THE PICTURES OF ALLEN ANDRE'S last shift are not a pretty sight.

At 10 p.m. on July 22, 1985, Andre, an employee of the Reliance Steel & Aluminum Co. plant in Vernon, Calif., was feeding coiled sheet steel into a slitting machine when his hand got caught in the recoil roller. The 24-year-old Andre, who was that day operating the machine for the first time and who had been left by his supervisor to do so unattended, was inserting cardboard into the recoiler when the tip of one glove wandered astray. In an instant, most of his torso disappeared into the slitter. A co-worker lunged for the "stop" button, but by then it was far too late. Wrapped in the recoiler with about a dozen sheets of steel on top of him, Andre's body had effectively been turned two-dimensional, squashed flat as a highway squirrel.

Pictures of Andre and other workers killed on the job sit in the file drawer of a County of Los Angeles district attorney, Environmental Crimes/OSHA Division. Their presence in a state prosecutor's case file is significant. In another era, evidence such as this might have been introduced in a range of civil court actions against the company itself -- worker's compensation claims, Occupational Safety and Health-Administration citations, lawsuits on behalf of the decedent's family. Fines and penalties might have been imposed. But nobody would have been talking about sending company officials to jail.

Times have changed, though. From New York to California, state attorneys, operating against a backdrop of sharply rising accident statistics, declining OSHA investigations, and toughening workers' right-to-know laws, have begun relabeling what were once classified "regulatory infractions" or "poor business judgments" as criminally liable acts (see box, "The Corporate Blotter," page 50). Nearly half the states already have some sort of corporate criminal-liability law on the books, and a House subcommittee has been considering a bill that could put executives behind bars for concealing workplace hazards from their employees. While the transgressions of Ivan Boesky and Dennis Levine dominate the "corporate crime" headlines, a portfolio of workplace death cases -- many involving common-law charges of second-degree manslaughter or worse -- are setting legal precedents that redefine how the criminal justice system looks at the free enterprise system.

"We're not talking here about 'white-collar' crime, where the agent primarily benefits himself," says William Maakestad, an associate professor of management at Western Illinois University and an expert on corporate criminal liability. "This [area of the law] involves crimes [committed] during the ordinary course of doing business, where the motive is primarily greed or desperation, and the beneficiary, if there is one, is the company, not the individual. In that regard, a lot of these cases are no different from such common street crimes as assault."

A lot of these cases also suggest that small companies are generically more vulnerable to criminal prosecution than their larger counterparts. Big companies may complain about overregulation, but most can afford the kind of safety measures the regulators require. In the event of a serious accident, multiple layers of authority can make it difficult for prosecutors to prove that upper management knew what was going on. Not so for small companies. For many, cutting corners here and there often saves enough dollars to keep them in business. When something does go wrong, having fewer layers of management to sort through makes it easier for prosecutors to prove that top executives knew or should have known about unsafe conditions.

"So far, anyway," Maakestad says, "when you talk about 'workplace intent' crimes, you're mostly talking about small to midsize companies. These changes affect all companies, though, regardless of size. What we're seeing is nothing less than a redefinition of what's morally acceptable business behavior."

Like other reform movements, the push for corporate criminal accountability represents a confluence of several streams. One factor is the increase in workplace "accidents" registered in the mid-1980s. After four straight years of gradual decline, according to studies by the U.S. Bureau of Labor Statistics, the rates of job-related injuries and fatalities climbed 12% and 14%, respectively, since 1983. And these are only the reported cases; since 1980, documented violations of federal record-keeping statutes are also up a whopping 74%. Another factor is the Reagan Administration's gutting of the federal safety inspection effort, a vaccum into which state prosecutors are not adverse to rush. Safety inspections are down 40% since 1981.

"It's obvious that the regulatory process hasn't done the job," avers John Lynch, head deputy of Los Angeles's Environmental Crimes/OSHA Division. "When human life can be reduced to 'the cost of doing business,' something's got to give. And believe me, one company officer spending two days in jail is worth any fine you can impose [against the organization]. When you lock that cell door, word gets around an industry real fast."

The third overriding issue is the evolution of the law itself. Prior to this century, common law exempted companies from criminal sanctions for two basic reasons: because they had no "mind," companies could not harbor what the law defined as "intent" to commit crimes; and because they had no "body," they could not be jailed for crimes allegedly committed. Not until 1909, in fact, did the U.S. Supreme Court hold that corporations could be held liable, as individuals can be, for crimes involving "intent." And not until a series of cases in the mid-'70s was that principle enlarged in ways that removed the shield of immunity from company executives. In 1975, for instance, the high court ruled in United States v. Park that an executive could be held criminally culpable even if he had ordered the correction of a long-standing infraction.

