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30 April 2016 • www.CPAPracticeAdvisor.com FEATURE In Febr uar y 2016, the DOL brought suit against U.S. Steel Corp., alleging that U.S. Steel 's policy that employees immediately report workplace incidents violates the Occupational Safety and Health Act, because it allegedly discourages employees from reporting workplace injuries. According to R ichard Men- delson, OSH A's Regional Adminis- trator in Philadelphia, "U.S. Steel's policy discourages employees from reporting injuries for fear of retalia- tion. Because workers don't always recognize injuries at the time they occur, the policy provides an incen- tive for employees to not report inju- ries once they realize they should, since they are concerned that the timing of their report would violate the company's policy and result in some kind of reprimand." For employers, any increase in OSH A fnes could be a costly prob- lem, underscoring the importance of a robust and efective workplace safet y policy. However, OSH A's recent enforcement positions only create confusion over how to imple- ment an efective safety policy, while at the same time avoiding a situation similar to U.S. Steel. In order to navi- gate these contradictory positions, companies must monitor changes in federal regulations, as well as under- stand what actions they should to take to avoid issues with OSH A and minimize potential liability. OSHA, Fines, and the Bipartisan Budget Deal Under the Occupational Safet y and Health Act of 1970, employers are responsible for providing a safe and healthful workplace for their employees. According to OSH A, it ensures these conditions for A meri- can workers by seting and enforcing standards, and providing training, education, and assistance. That includes the ability to fne compa- nies for health and safety violations, and to investigate retaliation against employees for reporting workplace incidents or unsafe conditions. For the frst time in more than 20 years, OSHA is signifcantly increas - ing those fnes, based on a provision in the federal government's 2015 budget deal that few under the radar when the budget was passed. Te pro- vision allows OSHA to implement a "catchup" adjustment. Te adjust- ment is based on the diference in the Consumer Price Index ("CPI") since the last time OSHA raised penalties in 1990 through October 2015. Afer the initial increase in rates, moving forward OSHA will adjust penalties based on the CPI. Te provision could allow OSHA to raise rates more than 80 percent, if the maximum amounts are imple- mented. Tat means the maximum penalty for a willful violation would increase to about $127,000 from the current $70,000. Te change is expected to go into efect by August 1, 2016. W hile OHSA could seek less than the ma x imum increase allowed under the law, indications are that ofcials will ask for as much as possi- ble. During Congressional testimony last October, David Michaels, Assis- tant Secretary at the Agency, claimed that, "Te most serious obstacle to efective OSH A enforcement of the law is the very low level of civil pen- alties allowed under our law, as well as our weak criminal sanctions. Te deterrent efects of these penalties are determined by both the magni- tude and the likelihood of penalties. However, OSH A's current penalties are not strong enough to provide adequate incentives." The DOL's Lawsuit Against U.S. Steel Even while claiming that additional penalties are necessar y to ensure that companies comply with work- place safety rules and regulations, OSH A and the DOL appear to be making it harder to do just that. On February 17, 2016, the DOL fled suit in federal court against U.S. Steel, claiming that U.S. Steel's workplace injur y policy requiring employees to immediate report any workplace incident violates the OSH Act. Te lawsuit stems from an OSH A investigation in 2014, afer U.S. Steel suspended t wo employees who reported incidents several days Successfully Navigating Workplace Safety Issues in 2016 By Richard D. Alaniz R ecent Occupational Safety and Health Administration ("OSHA") develop- ments are a growing cause of concern for many employers and manufac- turers in the United States. Efective August 1, 2016, OSHA—the federal agency that enforces workplace safety—is expected to increase its fnes for workplace safety violations more than 80 percent. At the same time, OSHA and the Department of Labor (DOL) are making it harder than ever for employers to police safety violations.