Research conducted by the Institute for Work & Health (IWH) has convinced the Occupational Safety and Health Administration (OSHA) that more expensive fines for workplace-safety violations are likely to send stronger messages to employers to improve workplace-safety efforts.
A recent press release from the National Safety Council stated, “There is strong evidence that regulatory health and safety inspections that result in a citation or penalty are effective in reducing work-related injuries. This is according to a recent systematic review conducted by the Institute for Work & Health, which also found that general deterrence—the mere chance that employers may get inspected one day—is not as effective.”
OSHA has taken the IWH study to heart. Asistant Secretary of Labor for OSHA David Michaels said that the study “confirms what we have been saying for a long time.”
As a result, OSHA recently announced that it would pursue more “impactful” (penalty-laden) inspections for fiscal 2016.
“OSHA inspections and penalties are important and effective components of a comprehensive strategy to improve workplace safety and health,” Michaels said. “That is why we have made strong, fair and effective enforcement one of OSHA’s primary objectives in this administration.”
In November 2015, President Obama signed a bill that will permit OSHA to implement a “catch-up adjustment,” based on the Consumer Price Index, to its civil monetary penalty structure, which was first implemented 25 years ago.
Under the bill, OSHA will be allowed to implement its new monetary penalty structure in August 2016. While the exact amounts have yet to be determined, experts estimate a minimum increase of 80 percent. However, the law actually allows for a “maximum adjustment” of up to 150 percent.
So, given the 80–150 percent range, the penalty for “Other Than Serious” and/or “Serious” violations would increase from $7,000 to between $12,600–$17,500, while the penalty for “Repeat” and/or “Willful” violations would increase from $70,000 to between $126,000–$175,000.
Given the nature of the bill, OSHA will be able to continue to increase these fines each subsequent year, in line with increases in the Consumer Price Index.