Washington Report 062000

Date Published: 
Original Author: 
Robert M. Fells
Original Publication: 
ICCFA Magazine

ICFA Submits Comments on Telemarketing Sales Rule 

by Robert M. Fells, Esq., General Counsel 
Similar to its review of the Funeral Rule, the Federal Trade Commission (FTC) is soliciting public comments as part of its review of the Telemarketing Sales Rule. The ICFA recently submitted comments to the FTC urging retention of the existing exemption for preneed-type phone calls.
"The ICFA supports the FTC Telemarketing Sales Rule as an effective regulation that protects the public from abusive and fraudulent telemarketers without imposing unreasonable burdens on legitimate businesses. We believe that the existing rule achieves an appropriate balance between enabling consumers to avoid unwelcomed calls while safeguarding the constitutional rights of commercial free speech to businesses.
"Our comments are specifically addressed to §310.6(c) of the rule that exempts 'Telephone calls in which the sale of goods or services is not completed and payment or authorization of payment is not required, until after a face-to-face sales presentation by the seller.' The ICFA advocated this exemption during the original 1995 rulemaking proceeding and we believe that it has worked well for the following reasons.
"Typically, members of the funeral home and cemetery profession do not sell property, merchandise or services over the phone. Telemarketing is used to determine the level of interest by consumers in making prearranged funeral and burial plans, then establishing appointments with prospective customers at a mutually agreeable time in order to make an in-person or face-to-face 'preneed' sales presentation.
"The FTC Request for Public Comments specifically asks, 'Is the exemption for 'face-to-face' transactions still appropriate? If not, why not, and how should this exemption be changed?' The ICFA is not aware of abuses to the §310.6(c) exemption by funeral-related sellers and the required 'face-to-face' component of the exemption is a significant safeguard to prevent potential abuses. Industry members know from experience that it is difficult, if not impossible, to sell various types of merchandise such as caskets, monuments, vaults, cemetery lots or mausoleum crypts sight unseen by telephone. In the absence of a personal examination of these items or through viewing representations such as models, photographs or drawings during a face-to-face presentation, a purchase decision will not be made by consumers.
"The ICFA urges the Commission to retain the §310.6(c) exemption as a commonsense method of applying the Telemarketing Sales Rule only to those entities that actually attempt to sell goods and services over the telephone. Application of the rule to businesses that solely make appointments with prospective purchasers is unreasonable and unduly burdensome, offering no additional level of consumer protection. Furthermore, consumers are protected from potential fraudulent or high-pressure sales tactics of face-to-face presentations through the FTC Three-Day Cooling Off Rule and other federal and state laws."
Public comments may be viewed on the FTC Web site at www.ftc/gov by clicking on "Consumer Protection" and following the prompts to "Telemarketing Rule Review." Important developments will be reported as they occur. 

