A decades-old provision that Occupational Safety and Health Administration (OSHA) fines will not increase with cost of living (Fines have been frozen since 1990) no longer applies. As of Jan. 1, 2016, according to provision 701 of the new budget, OSHA is authorized to adjust fines for cost of living. According to the Department of Labor Statistics, that equates to an 82 percent jump.
Those experiencing semi-frequent OSHA visits have had incentive to avoid the serious infractions that OSHA inspectors are hardwired to check. Lockout/Tagout, Hazardous Communications, and OSHA 300 violation fines that had been a serious 'ouch' at $7,000, per instance may now leap to nearly $13,000, if OSHA decides to levy fines at its full authorization.
Now consider this increase by a factor-of-ten with so-called repeat, severe, and willful violator fines—from $70,000 to $127,000 a pop. What's more, repeat violator status isn't constrained to a single facility, it's considered part of corporate-wide compliance. So, if you have facilities in multiple locations, disparate citations can quickly spiral into repeat offense status.
What does that mean to you as an OEM? Hopefully, nothing. Many smaller OEMs have never even had an OSHA inspection. A downside of rare inspections could be a lack of consistent corrections and constant reminders of the necessity of compliance, so keep that in mind.
Even if provision 701 doesn't affect you directly, think of your customers. They likely have many facilities throughout the country, and each is expected to remain compliant. On balance, likelihood for repeat or severe infractions only grows with the number of facilities under a single corporate flag.
Now, it's important to note that no changes have been made yet, and the increase is only authorized, not enacted. But, realistically, what are the chances the fine increases don't go full throttle? If nothing else, hopefully this serves as a wakeup call, even for smaller companies, to stay vigilant with compliance.
