OSHA Unveils Its New Severe Violator Enforcement Program and Announces Plans to Increase Penalties for OSH Act Violations

For some time now, we have been following the development of various initiatives signaling OSHA's plan to beef-up its enforcement activities. On April 22, 2010, OSHA continued its escalation of enforcement efforts when it unveiled a directive for its new Severe Violator Enforcement Program (SVEP). OSHA simultaneously announced plans to follow the SVEP's development with a modification of its penalty calculation system that will result in increased monetary fines for OSH Act Violations. The effect of these announcements on states with their own occupational safety plans is currently being assessed. Consequently, there will likely be a significant change in enforcement under state plans as well.

Severe Violators Enforcement Program

The SVEP is scheduled to become effective within 45 days of its April 22 announcement. The program is designed to concentrate some of OSHA's resources toward inspecting employers who OSHA deems to have demonstrated indifference to their OSH Act obligations by committing certain willful, repeat or failure to abate violations. An employer will be eligible for severe violator enforcement under the following circumstances:

• An inspection results in one or more willful or repeated violations or failure to abate notices based on a serious violation related to the death of an employee or three or more hospitalizations;
• An inspection yields two or more willful or repeated violations or failure to abate notices (or any combination thereof) based upon high gravity serious violations related to a high-emphasis hazard, as defined by the directive. A high emphasis hazard is a hazard arising from OSHA's regulations for: fall hazards in general industry, construction, shipyard, marine terminal or long shoring; hazards covered under OSHA's national emphasis programs on amputations, combustible dust, crystalline silica, lead, ship breaking or hazards associated with excavation/trenching under OSHA's Special Emphasis Program;
• An inspection results in three or more willful or repeated violations or failure to abate notices (or any combination thereof) based upon high gravity serious violations related to hazards due to the potential release of a highly hazardous chemical, as defined in the OSHA's Standard for Process Safety Management; or
• Any egregious citation enforcement action.

Enhanced enforcement under the SVEP may subject employers to increased scrutiny in the form of mandatory follow-up inspections of worksites, nationwide inspections of related worksites, the issuance of press releases and other communications designed to increase awareness of OSHA enforcement action taking place, enhanced settlement provisions, and corporate-wide agreements, among other things.

Increased Fines for Violations

In addition to the SVEP, OSHA announced plans to modify its penalty calculation system. The modification is expected to go into effect sometime this year and will increase monetary fines for OSH Act violations. The following are a few of the anticipated changes:

• An employer that has been cited for any high gravity serious, willful, repeat, or failure to abate violation within the previous five years will receive a 10 percent increase in the penalty assessed, up to the statutory maximum fine for the penalty.
• The time period for issuing repeated violations will be increased from three to five years;
• Area directors may not offer more than a 30 percent reduction of a penalty at an informal conference without obtaining approval from the regional administrator;
• Area offices utilizing expedited settlement agreements will generally be limited to offering a 30 percent reduction of penalties. If an employer agrees to hire an outside consultant, the area director may grant an additional 20 percent reduction; and
• Where circumstances warrant, and at the discretion of the area director, high gravity serious violations related to OSHA standards identified in the SVEP will not have to be grouped or combined, but may be cited as separate violations, each carrying its own proposed penalty.

Other penalty calculation changes were also announced. OSHA anticipates that the modification of its penalty calculation system will increase the overall dollar amount of all penalties. For example, it anticipates that the average penalty for a serious violation will increase from approximately $1,000 to an average of $3,000 to $4,000.

Ramifications for Employers

With other OSHA initiatives on the horizon, it is safe to say that the potential for scrutiny by OSHA can be expected to continue to increase in years to come. In fact, OSHA is currently on track (for this fiscal year) to significantly outpace its inspection activity of last year (which set a record for the number of inspections). Employers may wish to take action now to conduct training, enforce safety requirements, conduct safety reviews/audits or, if need be, create new safety policies and procedures consistent with the OSH Act. Taking proactive steps now to provide a safe workplace for employees should not only increase employee safety and welfare but should also help reduce the potential for significant legal liability.