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OSHA Publishes New Penalty Policy
On April 22, David Michaels, assistant secretary of labor for the Occupational Safety and Health Administration (OSHA), issued a memorandum to all regional administrators regarding administrative enhancements to OSHA's penalty policies. The memorandum has the effect of significantly changing the penalty calculation system outlined in OSHA's Field Operations Manual.
OSHA's memorandum explains that in 2009, OSHA assembled a work group to evaluate OSHA's penalty policies. The general consensus of the group was that OSHA's penalties were too low to have an adequate deterrent effect. Based on the group's findings, the memorandum sets forth several changes with regard to OSHA's penalty policies, with such changes to become effective in the next several months. Among the more significant changes to be made to OSHA's penalty policies are the following:
- Expanding the time frame for considering an employer's history of violations for repeat violations from three years to five years. Consequently, if you receive an OSHA citation and it becomes a final order, you are subject to a repeat violation if, over the following five years, you are alleged to have violated that same or similar standard.
- Limiting area directors' settlement authority during the informal conference to only a 30 percent maximum penalty reduction. To obtain a penalty reduction beyond this 30 percent, area directors will have to obtain approval from regional administrators. Area directors are also authorized to offer an employer with 250 or fewer employees an additional 20 percent reduction if that employer agrees to retain an outside safety and health consultant.
- Increasing penalties by 10 percent for employers that have been cited for any high-gravity serious, willful, repeat or failure-to-abate violations within the previous five years.
- Calculating final penalties serially, unlike the present practice in which all of the penalty reductions are added and then the total percentage is applied to arrive at the proposed penalty. By calculating the final penalties serially, the reductions are taken separately instead of being summed together for one overall penalty reduction. This change can result in a penalty increase of approximately 50 percent.
OSHA anticipates that the new penalty classification scheme will increase the overall dollar amount of penalties to promote deterrence. The memorandum expressly states that the average penalty for a serious violation will increase from approximately $1,000 to an average of $3,000 to $4,000.
Also on April 22, OSHA announced the commencement of its Severe Violator Enforcement Program, which is intended to concentrate on those employers demonstrating an indifference to OSHA. Employers that commit willful, repeated, or failure-to-abate violations will be subject to increased OSHA inspections and mandatory follow-up inspections. For more information about the Severe Violator Enforcement Program, click here.
In light of these changes to OSHA's penalty and enforcement policies, it is important that you ensure your safety rules are being adequately communicated to your employees in a manner in which they understand and that you are taking steps to ensure your employees' understanding of your safety rules.
Source: Hendrick, Phillips, Salzman & Flatt June 2010 E-Newsletter
6/22/2010
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