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Risk in Context

Concerned About OSHA’s New Maximum Penalties? Three Ways You Can Improve Your Safety Management

Posted by Robert Elia August 02, 2016

The cost of violating workplace safety regulations just got higher. As of August 2, the Occupational Safety and Health Administration (OSHA)’s maximum penalties jumped approximately 78%, the first increase since 1990. Companies without the proper workplace safety management processes may face significant penalties if fined for multiple violations, especially given that further inflation adjustments will be made.

The new OSHA penalty structure includes increases from:

  • $70,000 to $124,709 for “willful or repeat violations.”  
  • $7,000 to $12,471 for “serious,” “other-than-serious,” and “posting requirements” violations.
  • $7,000 to $12,471 per day beyond the abatement date for “failure to abate” penalties.

These penalties will apply to any citations issued by OSHA starting on August 2, even if the inspection or violation occurred before then. State-level OSHA plans must adopt maximum penalty levels at least as effective as federal OSHA's.

These higher fines reinforce OSHA’s commitment to punishing bad workplace behavior while stressing the importance of acting before violations are flagged. The following three steps can help protect both your employees’ safety and your company’s bottom line.

Establish Strong Safety Leadership

Safety leaders play a pivotal role in preventing costly OSHA penalties. Leaders should communicate safety expectations to employees, develop safety plans, and establish accountability. Plans should be reinforced through regular training exercises and ongoing feedback. The inclusion of regulatory compliance reviews, assurances, and improvement action plans is especially important.

To effectively manage and mitigate unidentified risks and hazards, safety leaders should identify potential hazards, changing conditions, and applicable incidence-prevention procedures.

When an environmental health and safety (EHS) incident occurs, safety leaders should conduct an in-depth investigation to identify the root cause and prevent a recurrence. Finally, safety performance should be reviewed regularly and results shared so that all employees are aware of successes and failures.

Leverage Digital Platforms

Online and other digital tools can help improve EHS management system effectiveness in compliance with regulations. An online system allows for more accurate data aggregation, incident investigation, and swift reporting to document actions taken. Additionally, mobile tools can provide compliance checklists and immediate feedback for corrective action. Although “going digital” requires a certain level of investment, the goal is to reduce the cost and time associated with inefficient processes that may result in errors, injuries, and OSHA penalties.

Build Inclusive EHS Committees

EHS committees should include employees and managers. Employees see problems in the workplace firsthand and should be empowered to bring issues to management’s attention, without retribution.

OSHA penalties may be cause for concern, but they can be mitigated and even prevented through the collective risk management efforts of your employees and your investments in safety protocols and tools. The payoff of a stronger safety management system may not only be reduced injuries, but also total cost of risk savings.

Related to:  Marsh Risk Consulting

Robert Elia

Managing Director, Marsh Risk Consulting