As a result of Congressional action last year, the Department of Labor announced that 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, 2016 for violations that occurred after Nov. 2, 2015.
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, $1 in 1990 has the same buying power as $1.84 today.
The hike implements changes required by the passage of the Federal Civil Penalties Inflation Adjustment Act last November. 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 (OSHA’s maximum penalties were last raised in 1990). Also, the increase is meant to better protect workers. By making violations more costly to firms that do not comply with OSHA rules, responsible employers, who should not have to compete with those who do not follow the law, should see a benefit.
Along with OSHA, increases were also imposed for penalties levied by other agencies. 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.
A fact sheet from the Department of Labor is available.
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