The Minnesota legislature has declined to adopt significant increases in OSHA penalties, which are the fines that may be levied against employers for violations of workplace safety and health rules.
Last year, Federal OSHA increased their penalty structure by approximately 80%, and adopted a policy which will require fines to be adjusted annually to keep pace with Consumer Price Index in the future. Their motivation in doing this was to ensure that the penalties were more reflective of current price levels. The fine structure had not been adjusted in almost 30 years, and were no longer reflective of actual price levels, thus losing their deterrent and punitive effects. Companies which were found to have committed serious workplace safety violations were receiving fines of only a few hundred dollars. In some cases, violations resulting in death or serious injury were met with fines of only a few thousand dollars.
Normally, states such as Minnesota and Iowa, which operate their own OSHA programs, as opposed to being covered by Federal OSHA, must ensure that their programs and fines are at least as stringent as Federal requirements. Therefore, it would seem that Minnesota would have been required to adopt this increased penalty structure months ago. I haven’t been able to find an explanation as to why Minnesota hasn’t complied.
The net effect of this is that OSHA penalties in Minnesota will remain quite low, compared to other states. For instance, in Federal OSHA states, and many other so-called “state plan states”, the maximum penalty for a serious violation will increase from $7,000 to $12,000, and the maximum penalty for a willful violation will increase from $70,000 to $126,000. In these states, the fines will continue to increase on an annual basis. But in Minnesota, penalties will remain at the lower levels shown above, and will not be adjusted annually to match inflation.
Critics fear that penalties that are based on 30 year old price indexes will allow disreputable employers to continue their negligent safety practices without fear of consequences.
In states in which the new penalty structure applies, including Wisconsin, North Dakota, South Dakota, and Montana, the changes took effect Aug. 1, 2016.
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