produced in violation of the
Act, often in industries that have a high percentage of low-wage
workers. In addition, I have placed a premium on swift action by
attorneys in the Solicitor's Office in all enforcement cases, and in
particular in those cases in which the Department determines that an
employer retaliated against an employee for exercising his or her
rights, such as under the Mine Safety and Health Act.
In the 7 months since I became Acting Solicitor, the Solicitor's
Office has initiated a number of major enforcement actions in various
programs. For example, last month, the Department filed suit against
Enron, the administrative committee, Kenneth Lay, Jeffrey Skilling, and
the outside members of the Board of Directors for breach of fiduciary
duty. Attorneys in the Solicitor's Office continue to support the
Employee Benefits Security Administration as it investigates a number
of other corporate fraud cases.
In the OSHA area, since I became Acting Solicitor in January, the
Department has issued nine ergonomic citations under OSHA's general
duty clause. These citations were issued in a variety of industries,
including nursing homes, the printing industry, warehousing, and the
beverage distribution industry. Solicitor's Office attorneys throughout
the country are prosecuting these cases. In the wage-hour area, we are
continuing our efforts to ensure that poultry workers are compensated
for donning and doffing by litigating against two poultry producers and
by filing, last month, an amicus brief in the First Circuit Court of
Appeals in support of private poultry plaintiffs' petition for
rehearing in Tum v. Barber.
To take one last example, from the civil rights area, as Acting
Solicitor I recently authorized the filing of the second systemic
compensation discrimination case by the Department in over 25 years.
The only other systemic compensation discrimination case filed by the
Department in the last 25 years was one that I authorized while Acting
Solicitor in 2001.
In addition to approving enforcement actions and working with
attorneys to strengthen those actions, I have also intervened in cases
when such intervention would facilitate reaching favorable settlements.
I believe it is important for the Solicitor, or the Acting Solicitor,
to demonstrate to attorneys in the Solicitor's Office, to investigators
in the client agencies, and to the regulated community his or her
commitment to enforcement by personal involvement when such
intervention can improve the chance for favorable results. For example,
as Acting Solicitor in 2001, I worked with lawyers in the National
Office and the Philadelphia Office to negotiate a final settlement of
the Beverly Nursing Home ergonomics case. One significant feature of
this settlement is that the terms extend beyond the cited facilities to
a nationwide agreement. Similarly, I worked with career civil servants
in the Solicitor's Office and the Wage and Hour Division to negotiate
one of the largest Wage-Hour settlements ever, a $10 million settlement
with Perdue for failing to compensate employees for donning and
doffing.
Regarding the second important mission of the Solicitor's Office,
the legal advisory functions, I believe that attorneys must provide
their client agencies with clear, concise, easy-to-understand legal
advice that is based on a careful review of all relevant legal
authorities. Whether it is legal advice on a newly passed statute, an
ethics issue, a proposed or final regulation, or any other question,
attorneys must inform their clients of the range of options that are
legally available and the legal risks attendant to or prohibitions on a
particular course of action. As with any legal organization,
Solicitor's Office attorneys must be responsive, thorough, and
objective. They must have the confidence and trust of their client
agencies.
In addition to enforcement and legal advice functions, the
Solicitor of Labor also manages one of the nation's largest law firms--
a staff of approximately 700 employees including some 500 attorneys
working throughout the country. Throughout my tenure at the Department,
and particularly since I became Acting Solicitor in January 2003, I
have stressed the need to share cases, experiences and work among the
various offices. For example, a number of OFCCP cases have been shifted
among regions and the national office to ensure that they would be
handled more quickly.
Close coordination among offices also enables the Solicitor's
Office to properly staff major cases, such as Enron, with attorneys in
multiple offices helping to litigate against teams of lawyers on the
other side. Close coordination also facilitates the ability of the
Solicitor's Office to shift work if one office becomes overloaded and
to more effectively deploy the legal talent in the various offices.
Shortly after arriving at the Department in 2001, I requested that the
Solicitor's Office set up a nationwide internal brief bank to ensure
that all of our offices had access to key briefs and legal memorandum.
This internal database should continue to help increase the efficiency
of the Solicitor's Office. If confirmed as Solicitor, I will continue
these efforts to improve the Office of the Solicitor's ability to
litigate all cases, including the increasingly complex cases against
defendants with numerous lawyers.
To mention one last management principle that is important to me,
as Acting Solicitor I have worked hard to give a greater role to the
Associate and Regional Solicitors in the overall management of the
office. These dedicated senior career civil servants have tremendous
substantive knowledge and a keen sense of what is needed to improve the
management of the Solicitor's Office and thus enhance the Solicitor's
Office's ability to bring strong enforcement actions and render high-
quality legal advice.
In conclusion, the Department of Labor Solicitor's Office has a
long and proud tradition of protecting America's workers and providing
sound legal advice to its client agencies. I appreciate the great
responsibility that I will bear if confirmed for the difficult and
challenging job as Solicitor and understand the need to carry on the
office's great tradition. Thank you again for considering my
nomination, and I would be pleased to answer any questions that you may
have.
