How Federal Overregulation Would Impact This Missouri Small Business Owner

Date: April 20, 2016

A look at two harmful Department of Labor rules.

How Federal Overregulation Would Impact This Missouri Small Business Owner

Dave
Griggs, chairman of the Missouri Leadership council and owner of Dave Griggs’
Flooring America, says he is biased in thinking that Missouri—and Columbia in
particular—is a great place to do business.

In
addition to being a low-tax state, Griggs says the presence of the Regulatory
Fairness Board is a huge benefit. The Board aims to ease the regulatory burden
on small businesses by presenting constructive input on the impact of
regulations.

At
the federal level, however, the overwhelming tide of regulation is a much
bigger problem.

“My
big gripe right now is gross overregulation, to the point of absurdity, by the
federal bureaucracies,” Griggs says.

The
most recent issue concerning him is a new regulation limiting silica exposure,
which was issued by the Department of Labor’s Occupational Safety and Health
Administration. Under the new rule, the amount of silica that workers on the
job could be exposed to would be cut in half. In addition to increasing
monitoring costs and paperwork requirements for small businesses, NFIB
estimates this regulation would cost the economy $7.2 billion a year and 27,000
lost jobs over 10 years.

Griggs,
who owns a flooring company, says this will directly impact his business
because the flooring industry uses a lot of ceramic tile. Sand—the main
ingredient of which is silica—is a crucial component of installing tile floors.
Beyond Griggs’ company, he says this rule will have a widespread impact on the
construction industry because of the use of sand in procedures like bricklaying
and cement laying.

Furthermore,
not only did OSHA not meet its obligation to consult small businesses about the
impact of such a heightened standard, but the new regulation is also 1,772
pages. Most small businesses are not going to be able to read or comprehend the
content before an inspector shows up.

 “Unless
a small business is a member of some national association that has the
wherewithal to pay people to research this and pay lawyers to read it and say
this is what this really is, you’re just at the mercy of whoever the inspector
happens to be,” Griggs says. “So it becomes a totally arbitrary process, which
is just wrong.”

 Another
huge concern for Griggs is a Department of Labor interpretation of a rule
regulating the use of subcontractors. This rule—which was handed down in July
2015 but has flown under the radar—ignores IRS rules and classifications about
subcontracting and instead says that workers who are currently classified as
subcontractors are actually employees. This makes them eligible for benefits
and puts businesses on the hook for future and back payments of federal
withholding, Social Security and unemployment tax, not to mention penalties and
interest on the back payments.

 Because
it’s an interpretation of a rule, Griggs notes, there’s no publication, no
public comment and no Congressional oversight. The day the interpretation of
the rule was signed, it became law, and now companies are being audited on the
East and West Coasts based on this rule.

 “Even
though I have a 40-year-old business, the day that auditor comes in and [tells
me what I owe], I file bankruptcy,” Griggs says.

NFIB
is working for resolution on both regulatory issues. 

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