It’s not a done deal yet, but it appears OSHA fines could increase in 2016 due to language in the federal budget bill that’s been agreed upon between Republicans in Congress and the Obama administration. The fines could increase almost 80% in one jump, and increase annually by the rate of inflation after that.
While bills have been introduced for years now that would increase the amounts of OSHA fines, it’s safe to say that no one saw this coming via the federal budget bill.
In a section of the bill titled, “Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015,” OSHA would be allowed a “catch up adjustment,” apparently dating back to the last time OSHA fines were increased in 1990 (see pages 39-45 of the budget bill).
From October 1990 to September 2015, the Consumer Price Index, upon which the increase would be based, rose 78.24%.
Applying that increase to the current maximum OSHA penalties would produce these results:
- The maximum repeat or willful violation fine would increase from $70,000 now to $124,768, and
- The maximum serious violation fine would increase from $7,000 to $12,477.
The bill calls for the adjustment to “take effect not later than August 1, 2016.”
Along with the one-time catch-up increase, OSHA penalties could increase each year using the CPI. The head of OSHA could choose not to increase fines the first year the new rules are in effect with the agreement of the Director of the Office of Management and Budget.
Allowing OSHA to make the one-time increase and future inflationary increases would put it in line with many other federal agencies that can increase fines by inflation, including the Food and Drug Administration, the EPA, the Equal Employment Opportunity Commission, the FCC, and several agencies under the Department of Transportation, including the Federal Highway Administration and the Federal Aviation Administration.
“Unscrupulous employers often consider it more cost effective to pay the minimal OSHA penalty and continue to operate an unsafe workplace than to correct the underlying health and safety problem,” OSHA chief David Michaels said about previous bills that would increase agency penalties.
The U.S. House and Senate have passed the budget bill with the OSHA provision. The bill waits for President Obama’s signature.
What do you think about a potential increase in serious OSHA fines to about $12,500 and willful and repeat fines to about $125,000? Let us know in the comments.
