Ways to Avoid Increased OSHA Fines - effective August 1, 2016
With OSHA's impending penalty increase, companies must empower employees, embrace technology and be prepared to ensure compliance success.
On June 30, 2016, the U.S. Department of Labor (DOL) announced its interim final rule on Federal Civil Penalties Inflation Adjustment Act Catch-Up Adjustments. The rule was formally published in the Federal Register on July 1. The increase is the result of the . Bipartisan Budget Act of 2015, signed into law on November 2, 2015
The Bipartisan Budget Act was the consummation of a deal reached in Congress to avoid a default on the nation’s debt. Surprisingly, the bill also contained the Inflation Adjustment Act, a provision that allowed federal agencies to annually adjust their civil penalties for inflation beginning with a one-time adjustment this year to catch up from the last time the agency’s civil penalties were modified. For the Occupational Safety and Health Administration (OSHA), the last time Congress increased the agency’s civil penalties was 1990. Under the interim rule, the maximum penalties for workplace safety violations issued by OSHA will spike by 78.16 percent, effective August 1, 2016, as follows:
→ Other-than-Serious violation: from $7,000 to $12,471; → Serious violation: from $7,000 to $12,471; → Repeat violation: from $70,000 to $124,709; → Willful violation: from $70,000 to $124,709; → Failure-to-Abate violation: from $7,000 to $12,471 per day; and
→ Violation of a posting requirement: from $7,000 to $12,471.
Dr. David Michaels is the longest serving Assistant Secretary of Labor for OSHA, and has consistently worked to increase OSHA’s enforcement strength and effectiveness. OSHA has been given the authority to increase penalties effective August 1, 2016, however, the Administration has not confirmed the percentage of increase that will be applied. Following the initial increase, OSHA will be permitted to increase penalties annually based on the CPI. As Dr. Michaels stated, “OSHA penalties must be increased to provide a real disincentive for employers accepting injuries and worker deaths as a cost of doing business.” Workplace injuries and illnesses cause an enormous amount of physical, financial and emotional hardship for individual workers, and their families. At the same time, costs to employers are also substantial, including workers compensation payments, decreased productivity, and the costs of replacing injured workers. These harsh realities underscore the urgent need for employers to provide a safe workplace for their employees. The increase in penalties is scheduled to take effect on August 1, 2016, in all states regulated by federal OSHA. The federal changes will not automatically apply in “State Plan” states. But since regulations in State Plans must be at least as effective as federal OSHA requirements, penalties in State Plans may also be increased to match federal penalties.
All it takes is one workplace safety or employee health violation to severely hinder a business’s financial standing. With OSHA’s near-80 percent fine increase going into effect August 1, and its more rigorous inspections process, it could be even more crippling to try to stay up to code. Until very recently, a serious OSHA violation penalty stood at $7,000. New rules now in effect have increased the fine to $12,600. When it comes to willful and repeat violations, penalties have gone up from $70,000 to $126,000 per violation. For small or medium sized business, it could spell the end.
However, there are a few steps that any company can take to avoid compliance slipups, and ensure costly and damaging fines are avoided. By following these three simple guidelines, decision makers and employees can keep their teams on course to OSHA compliance success.
Empower Employees
Develop a culture where employees are encouraged to speak up, without fear of retribution, about potential safety hazards and concerns. For example, employees in health, safety or construction, are often the ones in the field and on the ground, and may see things management doesn’t. By providing a way for staff to anonymously report potentially hazardous situations, employers can take the necessary actions to resolve the issue. Designate an employee or employees to conduct regular safety checks, and implement training programs so that everyone is on the same page. Provide your in-house safety inspector with a record-keeping system like a mobile form for real-time accountability, and to ensure that safety is monitored constantly, and hazards are being flagged up the chain.
Be Prepared
The stakes for a violation are higher than ever, and even the thought of a fine can be intimidating in and of itself. By developing a plan early, everyone, from management to employees, is prepared when the time comes for an inspection. Just like practicing for a fire drill in school, when everyone is better informed and well-prepared to go through an inspection, nerves are calmed, employees are equipped and inspections are organized. Prep teams with mock interviews to ensure employees understand their rights during inspections. Conduct regular “surprise” inspections that are true to OSHA rules to help set the stage for the real thing.
An OSHA inspection can be a frightening prospect and the newly-enforced violation increase can put businesses in danger of losing their financial footing. With a shaky economy and ever-changing landscape, the last thing anyone needs is a fine or violation that can go into five figures. By taking the steps above, organizations, small and large, can ensure employees and the state of their business is in good shape.
Here are some recommendations to make sure your facility is ready for an OSHA inspection:
Evaluate your safety program
Ensure your inspection frequency is adequate
Verify training is up-to-date
Confirm all paperwork and documentation is in order including:
OSHA 300 Logs
Written programs
Medical evaluations and respirator fit-testing, if applicable
Do not become a statistic for OSHA’s new increased penalties. If you are uncertain about OSHA compliance, we can help. For more information, contact Physec Compliance Group.
