How to Contest and Reduce OSHA Fines

OK, so you were visited by the Occupational Safety and Health Administration (OSHA) and citations were issued. As an employer who has been cited, you may either:

• Agree to the citation, correct the condition by the date set in the citation and pay the penalty, if one is proposed.
• Disagree with the citation. You have 15 working days from the date you receive the citation to contest in writing the citation, the proposed penalty and/or the abatement date.

Before deciding to contest the citation, you may request an informal conference with the OSHA area director within the 15-working-day period to discuss any issues related to the citation.

“Always ask for an informal conference,” advised Heather MacDougall, SPHR, an attorney with Akerman Senterfitt, based in West Palm Beach, Fla.

MacDougall told SHRM Online that the potential advantages of an informal conference include:

• Penalty reduction.
• Extension of abatement dates.
• Deletion of citations.
• Reclassification of citations.
• Clarification of abatement procedures or alleged violations.
• A public relations opportunity with the area director.
• The discovery of more facts to ascertain whether to contest the citation.

You also have the right to challenge the citation before the Occupational Safety and Health Review Commission (OSHRC).

The commission is an independent agency that hears employer contests of OSHA citations. Both employers and employees have the right to participate in this hearing before an administrative law judge (ALJ). The hearing mirrors all the elements of a trial, including examination and cross-examination of witnesses. You may choose to represent yourself or have an attorney represent you. The ALJ may affirm, modify or eliminate any contested items of the citation or penalty.

As with any other legal procedure, there is an appeals process. Once the ALJ has ruled, any party to the case may request a further review by the full commission. The commission’s ruling, in turn, may be appealed to the federal circuit court in which the case arose or for the federal circuit where the employer has his or her principal office.

The number of safety and health inspections carried out by OSHA each year and the rate at which employers choose to contest the citations issued and penalties proposed by OSHA all have an impact on the number of cases before the commission and the time needed to decide cases, MacDougall said. These stalemates have resulted in cases on OSHRC’s docket languishing for several years. “In recent years, the agency had cases on the docket that were more than 10 years old,” she said.

Depending on the strength of your case, it may be worth appealing to the commission, said Curtis Chambers, CSP, the CEO of OSHA Training Services, a provider of OSHA training. “It has been my experience that generally, the ALJs are skewed towards OSHA, and the same is true of the commissioners on the OSHRC,” he told SHRM Online. “However, sometimes appealing to the commission is a necessary evil you must endure before you can appeal to the courts of appeal, where I find you tend to get a more balanced and fair decision,” he said.

Other than contesting citations, you may solicit OSHA’s discretion to reduce fines for the following reasons:

A good safety record. OSHA may cut fines up to 10 percent, as long as you don’t have any willful, serious, repeat or failure-to-abate citations in the previous five years.

This particular reduction only applies if there have been no such citations issued to the employer at any worksite in the country, including in states that operate a state plan OSH program, said Chambers.

During the last update to OSHA’s Field Operations Manual, the agency changed the “Clean History” penalty reduction in an important way, said Eric Conn, head of Epstein, Becker, Green’s national OSHA Practice Group based in Washington, D.C. “They used to just require a clean record. Now, they require that you have had an inspection that resulted in no violations during that time,” Conn told SHRM Online. “In other words, now, you no longer benefit from having a clean record if OSHA has not had any reason to be at your facility during the past five years. Of course, it’s rare that OSHA leaves a facility without citing something,” he added.

Size adjustment. There is an automatic adjustment based on the size of your company. OSHA will reduce fines for companies with 25 or fewer employees by as much as 60 percent. Companies with 26 to 100 workers are eligible for a 30 percent reduction, and employers with 101 to 250 workers can get a 10 percent reduction.

It’s important to remember that the size of the employer shall be calculated on the basis of the maximum number of employees of an employer at all workplaces nationwide at any one time during the previous 12 months, Chambers said.

Limited exposure. If you can show few or no employees were exposed to the hazard, OSHA may reduce your penalty. “The penalty amount is calculated in part on how many employees are exposed to the violative condition,” said Chambers.

Good-faith effort. When a company can show that it has made a good-faith effort at safety compliance, fines may be reduced. A reduction of up to 25 percent for good faith normally requires a written safety and health management system, said MacDougall.

To show good faith, you must have:

• Implemented a comprehensive workplace safety program, including a worksite analysis for the purpose of hazard identification, and hazard prevention and control measures.
• Conducted the required safety training.
• Maintained up-to-date, accurate records.
• Enforced safety rules consistently, and have the disciplinary records to back up that claim.

OSHA factors in employers’ good faith during the inspection itself, Conn said. This includes cooperation with the inspecting officer, prompt responses to document and information requests, and addressing the inspector’s recommendations “on the spot,” he said.

Employers can also qualify for OSHA’s “quick-fix” 15 percent reduction if hazards uncovered during inspections are fixed within 24 hours. The quick-fix reduction applies to violations classified as other-than-serious, “low-gravity serious” or “moderate-gravity serious.” The corrective actions must be permanent and substantial, not temporary or cosmetic, said MacDougall.

Additionally, if the employer can demonstrate financial hardship, which is undefined, OSHA is often willing to further reduce the penalty and consider penalty payment plans, said Conn.

There’s also the option of “Enhanced Abatement.” If employers agree to implement abatement “corporatewide” or agree to bring in a third-party auditor, OSHA often will be more flexible on penalty reductions, he said.

Sometimes OSHA will negotiate penalty reductions in exchange for safety improvements. However, these can include expensive engineering controls that go well beyond OSHA standards.

“That’s something that will have to be decided on a case-by-case basis,” said Chambers. “Sometimes the negotiated penalty is for providing some desired administrative action, such as having your workers attend an OSHA 10-hour class, as opposed to some engineering control,” he said.

Roy Maurer is an online editor/manager for SHRM.

Follow him on Twitter @SHRMRoy.

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