OSHA Civil Penalties Spike by 80% on August 1st

By Eric J. Conn

On June 30, 2016, the U.S. Department of Labor issued an Interim Final Rule to implement the Federal Civil Penalties Inflation Adjustment Improvements Act passed last Fall as part of the highly publicized “Bipartisan Budget Act of 2015” negotiated between the Republican-controlled Congress Interim Final Ruleand the White House. Employers have a short window – until August 15th – to submit comments on the penalty increase rule.

As described in our November 2015 article here on the OSHA Defense Report, the inclusion in the budget deal of this extraordinary provision requiring immediate penalty increases to “catch up” with inflation was shocking to many, especially in light of the fact that the Republicans who accepted it are the same politicians who, year after year, reject Democrat-led efforts to pass some version of the Protecting America’s Workers Act – OSHA reform legislation that has as its cornerstone a provision to increase OSHA statutory penalties.

Although the Federal Civil Penalties Inflation Adjustment Improvements Act applies to all federal regulatory agencies, its impact will be felt most by employers receiving citations from OSHA. This is because many federal agencies, such as EPA and MSHA, quasi-regularly increase their penalties based on inflation.  OSHA, on the other hand, has been statutorily prohibited from raising penalties for the last 25 years under a budget bill passed in the 1990s.  As a result, OSHA’s August penalty “catch-up” hike will be the most significant of all federal agencies, raising penalties a whopping 78%, and increasing employers’ burden by an estimated $111M in the first year.

Also extraordinary is the fact that the regulation was not Continue reading