OSHA requirements are set by statute, standards and regulations. Our interpretation letters explain these requirements and how they apply to particular circumstances, but they cannot create additional employer obligations. This letter constitutes OSHA's interpretation of the requirements discussed. Note that our enforcement guidance may be affected by changes to OSHA rules. Also, from time to time we update our guidance in response to new information. To keep apprised of such developments, you can consult OSHA's website at http://www.osha.gov.
March 23, 1995
MEMORANDUM FOR: REGIONAL ADMINISTRATORS FROM: JAMES W. STANLEY Deputy Assistant Secretary SUBJECT: FIRM Change: Minimum Serious Willful Penalty
This is to advise you of a change to OSHA's civil willful penalty which will be effective as of the date of this memorandum. The change concerns the proposed minimum serious willful penalties for the smaller employers. The small employers in this situation are those with 50 or fewer employees. In no case will the proposed penalty be less than the statutory minimum, i.e., $5,000 for these employers.
Please make the following pen-and-ink changes at C.2.b.(1) on page IV-8 of the OSHA Field Inspection Reference Manual (FIRM):
C. 2. b. Minimum Penalties. The following guidelines apply:
(1) The proposed penalty for any willful violation shall not be less than $5,000 for other than serious and regulatory violations, and shall not be less than $25,000 for serious violations. The $5,000 penalty is a statutory minimum and not subject to administrative discretion.
(1) The proposed penalty for any willful violation shall not be less then $5,000. The $5,000 penalty is a statutory minimum and not subject to administrative discretion. See C.2.m.(1)(a)1, below, for applicability to small employers.
Please make the following pen-and-ink changes at C.2.m.(1)(a)1, 3, and 4 on page IV-18 of the FIRM:
C. 2. m. (1) (a) Serious Violations. For willful serious
violations, a gravity of high, medium moderate + (Correction) moderate, or low shall be assigned based on the GBP of the underlying serious violation, as described at C.2.g.(2).
1 This adjustment factor for size shall be applied at one half of the values stated at C.2.i.(5)(a)1; i.e., a reduction of 30 percent (1-25 employees), 20 percent (26 100 employees), or no reduction (251 or more employees).
1 The adjustment factor for size shall be applied as shown in the following chart:
10 or less 80 11-20 60 21-30 50 31-40 40 41-50 30 51-100 20 101-250 10 251 or more 0
2 The adjustment factor for history shall be applied as described at C.2.i.(5)(c); i.e., a reduction of 10 percent shall be given to employers who have not been cited by OSHA for any serious, willful, or repeated violations in the past 3 years. There shall be no adjustment for good faith.
3 The proposed penalty shall then be determined from the table below:
Total percentage reduction High Gravity Moderate Low Gravity size and/or Gravity history
0% $70,000 $55,000 $40,000 10% $63,000 $49,500 $36,000 20% $56,000 $44,000 $32,000 30% $49,000 $38,500 $28,000 40% $42,000 $33,000 $24,000 50% $35,000 $27,500 $20,000 60% $28,000 $22,000 $16,000 70% $21,000 $18,500 $12,000 80% $14,000 $11,000 $8,000 90% $7,000 $5,500 $5,000
(For Original Penalties to be proposed chart, see printed copy)
4 In no case shall the proposed penalty be less than $25,000 (Correction) $5,000.
State Plan States. Regional Administrators shall ensure that this memorandum is promptly forwarded to each State designee and explain its content as requested. This changes the minimum willful penalty policy which was previously transmitted by memorandum on June 14, 1994 and later incorporated in CPL 2.103, the Field Inspection Reference Manual (FIRM), on September 26, 1994. OSHA believes that this policy change is an effective tool for dealing with significant willful safety and health violations especially as modified in the above table which minimized penalties for employers with 50 or fewer employees, States are encouraged to adopt this or an equivalent policy. State designees shall advise the Regional Administrator of their intention within 30 days.
States that adopt an identical or alternative policy should submit appropriate plan documentation. States wishing to pilot alternatives may do so and should consider entering into limited Performance Agreements on this issue.
If you have any questions, please contact Helen Rogers or William Smith in the Office of General Industry Compliance Assistance at (202) 219-8031.