Articles Posted in OSHA Safety Regulations

A study recently published in the journal Science suggests federal workplace health and safety regulations in the United States save lives without affecting a company’s profit margin. The study examined data from hundreds of California work sites subject to random Occupational Safety and Health Administration (OSHA) inspections over a ten-year period. Although critics of OSHA argue federal safety regulations are too costly, the study found federal inspections not only reduced workplace injury claims, but also failed to have a negative impact on profits or sales. In the four years following an OSHA inspection, workers’ compensation expenses at companies that were randomly inspected were an average of $355,000, or 26 percent, less than those at businesses that were not inspected.

Michael Toffel, co-author of the study and Harvard Business School Professor, stated it was ironic that the same companies who claim OSHA kills jobs are actually reaping a benefit in the form of reduced injuries and workers’ compensation costs from the inspections. He also said if OSHA inspections throughout the nation created a similar benefit, businesses in the U.S. are gaining about $6 billion in added value from the federal safety program. Toffel believes that number may actually be low as it does not take into account other savings from expenses such as loss of production costs following an accident.

According to Marc Freedman, Executive Director for the Labor Law Policy at the U.S. Chamber of Commerce, OSHA inspections are not problematic for most businesses. Instead, he stated the way in which inspections are conducted and the dynamic between a company owner and OSHA inspectors is the issue. Freedman believes inspections under the current administration are conducted in such a way as to increase penalties. Others disagree, stating OSHA inspections are conducted by law enforcement officials who are bound to note each and every workplace safety violation regardless of political pressure from the White House.

The maximum penalty OSHA may assess for each serious safety violation, when an employer knew or should have known a safety violation would likely result in a worker’s death or serious physical injury, is $7,000. In general, penalties are assessed at an average rate of $1,000 per serious violation. OSHA officials also reportedly take into consideration a company’s safety record and other factors when determining financial penalties. Based upon his research, Toffel believes safety tends to increase following random OSHA inspections because inspectors discuss the problems and potential solutions with companies. Instead of focusing on the violations, Toffel said managers become eager to create solutions that will increase worker safety.

The Occupational Safety and Health Act of 1970 created OSHA to decrease worker injuries and fatalities. Under the Act, employers must comply with certain safety-related requirements such as providing workers with training, information about safety hazards, and copies of safety test results. Employers must also provide a workplace that is reasonably free of safety hazards. When a serious workplace accident occurs, OSHA will normally investigate whether an employer complied with established safety standards at the work site.

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