Thursday, July 5, 2012

OSHA employer penalties rising

Employer should be wary of increased efforts by federal and state OSHA officials to enforce and penalize employers. While some actions aimed at increasing penalties have been bottle-necked in Congress and in federal courts, but such roadblocks alone won't stop employers from facing increased headaches and costs from OSHA visits to workplaces. Increased OSHA inspections will allow the agency to spot and cite violations with increased frequency, the federal agency is also changing the rules which govern how penalties are applied to greatly reduce the latitude given to employers and set employers up to face quickly-increasing fines for workplace safety violations.

In writing for the Society of Human Resource Management labor attorney Allen Smith reported on a presentation by Nina Stillman, a labor attorney with Morgan Lewis in ChicagoAs penalties are capped by existing federal laws, OSHA has increased penalties by ramping up the use of repeat violator citations. Stillman said OSHA “is doing repeats all over the place.” Such citations are very costly for employers, costing up to five times the penalty of the first-offense citation. 

Stillman also reported that OSHA has increased the penalties by:

  • Lengthening the time for considering an employer’s history of serious, willful, repeat or failure-to-abate violations from three to five years.
  • Lowering the reduction levels provided to employers based on size—for example, no size reduction will be allowed for employers with more than 251 workers, according to the memo.
  • Increasing minimum penalties for serious violations to $500.
  • Limiting OSHA area directors’ discretion to offer penalty reductions without obtaining approval from OSHA regional offices.
  • Eliminating the 10 percent reduction for employers participating in a strategic partnership.
  • Raising final penalties from a range of $1,500 to $7,000 to a range of $3,000 to $7,000.

OSHA is also cracking down on repeat offender employers by way of it's Severe Violator Enforcement Program. An OSHA media release describes the program's efforts:

This supplemental enforcement tool includes increased OSHA inspections in these worksites, including mandatory OSHA follow-up inspections, and inspections of other worksites of the same employer where similar hazards and deficiencies may be present. 

Such stepped-up provisions are bound to increase revenue by way of repeat-offender penalties, which are much higher per violation. 

While the agency is ramping up enforcement and seeking to increase penalties upon employers, these efforts have hit walls in both Congress and in the courts:

  • Legislation entitled the Protecting America's Workers Act stalled when it became stuck in the House. It's not likely the current House leadership will allow the legislation to move forward in its present form. This legislation would uncap existing maximum penalties of $7,000 for serious violations and $70,000 for willful violations, increasing them to $12,000 and $250,000 respectively and adjusting  them for inflation in the future.

  • On April 6, 2012, the U.S. Circuit Court of Appeals for the District of Columbia ruled in favor of a construction contractor with a ruling in AKM LLC d/b/a Volks Constructors v. Secretary of Labor that held that OSHA’s citation policy for old recordkeeping errors violated the OSH Act’s provision that no citation may be issued after six months following the occurrence of any violation.

While employers should strive to maximize safety on their work sites and places of business, these changes by OSHA, as well as other efforts which are being made, signal that there will be less leeway and tougher enforcement down the road. Even mistakes made without the knowledge of management or in contradiction of established safety policies will become increasingly expensive in the years to come. Thus employers should make their best efforts to keep informed about these changes, as well as tighten up their safety practices in workplaces.


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