OSHA Penalties Increase Set for August 1, 2016
On August 1, 2016, OSHA fines are increasing and increasing dramatically. Specifically, the maximum penalty for serious or other OSHA violations will rise from $7,000 to $12,471, and the highest penalty for willful or repeat violations will increase from $70,000 to $124,709. The penalty increases are applicable to civil penalties assessed by OSHA after August 1, 2016, where the underlying violations occurred after November 2, 2015. The new penalty levels will apply prospectively only to new and pending OSHA inspections.
These increases come pursuant to the Federal Civil Penalties Inflation Adjustment Act, which was signed into law on November 2, 2015 as part of the Bipartisan Budget Act of 2015 (“2015 Inflation Adjustment Act”), whereby OSHA and several other federal agencies have been directed to increase their civil monetary penalties to adjust for inflation. Because OSHA’s penalties have not increased since 1990, the 2015 Inflation Adjustment Act directed the Department of Labor to make a “catch up adjustment” based upon the increase in the Consumer Price Index from October 1990 to October 2015. As a consequence, the OSHA penalties will increase 78%.
Going forward, OSHA will be required to implement annual cost of living increases by January 15 of each year, with future adjustments to the penalties tied to the Consumer Price Index.
Employers should be proactive and conduct internal audits to ensure compliance with OSHA standards in order to avoid these increased penalties. Moreover, in light of the significant increase in penalties, employers may also want to reevaluate how to address any OSHA inspection they may face in the first instance.