In 2015, Congress passed the Federal Civil Penalties Inflation Adjustment Act Improvements Act to advance the effectiveness of civil monetary penalties and to maintain their deterrent effect. Under the Act, agencies are required to publish “catch-up” rules that adjust the level of civil monetary penalties, and make subsequent annual adjustments for inflation no later than January 15 of each year.

The Act provided for “catch up” rules to make up for lost time since the last adjustments.OSHA’s maximum penalties, which have not been raised since 1990, were increased by 78 percent in 2016, and the top penalty for serious violations rose from $7,000 to $12,471. The maximum penalty for willful or repeated violations increased from $70,000 to $124,709.

Following the implementation of the “catch up” provisions of this Act, OSHA has increased it’s penalties annually. For example, on January 13, 2022 OSHA announced that its maximum penalties for serious and other-than-serious violations will increase from $13,653 per violation to $14,502 per violation. And the maximum penalty for willful or repeated violations will increase from $136,532 per violation to $145,027 per violation. The increased penalty levels appled to any penalties assessed after January 15, 2022.

Nonetheless, on September 8, 2021 house Democrats passed a $3.5 trillion “reconciliation package” which proposed to increase the OSHA budget by $707 million through 2026 to increase OSHA staffing which has decreased over the years due to budget cuts.

The OSHA provisions of the reconciliation package contained language that would increase OSHA penalties as follows:

– – The package proposed to raise the maximum fine for willful or repeat violations of OSHA workplace safety rules from $136,532 to $700,000, with a $50,000 minimum.
– – The serious failure-to-abate fine limit would have increased from $13,653 to $70,000.

A reconciliation package differs from a typical bill. Instead of needing 60 votes to pass the Senate, it needs only a simple majority of 51 votes. Since Vice President Kamala Harris holds the tie breaking vote, it did not seem like there was much chance this penalty increase would fail to be come law. However, it has not.

According to a status report just published by the National Law Review, employers can “breathe a sigh of relief for now as it appears that Senate Democrats are no longer pursuing a massive increase to OSHA’s penalties for safety violations.”

The “tmost recent update to the reconciliation spending bill still being debated by the U.S. Senate did not mention or include any provisions for raising the cap on civil money penalties for citations issued by OSHA.”