As we recently reported, all penalties levied by the federal Occupational Safety and Health Administration were increased by 7 percent due to a law that requires civil penalties to adjust for inflation. Penalties for serious violations are now up to $15,625. Penalties for willful or repeat violations are now up to $156,259.

(States with approved state OSH plans are supposed to match those adjusted penalties. Some will, and some won’t, but that’s a different story.)

Now those penalties have the potential to become even higher. Recent directives issued by the agency (available here and here) just made it easier for OSHA to use what are called “Instance-By-Instance penalty adjustments,” or “IBI citations.” IBI citations have the effect of raising the standard penalties even more. The following can result in an IBI citation:

  • The employer has received a willful, repeat, or failure to abate violation within the past 5 years where that classification is current.
  • The employer has failed to report a fatality, inpatient hospitalization, amputation, or loss of an eye pursuant to the requirements of 29 CFR 1904.39.
  • The proposed citations are related to a fatality/catastrophe.
  • The proposed recordkeeping citations are related to injuries or illnesses that occurred as a result of a serious hazard.

For example, an IBI citation could be issued where there are multiple machines in a facility that are missing a guard, or multiple injury cases that should have been recorded on the OSHA log. In the past, these violations were “grouped” with a single penalty. Under the new policy, which was announced last week and will become effective 60 days after issuance, the agency now has the ability to treat each violation separately, each with a separate penalty. That employer with 10 machines missing a guard could be subject to a penalty of $156,000 or more if the violations are deemed serious, and $1,560,000 or more if the violations are deemed willful.

The new policy is actually the revival of an older policy, which was known as the “egregious multiplier.” The “egregious multiplier” was first applied in 1986, and resulted in numerous multi-million-dollar citations. The policy was moderated over the years and used only sporadically, typically only if the violation was both “egregious” and willful.

The policy announced last week changes that. It is designed to address “high-gravity” serious violations, with particular focus on lockout/tagout, machine guarding, permit-required confined space, respiratory protection, falls, trenching, and cases with other-than-serious violations specific to recordkeeping.

Employers, especially those with a history of previous citations, should redouble their compliance efforts with respect to those standards. The price for non-compliance just got much, much higher.

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