OSHA Increasing Fines Through Major Changes in Enforcement Policies

UPDATED 6/21/2023

A proposal to increase the maximum OSHA fines to five times the current levels was dropped from the budget bill adopted by the previous Congress. In response, the Biden Administration apparently decided it will increase OSHA fines through two administrative changes in its enforcement policies. In two January 26, 2023, OSHA enforcement memos, OSHA announced that it would be expanding the use of instance-by-instance citations and narrowing the practice of grouping citations (which combines alleged interrelated violations of different standards or different provisions of a single standard into one alleged violation). 
 
One enforcement memo ("Exercising Discretion When Not to Group Violations") states that, in cases where grouping does not elevate the gravity or classification and resulting penalty, the violations should not be grouped if the evidence allows for separate citations. The limits of this approach remain untested. Typically, when an employee fails to lock out a piece of equipment, OSHA focuses on citations alleging failure to establish a LOTO procedure, failure to implement the procedure, failure to provide required training, and failure to perform an annual inspection. An open question is how far OSHA may go in issuing a separate citation for the failure to implement each element of the required LOTO procedure – advising employees the equipment is going to be locked out, shutting down the equipment, isolating the equipment, locking and tagging the energy isolating device, etc.
 
The second January 26 OSHA enforcement memo ("Application of Instance-by-Instance Penalty Adjustments") states that the current policy of limiting instance-by-instance citations to alleged willful violations is being modified to authorize instance-by-instance citations for high-gravity serious violations of OSHA standards specific to falls, trenching, machine guarding, respiratory protection, permit-required confined spaces, lockout tagout, and other-than-serious violations of OSHA’s injury and illness recordkeeping rule. In other words, OSHA is taking the position that the alleged violations no longer need to be willful, much less egregious, to merit instance-by-instance penalties where the wording of the standard permits that interpretation, and the same remedial action would not cure the violation.
 
In citations dated June 9, 2023, and issued to Miracapo Pizza, OSHA indicated how these two memos could be implemented. The total proposed penalty is slightly over $2.8 million, largely for alleged LOTO violations. The agency issued a 13-item citation alleging 13 willful violations, each with a proposed penalty of $156,259. There are nine separate items for allegedly failing to provide LOTO training to nine sanitation employees that perform deep cleaning, sanitizing, and inspection of equipment. In addition, there are four separate items for allegedly failing to ensure employees de-energize and lock out hazardous mechanical energy sources before performing cleaning, sanitizing, and inspection tasks on four different pieces of equipment. OSHA also issued a three-item high-gravity serious citation alleging that the employer did not ensure employees used fall protection while exposed to the edges of unprotected working surfaces, eight feet or more above the lower level, while performing disassembly and cleaning of three pieces of production equipment. The agency issued two high-gravity serious citations for the alleged failure to provide machine guarding on what appeared to be two identical machines.
 
In contrast, OSHA combined alleged violations of the "requirement" to establish equipment-specific, written energy control procedures/instructions for multiple pieces of equipment, and combined alleged violations of the flexible requirement to conduct a periodic inspection of the energy control procedures/instructions for multiple pieces of equipment. Possibly, OSHA took this approach to avoid litigating the issue of whether an equipment-specific LOTO procedure/instruction is required for each piece of equipment. It appears that OSHA amended the LOTO standard in 1990 to adopt that "requirement" through a Federal Register correction notice issued approximately one year after adoption of the LOTO Standard but without a supplemental rulemaking. No penalty was proposed for the failure to perform the periodic LOTO inspection, but an upheld citation would establish the predicate for a future citation alleging a repeat or willful violation.
 
One of OSHA’s next actions regarding enhanced penalties may be to summarily amend some of its standards, without imposing any additional compliance obligations on employers, to permit instance-by-instance citations where the current language of the standards would not support that approach. For example, Section 1910.176(a) states: "Aisles and passageways shall be kept clear and in good repair, with no obstruction across or in aisles that could create a hazard." Could OSHA sustain a separate citation for each obstruction or each blocked aisle? If not, it would be easy to rewrite the standard to state: "Each aisle and passageway shall be kept clear and in good repair, with no obstruction across or in any aisle that could create a hazard."
 
These administrative changes will spur additional citation contests, and force the Review Commission to reevaluate how it exercises its authority to assess appropriate civil penalties under Section 17 of the OSH Act. In exercising this authority, the Review Commission must consider the size of the cited employer, the gravity of the violation, the good faith of the employer, and the employer’s history of previous violations. However, “the Commission cannot group separately charged and proven … offenses for the purposes of assessing a penalty." Chao v. Occupational Safety And Health Review Commission, 480 F.3d 320, 326 (5th Cir. 2007).

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Proposed TSCA Risk Management Rules Would Supersede OSHA PELs

Lawrence Halprin also authored a paper describing how the Biden Administration plans to develop and adopt risk management rules under Section 6 of TSCA in the context of its methylene chloride proposal. He explains that EPA’s May 3, 2023, methylene chloride proposal appears to be the initial EPA template for these rules, which has already been carried forward to EPA’s June 16, 2023, perchloroethylene proposal. The paper, titled "A Methylene Chloride Proposal: An EPA Template for Superseding OSHA on Workplace Chemical Regulation," was published by the Washington Legal Foundation.[1] While there are substantial legal issues to be resolved, Lawrence concludes, "it appears … EPA will eventually supersede and largely replace … OSHA as the agency with primary responsibility for establishing substance-specific toxic chemical standards for the workplace."

[1] https://www.wlf.org/wp-content/uploads/2023/06/Lawrence-HalprinWP_June2023.pdf