TOPIC/WORKPLACE - DRUG-TEST LAW YEALDS EMPLOYERS' CAUTION

The new freedoms present a 'Pandora's box,' an analyst says.
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Steps to drug or alcohol testing

The legislation requires employers who choose to test to follow these
procedures at a minimum. Random testing requires additional steps.

1. Decide what types of testing to perform: Pre-employ- ment, random,
reasonable suspicion or post-accidend.

2. Develop a policy that outlines testing, disciplinary, and rehab-
ilitation procedures.

3 Establish an awareness program about the danger of drug and alcohol use in
the workplace. Employers who offer an employee assistance program must
inform workers of the benefits and services available. If the employer does
not have an EAP, the employer must post a list of such providers and create
a file of substance abuse programs and other resources.

4. Provide two hours of initial training to supervisors, and one hour
annually thereafter. The training must cover information on recognizing
substance abuse, documenting such evidence and referring employees to
assistance programs.

5. Communicate written policy to employees subject to testing. Ensure that
all other prospective and current employees have access to the policy.

SOURCE: Holmes , Murphy & Associates. House File 299 ----

Some employers have waited for this day for years.

Gov. Terry Branstad is scheduled to sign a bill at 9 a.m. today giving Iowa
employers new freedom to test workers for alcohol and other drugs.

The law will go into effect 30 days after the signing, but that's not soon
enough for some employers, said Jon Shanahan, a vice president at Holmes,
Murphy & Associates, which consults companies on human-resources issues.

"People are all hyped up. Clients have been waiting for this forever," he
said. But before they begin celebrating, Shanahan advises that companies
thoroughly examine what they've won.

"I don't think they realize what it is," he said. "In some ways, it's a
Pandora's box."

No Requirement

Nothing in the bill requires employers to test. The costs - both to the
employer's bottom line and to employee morale - may persuade companies not
to, Shanahan said.

Employers have fought for the right to randomly test workers, arguing it is
needed to ensure workplace safety. But many ultimately will avoid the
random route and instead test after accidents and when they suspect an
employee is impaired by drugs, observers say.

Russ Samson, attorney for the Association of Business and Industry, agrees
that random testing won't be rampant in the state. But the bill's
requirements alone shouldn't frighten away employers, he said. "The
procedural safeguards work to the benefit of the employer as well as the
employee," Samson said.

The bill limits rehabilitation costs and frees employers from having to pay
for complete physicals when they require testing of job applicants. But
other costs are involved.

With tests running $25 to $50 each, randoin testing can be expensive,
especially for small employers. The bill requires employers to hire an
independent entity to select the employees to be tested at random. Tests
must be conducted on company time, and if the collection of samples is done
off-site, the employer must pay for transportation.

Policy Needed

No matter what type of testing is done, companies must write a policy, train
supervisors and take other steps.

Most employers won't find testing a good investment, said Craig Zwerling,
director of the University of Iowa's Injury Prevention Research Center.
Zwerling said his studies and others have found little evidence that drug
use in the workplace causes occupational injuries or that drug testing is
making the workplace safer.

"Employers need to take a long, hard look at this before paying out the
cash," he said.

Before beginning testing, employers should do a cost-benefit analysis,
factoring in the average cost of accidents in their industry, Zwerling
said. But the most important factor is the prevalence of drug use among
applicants, he said.

Generally, only if 10 percent or more of an employee's applicant pool is
using drugs, then an employer might save money by testing, he said. He
suspects that most Iowa employers will find much smaller rates.

Employers should have a better idea next year of the extent of drug use,
because the bill requires labs to report to the state the number of tests
and the results.

Lower Use Rate

One such lab, Iowa Methodist Medical Center Clinical Laboratory, is finding
that about 5 percent to 7 percent of pre-employment tests in Iowa are
positives, said clinical chemist Rich Snyder.

Many employers - forced by federal law to do random drug tests have lobbied
Congress to do them less, said Zwerling, who has testified on their behalf.

"Those forced to test have found it expensive and are asking questions about
its effectiveness," he said.

MidAmerican Energy Co., disagrees that drug testing is a waste of money.
About 2,000 of the company's workers - those who have commercial driver's
licenses or who work on the natural gas system - are subject to federal
testing requirements.

Last year, the company spent nearly $59,000 to test 830 employees, said
drug-test administrator Muriel Boggs. Five of those tested positive for
marijuana or cocaine. Four of those workers went to a rehabilitation
program, and one was fired after testing positive again.

While that may seem a poor return on the company's investment, Boggs said,
the safety benefits cannot be calculated as easily.

"We must really be sure that we're taking care of our customers and the
community," she said.

Save Money

The Weitz Co., a national contractor based in Des Moines, believes drug
testing can save money. The company started random testing in Arizona in
1993 and has since expanded it to Florida, Colorado and Nebraska.

Since 1992, Weitz has reduced its out-of-pocket costs for workers
compensation by 600 percent, said Gary Farman, risk compliance manager.
Drug testing has played a big part of that, he said.

Weitz hasn't decided what it will do in Iowa, but Farman said he expects the
company to do random testing.

Added Pressure

That may affect other construction companies' decisions on testing. "If
everyone is doing it and you're not, there will be pressure on you to do
so," Samson said. Companies will worry that they are getting applicants who
failed other employers' drug tests.

The construction industry has been one of the biggest backers of the bill.
It argues that mistakes can be deadly in the business, and it worries that
many employees work while under the influence.

"People work hard, and they play hard," Farman said. When Weitz started
testing in Phoenix, about 30 percent of workers were failing random tests,
Farman said. Since then, rates have fallen to 1 percent to 2 percent.

The bill could become law just as the construction industry begins its busy
season. But because of the steps the bill requires, companies won't likely
start testing immediately, said Scott Newhard, director of public affairs
for Associated General Contractors, which represents companies in heavy
highway and bridge construction and municipal and utility work.

Newhard expects larger companies, especially those who test truck drivers
under federal laws, to more readily adopt random testing for all workers.
But smaller companies may balk at the expense, he said.

Company Culture

Shanahan said that besides the financial costs, employers should consider
whether random testing fits a company's culture. He's heard clients worry
about being seen as "Big Brother."

Samson advises that employers explain to employees why they're testing, he
said. Workers need to be assured that employers are testing for drugs and
not looking for other health-related information.

The bill presents other tough choices. It lets employers fire workers who
test positive for drugs, which they had wanted. But the bill also requires
employers to treat everyone the same, regardless of rank or tenure. Will
employers risk losing a valued veteran by creating a strict discipline
policy?

"People are overwhelmed by the intricacies of this law," Shanahan said.
Small employees may find it too much work, he said. And if the policy is
complicated, the supervisor in the field won't want to deal with it.

Employers who want to test can get help, however. The Association of
Business and Industry and other groups plan to offer seminars to educate
employers on the law and help them develop a drug-testing policy.

A policy may be all a company needs, Samson said. "Employers may find that
the mere threat of random testing is enough," he said. "They could set up a
policy but never do it."