The U.S. Department of Labor recently announced new rules to adjust civil penalty amounts for violations of Occupational Safety and Health Administration (OSHA) rules, in effect raising maximum penalties by 78%. The action was taken in accordance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act (passed by Congress in 2015) to advance the effectiveness of civil monetary penalties and to maintain their deterrent effect. The law directed agencies to adjust their penalties for inflation each year using a much more straightforward method than previously available, and required agencies to publish “catch up” rules by July 1, 2016 to make up for lost time since the last adjustments. And, As required by law the department will accept public comments for 45 days to inform the publication of any final rule. So, this was their “catch-up.”
- OSHA’s maximum penalties, which have not been raised since 1990, will increase by 78%. The top penalty for serious violations will rise from $7,000 to $12,471. The maximum penalty for willful or repeated violations will increase from $70,000 to $124,709.
- WHD’s penalty for willful violations of the minimum wage and overtime provisions of the Fair Labor Standards Act will increase from $1,100 to $1,894.
- The new civil penalty amounts are applicable only to civil penalties assessed after Aug. 1, 2016, whose associated violations occurred after Nov. 2, 2015.
“Civil penalties should be a credible deterrent that influences behavior far and wide,” said U.S. Secretary of Labor Thomas E. Perez. “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.”