Guess Again

It’s one of those stories that just screams “corporate waste and greed” or possibly “managerial incompetence” – at least, the headline does. Wal-Mart is spending somewhere on the order of $2 million fighting a $7,000 fine slapped onto them by OSHA as the result of a seasonal worker being trampled to death on “Black Friday” last year. Any rational person reading the story will probably wonder why the company doesn’t just save itself the $1,993,000 and pay the fine; certainly it makes no sense to spend 286 times more to fight a penalty than to just accept it. One could almost imagine a stockholder’s revolt, like the one Disney had when they gave Michael Ovitz $76 million in a termination package after less than one (unproductive) year with the company, breaking out over this. It’s when you read down past the headline and find out what the fine is actually about that things become rather murky…

As recounted on the NBC New York site , the fine in question is intended to punish the retail giant for unsafe working conditions that led to its employee’s wrongful death. The headlines imply that Wal-Mart is trying to get out of having to pay anything over this episode, but the full story establishes that the company has already paid out $400,000 for a victims’ compensation fund and donated $1.5 million to the community, as well as developing and implementing new crowd management plans for next year. The real issue here is that OSHA is attempting to classify “crowd trampling” as an occupational hazard for the first time in history – and that has implications that reach far beyond $7,000 in fines or even $2 million in legal fees…

What a lot of people in this country fail to realize is that OSHA is not a legislative body; no one within the organization will ever stand for election and most of its personnel are simply career civil servants – employees of the Federal government, or technically, you (assuming you are a U.S. citizen). They serve at the pleasure of the President, and while it is possible for their regulations to be struck down by the Federal courts as illegal or unconstitutional, this rarely happens. The facts of the matter are that a group of people who were not elected to office, by you or anyone else, are creating laws out of thin air that could negatively impact a company which has already gone above and beyond anything specified in the existing laws to handle the situation…

To take this situation to its logical conclusion, suppose some minor bureaucrat from your local government decided that exposure to water should be considered a hazardous working condition, because someone in your state had drowned once. This individual states that water is now a work hazard, and because you have a drinking fountain in your place of business, you are in violation of the law and must pay a fine. Would you whip out your checkbook and pay the fine, knowing that tomorrow the same petty official could declare pencils, photocopiers or breathing to be workplace hazards and enact another fine? Or would you draw your line in the sand and say “no?” Is this actually an effort to avoid senseless loss of life in the workplace, or a heavy-handed power grab by unelected Executive Branch personnel ?

Of course, it’s possible that Wal-Mart would never have run afoul of the new anti-trampling laws; that their new management plans would have been accepted by the courts as a reasonable response to an unavoidable workplace hazard, and no ambulance-chasing lawyer or power-grubbing bureaucrat would ever have attempted to shake them down for further funds, settlements, or sanctions…

But all things considered, I don’t think we can reasonably blame them for contesting this OSHA ruling…