Response to Questions of Senator Kennedy From Howard Radzely
541 Regulations
The Department of Labor's proposed overtime regulations changes
have been controversial among a number of critics. There are concerns
that they will weaken overtime pay protections and exclude hundreds of
thousands of workers from receiving overtime pay.
1. Has the Solicitor's office had any involvement in proposed
modifications to the FLSA ``white collar'' exemption regulations?
Please describe.
Answer: Yes, the Solicitor's Office has been providing legal advice
to the Employment Standards Administration's Wage and Hour Division
(WHD) throughout the ongoing rulemaking process. The Solicitor's Office
has had a number of lawyers, principally led by the Associate Solicitor
far the Fair Labor Standards Division, who have been advising the WHD
and who reviewed the draft Notice of Proposed Rulemaking, which was
largely completed last year. Specifically, the Solicitor's Office
reviewed the policy decisions of the WHD for compliance with the Fair
Labor Standards Act, the Administrative Procedure Act, and all other
applicable statutes, regulations, executive orders and case law. Once
the comment period closes on this Notice of Proposed Rulemaking at the
end of this month, the Solicitor's Office will work with the WHD to
ensure that any final rule that the WHD may choose to promulgate
considers all comments in the record, is supported by the-record, and
is consistent with all applicable statutes, regulations, executive
orders, and case law. As Acting Solicitor, and if I am confirmed as
Solicitor, I will work with the attorneys in the Solicitor's Office to
ensure the integrity of the rulemaking process and to ensure that the
Department's policy decisions are supported by the record and
consistent with all applicable legal authorities.
2. Was anyone in Congress consulted before these changes were
proposed? If not, why wasn't Congress consulted about these major
changes? Will you and the Wage and Hour Division commit to consulting
with Congress before you further develop this rule?
Answer: I am aware that the WHD had a number of stakeholder
meetings before it proposed changes to the ``white collar'' exemption
regulations. I not aware whether the WHD consulted with any Members of
Congress before these changes were proposed. The comment period is
currently ongoing and the record will remain open until June 30, 2003.
All comments received by that date, including comments from Members of
Congress, will be considered by the WHD when drafting any final rule.
Under the Administrative Procedure Act and applicable case law, any
final rule promulgated by the WHD must be based on the rulemaking
record. Should the Department decide to finalize a new ``white collar''
exemption regulation, as Acting Solicitor, and if I am confirmed as
Solicitor, I will work with the attorneys in the Solicitor's Office to
ensure the integrity of the rulemaking process and to ensure that the
Department's policy decisions are supported by the record and
consistent with all applicable legal authorities.
LM-2 Initiative
The Department of Labor has proposed a major expansion of the LM-2
financial reporting requirements for labor organizations. I understand
that the Department's justification for the rules is that they will
enhance financial transparency and accountability. Critics are
concerned that therules dramatically expand the recordkeeping and
reporting burden on labor organizations, at a cost of hundreds of
millions of dollars, with questionable benefits to workers.
1. What has been the involvement of the Solicitor's office in this
rulemaking? What has been your involvement?
Answer: The Solicitor's Office has had a number of lawyers,
principally led by the Associate Solicitor for the Labor Management
Laws Division, providing legal advice to the Employment Standards
Administration's (ESA) Office of Labor-Management Standards (OLMS)
during the promulgation of the proposed rule and during OLMS's ongoing
review of the comments received during the comment period. The Notice
of Proposed Rulemaking (NPRM) was published on December 27, 2002. My
involvement at the proposal stage was limited. Since the comment period
closed on March 27, 2003, as Acting Solicitor, I have been working with
the Associate Solicitor for Labor Management Laws and other attorneys
in the Solicitor's Office to ensure that any decisions regarding the
final rule made by the Department consider all comments in the
``record, are supported by the record, are consistent with the Labor-
Management Reporting and Disclosure Act of 1959, as amended, the
Administrative Procedure Act, and all other applicable statutes,
regulations, executive orders, and case law. As Acting Solicitor, and
if confirmed as Solicitor, I will work with attorneys in the Solcitor's
Office to ensure the integrity of the rulemaking process and to ensure
that the Department's policy decisions are supported by the record and
consistent with all applicable legal authorities.
2. The major burden of the rules will be borne by small labor
organizations, many of which are run by volunteers. More than 90
percent of affected unions fall within the Small Business
Administration's definition of ``small entities.'' Yet the proposed
financial reporting rule makes no attempt to distinguish between the
requirements imposed on small entities as cot pared to larger
organizations. Did the Office of the Solicitor review the proposed file
for its compliance with the various statutes; regulations, and
executive orders requiring agencies to take special account of the
impact of their rules on small entities? If so, who conducted that
review, what did it entail, and what were the conclusions reached?
Please provide copies of any reports or documents provided to your
office regarding the impact of the rules on small entities.
