CHANGES TO THE HCS

The new HCS still requires chemical manufacturers and importers to evaluate the chemicals they produce or import and provide hazard information to employers and workers by putting labels on containers and preparing safety data sheets.

However, the old standard allowed chemical manufacturers and importers to convey hazard information on labels and material safety data sheets in whatever format they chose. The modified standard provides a single set of harmonized criteria for classifying chemicals according to their health and physical hazards and specifies hazard communication elements for labeling and safety data sheets.

Major changes include:

Hazard classification: Chemical manufacturers and importers are required to determine the hazards of the chemicals they produce or import. Hazard classification under the new, updated standard provides specific criteria to address health and physical hazards as well as classification of chemical mixtures.

Labels: Chemical manufacturers and importers must provide a label that includes a signal word, pictogram, hazard statement, and precautionary statement for each hazard class and category.

Safety Data Sheets: The new format requires 16 specific sections, ensuring consistency in presentation of important protection information.

Information and training: To facilitate understanding of the new system, the new standard requires that workers be trained by Dec. 1, 2013, on the new label elements and safety data sheet format, in addition to the current training requirements.

OSHA made limited changes to the proposed rule it had issued previously. Changes related to labeling include flexibility regarding required statements to allow label preparers to consolidate or eliminate inappropriate or redundant statements. The final rule also allows for longer deadlines for full implementation.

CHEMICAL USER AND PRODUCER RESPONSIBILITIES

Responsibilities under the revised HCS will depend on whether an organization is a chemical user or a chemical producer.

Chemical users must continue to update safety data sheets when new ones become available, provide training on the new label elements and update hazard communication programs if new hazards are identified.

Chemical producers must review hazard information for all chemicals produced or imported, classify chemicals according to the new classification criteria and update labels and safety data sheets.

EFFECTIVE DATES

Need for Standard Regulations

Prior to the adoption of the GHS by the United Nations in 2003, different countries had many different regulatory systems related to hazard communications. There are a number of disadvantages to these varying standards, including:

• Diverse and conflicting requirements created confusion for employers required to provide hazard information to employees;
• Labels and safety data sheets may have included symbols and hazard statements that were unfamiliar to readers or not well understood; and
• Containers may have been labeled with such a large volume of information that important statements were not easily recognized.

Development of multiple sets of labels and safety data sheets was a major compliance burden for chemical manufacturers, distributors, and transporters involved in international trade. Small businesses had particular difficulty in coping with the complexities and costs involved.

Adoption of the GHS

As a result of the issues outlined above, and in recognition of the extensive international trade in chemicals, there has been a long-standing effort to harmonize these requirements and develop a system that can be used around the world. In 2003, the United Nations adopted the GHS. The new system is being implemented throughout the world by countries including Canada, the European Union, China, Australia and Japan.

In the United States, the adoption of the GHS followed this timeline:

• September 2009: OSHA published a proposed rulemaking on to align OSHA’s HCS with the GHS.
• March 2010: OSHA held public hearings regarding the proposal.
• Oct. 25, 2011: After extensive notice and comment, the Office of Management and Budget (OMB) received the final rule on for a 90-day review.
• Jan. 24, 2012: The 90-day deadline expired and the OMB extended the review of the final rule until further notice.
• March 20, 2012: The final rule was filed with the Office of the Federal Register for publication on March 26, 2012.

The Department of Transportation (DOT), Environmental Protection Agency, and the Consumer Product Safety Commission actively participated in developing the GHS. DOT has already modified its requirements for classification and labeling to make them consistent with United Nations transport requirements and the new globally harmonized system.

EFFECT OF THE revised HCS

Over five million workplaces and over 40 million workers will be affected by the changes to the HCS. OSHA estimates the revised standard will prevent 43 fatalities and 521 injuries and illnesses annually.

The annualized monetized benefits associated with the final rule’s reductions in safety and health risks are an estimated $250 million a year. OSHA estimates additional annualized benefits of $507 million a year from cost reductions and productivity improvements. OSHA also anticipates that the final rule will generate substantial savings from simplified hazard communication training and from expanded opportunities for international trade due to a reduction in trade barriers.

The estimated cost of the final rule is $201 million annually. The costs includes reclassification of all chemicals, additional training of workers on the new labeling system and familiarization with the modified HCS standard.

More information

More information on the hazard communication standard, including the link to the Federal Register notice, can be found on OSHA’s hazard communication safety and health topics page at www.osha.gov/dsg/hazcom/index.html.

As previously mentioned, there is still litigation pending which is seeking to block this ruling overall. Should additional changes or updates occur between now and January 31st, we will update you accordingly.

Employers will be required to post the NLRB poster in the same place that other required workplace posters are, or electronically post, if that is how the company notifies their employees of information. This does not mean an email distribution, but rather an online data warehouse where policies or workplace documents are stored.

The required workplace poster is now available for free download from the NLRB website.

What is included in the law?

The law includes numerous health-related provisions that take effect over the next several years, beginning last year in 2010. Some of the major provisions include:

• Guaranteed issue and community rating will be implemented nationally so that insurers must offer the same premium to all applicants of the same age, sex, and geographical location regardless of pre-existing conditions.
• Health insurance exchanges will form in each state, offering a marketplace where individuals and small businesses can compare policies and premiums, and buy insurance.
• Firms employing 50 or more people but not offering health insurance will pay a “shared responsibility payment” if the government has had to subsidize an employee’s health care.
• Non exempt persons not securing minimum essential health insurance coverage are also fined under the shared responsibility rules. This requirement to maintain insurance or pay a fine is often referred to as the individual mandate, though being insured is not actually mandated by law.
• Improved benefits for Medicare prescription drug coverage are to be implemented.
• Medicaid eligibility is expanded to include all individuals and families with incomes up to 133% of the poverty level.
• Low income persons and families above the Medicaid level and up to 400% of the poverty level will receive subsidies on a sliding scale if they choose to purchase insurance via an exchange.
• Very small businesses will be able to get subsidies if they purchase insurance through an exchange.
• Establishment of a national voluntary insurance program for purchasing community living assistance services and support.
• The law will introduce minimum standards for health insurance policies and remove all annual and lifetime coverage caps.
• Policies issued before the law came into effect are “grandfathered” and are mostly not affected by the new rules.
  How will it be funded?

The Act’s provisions are designed to be funded by a variety of taxes and offsets. Major sources of new revenue include Medicare tax on incomes for individuals earning over $200,000 and joint filers over $250,000, an annual fee on insurance providers, and a 40% tax on “Cadillac” insurance policies. There are also taxes on pharmaceutical companies, high-cost diagnostic equipment makers, and a federal sales tax on indoor tanning services.

How are legal challenges impacting the law?

Organizations and lawmakers who opposed the passage of the bill have taken legal action against it and several court challenges are currently at various stages. The targets of the threatened lawsuits are several key provisions of the bill, but most focus on the “individual mandate”. A total of 28 states have filed joint or individual lawsuits (including 26 states engaged in a joint action) to overturn the individual mandate portions of the law, arguing that fining individuals for failing to buy insurance is not within the scope of Congress’s taxing powers. Members of several state legislatures are attempting to counteract and prevent elements of the bill within their states, and legislators in 29 states have introduced measures to amend their constitutions to nullify portions of the health care reform law. It is likely that the constitutionality of the bill will be challenged before the Supreme Court sometime within the next year or so.