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OSHA's New Penalty Policy Means Business

OSHA is getting serious with companies that don't take the safety and health of their employees seriously. Last April, OSHA announced it was implementing a program to focus on employers who continually disregard their legal obligations to protect their workers from potential injuries. The Severe Violators Enforcement Program (SVEP) focuses OSHA's enforcement efforts on employers who willfully and repeatedly endanger workers by exposing them to serious hazards. Increased enforcement efforts include increased inspections, such as mandatory follow-up inspections of a workplace found in violation as well as inspecting other worksites the same company owns where similar hazards or deficiencies may be present.

Jim Ulseth

Jim Ulseth

Safety & Health Consultant

OSHA has discovered that employer indifference to compliance responsibilities is indicative of broader patterns of non-compliance at other related employer worksites.

OSHA's stronger enforcement efforts will concentrate its inspection resources on employers who have demonstrated recalcitrance or indifference to their OSH Act obligations by committing one or more willful, repeat or failure-to-abate (FTA) violations at the time the citations are issued.

Citations will be considered SVEP cases if one or more of the following circumstances occurs:

  • Fatality inspection with one or more willful or repeat violations, or FTA notices based on a serious violation of any gravity related to a death or 3 or more hospitalizations,
  • An inspection in which OSHA finds 2 or more willful or repeated violations or FTA notices (or any combination) based on high gravity serious violations related to a High-Emphasis Hazard,
  • An inspection in which OSHA finds 3 or more willful or repeated violations or FTA notices (or any combination) based on high gravity serious violations related to hazards due to the potential release of a highly hazardous chemical, as defined in the PSM standard,
  • All egregious (e.g., per-instance citations) enforcement actions.

Once a case is classified as SVEP, OSHA will then conduct follow-up inspections of the classified worksite, Nationwide inspections of the company's related workplaces/worksites, increased company awareness of OSHA's enforcement efforts, and enhanced settlement provisions (e.g. the employer agreeing to retain an outside safety and health consultant).

In addition to its SVEP efforts, OSHA is implementing long-overdue administrative modifications to its penalty calculations, which will subsequently raise the monetary penalties. Such penalties for violating the OSH Act have been increased only once in 40 years despite inflation. Although, OSHA's policy of reducing penalties for small employers and those acting in good faith will continue, it is being modified. The penalty reduction scale is (in this order): History (10%)--Good Faith, (15%)--Quick Fix, (15%)--Size (30%). It shall all be taken serially, unlike the previous practice in which all penalties reductions were summed (added) together.

An example of moderate gravity penalty comparison: Summed vs. Serial calculation

Example: Summed Serially
Proposed Penalty $5,000 $5,000
History (10%)   - 10% = $ 4,500
Good Faith (15%)   - 15% = $ 3,825
Quick Fix (15%)   - 15% = $ 3,251
Size (30%)   - 30% = $ 2,275
  10% + 15% + 15% + 30% = 70%  
Result $1,500 $2,275 

Results in an increase of approximately 50% higher penalty

  • The minimum penalty (citation) for a severe violation has increased to $ 500.00.
  • The average penalty for a serious violation will also increase from about $1,000 to an average $3,000 to $4,000 per violation.

OSHA hopes higher penalty amounts will provide a greater deterrent and further encourage employers to furnish a safe and healthful workplace for all employees.

Employers, I encourage you to take the high road. Get serious and improve your company’s safety culture not just for the sake of avoiding stiffer penalties but to assist your employees in getting home safely every day to their families.