Answer: Yes, prior to publication of the NPRM on December 27, 2002,
lawyers in the Solicitor's Office reviewed the proposed rule for its
compliance with all legal authorities requiring agencies to take
special account of the impact of the proposed rule on small entities
and insisted that ESA include an initial regulatory flexibility
analysis in the NPRM. The Associate Solicitor for Labor Management
Laws, with the assistance of attorneys in her office and attorneys in
other divisions who have experience in drafting and reviewing
regulations, reviewed the analysis performed by ESA, as well as the
entire NPRM, for compliance with all legal authorities that require
agencies to take special account of the impact of the proposed rule on
small entities. Following this review, the Solicitor's. Office
concluded that the NPRM published in the Federal Register last December
complied with all relevant legal authorities. I have attached behind
Tab A copies of the following reports and documents, which reflect
ESA's analysis of the impact of the proposed rule on small entities and
which were reviewed by the Solicitor's Office prior to publication of
the NPRM: the Initial Regulatory Flexibility Analysis section of the
NPRM and the Technical Feasibility Study for an On-line Financial
Downloading System prepared for OLMS by SRA International, Inc.
3. The Department states that the rules will not have an economic
impact of more than $100 million, and as a result, has not performed an
economic analysis of the benefits and burdens of the proposed rule as
required by Executive Order 12866. Did your office review that
determination? If so, who conducted that review and what did it entail?
What documentation was your office provided concerning the likely
economic impact of the rules? Please provide copies.
Answer: Yes, the Solicitor's Office last year reviewed the
determination required by EO 12866 that the proposed rules will not
have an economic impact of more than $100 million. That review was
conducted by the Associate Solicitor for Labor Management Laws in
consultation with attorneys in her Division and other divisions. I
understand that the review entailed an examination of the NPRM,
particularly the section concerning the Paperwork Reduction Act, and
the additional analysis contained in the full Paperwork Reduction Act
package submitted to the Office of Management and Budget (OMB). The
NPRM is attached in response to the prior question behind Tab A. I have
attached behind Tab B a copy of the Department's Paperwork Reduction
Act package submitted to OMB.
Ergonomics Enforcement
When the Secretary of Labor announced her plan on ergonomics
following the repeal of OSHA's ergonomics rule, she committed the
Department to a vigorous enforcement initiative under the OSH Act's
``general duty'' clause. The Office of the Solicitor obviously plays a
key role in designing such an enforcement program.
1. What has been your involvement in developing a general duty
enforcement program on ergonomics?
Answer: I have worked closely with attorneys in the Solicitor's
Office's Occupational Safety and Health Division as well as with
attorneys in regional offices throughout the country to develop for
prosecution ergonomics cases under the OSH Act's ``general duty''
clause. For example, in the five months since becoming Acting Solicitor
in January 2003, I have personally reviewed and approved eight general
duty clause ergonomics citations in a number of different industries.
(See answer number 3 below for further details.) In addition, while I
was Acting Solicitor from June 2001 through January 2002, I was
personally involved in the Beverly Enterprises nursing home ergonomics
case and was able to negotiate a settlement which provided for
nationwide abatement of ergonomics hazards at all facilities within
OSHA's jurisdiction, even though the citations involved only five
facilities in Pennsylvania. Moreover, at my request, attorneys from the
OSH Division of the Solicitor's Office provided training and continue
to provide assistance to state attorneys in state plan states
concerning prosecution of ergonomics citations under the general duty
clause. I have also worked closely with attorneys in the OSH Division
and the Regional Solicitors' offices to develop procedures that will
ensure successful prosecution of ergonomics cases under the OSH Act
general duty clause. Additionally, I worked with OSHA and; ``attorneys
from the OSH Division to develop ergonomics emphasis programs in
several industries. (See below for more details.) As Acting Solicitor,
and if I am confirmed as Solicitor, I intend to work closely with OSHA
and attorneys throughout the Solicitor's Office to ensure successful
prosecution of ergonomics cases.
2. Please describe the Department's general duty enforcement
program on ergonomics. Is the Department conducting targeted
inspections? If so, which industries and employers are being targeted?
What standards or criteria is your office using to determine whether or
not to bring a general duty enforcement case on ergonomics, e.g.,
number/type of injuries, presence of serious hazards, etc.? What is the
Department's definition of a ``recognized'' ergonomics hazard? Please
provide any documents describing the Department's general dirty
enforcement program on ergonomics.
Answer: The Department's general duty clause enforcement strategy
for ergonomics is based on its prior experience in ergonomics cases,
including the successful resolution of the Beverly Enterprises case,
the Occupational Safety and Health Review Commission's decisions in the
Beverly Enterprises and Pepperidge Farms cases, and the Department's
efforts under the general duty clause for other workplace hazards.
Specifically, the Department is focusing on cases in which it can meet
the four prongs of the general duty clause-the existence of an
ergonomics hazard; whether the hazard is recognized; whether the hazard
is causing or is likely to cause serious physical harm to employees;
and whether a feasible means exists to reduce the hazard. As part of
the Department's enforcement program, specialized training has been
provided to OSHA inspectors and attorneys from the Solicitor's Office
on how to inspect a workplace for ergonomics hazards, how to prepare a
citation for ergonomics hazards, and how to prosecute a citation to
successful resolution. The Department's general duty clause enforcement
program on ergonomics includes inspections scheduled in several ways:
targeting workplaces in industries with relatively high rates of
injuries thought to be related to ergonomics hazards and where feasible
means to reduce those hazards are available; reviewing ergonomics
conditions during inspections conducted as part of OSHA's regular
inspection program; and responding to specific complaints.
