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Friday, November 13, 2015

OSHA Fines Predicted to Double in 2016

By: Thomas Eden

Buried in the fine print of the recent budget agreement between Congress and the White House, and seemingly slipped in at the last minute with no one claiming responsibility for the change, the Occupational Safety and Health Administration now has authority to raise penalties by about 82 percent.

The Federal Civil Penalties Inflation Adjustment Act amends a 1990 law to provide a “catch-up” adjustment that allows OSHA to raise penalties by the amount of inflation that has occurred since 1990. OSHA had previously been exempted from the inflation adjustment provision of the 1990 law, but can now raise the maximum penalty amounts for “Other than Serious,” “Serious,” “Repeat,” and “Willful” violations. For example, although the OSH Act provides for a maximum penalty of $7,000 for “Other than Serious” or “Serious” violations, under the new law, maximum penalties for these types of violations could be increased to about $12,744. For “Repeat” and “Willful” violations, the current maximum penalty of $70,000 could be increased to $125,438.

The law requires that these penalty changes be announced by the publication of an interim final rule by July 1, 2016, with the adjusted penalties going into effect by August 1, 2016. These changes will be made through new regulations, with opportunity for public comment.

At first. After the one-time “catch-up” to capture the amount of inflation that has occurred since 1990, OSHA can annually increase the maximum penalties for each type of violation consistent with the inflation rate for the prior fiscal year, as determined by the federal government’s Consumer Price Index.

Common Sense Counsel: No one is immune from OSHA citations. With this year’s new requirement to report to OSHA all admissions to a hospital, amputations, and loss of an eye within 24 hours, and with 37 percent of those reports resulting in on-site inspections, the stakes have clearly been raised. Although OSHA’s announced goal is to ensure that employers provide a safe workplace, citations are typically issued as a result of failing to comply with the provisions of OSHA Standards.

Having a safe workplace does not necessarily mean that you have complied with all of the OSHA Standards that are applicable in your workplace. Enhanced enforcement as a result of the last seven years of the present OSHA Administration has become the norm, including “regulation by shaming” through press releases issued when high-penalty cases occur, and now the increased penalties about to go into effect. In this climate, we strongly encourage you to make sure that your safety programs and physical site conditions are fully compliant.

Tommy Eden is a partner working out of the Constangy, Smith & Prophete, LLP offices in Opelika, AL and West Point, GA and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. The above information was taken from a more extensive Client Alert published by his law firm’s OSHA Practice Group. Tommy can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com