Since then, a handful of well-publicized trials have driven home the message that a new era of accountability is at hand. One of these, State of Indiana v. Ford Motor Co., in 1979, set a powerful legal precedent. In this case, the corporation was charged with reckless homicide following the deaths of three Indiana teenagers in a Pinto fuel-tank fire. Although Ford was ultimately acquitted, the case was a public-relations debacle for the auto company and a shot across the bow of corporate America.

Then, in 1985, came the seminal corporate-crime case of recent times, People of the State of Illinois v. Film Recovery Systems Inc.

Film Recovery Systems was no up-and-coming growth company in a glamorous industry. Operating out of a single plant in Elk Grove Village, Ill., Film Recovery extracted silver from used hospital X-ray and photographic film. Most of the plant employees were Mexican or Polish, did not possess legal working papers, and spoke little or no English. To extract the silver, they had first to dump the film into open vats of sodium cyanide in solution and then transfer the leached remnants to another tank. The plant was not ventilated, and visitors routinely complained of dizziness and nausea.

On February 10, 1983, one of Film Recovery's employees, 59-year-old Polish immigrant Stefan Golab, did more than complain about the fumes. Golab staggered outside and collapsed, unconscious. After efforts to revive him failed, he was pronounced dead from what a local medical examiner labeled "acute cyanide toxicity."

Over the next six months, an intensive investigation by Cook County, Ill., attorneys established a long list of incriminating details, including the facts that (1) Film Recovery workers seldom wore even the most rudimentary safety equipment; (2) workers were laboring in what amounted to an industrial gas chamber (one prosecutor called conditions there "positively Dickensian"); and (3) company executives not only played down the dangers of cyanide exposure but removed labeling that identified it as poisonous in the first place.

The prosecutors moved under an Illinois homicide statute targeting anyone who knowingly commits acts that "create a strong probability of death or serious bodily harm." Three Film Recovery managers -- the president, the plant manager, and the foreman -- were convicted of murder. In sentencing them each to 25 years in prison, Judge Ronald J. P. Banks likened their actions to those of a terrorist who "leaves a time bomb ticking in a public place."

Banks's choice of words was appropriate, for the Film Recovery trial ignited a firestorm of publicity and intense heat within the legal-prosecutor community. It also raised a fundamental question: is business in for an avalanche of criminal-liability cases?

Based on the evidence so far, that prospect seems unlikely. Convictions are still hard to come by, and state attorneys readily admit they have neither the legal authority nor the available work force to go after any but the egregious offenders.

"The nuance that escapes most people," says Milwaukee district attorney E. Michael McCann, another visible activist in the pro-liability movement, "is that it's not criminal to be negligent. To invoke [criminal sanctions], you have to have a real element of recklessness, whether it's in the design of the workplace, the procedures themselves, or the type of horseplay that turns out to be lethal."

"Fly-by-nighters like Film Recovery are not your basic Fortune 500 companies," adds Cook County assistant state's attorney Gary Leviton, a veteran of the Film Recovery prosecution. "The police and OSHA reports on them read like an Agatha Christie novel. You're just not going to see many [cases] as bad as this one. Still, as we always say, there's nothing like a dead body to let you seize the moral high ground."

To others, even corpses may not justify this legal intrusion into the workplace. In a supporting brief to the People of the State of Illinois v. Chicago Magnet Wire Corp. appeal, the Chamber of Commerce of the United States warned that U.S. business could fall prey to "thousands of states attorneys across the nation, operating under no uniform standard, charging about like loose cannous on the deck of a tossing ship."

"We view this as a major threat," says Paula Connelly, labor counsel for the National Chamber Litigation Center, an affiliate of the Chamber of Commerce. "Reckless conduct, for example, is a very broad standard -- far broader than what federal [OSHA] law addresses. Even penalties for willful violation fall far short of state murder statutes. Maybe the public wants this sort of backlash, but we'd rather see tougher state OSHA regulations instead."

Both sides agree that Film Recovery's degree of negligence isn't necessary to attract a district attorney's attention. Many companies cut corners. Safety guards break and aren't replaced quickly. The exhaust system in the delivery truck leaks, the production line moves too fast. Workers have to fill in for absentees on machines that they haven't been adequately trained to use. Suddently, Allen Andre makes a bad move and disappears into the slitter.

There are an estimated 100,000 work-related deaths annually. What prosecutors now want to know is: in how many cases did the boss know -- or have reason to know -- that conditions were unsafe? Did management not understand the level of risk, or did it exhibit a cynical disregard of the consequences?