As part of the Department's general duty clause enforcement
program, OSHA has one National Emphasis Program in the nursing home and
personal care industry. Additionally, OSHA has fourteen Regional
Emphasis Programs and three Local Emphasis Programs that target
ergonomics hazards in four industries: meatpacking, auto parts,
hospitals, and warehousing.
The criteria that the Solicitor's Office uses in deciding whether
to bring an ergonomics case are whether the Department can establish
the four criteria necessary to prove a general duty clause violation:
the existence any one ergonomics hazard; whether the hazard is
recognized; whether the hazard is causing or is likely to cause serious
physical harm to employees; and whether a feasible means exists to
reduce the hazard.
The Department's definition of ``recognized'' hazard is taken from
well established case law detailing what OSHA must establish to
demonstrate that a hazard is ``recognized'' for purposes of the general
duty clause. OSHA has had success in general duty clause cases,
including those involving citations for ergonomics hazards,
establishing recognition of a hazard on the basis of industry
recognition, employer recognition, and, in some cases, commonsense
recognition. How the Department will prove recognition of the hazard
necessarily depends on the facts of each individual case, including the
specific ergonomics hazard which is causing serious injuries. Among the
specific means OSHA has used in the past are 4igh rates of work-related
injuries recorded by the company, internal company investigations,
reports from experts, and recommendations by insurance companies on how
to reduce injuries/illness rates.
I have attached behind Tab C the following documents describing the
Department's general duty enforcement program on ergonomics. I have
attached OSHA Directive Number: 02-03 (CPL-2), OSHA's National Emphasis
Program-Nursing and Personal Care Facilities SIC 8051, 8052, 8059 (July
17, 2002). I have also attached OSHA Instruction CPL 2.103, Field
Inspection Reference Manual (FIRM), September 26, 1994 (pp. III-8 to
III-13) which provides guidance on application of the general duty
clause in OSHA inspections and is referenced in the National Emphasis
Program. I have also attached documentation on twelve of the seventeen
Regional and Local Emphasis Programs provided to me by OSHA. An
additional document, the Ergonomic Case Development Procedures, is an
internal privileged and confidential document developed by attorneys in
the Solicitor's Office OSH Division and 08HA employees to ensure that
the Solicitor's Office can successfully prosecute ergonomics citations.
Because release of this internal document could seriously compromise
the Department's enforcement efforts, I have not attached this document
3. How many general duty ergonomics enforcement cases have been
brought since the repeal of the ergonomic rule? Please provide
information on all such cases, including the employer cited, the nature
of the citations, the penalty assessed, and the outcome of the cases in
terms of penalties and abatement.
Answer: Since becoming Acting Solicitor in January 2003, I have
approved and the Department has issued ergonomics citations against six
facilities and I have approved two additional citations which are
expected to be issued shortly. The issued citations, which are
described as requested in the chart below, are against three nursing
homes, a manufacturer of heavy doorframes, a printing, company; and a
food distribution warehouse facility: (The citations I have approved,
but which have not yet been issued, are also against nursing homes.)
Between early 2001, when the ergonomics regulation was repealed under
the Congressional Review Act, and January 2003, OSHA issued a number of
ergonomics hazard alert letters, but brought no ergonomics cases.
OSHA Ergonomics Enforcement Actions 2001-June 9, 2003
Alpha Health Services.--Three nursing homes located in Idaho.
Employees were experiencing back injuries from resident handling
activities.
Nursing Home NEP inspection.--Ergonomics citations (one to each
nursing home) issued February 21, 2003, settled March 13, 2003. The
penalty proposed for the ergonomics citation for each location was
$900. The settlement provided for payment of penalties of $265 for each
of two locations and $270 for the third. The nursing homes agreed to
implement a policy for transferring and lifting non-weight-bearing and
partial-weight-bearing residents that mandates the use of appropriate
mechanical lift assist and transfer devices to the extent possible.
Security Metal Products.--Clinton, Oklahoma--manufactures custom
door frames. Employees were experiencing back injuries due to lifting,
pulling and pushing of heavy doorframes during the assembly, finishing
and painting process.
Ergonomics citation issued February 26, 2003, settled March 18,
2003 (together with nine other nonergonomics citation items). A penalty
of $5,600 was proposed. The employer agreed to a program providing for
the implementation of all feasible engineering controls by November 17,
2003. The penalty for this citation was reduced to x2,800 in the
settlement.
Brown Printing Co.--East Greenville, Pennsylvania--lithographic
printing of catalogs and magazines. Employees were experiencing back
and shoulder injuries from reaching, pulling, lifting and flipping
stacks of printed material.
Ergonomics citation issued May 27, 2003. The proposed penalty is
$4,500. The company has contested the citation.
Supervalu Holdings, Inc.--Hazelwood, Missouri--supermarket food
distribution warehouse facility. Employee/order selectors experiencing
back and shoulder injuries from reaching, pulling and lifting heavy
grocery packages.
Ergonomics citation issued May 22, 2003. A penalty of $6,300 was
proposed for this citation. The company has 15 working days after
receipt of the citation to file a notice of contest.
