Incident Prevention Magazine

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Voice of Experience: OSHA Citations and Informal Conferences

OSHA fines will increase for the first time in 25 years under a provision in the recently signed U.S. congressional budget deal.

The Federal Civil Penalties Inflation Adjustment Act of 1990 exempted OSHA from increasing its penalties to keep pace with inflation. But a section of the new budget signed in November by President Barack Obama – referred to as the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 – strikes the 1990 exemption.

Now, OSHA is directed to issue an interim final rule adjusting its penalties to account for current inflation levels, which would raise proposed fines by about 80 percent. This means the maximum penalty for a willful violation would rise from the current $70,000 to about $127,000. Additionally, OSHA fines for serious and other-than-serious violations could increase from $7,000 per violation to approximately $13,000 per violation. The penalty adjustment must take effect before August 1 of this year. In subsequent years, employers should expect to see OSHA fines increase by January 15 of each year as the agency makes adjustments based on the annual percentage increase in the consumer price index.

Clearly, the safety of employees should be basic and fundamental to a company’s value system and supported by all employees at all levels of operations. And this potentially huge increase in OSHA fines is yet one more compelling reason for employers to review and strengthen company safety programs and to continue stressing a culture of safety throughout their organizations.

Since the financial stakes for organizations are about to get higher with the increase in OSHA fines, it’s critical that readers are aware of some industry changes and options related to workplace compliance.

For starters, as many readers likely know, a revision affecting reporting requirements was made to OSHA 29 CFR 1904, “Recording and Reporting Occupational Injuries and Illness,” effective January 1, 2015. Before the change, the only time an employer had to notify OSHA of an accident was when a fatality occurred or a catastrophic event resulted in three or more individuals being admitted to a hospital for treatment. Now, per 1904.39, notification is required within 24 hours if an employee has been admitted to a hospital for treatment, an amputation or the loss of an eye. Still in effect is the requirement to notify OSHA within eight hours if a fatality has occurred.

Informal Conferences
Now let’s talk a bit about OSHA citations and informal conferences. I have been involved in many investigations and informal OSHA conferences, and I have found that it’s not uncommon for companies to fail to prepare for possible OSHA inspections; in fact, in my opinion, most employers never plan on them at all. They may also be unprepared to handle complaints filed by employees that prompt visits from CSHOs, hoping instead that nothing ever happens to any of their employees that may result in a visit.

But obviously OSHA representatives do visit employer work sites. And when an occasion arises that results in the agency issuing a citation, employers should be aware that they have the right to request an informal conference with the local assistant director or supervisor of the nearest OSHA office. In order to request an informal conference, the employer must contact the assistant regional director in the utility’s area within 15 days of receipt of the citation.

Today, informal conferences are growing in popularity in light of the increased number of citations being issued. The conferences are extremely useful because they present employers with an opportunity at an early stage of the process to negotiate penalty reductions, extensions of abatement dates, deletions of violations and/or reclassifications of violations. Reclassification of a violation to one that is less severe can impact not only the amount the employer pays in penalties now, but it can also affect the amount of potential future penalties. For example, if the employer later receives another citation for the same initial violation, and had participated in an informal conference related to the initial violation, it’s possible the employer will not receive a repeat violation that could have resulted in higher penalties.

At an informal conference, the employer does not have the right to review OSHA’s files regarding the citation. As a result, the employer will not be privy to all of the case’s potential weaknesses. For instance, when CSHOs interview employees involved in an accident or a complaint, OSHA can and does use that information to determine the level of citation and fine, but the employer does not have access to that information. Not knowing exactly what was said in employee interviews can cause difficulties for the employer. Employee testimony is often disputed by the employer and defended by documentation the employer submits. The local assistant director or his or her representative will listen to employer input at the informal conference, but the director or representative will not share exactly how the level of the citation was determined. Instead, the citation will only state what regulations were violated.

One upside to participating in an informal conference is that the employer will have the opportunity to obtain a better explanation for the violations cited as well as gain a better understanding of the specific standards that apply. If the employer decides to formally contest the citation, the information gathered during the informal conference may help to better position the employer to evaluate the strengths and weaknesses of the citations and any potential defenses.

When formally contesting a citation, the employer will be subject to the jurisdiction of the Occupational Safety and Health Review Commission (OSHRC), an independent federal agency that was created to decide contests of citations or penalties resulting from OSHA inspections. The OSHRC functions as a two-tiered administrative court, with established procedures for conducting hearings, receiving evidence and rendering decisions by its administrative law judges, as well as for discretionary review of administrative law judges’ decisions by a panel of commissioners. Any and all agreements made at an informal OSHA conference are invalid once an employer formally contests a citation; only the original fines and citations will be considered by the OSHRC. OSHA has incentive to settle contested citations early in the process, and this often occurs. To save time and keep costs down, a number of contested cases are settled for reduced fines and lower levels of citations.

Hopefully your company will never have to deal with citations, informal conferences or formal OSHRC proceedings. If it does, I advise you to seek out experienced OSHA-authorized safety consultants and labor attorneys to represent and advise company management as the case proceeds.

About the Author: Danny Raines, CUSP, safety consultant, distribution and transmission, retired from Georgia Power after 40 years of service and opened Raines Utility Safety Solutions LLC, providing compliance training, risk assessments and safety observation programs. He is also an affiliate instructor at Georgia Tech Research Center OSHA Outreach in Atlanta. For more information, visit www.electricutilitysafety.com.

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