Employers Could Be in for a Big Surprise with Retroactive OSHA Fine Increases
There will soon be a bigger price to pay for violating workplace safety – both for future fines and those currently being investigated by the U.S. Occupational Safety and Health Administration. That’s because employers will be facing larger retroactive OSHA fine increases. How’s this possible?
President Barack Obama signed The Bipartisan Budget Act of 2015 in November of 2015. With the passage of this law, all federal agencies with civil monetary penalties covered by the statute, including OSHA, are required to update their existing fine structure.
Starting August 1, 2016, OSHA's civil penalty structure will sharply increase to reflect the change in the consumer price index. The last update was pre-1996. For the time being, the rate from October 2015 will be used. It should be noted, OSHA is now required by law to adjust its penalties annually based on this index.
The Bipartisan Budget Act of 2015 allows OSHA to increase maximum fines by up to 78%. Currently, the existing cap is $70,000 for “repeat and willful” violations. However, these fines could realistically increase to $124,709. Plus, the top fines for “serious and other-than-serious” violations could escalate to $12,471 (from the current maximum of $7,000).
Violating Workplace Safety? It’ll Cost You.
According to the agency, employers inspected before the August 1 effective date – but receiving OSHA citations after that date – will be subject to the adjusted civil penalties. This means that employers being investigated as far back as February 1, 2016 could face the higher fines. Why? Because OSHA can take up to six months after the start of an inspection to issue citations and propose penalties.
It is expected that OSHA will likely apply the higher penalties to these current inspections, given that David Michaels, assistant secretary of Labor for Occupational Safety and Health, advocated strongly for the revised penalty structure. He indicated that he wanted to send a strong message that workplace safety of the utmost importance and employers should be accountable financially for their violations.
Employers currently undergoing inspections cannot force OSHA to complete its examinations faster to avoid the higher penalties, but they should respond as quickly as possible to any agency requests for documentation, interviews and site visits.
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