Payment for Personal Protective Equipment
For several years, OSHA has had a rule pending that would require
employers to pay for OSHA-required personal safety equipment, such as
hard hats and safety gloves. Paying for this safety equipment is
particularly hard on low-income workers. OSHA initiated the rulemaking
after the Occupational Safety and Health Review Commission decided that
OSHA's policy requiring employers to pay for this equipment was not
entitled to deference. The rulemaking record closed several years ago,
but the rule has languished and is listed as ``next action
undetermined'' in the most recent Regulatory Agenda.
1. Has your office been consulted about proceeding with a final
rule on payment for personal protective equipment? Have you been
involved in such consultations? Please describe.
Answer: Attorneys in the Solicitor's Office's OSH Division have
been providing legal advice to OSHA as the Department considers what
action to tine next in response to the comments received on OSHA's
Notice of Proposed Rulemaking. Solicitor's Office attorneys have been
working with OSHA to ensure that any Departmental decision is
consistent with the rulemaking record, the OSH Act, the Administrative
Procedure Act, and all applicable statutes, regulations, executive
orders and case law and they have kept me apprised of their work. When
the Department makes final decisions on personal protective equipment
(PPE) and a draft Federal Register notice is completed, I will, as
Acting Solicitor, and if I am confirmed as Solicitor, work with
attorneys in the OSH Division to ensure that the Department's decisions
consider the comments in the rulemaking record, are based on the
rulemaking record, and are consistent with all applicable legal
authorities.
2. Is there a legal impediment to OSHA's proceeding with a final
rule requiring employer payment for PPE? If so, please explain.
Answer: As noted above, the Department's final decision must be
consistent with the rulemaking record and applicable legal authority. I
have not had the opportunity to review the comments to the proposed
rule; therefore I do not at this time have any opinion about whether
there are any legal impediments to OSHA proceeding with a final rule
requiring employer payment for PPE.
3. In the past three years, has OSHA cited any employers for
failing to pay for required safety equipment? Has your office been
involved in any such cases? Please provide details about any such
cases, including the nature of the case and its outcome.
Answer: I am unaware whether OSHA has cited any employers for
failing to pay for required safety equipment in the past three years.
However, a number of specific standards require-employers to pay for
certain PPE, and OSHA may have cited employers under these standards. I
have consulted with the Associate Solicitor for Occupational Safety and
Health and the eight Regional Solicitors and they were not aware of any
litigated cases in the past three years which, if successful, would
require employers to pay for PPE.
Tuberculosis Rule
I understand that the Department of Labor does not plan to pursue
the tuberculosis (TB) regulation that was previously on the OSHA
agenda.
1. Was your office involved in this decision? Was a decision made
that TB does not pose a significant risk to workers who experience
occupational exposure?
Answer: The Department announced in its Spring Regulatory Agenda
that it intends to withdraw the TB regulation. Before the agenda was
published, OSHA consulted with attorneys in the Solicitor's Office's
OSH Division to ensure that the Department's decision withdrawing the
rule was consistent with the rulemaking record and in accord with the
OSHA Act and all applicable statutes, regulations, executive orders and
case law. I am advised that the Solicitor's Office's OSH Division
advised OSHA that OSHA's decision was, in its view, consistent with the
rulemaking record and in accord with all applicable legal authorities.
I am not aware of any decision, based on the rulemaking record,
regarding whether TB poses a significant risk to those workers who
experience occupational exposure. Because any final decision closing a
rulemaking must be based on the rulemaking record and because the
Federal Register notice withdrawing the proposed rule has neither been
completed nor reviewed by me, I do not know at this time the specific
bases on which the rule is proposed to be withdrawn. I understand that
OSHA has publicly stated its rationale in a press release dated May 30,
2003.
2. Does the Department have plans to protect against occupational
exposure to TB under the general duty clause? If so, what criteria have
been established to determine whether a recognized hazard exists?
Answer: Yes; the Department has a plan in place to protect against
occupational exposure to TB under the general duty clause. Although
OSHA does-not have a specific TB standard, it does have a number of
other standards relevant to TB exposure. Since 1996, OSHA has had in
place Directive CPL 2.106, Enforcement Procedures and Scheduling for
Occupational Exposure to Tuberculosis (February 06, 1996). This
Directive remains in effect. I understand that OSHA has issued
approximately 150 citations pursuant to this Directive, including some
40 general duty clause citations. Moreover, one of the components of
the National Emphasis Program or nursing homes, described above, is
inspecting for occupational exposure to TB. I am also aware that TB is
a component of several regional and local emphasis programs.
As noted above, the Department's definition of ``recognized''
hazard is taken from well-established case law detailing what OSHA must
establish to demonstrate that a hazard is ``recognized'' for purposes
of the general deity clause. OSHA has had success in general duty
clause cases establishing recognition of a hazard on the basis of
industry recognition, employer recognition, and, in some cases, common
sense recognition. In case of TB, the Department has also utilized
guidelines published by the Centers for Disease Control and Prevention.
How the Department will prove recognition of the hazard necessarily
depends on the facts of each individual case.
Statutory Authority for Proposed 541 Regulation
What is ;our understanding of the intent of the Fair Labor
Standards Act (FLSA)? Now is the proposed 541 regulation consistent
with this legislative intent?
