Improvements Needed in Assessing Penalties and Controlling Penalty Collections Resulting From OSHA Inspections

HRD-81-150: Published: Sep 15, 1981. Publicly Released: Sep 15, 1981.

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The Occupational Safety and Health Act authorizes the Secretary of Labor to establish national occupational safety and health standards and to enforce compliance through workplace inspections and penalties for violations. GAO reviewed the adequacy of the accounting controls and procedures used by the Occupational Safety and Health Administration (OSHA) and the Office of the Solicitor for processing penalty cases and collecting and safeguarding penalty payments.

GAO found that the OSHA management information system was not providing accurate data showing penalty balances due because data were not entered into the system to record regional solicitor adjustments to penalties proposed by OSHA area offices and contested by employers. Penalty receipts were often transmitted between offices without internal controls or acknowledgment of receipts. Thus, penalty receipts could become lost in the mail or otherwise misplaced, and such a loss might not be detected. Recent system changes, if effectively implemented, should provide accurate data on penalties due from employers. GAO believes that internal controls over remittance of penalties could best be achieved by requiring the sending offices to prepare a list identifying each check and money order and the total amount being remitted and by requiring receiving officers to acknowledge receipt of the remittances by signing and returning one copy of the list to the sending officers. Penalty payments have not been promptly deposited, thereby delaying access to the funds by the Treasury and increasing the potential for loss or misplacement of funds. GAO also found that most employers who contest citations receive substantial reductions, despite the fact that they are supposed to pay the full penalty. This practice suggests that the proposed penalties may be too high, settlements may be too lenient, or both. Further, GAO found that the regional solicitors' offices followed inconsistent practices of initiating court suits to recover unpaid penalties in collection cases.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should require OSHA and the Office of the Solicitor to develop and implement a recordkeeping system to provide improved management controls over penalty receipts in transit between Labor offices. At a minimum, such a system should require receiving offices to acknowledge receipt of payments.

    Agency Affected: Department of Labor

  2. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should require OSHA and the Office of the Solicitor to emphasize to their field offices the importance of forwarding penalty receipts promptly. Receipts should be forwarded on the day of collection, or at least by the following business day. The Secretary should also require OSHA headquarters to make daily collections and deposits of penalty receipts from the post office box.

    Agency Affected: Department of Labor

  3. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should require the Office of the Solicitor to establish a uniform minimum penalty for regional solicitors to use in determining whether to pursue court action to recover unpaid penalties in collection cases.

    Agency Affected: Department of Labor

 

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