Small Businesses and Workplace Fatality Risk: an Exploratory Analysis
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Library of Congress Cataloging-in-Publication Data Small businesses and workplace fatality risk : an exploratory analysis / John Mendeloff ... [et al.]. p. cm.—(TR ; 371) Includes bibliographical references. ISBN 0-8330-3944-X (pbk. : alk. paper) 1. Industrial accidents. 2. Occupational mortality. 3. Small business. 4. Industrial safety. I. Mendeloff, John. II. Series: Technical report (Rand Corporation) ; 371. HD7262.S59 2006 363.11—dc22 2006009575 The RAND Corporation is a nonprofit research organization providing objective analysis and effective solutions that address the challenges facing the public and private sectors around the world. RAND’s publications do not necessarily reflect the opinions of its research clients and sponsors. R® is a registered trademark. © Copyright 2006 RAND Corporation All rights reserved. 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The Kauffman-RAND Center for the Study of Regulation and Small Business, which is housed within the RAND Institute for Civil Justice, is dedicated to assessing and improving legal and regulatory policymaking as it relates to small businesses and entrepreneur- ship in a wide range of settings, including corporate governance, employment law, consumer law, securities regulation, and business ethics. The center’s work is supported by a grant from the Ewing Marion Kauffman Foundation. Information about the RAND Institute for Civil Justice is available online (http://www. rand.org/icj). Inquiries about research projects should be sent to the following address: Robert T. Reville, Director RAND Institute for Civil Justice 1776 Main Street P.O. Box 2138 Santa Monica, CA 90407-2138 310-393-0411 x6786; fax 310-451-6979 [email protected] Information about the Kauffman-RAND Center for the Study of Regulation and Small Business is available online (http://www.rand.org/icj/centers/small_business). Inquiries about research projects should be sent to the following address: Susan Gates, Director Kauffman-RAND Center for the Study of Regulation and Small Business 1776 Main Street P.O. Box 2138 Santa Monica, CA 90407-2138 310-393-0411 x7452; fax 310-451-6979 [email protected] iii Preface A range of federal policies seeks to reduce regulatory burdens on small businesses. The Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA) and its predecessor, the Regulatory Flexibility Act of 1980, for example, seek to increase the weight given to small- business concerns in the regulatory rulemaking and enforcement processes. Similarly, the Occupational Safety and Health Administration (OSHA) exempts workplaces with fewer than 11 workers from regular “programmed” inspections, considers firm size when assessing penal- ties, and runs a consultation program for firms with fewer than 500 workers. While previous research suggests that small establishments (work sites) have much higher rates of deaths or serious injuries than larger establishments have, we know little about injury and fatality rates at small firms (companies). To shed light on these issues, this study examined the relationship between fatality rate, i.e., the number of deaths per 100,000 workers, and business size, both in terms of establishment size and firm size, for the period from 1992 to 2001. By providing a more complete picture of risks found at both smaller establishments and smaller firms, the research should help inform effective policies toward small businesses. The research should be of interest to policymakers at both the state and federal levels as well as businesses and others interested in accident prevention and compensation issues. The work was completed under the auspices of the Kauffman-RAND Center for the Study of Regulation and Small Business and was funded by the Ewing Marion Kauffman Foundation. v Contents Preface ............................................................................................................ v Figures ........................................................................................................... ix Tables ............................................................................................................ xi Summary .......................................................................................................xiii Acknowledgments .......................................................................................... xxiii Abbreviations ................................................................................................. xxv CHAPTER ONE Introduction ..................................................................................................... 1 Why Size Might Make a Difference ........................................................................... 2 Employer Investments in Safety Might Reflect Costs and Benefits of Safety Measures .............. 2 Costs and Benefits Might Be Related to Size............................................................... 3 Previous Research on Size and Risk ........................................................................... 6 Fatalities and Other Serious Injuries ........................................................................ 6 Less-Serious Injuries ........................................................................................... 7 Accident Types and Size....................................................................................... 8 Underreporting and Size .....................................................................................