Occupational Safety and Health

Civil penalties are an important enforcement tool in encouraging employers to meet their legal responsibilities to provide safe and healthful workplaces. Concerned that the Occupational Safety and Health Administration's (OSHA) penalties were too low to be an effective deterrent, Congress raised the penalty ceiling in November 1990. This report, undertaken before the increase was enacted, examines (1) how actual penalties compare with the maximums allowed, (2) whether proposed penalties and reductions are about the same across regions and at the different administrative and judicial review levels, and (3) if OSHA's policy of reducing penalties to avoid litigation achieved its goal of quicker and more comprehensive abatement of cited hazards. GAO also obtained information on the effects of the higher penalty limits that OSHA implemented in March 1991. GAO observes that basing penalties on employers' economic benefit from not complying would help strengthen the desired deterrent effect.

GAO found that: (1) OSHA and the Occupational Safety and Health Review Commission (OSHRC) have considerable discretion in proposing and reducing penalties; (2) OSHA and OSHRC policies require that they consider four factors in establishing penalties, but the law does not specify how much weight those factors should have in agency deliberations; (3) OSHA uses gravity as the primary factor in deriving the proposed penalty and then reduces the penalty based on the other three factors; (4) OSHA does not consider an employer's economic benefit from noncompliance in setting a penalty; (5) the penalties initially proposed by OSHA for violations cited in fiscal year 1989 across all OSHA regions were substantially below the maximum allowed by law, and OSHA reduced many penalties; (6) most employers did not formally contest OSHA citations, but those who did contest received greater penalty reductions than those who accepted their citations or those who settled through the OSHA informal settlement process; (7) OSHA believes that reducing penalties leads to both quicker and more comprehensive abatement, since reducing penalties makes employers more likely to accept the penalty, rather than to contest it or to continue the appeal if they have already contested it; (8) it was unable to confirm a causal relationship between penalty reductions and quicker or more comprehensive abatement, although penalty reductions may lead to a quicker resolution of citations; and (9) although the maximum penalty has increased sevenfold, the average proposed OSHA penalty is about three to four times greater than it was before the new maximum went into effect.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Team: Phone: