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State Safety Plans Object to Federal OSHA Fine Increases

  • September 8, 2016

State workplace safety agencies raised objections to adopting federal Occupational Safety and Health Administration’s penalty increases in letters to the Department of Labor on OSHA’s interim final rule, Federal Civil Penalties Inflation Adjustment Act Catch-Up Adjustment. State agencies with OSHA-approved job safety and health programs maintain that OSHA exceeded its authority in imposing the new fine structure on State Plans.

Under the Inflation Adjustment Act Improvements Act of 2015, Congress authorized OSHA to increase its fines, unchanged since 1990, to adjust for inflation. (For more, see our article, Maximum OSHA Fines for Safety Violations Increase by 78%.) In the interim final rule, DOL changed how State Plans must act to keep their federal approval under the State Plan Indices of Effectiveness. The federal agency provides up to 50 percent of the funding for State Plan programs, which must be “at least as effective” as their federal counterpart. DOL stated, “OSHA will require State Plans to increase their penalties to reflect the federal penalties increases at the state levels in order to maintain their ‘at least as effective’ status.”

State officials said federal officials should not be allowed to use the new federal law to change the federal regulations that state agencies must follow to keep their federal approval. Further, they said the law should apply only to federal, not state, fines.

Jim Krueger, Chair of the Occupational Safety and Health State Plan Association, an organization of 28 states and territories with OSHA-approved state plans, said the rule should not be “misunderstood” to mandate that states “more closely mirror federal penalty practices.” Mr. Krueger also is Director of Compliance of the Minnesota state plan.

State officials from Kentucky, New Mexico, and North Carolina also sent letters of objection. Butch Tongate, Acting Cabinet Secretary of the New Mexico Environment Department, called the increases “improper.” He wrote that New Mexico “encourages” the Labor Department to “reconsider its actions in this rulemaking” so that it moves forward with the “reasoned and well informed rulemaking” procedures of the Administrative Procedure Act.

Derrick K. Ramsey, Secretary of the Kentucky Labor Cabinet, and Ervin Dimeny, Commissioner of the Department of Workplace Standards, said the change to the State Plan Indices of Effectiveness is “arbitrary, capricious, and an abuse of discretion because it is not based upon a reasoned analysis as required by the Administrative Procedure Act and it was done through interim final rulemaking.”

Without changes from OSHA, State Plan penalties will likely increase.

Jackson Lewis assists employers to avoid OSHA violations and reduce the monetary impact of proposed fines for any alleged violations.

©2016 Jackson Lewis P.C. This material is provided for informational purposes only. It is not intended to constitute legal advice nor does it create a client-lawyer relationship between Jackson Lewis and any recipient. Recipients should consult with counsel before taking any actions based on the information contained within this material. This material may be considered attorney advertising in some jurisdictions. Prior results do not guarantee a similar outcome.

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