For the first time in twenty-five years, OSHA penalties are increasing – and significantly. A federal act passed in 1990 exempted OSHA from increasing fines to account for inflation, but the new budget signed into law on November 2, 2015, includes an amendment striking that exemption.¹
The “Catch-Up Adjustment,” based on the percentage difference between October 1990 and the Consumer Price Index Budget of October 2015, will amount to a penalty increase of about 80%. That will bump the current $7,000 cap on serious OSHA violations to about $12,500, and the willful, repeat violations penalty of $70,000 to just over $126,000. Once this one-time adjustment is made, OSHA will also be required to adjust penalties annually using the Consumer Price Index’s yearly percentage increase.²
Budget changes will go into effect on July 1 of 2016, and increased penalties will begin August 1 in all states regulated by OSHA. For employers, now is the time to ensure that workplace safety programs and equipment are meeting appropriate standards. This includes:
• Confirming that employee safety training is comprehensive and documented
• Assessing workplaces for potential hazards and addressing them in the most appropriate manner
• Addressing employee safety concerns
• Confirming that existing safety equipment is fully compliant and operational
Consider the OSHA penalty hike a boon for workplace safety. Studies have shown that workplace injuries are reduced in settings in which health and safety inspections have direct consequences for violations.³ And while it can be asking the impossible to build a system with the resources to inspect every single workplace for violations, increasing employer awareness about steep financial penalties for non-compliance may well do the trick. An 80% increase in current OSHA fines will likely prove an effective method of stressing the importance of workplace safety.
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