610 IAC 9-4-3 Penalty reduction factors

Sec. 3. (a) Penalty adjustments vary depending on an employer's size, determined by the maximum number of employees, good faith, and a history of previous violations. Maximum penalty reductions are generally as follows: (1) Not more than seventy percent (70%) reduction, or eighty percent (80%) for serious knowing violations, may be provided for size. (2) Not more than twenty-five percent (25%) reduction may be provided for good faith. (3) Not more than ten percent (10%) reduction may be provided for history. However, no penalty reduction may be more than one hundred percent (100%) of the initial assessment. The reduction also may not reduce a penalty to less than the minimum penalty amounts described in this rule. Since these reduction factors are based on the general character of an employer's safety and health performance, the factors are calculated only one (1) time for each employer. (b) After the classification as serious or nonserious, and the GBPs have been determined for each violation, the penalty reduction factors for size, good faith, and history are applied subject to the following limitations: (1) Penalties proposed for violations classified as repeat violations are reduced only for size. (2) Penalties proposed for violations classified as knowing violations are reduced only for size and history. (3) Penalties proposed for serious violations classified as high severity and greater probability violations are reduced only for size and history. (c) A history reduction of ten percent (10%) is given to employers that have not been issued by IOSHA any serious, knowing, or repeat violations in the past three (3) years. (d) The three (3) year history of no prior safety orders from IOSHA is calculated from the opening conference date of the current inspection. Only safety orders that have become a final order under IC 22-8-1.1-35.6(a) within the three (3) years immediately before the opening conference date shall be considered. (e) A history reduction may not be applied under the following conditions: (1) For a repeat violation. (2) To employers being issued a safety order for failure to certify abatement. (3) For violations related to a fatality. (4) To employers being issued a safety order for failure to notify employees and tagging movable equipment. (f) A good faith penalty reduction is permitted to recognize an employer's effort to carry out an effective safety and health management system in the workplace. A good faith reduction is not related to an employer that immediately corrects or initiates steps to abate a hazard after being informed of a violation by the compliance safety and health officer (CSHO). The following apply to reductions for good faith: (1) A good faith reduction is not permitted for any of the following: (A) High gravity serious violations. (B) Violations related to a fatality. (C) Knowing violations. If a knowing violation is found, no reduction for good faith may be applied to any of the violations found during the same inspection. (D) Repeat violations. If a repeat violation is found, no reduction for good faith may be applied to any of the violations found during the same inspection. (E) Failure to correct violations. If a failure to correct violation is found, no reduction for good faith may be applied to any of the violations found during the same inspection. (F) The employer is issued a safety order under abatement verification for failure to certify abatement. (G) The employer is issued a safety order under abatement verification for failure to notify employees and tagging movable equipment. (H) The employer has no safety and health management system, or there are major deficiencies in the program. (I) The employer failed to report a fatality, an inpatient hospitalization, an amputation, or the loss of an eye under the requirements of 29 CFR 1904.39. (2) A good faith reduction is permitted as follows: (A) A twenty-five percent (25%) reduction for good faith normally requires a written safety and health management system. In exceptional cases, CSHOs may recommend a full twenty-five percent (25%) reduction for employers, with one (1) to twenty-five (25) employees, that have carried out an effective safety and health management system, but have not documented it in writing. To qualify for this reduction, the employer's safety and health management system must provide: (i) appropriate management commitment and employee involvement; (ii) worksite analysis for the purpose of hazard identification; (iii) hazard prevention and control measures; (iv) safety and health training; (v) where young persons less than eighteen (18) years of age are employed, the CSHO's evaluation must consider whether the employer's safety and health management system appropriately addresses the particular needs of those employees, relative to the types of work they perform and potential hazards to which they may be exposed; and (vi) where persons who speak limited or no English are employed, the CSHO's evaluation must consider whether the employer's safety and health management system appropriately addresses the particular needs of those employees, relative to the types of work they perform and potential hazards to which they may be exposed. (B) A fifteen percent (15%) reduction for good faith is normally given if the employer has a documented and effective safety and health management system, with only incidental deficiencies. (C) Only fifteen percent (15%) and twenty-five percent (25%) may be used to reduce penalties due to the employer's good faith. (g) A penalty reduction of not more than seventy percent (70%) is permitted for small employers and eighty percent (80%) for serious knowing violations under Table 4-5 in section 5 of this rule. The size of the employer is calculated based on the maximum number of employees of an employer at all workplaces nationwide at any one (1) time during the previous twelve (12) months. (h) Reduction for size may not be given for an alleged violation that could have reasonably contributed to a fatal incident. (i) The rates of size reduction to be applied are as follows: Table 4-3: Size Reduction Employees Percent Reduction 1 -10 70% 11 - 25 60% 26 - 100 30% 101 - 250 10% 251 or more None (j) When an employer with one (1) to twenty-five (25) employees has at least one (1) serious violation of high gravity or multiple serious violations of moderate gravity showing a lack of concern for employee safety and health, the CSHO may recommend that only a partial reduction in penalty may be permitted for size. If the division director approves the partial reduction, the justification is to be fully explained in the case file. (k) The total size reduction normally equals the sum of the reductions for each factor. The following table gives an overview of the percent of penalty reductions that apply to serious, nonserious, and repeat violations, and may be used for determining appropriate reduced penalties for serious and nonserious violations: Table 4-4: Penalty Table Percent Reduction Penalty in Dollars Minimal-Greater Low-Lessor Medium-Lessor High-Lessor Low-Greater Medium-Greater High-Greater 0% $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 10% $900 $1,800 $2,700 $3,600 $4,500 $5,400 $6,300 15% $850 $1,700 $2,550 $3,400 $4,250 $5,100 $5,950* 20% $800 $1,600 $2,400 $3,200 $4,000 $4,800 $5,600 25% $750 $1,500 $2,250 $3,000 $3,750 $4,500 $5,250* 30% $700 $1,400 $2,100 $2,800 $3,500 $4,200 $4,900 35% $650 $1,300 $1,950 $2,600 $3,250 $3,900 $4,550* 40% $600 $1,200 $1,800 $2,400 $3,000 $3,600 $4,200 45% $550 $1,100 $1,650 $2,200 $2,750 $3,300 $3,850* 55% $450 $900 $1,350 $1,800 $2,250 $2,700 $3,150* 60% $400 $800 $1,200 $1,600 $2,000 $2,400 $2,800 65% $350 $700 $1,050 $1,400 $1,750 $2,100 $2,450* 70% $300 $600 $900 $1,200 $1,500 $1,800 $2,100 75% $250 $500 $750 $1,000 $1,250 $1,500 $1,750* 80% $200 $400 $600 $800 $1,000 $1,200 $1,400 85% $150 $300 $450 $600 $750 $900 $1,050* 95% $50 $100 $150 $200 $250 $300 $350 (l) Starred figures (*) in Table 4-4 represent penalty amounts not normally proposed for high gravity serious violations because no reduction for good faith is made in those cases. These amounts may occasionally apply to nonserious violations where the division director has determined a high unreduced penalty amount to be warranted.