OSHA Fine Amounts May Increase Significantly

Business owners already face financial hardship when contending with penalties from the Occupational Safety and Health Administration (OSHA), but based on a recent Congressional move, those steep fines could grow even larger.

New Maximum and Minimum Penalties

As part of the Build Back Better Plan, also known as the $3.5 trillion reconciliation bill currently being debated in Congress, the House Committee on Education and Labor has approved an incredible $700,000 per item for OSHA maximum penalties. The current maximum penalty is $136,532 for violations categorized as “willful,” “repeated,” and “failure to abate,” so the new maximum would be more than five times as high.

Minimum fines for these violation categories would increase from the current $9,753 to $50,000. Also, the current maximum for violations categorized as “serious” is $13,653. That would increase to $70,000.

In addition to these drastically increased fine levels, the committee is allocating $707 million for the OSHA budget, earmarked for “carrying out enforcement, standards development, whistleblower investigations, compliance assistance, funding for State plans, and related activities.” Such substantial changes and funding are intended to illustrate lawmakers’ commitment to worker safety and stringent labor law enforcement.

Historical Context

These penalty provisions are similar to those outlined in the Protecting America’s Workers Act, which was introduced to the House of Representatives in February 2019 but not passed.

Congress has not approved a significant OSHA penalty increase since 2016 when the maximum penalty for a “serious” violation rose from $7,000 to $12,471. That year, penalties for “willful” and “repeated” violations also rose—from $70,000 each to $124,709. Since then, penalty amounts have increased gradually, in keeping with the Consumer Price Index.

What This Means for Employers

When Biden was elected president, we all anticipated an increase in OSHA inspections and citations. However, if approved by the Senate, these penalty amounts could cripple any number of U.S. businesses. Rather than acting as a deterrent to haphazard onsite safety, these fines could lead to shuttered companies and loss of employment for so many workers.

In addition, companies will see their legal expenditures increase as more of them have to hire attorneys to fight these penalties and/or negotiate reduced fees. In turn, that will result in more costly trials, which will lead to more agency employees having to testify, more contractors losing workdays to appear in court, and more judicial backlogs.

While we can all respect our lawmakers’ concerns for worker safety, this move will ultimately hurt small businesses that are trying to make a profit and help their employees make a living. It is unclear if the measure will be fully approved by Congress and enacted, but if it is, employers will need to be even more vigilant in following OSHA standards, training their employees, and knowing their rights during an OSHA inspection.

For those who need assistance when facing a citation or penalty, the experienced OSHA defense attorneys at Cotney are here to help. With more than 20 offices throughout the United States, Canada, and internationally, we have the expertise to defend your rights and protect your company.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.