Nowhere is this redefinition of business behavior being applied more dramatically than in Los Angeles County today. In a few months, L.A. prosecutors expect the photos of Allen Andre to become evidence in criminal action against Reliance Steel and four of its officials, who face charges of negligently operating the workplace so as to cause the death of Allen Andre. Similar charges are on file against four other Los Angeles -- based companies as well, and matters are "pending" in nearly 40 other investigations. Since mid-1985, Los Angeles County law-enforcement officers have been requested to treat every workplace fatality as a potential homicide, and a rollout program sending both a D.A. and an investigator to every such site has become a working model for state attorneys from Wisconsin to Texas.

"It's crucial to interview witnesses right away," explains special assistant to the district attorney Jan Chatten-Brown. "If even a few days elapse, employees start worrying about their own job security, and then you're not as likely to get the full story." To develop a more complete picture of a company's management or financial structure, adds Chatten-Brown, she often relies on the expertise of state-employed auditors -- or even her own stockbroker.

"Since we can't put a company in jail," she adds, "we have to go to extraordinary lengths to establish specific, individual responsibility. On the other hand, companies aren't protected against self-incrimination, either. Through discovery, we can go after board minutes, insurance records, a whole range of things. With the right teamwork and resources, we can get an awful lot."

Los Angeles County has the scorecard to prove it. Yet it isn't numbers alone that make L.A. the emerging corporate-crime capital of America. For months, the city has been host to one of the highest-rated courtroom dramas ever: the Twilight Zone trial, starring film director John Landis and a quarter of codefendants. In this bitterly contested and long-running proceeding, prosecutors charged Landis and other officials of the Twilight Zone: The Movie production crew with involuntary manslaughter after a special-effects explosion caused a helicopter to crash during the filming of a Vietnam War sequence, taking the lives of actor Vic Morrow and two young children. While admitting to having hired the children illegally, in violation of state work-permit regulations, the defendants vigorously denied the negligence charges and maintained that the crash was nothing more than a tragic accident -- the unpredictable result of a stunt gone awry.

As real-life theater, "Twilight Zone: The Trial" presented enough subplots to anchor a miniseries: grants of immunity to key witnesses, disputes between D.A.s past and present, insults openly traded between a state's attorney and defense lawyers. Reporters were on hand from news organizations as diverse as CBS-TV and The Hollywood Reporter.

In a courthouse in Burbank, about 10 miles away, was a case of equally intense interest to corporate-crime watchers. Michael Maggio, president of Maggio Drilling Inc., in West Covina, Calif., pleaded no contest last year to involuntary-manslaughter charges stemming from a much less publicized workplace fatality.

According to testimony, Maggio was personally supervising a construction project in late 1985 when one of his employees, Kevin Bauman, became trapped in an elevator-shaft excavation. Bauman had been lowered down the 33-foot-deep, 18-inch-wide hole without a safety harness. After Bauman experienced difficulty breathing, firemen were summoned to the scene. Their first instinct was to drop an air hose down the tunnel and pump oxygen to the stricken man, but Maggio warned them that the shaft had not been properly cased and that by doing so, they would most likely dry out the hole and cause a cave-in. Other rescue efforts were employed, but by the time Bauman was rushed to a nearby hospital, he was beyond resuscitation.

Safety officials charged Maggio Drilling with a fistful of violations. They cited the company for failure to supply a safety harness, failure to shore up the shaft hole, and failure to monitor the air within. And the D.A.'s office went after Maggio more directly, charging him with involuntary manslaughter based on criminal negligence. Maggio had cut corners to save money and move the job faster. In announcing the indictments, district attorney Ira Reiner was blunt and unequivocal in his judgment of Maggio's culpability. "[Bauman's] death was caused by willful cost-cutting violations of the law," he declared. "The employer took a chance that he could save time and money by cutting corners, and lost. More to the point, the employee lost."

So did Michael Maggio, though the price he paid wasn't nearly so dear. Maggio, who had no prior criminal record, was sentenced to 45 days in the county jail, was put on five years' probation, and compensated Bauman's family $12,000.

Prosecuting attorney Joseph Shidler later offered a fuller explanation for pursuing the indictment against Maggio. "We saw three major violations here," says Shidler. "The first and most flagrant was the lack of a safety harness. If [Bauman] had been wearing one, this accident never would have happened.

"The second," he continues, "was their failure to test the air in the shaft. You don't ignore [the oxygen level] until the worker loses control of the situation. And the third was the requirement to have that shaft cased. Because when trouble came, that meant the firemen couldn't do what they were trained to do."

No prosecutor foresees an avalanche of criminal cases soon. With the law in this area still largely undefined, prosecutors are pursuing the most flagrant offenders now. As precedents are established, though, prosecutors will no doubt become more active. "In most legal circles," says Shidler's boss, John Lynch, "the prevailing view is, 'No gun, no intent, no crime.' Well, we're here to say, That ain't the way it works in L.A. anymore."