Answer: As the Supreme Court has indicated on a number of
occasions, the Fair Labor Standards Act (FLSA) was intended to
establish minimum wage standards and to more widely distribute work
among more employees. Regarding the exemptions for administrative,
executive and professional employees, Congress expressly provided the
Secretary of Labor with authority to define these terms. See 29 U.S.C.
213(a)(1) (``as such terms are defined and delimited from time to time
by regulations of the Secretary'').
In Mitchell v. Kentucky Finance Co., 359 U.S. 290, 295 (1959), the
Court stated that exemptions to the FLSA must ``be narrowly
construed.'' Do you believe that the proposed regulation meets that
standard? Please explain.
Answer: Yes. The Solicitor's Office, principally led by the
Associate Solicitor for the Fair Labor Standards Division, reviewed the
notice of--proposed rulemaking and determined that the proposal was
consistent with the Fair Labor Standards Act. Section 13(a)(1) of the
Act expressly provides the Secretary with the authority to define the
terms ``executive,'' ``administrative,'' and ``professional.'' See 29
U.S.C. 213(a)(1) (``as such terms are defined and delimited from to
time by regulations of the Secretary'').
Aren't the proposed changes in the duties tests uniformly favorable
to employers and unfavorable to employees?
Answer: No. In addition to increasing the salary level below which
a worker is automatically entitled to overtime from $155 to $425 per
week, the Wage and Hour Division's (WHD) proposal would, for example,
make it more difficult than it, is under current law to qualify as an
exempt executive. The standard test in the proposed rule, which applies
to all employees earning less than $65,000 per year, adds a third
requirement that the employee ``has the authority to hire or fire other
employees or whose suggestions and recommendations to the hiring,
firing, advancement, promotion or any other change of status of other
employees will be given particular weight''--to the two requirements
oft he existing short test, which is used today to test nearly all
employees for the executive exemption.
Isn't, creating a new exemption of ``highly compensated employees''
in clear violation of legislative intent to create only three
exemptions? Didn't Congress reject a salary ceiling in 1938?
Answer: As proposed by the WHD the test for highly compensated
employees contains the requirements that employees perform non-manual
work, that employees perform an identifiable executive, administrative
or professional function, and is consistent with the Fair Labor
Standards Act. As I understand, since at least the 1950s the
regulations have contained a different duties test for highly
compensated employees. For example, the current section 541.119 is
entitled ``Special proviso for high salaried executives.'' See also
current Section 541.214 (``Special proviso for high salaried
administrative employees'') and current Section 541.315 (``Special
proviso for high salaried professional employees''). The WHD Notice of
Proposed Rulemaking (NPRM) does not contain a salary ceiling because it
has a duties test in add non to a salary level and thus many employees
earning over $65,000 will be non-exempt under the Department's
proposal.
I have heard the argument that it is necessary to relax the duties
test in order to increase the minimum salary test. Why is that the
case?
Answer: There is no legal reason why the salary levels cannot be
changed without changing the duties test or vice versa.
Impact of Proposed 541 Regulation
I understand that the Solicitor's Office has been providing legal
advice to the Wage and Hour Division throughout the ongoing rulemaking
process on the 541 regulation. Were you involved in the decision to
promulgate a new regulation?
Answer: In conjunction with a team of attorneys led by the
Associate Solicitor for the Fair Labor Standards Division I have
provided legal advise to the WHD on its NPRM.
What is the goal of the new regulation.
Answer: Tammy McCutchen, Wage and Hour Administrator, has explained
that the goal of the WHD'S new regulation is to strengthen protections
for low-wage workers and to make the rules easier to understand, apply,
and enforce.
What legal and/or Policy parameters did the Solicitor's Office
impose, recommend, and/or, suggest during the rulemaking process?
Answer: During the preparation of the NPRM, which was largely
completed last year, the Solicitor's Office reviewed the policy
decisions of the WHD for compliance with the Fair Labor Standards Act,
the Administrative Procedure Act, and all other applicable statutes,
regulations, executive orders and case law.
Did you advise against any proposal that would have exempted fewer
workers?
Answer: The Solicitors Office reviewed the WHD's NPRM for
compliance with all applicable legal authorities. The role of the
Solicitor's office is to advise rulemaking agencies about the legal
ramifications and sustainability of specific proposals.
Did you advise in favor of any of the provisions that have the
effect of exempting more workers?
Answer: The Solicitor's Office reviewed all of the provisions of
the WHD's NPRM to ensure that they were consistent with all applicable
statutes, regulations, executive orders and case law.
Is there any reason--statutory, regulatory, policy, or otherwise?--
why the benefits to employers of any revision to the 541 regulation
must be greater than benefits to employees?
Answer: Accepting the premise of your question, I am not aware of
any legal reason why the benefits to employers of any revision to the
541 regulations mast be greater than the benefits to employees or vice
versa. However, as ESA/WHD have stated, the Department obviously
believes that there are substantial benefits for employees in this
NPRM.
Isn't it possible to ``clarify'' rules without exempting any more
workers?
Answer: it would be nearly impossible, as a practical matter, to
make clarifying changes to the rules without affecting the status of
any non-exempt or exempt employee. However, it is the job of the
Solicitor's Office to advise on legal requirements and sustain ability.