ICFA Testifies Against Ergonomics Proposal 

On May 9, ICFA Past President Edward C. Laux, CCE, testified on behalf of the association before the U.S. Department of Labor public hearings in Washington, D.C., on the proposed ergonomics program standard. The standard was developed by the Occupational Safety and Health Administration to reduce repetitive stress injuries, known as musculoskeletal disorders (MSDs), in the workplace. However, OSHA has stirred considerable controversy in the business community with its 300-page proposal requiring employers in manufacturing and manual handling operations to initiate a number of activities when an employee reports an OSHA-recordable MSD injury. The standard affects cemeteries, funeral homes and related facilities and contains no small business exemption.
Laux stated: "The ICFA supports efforts to identify and eliminate musculoskeletal disorders or MSDs in the workplace. However, we believe that the proposed ergonomics program standard is both vague and unduly complicated, especially in its application to small businesses in the cemetery and funeral home industries. Statistically, there are at least 100,000 cemeteries in the United States, although the U.S. Geological Survey estimates that this number could be as high as 200,000. Many cemeteries operate through volunteer boards of directors and one or two employees. There are also at least 22,000 funeral homes, and the vast majority of cemeteries and funeral homes, approximately 87 percent, are small businesses and family-owned operations. The owners of these small businesses wear a number of hats, including that of legal compliance officer for the many governmental regulations they face, including existing OSHA standards."
The ICFA acknowledged that the proposed ergonomics standard has made some effort to accommodate the 1.3 million small businesses OSHA believes will be affected. However, Laux pointed out that "we are concerned that many owners will feel unqualified to implement the mandated requirements. OSHA has suggested that small businesses adapt the guidelines contained in its publication for meatpacking plants, an approach that we believe is inappropriate for cemeteries and funeral homes, to say the least.
"More importantly, cemeteries and funeral homes in compliance with existing OSHA safety standards have found these regulations workable because they define the potential hazard and then identify appropriate remedies. By contrast, the ergonomics proposal would require employers to become MSD experts in identifying and rectifying potential hazards on their own.
"After the fact, OSHA personnel would inspect the worksite, in effect second-guessing the employer, to determine compliance. We know of no other OSHA standards that place businesses in such a vulnerable position. Although OSHA claims that small businesses would not need to hire expensive consultants to comply, we strongly disagree. The threat of costly fines for technical infractions will force many small business owners, in our opinion, to retain ergonomics consultants to advise them."
The ICFA pointed out that cemeteries and funeral homes have a documented history of few worker injuries and this fact should be recognized in applying the ergonomics standard to these operations. Laux stated, "Statistically, the cemetery and funeral home industries have recorded low injury rates and, based on my own personal experiences, industry members have more often been fined for paperwork violations than for any injuries sustained by their workers due to an unsafe worksite. The MSDs covered by the ergonomics proposal involve activities whereby tools, power lifts and other equipment have significantly aided workers and reduced the potential for injury.
"For example, the mechanical backhoe has eliminated the hand-digging of graves and consequential back injuries. However, the ICFA is alarmed that implementation of the proposed ergonomics program will launch yet another series of costly paperwork penalties against small businesses that yield little, if any, countervailing benefits to worker safety.
"For these reasons, the ICFA supports the use of an alternative threshold test to trigger coverage under the ergonomics program for cemeteries and funeral homes. The requirements would become effective whenever two adjudicated workers compensation MSD claims are handled within a three-year time period. This accommodation would recognize the historically low injury rate in our industries and allow small businesses to make adjustments where a problem has been detected without risking potentially costly fines for non-compliance.
"In addition, we understand that many MSDs are the result of repetitive motion tasks throughout the workday. Cemeteries and funeral homes are unique among small businesses because of the wide spectrum of tasks performed by their workers. A constant variety of office activities and field work, often by the same worker, are performed every day and eliminate the potential for repetitive motion injuries. In my opinion, it is rare for a cemetery or funeral home worker to perform only one or two tasks that would place the person at risk of sustaining a repetitive motion-type of MSD."
The ICFA shared the witness table with representatives from the National Funeral Directors Association and the National Funeral Directors and Morticians Association. The three associations coordinated their testimony and agreed to support a "two-MSD" threshold test in presenting their views to the Department of Labor.
Briefly, the ergonomics standard would require employers to establish: 1) Management leadership and employee participation programs; 2) Hazard information and reporting; 3) Job hazard and analysis control; 4) Training; 5) MSD (medical) management; and 6) Program evaluation. In addition to the vague provisions and substantial fines for non-compliance, there is considerable disagreement over the costs to American businesses. OSHA claims that the program will cost businesses approximately $4 billion annually, but the U.S. Small Business Administration argues that the cost could be 15 times higher. Adding to the controversy, OSHA refused to wait until the conclusion of a Congressionally-funded study by the National Academy of Sciences into the causes and extent of MSDs in the workplace. OSHA hopes to implement the new program before the end of this year.
The ICFA is currently drafting post-hearing comments to persuade the Department of Labor that accommodations for cemeteries and funeral homes are justified and necessary. The ICFA has partnered with the U.S. Chamber of Commerce and the National Coalition on Ergonomics (NCE) to oppose enactment of the ergonomics standard in its present form. For more information, the NCE Web site can be accessed on the internet at www.ncergo.org. The OSHA Web site also contains information relating to the standard, including transcripts of the public hearings at www.osha.gov. ICFA members will be kept informed of developments.