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Software developers try to end regulatory nightmare.

Software Developers Try to End Regulatory Nightmare

A new statute is passed. Companies rush to meet these new regulations. If they don't comply, they are faced with substantial penalties. Yet at the same time, the cost of complying can amount to millions of dollars.

One cost-effective solution business turns to is technology. Software developers are helping companies get a handle on a growing number of regulations in areas such as environmental protection, employee benefits and workplace safety.

For instance, in the area of environmental compliance, the number of federal and state regulations has risen from more than 2,000 in 1970 to more than 51,600 in 1986, according to George Esry, sales manager for the Exton, PA-based ERM Computer Services, Inc. Under the 1986 SARA reauthorization, beginning July 1, companies must report the number and quantity of hazardous substance releases each year. ERM has developed a software module, Enflex 313 Form R, to help companies meet the more stringent reporting requirements for water, land, underground, air, offsite waste and other releases.

More than 400 chemicals now require analysis; it is possible that some organizations, mostly chemical companies, face the administrative burden of reporting data on several hundred of them, says Mr. Esry. To meet these requirements, ERM's Form R module establishes a database of chemicals and quantities at each site.

The regulation also specifies how quantities are to be reported. The program organizes data to prepare calculations, such as mass balance, and will print Form R and submit it electronically to the Environmental Protection Agency.

OSHA's Answer

New requirements for training workers can also pose a heavy financial and administrative burden. How does a company with several hundred employees, who may switch jobs often and have varying degrees of knowledge, cost-effectively meet its training duties? This is the problem Waltham, MA-based Interactive Medical Communications saw when it created a software system to help employers meet the requirements of the Occupational Health and Safety Administration. OSHA's Hazard Communications Standard, which originally applied to the 14 million workers in the manufacturing sector, requiring an additional 18 million workers in chemical materials to be trained.

The hazardous communications program divides information into six categories of chemical exposures and hazards: solvents, metalworking fluids and lubricants, adhesives, compressed gases, metals and corrosives. The software runs on an IBM AT or PS2 and uses a laser disk system and a touch screen monitor. Employees respond to the queries from the system after each segment. To ensure that employees have learned the concepts, the system repeats the material and will not advance until the user responds correctly.

The software also keeps track of when and to what degree an employee is trained, which significantly reduces the large amount of record-keeping a training program requires. Says Jim Mason, president of Interactive Medical Communications: "The system has the ability to track the performance and participation of each user." Mr. Mason's company has also created a program to train workers on asbestos removal.

Section 89 Response

Employee benefits has seen its share of regulatory changes as well. Part of the Tax Reform Act of 1986, Section 89, sets an October 1, 1989, deadline for companies to show proof that their group benefit plans do not discriminate in favor of highly compensated employees.

"We've paid a good deal of attention to a company's eligibility in the benefits plans," says Richard Macy, principal of WTR Data Services, Inc., in New York, part of the benefits consultant Williams, Thacher & Rand. "The requirements leave employers with a massive amount of data they never had before."

Section 89 requires employers to prove they are not discriminating by meeting a series of standards--tests that involve costly gathering and monitoring of data to show which benefits workers actually are using. WTR has introduced a software program that will compare testing based on legislation meeting current IRS requirements as well as those proposed by Rep. Dan Rostenkowski, chairman of the House Ways and Means Committee.

Employers will have to collect information--first-time data, such as in which health plans an employee participates and whether dependents are covered under other plans. The software organizes data according to plan and employee information and compares the two to come up with the eligibility ratio.
COPYRIGHT 1989 Risk Management Society Publishing, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1989 Gale, Cengage Learning. All rights reserved.

Article Details
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Author:Oshins, Alice H.
Publication:Risk Management
Article Type:column
Date:Jul 1, 1989
Previous Article:Commissioner implements plans after court ruling.
Next Article:Paying the price of future health care benefits.

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