• OSHA Unveils "Severe Violator Enforcement Program" and Increases Penalties  
  • May 4, 2010 | Authors: Bradford T. Hammock; Roger S. Kaplan
  • Law Firms: Jackson Lewis LLP - Reston Office ; Jackson Lewis LLP - Melville Office
  • In moves that could raise the cost markedly for employers who violate the Occupational Safety and Health Act, the Occupational Safety and Health Administration not only has reworked its penalty formula to increase average “serious” penalties (OSHA’s garden-variety sanction) by three- to fourfold and to increase the chances of employers incurring “repeated” violations and still greater penalties, but has rolled out a “Severe Violator Enforcement Program” (SVEP) to focus sanctions on employers the agency says “have demonstrated indifference to their occupational safety and health obligations through willful, repeated or failure-to-abate violations” in described situations.

    Severe Violator Enforcement Program

    Under the SVEP, a violation meeting the criteria for an SVEP case is likely to result in targeted follow-up inspections of the worksite at issue, additional inspections of related worksites on a company-wide basis, extending possibly to corporate parents, subsidiaries and divisions of the same employer, increased adverse publicity through OSHA press releases, heightened “company awareness” of OSHA’s enforcement actions against a company through notification to top corporate executives, and more onerous settlement provisions, including corporate-wide agreements, where appropriate, and consent court of appeals judgments enforcing settlements and subjecting an employer to the risk of contempt sanctions for future violations.

    The following types of cases are considered eligible for SVEP treatment:

    • A fatality/catastrophe inspection in which OSHA finds one or more willful or repeated violations or failures-to-abate based on a serious violation related to three or more hospitalizations or the death of an employee.
    • An inspection in which OSHA finds two or more willful or repeated violations or failures-to-abate (or any combination of these), based on high-gravity serious violations related to a “high-emphasis hazard.”  A high-emphasis hazard is defined as a high-gravity serious violation of specific standards related to fall hazards, amputation hazards, combustible dust hazards, silica hazards, lead hazards, excavation/trenching hazards, shipbreaking hazards, and petroleum refinery hazards.  Fall hazards alone are identified in 23 OSHA standards across all industries.
    • An inspection in which OSHA finds three or more willful or repeated violations or failures-to-abate (or any combination of these), based on high-gravity serious violations related to highly hazardous chemicals, as defined in OSHA’s process safety management (PSM) standard.
    • All egregious enforcement actions, often characterized by the issuance of instance-by-instance citations and penalties.

    Administrative Enhancements to OSHA’s Penalty Policies

    OSHA’s head administrator, Dr. David Michaels, has told Regional Administrators to “enhance” OSHA’s penalties.  Citing the consensus among a work group tasked to consider the issue, Michaels says in his April 22 Memorandum to the Administrators that the group found “the Agency’s penalties are too low to have an adequate deterrent effect.”  The Memorandum effectively revises OSHA’s penalty calculations that are currently outlined in its Field Operations Manual (FOM).  Among other changes, Assistant Secretary Michaels has provided for:

    • Expanding the look-back period for considering whether a violation may be considered “repeated” (thereby incurring much higher proposed penalties) from three years to five.
    • Increasing penalties by 10 percent for employers that have been cited for any high-gravity serious, willful, repeat, or failure-to-abate violations within the previous five years.
    • Increasing the minimum proposed penalty for a serious violation to $500.
    • Reformulating penalty calculations to raise the “gravity based penalty” (OSHA’s starting figure) approximately 50 percent, while reducing the applicability and effect-ameliorating factors (size, good faith and OSHA history) to result in substantially higher proposed penalties overall.  Michaels anticipates the average penalty for a serious violation will increase from approximately $1,000 to an average of $3,000 to $4,000.