Isn't it possible to ``avoid litigation'' without exempting any
more workers?
Answer: It would be nearly impossible as a practical matter, to
make changes to the rules to ``avoid litigation'' without affecting the
status of any non-exempt or exempt employee. However, it is the job of
the Solicitor's Office to advise on legal requirements and sustain
ability.
Does ``modernizing'' and ``updating'' the regulations necessarily
require exempting more workers?
Answer: It would be nearly impossible, as a practical matter, to
modernize'' and ``update'' the rules without affecting the status of
arty non-exempt or exempt employee. However, it is the job of the
Solicitor's Office to advise on legal requirements and sustainability.
The proposed regulation claims that a greater increase in the
minimum salary test would cause job loss in the South. Was there any
economic analysis support conclusion.
Answer: Yes. I understand that the Employment Standards
Administration (ESA) prepared an economic analysis to support this
conclusion.
Did you analyze how many Wage and Hour opinion letters ruling that
particular employees are non-exempt would be reversed by the proposed
regulation?
Answer: I am not aware of any analysis regarding whether, and if
so, boor many, opinion letters would be affected by the proposed
regulation.
Would you please explain why 1.5 to 2.7 million on currently exempt
workers who would otherwise become non-exempt due to the increase in
the salary test
ill continue to be exempt due to changes in the duties test.
Wouldn't workers making over $22,100 fall under the short test?
Answer: Under the proposed regulation, all workers earning less
than $22,100 will automatically be non-exempt irrespective of their
duties. I understand that the Department's economic analysis shows that
1.5 million to 2.7 million currently exempt salaried workers will
become more readily identified as exempt salaried workers as a result
of clarifying the duties tests. I have been informed by ESA/WHD that
the Department's analysis shows that these 1.5 million to 2.7 million
workers, all of whom earn in excess of $22,100, are not eligible for
overtime under the current rules and will remain exempt salaried
workers under the proposed rule.
I have been informed by ESA/WHD that one sentence in the preamble
to the NPRM is apparently creating some confusion. This sentence
states: ``The PRIA [preliminary regulatory impact analysis) indicates
an additional 1.5 million to 2.7 million employees will be more readily
identified as exempt from the overtime requirements of the FLSA because
the updated duties tests will replace the duties tests in determining
their exemption.'' This sentence would have been clearer if it had
said: ``The PRIA indicates an additional 1.5 million to 2.7 million
currently exempt salaried employees will be more readily identified as
exempt from the over time requirements of the FLSA because the updated
duties tests will replace the duties tests in determining their
exemption.''
What is the minimum amount of education required red to qualify as
a professional under the proposed regulation?
Answer: The minimum education requirement to qualify as a
professional is the same under both the current and proposed
professional exemption. Both the current and proposed rules require,
among other things, that the employee be performing work in a field of
science or learning that ``customarily'' requires an advanced,
specialized degree. Since 1949; section 541.301(d) has explained that
``customarily'' means that employees with equal status and attainment,
but without a degree--such as ``the occasional chemist who is not the
possessor of a degree in chemistry''--``are not barred from the
exemption.'' The proposed rule continues this standard, as proposed
section 541.301(d) states that ``customarily'' ``generally restricts
the exemption to professions where specialized academic training is a
standard prerequisite for entrance into the profession.''
What is the minimum amount of education required to qualify as an
employee with a high level of skill or training under the
administrative exemption in the proposed regulation?
Answer: Neither the current nor the proposed administrative
exemption contains an education requirement.
Poultry and Meatpacking Industries
A recent court decision held that some work activities--in
particular, waiting in line for necessary equipment and walking to
workstations to receive necessary equipment--may not be compensable
activities. Do you agree, and if not, will you consider filing an
amicus to the expected appeal?
Answer: I do not agree with the First Circuit's recent decision in
Tum v. Barber Foods, Inc. On June 17, the Department of Labor, under my
direction as Acting Solicitor, filed an amicus curiae brief in support
of the plaintiffs' motion for panel rehearing and rehearing en banc.
Among other things, the brief argues that: ``The time spent by the
poultry processing employees waiting and walking after performing their
first principal activity and before performing their fast principal
activity is compensable `hours worked' . . . .''
In the settlement with Perdue, and the subsequent litigation with
Tyson, the Department of Labor took a very principled stand in support
of ensuing that poultry workers were paid for all time worked. In the
opinion letter issued by the Wage and Hour Administrator (which
invalidated a prior opinion Letter) regarding workers in meatpacking,
however, the Department reached a very ?different decision by declining
to ensure that all workers in meatpacking were similarly protected.
Please discuss the contradiction in these policies, and the reasons why
poultry workers are, in the view of Department of Labor, more worthy of
FLSA coverage than meatpacking workers.
Answer: First, to clarify; while I was personally involved in the
Perdue negotiations, the Tysons negotiations and subsequent litigation,
and the decision to sue George's Processing for, among other things,
failing to compensate employees for donning and doffing, I was recused
from consideration of the opinion letter you referenced until a few
days before it was issued by the WHD. The opinion was requested by a
then-partner at my prior law firm while I was under a one-year bar from
consideration of particular matters invoking my prior firm.
