MR. JENKINS: Thank you, Richard. Now, I think we have just a few minutes for any questions that anyone might have. Who would like to lead off? Okay, we have one. Go ahead.

Q : I have a question generally directed at the warehousing industry. As you people probably know, OSHA is coming up with potential standards in ergonomics. Prior to that in the past in some draft regulations has been the use of the NIOSH lifting equation as part of the OSHA standards. In my opinion, it has a very bad affect on the warehousing industry or anybody that is stacking cases or palletizing or depalettizing cases or bags or anything like this. Have you people addressed this and do you feel the same way I do?

MR. MURPHY: Well, let me try to answer that from a general perspective. First, we think a common sense practical approach to all of these programs are what is appropriate, and, in fact, just before this sessions started I was having a conversation with Dr. Waters from NIOSH about our becoming involved in doing further examination of warehouse positions to take a more practical approach to measuring the risks. I expect that we will do that over the next several months. Do any of you want to comment on that?

Q : Our experience is we sell bag goods at 80 pounds, 90 pounds, quickcrete, and things of this nature. When we did an accident review, we found that our employees didn't get injured lifting the heavier bags. Theirs was more of a repetitive lifting. You know, I see no difference between lifting an 80 pound bag and two 40 pound bags. I mean, if somebody wants 80 pounds of quickcrete, you are going to give them 80 pounds of quickcrete. It is either two bags or one bag. Two bags, I will take a chance and maybe not bend my knees, maybe lift incorrectly, but our data that we have taken a look at is more from a repetitive lifting. We can't isolate one product no matter what weight it is that would cause somebody to get injured. If they would come up with you can't lift over 51 pounds by yourself anymore, case closed, we would have a major concern with that because that is our business.

Q : Well, that was my question. It is not whether we could use this as a guideline or anything like that. If this NIOSH lifting equation becomes the law, which is possible, does this present a real problem to the warehousing industry? I think you mentioned the 51 pounds. However, if you analyze the jobs that are doing more than three or four cases or bags a minute, the 51 drops to something like 20 or 25 pounds. It goes down pretty fast when you apply the frequency factor to it.

Q : I was going to say usually in our end of the business it is when the compliance officer is in as to what we get cited for. He can see somebody buying one bag of goods at 80 pounds and say beautiful. He can see buying four pounds, but it would cause us some major problems, that particular thing, if it were definitely law enforced. It would cause us some problems.

MR. MURPHY: That was one of the reasons why I showed that slide about the container. I think some of the questions that you raise have to be taken in light of the economy that we are all into here, and it is not necessarily just domestic but it is a world economy. What we do here will have ripple effects, pro or con, either way, and what will it do to business in the interim.

To answer your questions -- I didn't understand your question initially. You were asking if we believed that some strict interpretation of the current formulas and other guidelines would have an impact on the industry. The answer is absolutely yes. That is why we currently are so actively involved in working with OSHA and others in trying to develop practical hands on guidelines for the industry.

Q : I have two questions, if I might. The first one is for Chuck and Richard. If you guys could talk a little bit about the cost benefit process that you went through for some of your improvements, and then the second one for David is did you have the same -- we looked at a four and a half year pay back period, if you will, on some of the things that you did. Did you sell that up front as a four and a half year pay back period or how did that come about? Looking back at 1991, how did you sell the program versus retrospectively looking at it and seeing it to the point I have here?

MR. SWANDERSKI: If I can go first, the cost benefit analysis in our industry, we look at total cost of shipping, storing and moving goods. We don't try to isolate cost benefit and ROI strictly on back support, safety shoes, mechanized conveyors and things of this nature. We have a real good idea of what it cost us to ship goods. Part of that cost also included reworks on damages, rerouting because of poor sortation, accidents, the time it takes to investigate accidents, workers' comp. cost, light duty cost, what I call you can't work full tilt cost, so you are actually doing a lighter job, we are paying you a wage to do a lighter job.

But, the biggest thing on cost and return on investment is that you have to look at a total picture of what things cost you. I will go back to putting a .40 broom hanger up to protect a broom. Well, I can sit there as an ergonomic consultant or as an efficiency expert and say you are spending 1.3 hours per week looking for the broom. That is $7.55 plus benefits. If you put the .40 broom hanger on, you have improved your efficiency. So you look at the total package of what things do for you, and it helps us out to do the cost benefit.

We try to sit in on every decision that is being made. We were involved in a planning session, and we had a five page punch list for our newer distribution centers, what we wanted. We try not to be a separate entity because then it becomes very, very difficult to give an ROI on pure safety, pure ergonomics and pure workers' comp. because some of the things, my philosophy and our company's philosophy is let me control the frequency of injuries. Costs of injuries depends on so many variable factors that I don't have a clue as to how you control the totality of it, but if no one gets hurt and no one slips on this and no one gets hurt, then we don't have a dollar problem.

