The Labor Department announced today that, as a result of Congressional action last year, it will raise by 78% the maximum penalties it can impose for violations of Occupational Safety and Health Administration (OSHA) rules.
The changes affect penalties assessed after Aug. 1 for violations that occurred after Nov. 2, 2015. They are contained in an interim final rule that will be published soon in the Federal Register.
The 78% hike implements changes required by Congress' passage last November of the Federal Civil Penalties Inflation Adjustment Act. As reported by Remodeling in February, that law required agencies to publish "catch up" rules regarding the penalties they impose so that the penalties no longer lose their financial sting because of inflation. For instance, OSHA's maximum penalties haven't changed since 1990.
Here's how much OSHA's penalties will rise:
Type of OSHA Violation||Old Penalty||New Penalty|
Willful or repeated violation||$5,000 to $70,000||$8,908 to $124,709|
Other-than-serious violation||Up to $7,000||Up to $12,471|
Failure to correct a violation||Up to $7,000||Up to $12,471|
Violation of a posting requirement||Up to $7,000||Up to $12,471|
“Civil penalties should be a credible deterrent that influences behavior far and wide,” Labor Secretary Thomas E. Perez said in a news release. “Adjusting our penalties to keep pace with the cost of living can lead to significant benefits for workers and can level the playing field responsible employers who should not have to compete with those who don’t follow the law.”
Along with OSHA, increases also were imposed for penalties levied by the Office of Workers' Compensation Programs, its Wage and House Division, the Mine Safety and Health Administration, and the Employee Benefits Security Administration. For instance, the penalty for willful violations of the minimum wage and overtime provisions of the Fair Labor Standards Act will rise to $1,894 from $1,100. Click here for a list of all the changes by all departments. Labor also issued a fact sheet on the changes.
The Labor Department could have increased the penalties as much as 150%. Instead, it chose to stick to inflation adjustments. According to the Bureau of Labor Statistics' Inflation Calculator, a $1 in 1990 has the same buying power as $1.84 today.