Congress Considers Higher OSHA Penalties (Again)

Sidney Shapiro

March 19, 2010

The Workforce Protections Subcommittee of the House Education and Labor Committee held a hearing Tuesday on the Protecting America’s Workers Act of 2009, legislation that would, among other reforms, modernize workplace health and safety penalties. More than a decade ago, I testified at a similar hearing in the House of Representatives on the same subject. The need for stronger OSHA penalties was apparent then, and it is no less apparent today.

The hearing is memorable to me because I testified along with a father whose son was killed on a construction site while working at a summer job between years of college. His son was working on one of the floors of a multi-story building under construction. He was asked to carry some construction materials across the floor of the building from one side to the other. He piled up the materials in his arms with the result that he could not see clearly in front of himself. When he walked across the floor, he stepped into the hole that was the elevator shaft, falling to his death at the bottom. The contractor had not put up a barricade around the hole in the floor, as it was required to do in order to prevent just such accidents.

OSHA has done much good; workplaces are safer than they were at the time that the agency was founded. But one does not have to look very far to find stories like the one told that day at the hearing. Workers continue to be killed and seriously injured in accidents related to OSHA violations.

Jonathan Snare, the witness appearing Tuesday on behalf of the Chamber of Commerce, testified that since penalties are not punitive – that is, they are not intended to punish firms for violating the OSH Act – there is no point in having higher penalties. This argument has two flaws. First, the goal of financial penalties is to encourage compliance. Economic analysis teaches us that the incentive of an employer to comply with OSHA regulation is based on the likelihood that it will be caught if there is a violation and the size of the penalty it will receive. Because many businesses will not be inspected, Congress needs to create more significant penalties for violations that can kill or maim employees. As OSHA administrator David Michaels testified, payment of OSHA fines is just a cost of doing business for firms, reducing any incentive to take care to not violate the law.

Second, the OSH Act has criminal penalties, which are supposed to be punitive, but they are so minor that it is an insult to working men and women. Under current law, if the employer knowingly violates the act, leading to the death of an employee, the federal penalty is at most six months in jail. This is the issue about which I testified years ago. The problem remains unfixed.

The inadequacy of the penalty is easily demonstrated. There is a federal law that provides for one year in jail for maliciously harassing a wild ass. You don’t even have to kill the burro to get a one-year sentence – just harass it.

The modernization of OSHA penalties is long overdue. I hope the hearing was the first step in accomplishing this goal.

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