The opinion letter you referenced concerns the issue whether
section 3(o) of the FLSA could apply to employees ``putting on [or]
taking off'' ``protective equipment'' in the meat packing industry. As
you know, Section 3(o) provides that ``there shall be excluded any time
spent in changing clothes or washing at the beginning or end of each
workday which was excluded from measured working time during the week
involved by the express terms of, or by custom or practice under a bona
fide collective bargaining agreement applicable to that particular
employee.''As the Department has indicated in discovery of the Tysons
case, depending on the facts of the particular case, the WHD's opinion
letter applies in poultry, as well as meat packing, cases. Moreover,
the Department's position that donning and doffing is compensable in
the poultry industry applies to similarly situated workers in meat
packing and other industries.
H-2A and H-2B workers
In 2001, the Department of Labor failed to publish the adverse
effect wage rates that apply to H-2A temporary foreign agricultural
workers until a lawsuit was filed to enforce the Department's own
regulation. Why did the Department decide not to publish the adverse
effect wage rates in 2001 until sued, and to delay publication in 2002
until a court heating was scheduled--and what role did the Solicitor's
office play in these decisions? Why did the Department decide to appeal
the decision of the District of Columbia federal district court and
what role did the Solicitor's office have in deciding to make (and
later, drop) the appeal?
Answer: During the litigation, the government submitted a
declaration by Christopher T. Spear, Assistant Secretary for Policy,
explaining the reasons for its actions. The Declaration explained that
while the Department usually publishes the adverse effect wage rate
(AEWR) in February or March, the regulations require the Department to
publish the AEWR ``at least once in each calendar year, on a date or
dates to be determined by the Director'' and ``unusual circumstances''
caused the Department ``to delay its publication.'' The Declaration
noted, among other things, that the Department ``ha[s] received
correspondence from a number of members of Congress from both parties
which indicate that the Congress is examining various legislative
options to reform or replace the H-2A program. These legislative
options include possible adjustments to the nature and scope of an
employer's wage obligation. These members of Congress requested that
the Department refrain from publishing an AEWR for the current calendar
year until Congress has had an opportunity to address the issue since
the issuance of an AEWR for this calendar year may negatively impact
the progress and resolution of this legislative endeavor.'' Lawyers
from the Solicitor's Office's Employment Training and Legal Services
Division worked closely with the Justice Department throughout this
litigation.
As is common in cases in which the government receives an adverse
civil decision from a federal district court, the Department of Justice
filed a protective notice of appeal on behalf of the Department of
Labor. The Solicitor's Office made a confidential recommendation to the
Justice Department concerning whether appeal was warranted in this
case.
Under the FLSA, an employer must pay all workers the minimum wage,
over and above the costs of transportation and other costs incurred for
the primary benefit of the employer. The Eleventh Circuit, relying on
Department of Labor opinion letters, held in Armada v. Florida Pacific
Farms that this means an employer must reimburse temporary nonimmigrant
workers for transportation and visa costs to the extent these expenses
reduce workers' wages below the federal minimum. What steps is the
Department or the Soficitor's office taking to enforce this decision in
administering the H-2A and H-2B programs in the Eleventh Circuit and in
other circus?
Answer: The WHD is currently analyzing the Eleventh Circut's
decision in Arriaga v. Florida Pacific Farms. The WHD, supported by the
Solicitor's Office, has an active agriculture enforcement program. One
of the WHD's national initiatives is in agriculture. I understand that
during every agriculture investigation Wage-Hour investigators look
for, among other things, violations by employers of H-2A and H-2B
workers of various statutes, such as the FLSA and the Migrant and
Seasonal Agricultural Worker Protection Act, including minimum wage
violations. I have been informed that the WHD has one investigation
from Florida which raises, among other things, the issues considered by
the court in Arriaga. I am not aware of any cases referred to the
Solicitor's Office that raise these issues.
In how many instances has the Department of Labor documented non-
compliance with the FLSA minimum wage rules for H-2A or H-2B workers?
Has use Department of Labor pursued enforcement of these rules? Has our
office been involved in any such cases? Please provide the number of
such cases, and the details of any such cases you have handled,
including the nature of the case and its outcome.
Answer: The Department has an aggressive program to combat minimum
wage violations against H-2A and H-2B workers, and works to remedy any
such violations as a major component of its agricultural initiative. I
do not have statistics on the number of cases in which the WHD has
documented non-compliance with the FLSA minimum wage rules for H-2A or
H-2B workers. However, the WHD specifically investigates to determine
if there are any such violations and is often successful at recovering
back wages without the direct intervention of the Solicitor's Office.
While I do not have exact statistics on cases riled by the Solicitor's
Office in the last few years, I am aware of the following three cases
involving FLSA minimum wave or overtime violations: pending litigation
against the North Carolina Grower's Association where the employers
failed to pay overtime to H-2A forestry workers; pending litigation
against Sun and Moon Construction for failure to pay minimum wage to H-
2B workers; and a January 2002 injunction and unpaid minimum wage and
overtime compensation of $33,392 against Color Spot Christmas Trees
which employed H-2A, workers. As Acting Solicitor, and if confirmed as
Solicitor, I stand ready to assist in these efforts.
[Whereupon, at 11:34 a.m., the committee was adjourned.]