Occupational Safety and Health:

Penalties for Violations Are Well Below Maximum Allowable Penalties

HRD-92-48: Published: Apr 6, 1992. Publicly Released: Apr 6, 1992.

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Carlotta C. Joyner
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Pursuant to a congressional request, GAO reviewed how the Occupational Safety and Health Administration (OSHA) sets and reduces workplace safety and health violation penalties, focusing on: (1) how much OSHA actually assesses for violations; (2) whether proposed penalties and reductions were about the same across regions and at the different administrative and judicial review levels; and (3) whether the OSHA policy of penalty reductions to avoid litigation achieves its goal of quicker and better abatement of cited hazards.

GAO found that: (1) OSHA and the Occupational Safety and Health Review Commission (OSHRC) have considerable discretion in proposing and reducing penalties; (2) OSHA and OSHRC policies require that they consider four factors in establishing penalties, but the law does not specify how much weight those factors should have in agency deliberations; (3) OSHA uses gravity as the primary factor in deriving the proposed penalty and then reduces the penalty based on the other three factors; (4) OSHA does not consider an employer's economic benefit from noncompliance in setting a penalty; (5) the penalties initially proposed by OSHA for violations cited in fiscal year 1989 across all OSHA regions were substantially below the maximum allowed by law, and OSHA reduced many penalties; (6) most employers did not formally contest OSHA citations, but those who did contest received greater penalty reductions than those who accepted their citations or those who settled through the OSHA informal settlement process; (7) OSHA believes that reducing penalties leads to both quicker and more comprehensive abatement, since reducing penalties makes employers more likely to accept the penalty, rather than to contest it or to continue the appeal if they have already contested it; (8) it was unable to confirm a causal relationship between penalty reductions and quicker or more comprehensive abatement, although penalty reductions may lead to a quicker resolution of citations; and (9) although the maximum penalty has increased sevenfold, the average proposed OSHA penalty is about three to four times greater than it was before the new maximum went into effect.

Matter for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: Congress does not intend to consider this recommendation.

    Matter: Because Congress set forth the four factors to be considered in determining penalties, it may wish to consider amending the act to require that the benefit to the employer from noncompliance also be a factor used in setting penalties.


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