MR. MURPHY: I will be honest. We did not do any cost benefit analysis, not because we can't, but because it really didn't matter to us. We knew what our issues were. We knew what our work comp. costs were, and we knew we lived in a state that was extremely generous, if you will, on the work comp. program, and we had to find a way to stay competitive.

We also are probably much more sophisticated because of the service nature of our business in ABC cost accounting. So I know exactly what it costs us to do a service for any particular customer, and that is why the cost per hour has a value to us. This may not necessarily be what Chuck referred to, from an overhead standpoint.

MR. FORTE: To answer your question at J. C. Penney, cost benefits was not an issue in selling the program. About the only thing we discussed was cost avoidance. We saw a trend, and we didn't want the injury rate to keep increasing. So we talked about future cost avoidance. Going with the program was not based on cost savings. J. C. Penney has always been a very people oriented company. We have extensive safety programs, rep meetings, all kinds of things, and as soon as our executive management found out that this was something that would improve the workplace for our people, it really was a no brainer.

MR. JENKINS: Next question.

Q: My name is Tom Doyle. I am an ergonomics consultant with the State of Ohio, and one of my specialties is in occupational vibration and also dealing with whole body vibration. I have measured vibration in a number of vehicles, including forklifts, and I was interested in Mr. Murphy's comments about some of the ergonomic seats. As I have recommended these ergonomic seats for warehouses, which may be similar to yours, and this is the first time I have heard objections to these types of seats. I find it very interesting.

I would like to kind of pursue that a little further, and I also wanted to ask Mr. Forte there from J. C. Penney if you have ever had any experience in changing out these seats on forklifts.

MR. MURPHY: I made those comments on the old seats and I showed the picture on purpose because it is not that we haven't changed them all, it is just that there are a few people who prefer the old seat style. Again, some of it is related to the size of the individual. It is tough to find seats to fit everybody's bulk, if you will. I am just being honest, and I am being honest about the fact that even the smaller people who are sitting there driving all day need to change their position occasionally. You can't do that as easily in an ergonomic seat. Again, the issue of trying to turn back for a bigger person is also very hard to do. So I don't have any other solutions. There are a few people that have asked to keep the old seats because of that, and we have granted that because, again, it is their preference.

MR. FORTE: At J. C. Penney we have a very large forklift fleet. We have about 600 vehicles, and we replace a lot of them each year on an ongoing basis. We have a very good partnership relationship with our forklift suppliers, and each year before we purchase we review new technology, new vehicles. We get them in our facilities, and we let our people use them. We get feedback from them. So our people would use these vehicles, have an opportunity to tell us what is comfortable and what is not comfortable. We are limited to a degree by what is available, but we do everything we can to make sure that we get the best equipment for our people. That includes seats, seat belts, controls, everything.

MR. JENKINS: One last question.

Q: My name is Ed Frederick. I am an industrial hygienist with Michigan OSHA, and I wanted to clear up a misunderstanding that I may have had regarding something Chuck said. You increase the size of your isles so that workers would move their feet and turn their whole body instead of twisting?

MR. SWANDERSKI: No, that was one of the options that we had. From the design standpoint, that is the way it is. We did not do that. That was one of the things I said we could do to get them to get in position. A lot of times I think that by design we force employees to do things that aren't necessarily good, but by redesign we could force them to do -- I will clarify this. We would force them to do something better in that they wouldn't be twisting, but they would be carrying, which in the long run may end up being more of a deficit than just the normal twisting motion. Is that okay?

Q: Yes. Speaking on behalf of OSHA, even though no one asked me to, the gentleman's concern here that we are suddenly going to become the box police on the weight, and performance standard versus a specification standard, that is something that I think industry always has to be concerned about. When we talk about a performance standard and then make it into a specification standard, there is an unfairness there that I think can be related back to our desire to write a violation. I think the three gentlemen that spoke today all have excellent programs, and if we do come up with a standard OSHA will go out and review those programs. Especially in J. C. Penney's case, you know that when you have a program that is run over 50 states you can have deficiencies at a given location. That is what we will be doing is going out and looking at deficiencies in otherwise excellent programs.

MR. SWANDERSKI: Thank you. I concur with you.

MR. JENKINS: With that, I would like to close the session by thanking the speakers, Chuck Swanderski of Lowes Company, Dave Forte of J. C. Penney, and Richard Murphy, Jr. of Murphy Warehouse.

THIS PAGE WAS LAST UPDATED ON OCTOBER 28, 1997