The Multinational Monitor


L A B O R 'S   C H A L L E N G E

Crime Without Punishment

Lax Enforcement at OSHA

by Jim Donauhue

A Multinational Monitor survey of Occupational Safety and Health Administration (OSHA) enforcement data reveals that the largest U.S. corporations violate workplace safety laws on a massive scale, while confirming that the agency deserves its reputation of having a weak enforcement record.

Each of the country's 10 largest corporations were cited for repeated violations of workplace safety regulations [see table - omitted here]. General Electric, by far the most cited company, received more than 1,400 citations. GE also leads in the number of citations issued per 1,000 employees. IBM, the least cited company, received 15.

Despite its incredible record, General Electric spokesperson Jack Batty denies the company's health and safety program needs substantial improvement. "We are always trying to do better," Batty says. "As long as there are any accidents, we'll be out there trying to do better."

Multinational Monitor analyzed completed OSHA inspection reports from 1982 through 1990 for the 10 largest U.S. corporations as listed in the 1990 Fortune 500. Those corporations are Chrysler, Dupont, Exxon, Ford Motor Company, General Electric, General Motors, International Business Machines (IBM), Mobil, Philip Morris and Texaco. The OSHA reports were obtained by a Freedom of Information Act request.

The Monitor also examined records dating back to 1982 from most of the states that conduct workplace safety enforcement operations separate from OSHA. California, Michigan and Washington are among the states with autonomous enforcement power and did not begin reporting complete enforcement information to OSHA until very recently. Despite this limitation, the survey offers insight into the enforcement record of OSHA and 20 of the 23 states that conduct enforcement separate from OSHA.

The data demonstrate the sluggish enforcement strategy of the state and federal agencies. OSHA and the state agencies together declined to levy penalties for 67 percent of the violations found. In addition, penalties totalled $1,000 or less in 86 percent of OSHA's inspections. General Electric paid a meager $151,003 in penalties on only 382, or 25 percent, of the total citations issued. In the nine years surveyed, GE paid an average of $46 each day for violating worker safety laws.

Until recently, OSHA's maximum penalty was $10,000 for a wilful violation of the Occupational Safety and Health Act. But OSHA and states with autonomous enforcement power levied total penalties of $10,000 or greater in only 14 of the 795 inspections of the top 10 corporations in which a citation was issued. (This figure does not include 11 cases that were still open at the time of the survey in which the assessed penalty was $10,000 or more.) The federal and state agencies imposed total penalties between $5,000 and $10,000 in only 12 inspections. (This figure does not include two cases still open at the time of the survey.)

In March 1991, the maximum penalty for a wilful violation of the OSH Act increased from $10,000 to $70,000. Wilful violations are those committed with an intentional disregard of, or plain indifference to, the requirements of the act. The maximum penalty for serious violations increased from $1,000 to $7,000. Serious violations are those in which a company should have known of a substantial probability of an accident resulting in death or serious injury, such as a crushed arm or liver failure. Of the 1,238 penalties issued against the 10 corporations collectively, only 5 percent were imposed for wilful violations. Eighty-four percent were imposed for serious, 6 percent for repeated, and 5 percent for other violations.

Under the Reagan and Bush administrations, OSHA's budget has declined in real terms (the agency now has approximately 1,200 inspectors to monitor the nation's 7 million workplaces) and it has emphasized a regulatory philosophy that calls for a more cooperative relationship with corporations to promote "voluntary compliance" with worker safety standards. Critics charge that the policy is nothing more than a pretext to drastically reduce penalties.

Joseph Kinney of the National Safe Workplace Institute calls OSHA's voluntary compliance strategy a "farce." Kinney argues that a true voluntary compliance system requires verification. He points out that IRS auditors are permanently stationed at many corporations to verify compliance with tax laws and that Pentagon officials monitor defense contractors every day for compliance with procurement laws. "All the major companies are audited every year by the IRS, and their audits are so big that they have IRS teams that are actually permanently based at those companies," Kinney says. "Theoretically, our internal revenue tax system is a voluntary compliance system. So, I think we ought to have the same kind of compliance strategy with OSHA that we have with IRS. I think we ought to have OSHA inspectors at these companies on a daily basis from moment to moment. And that's voluntary compliance."

Kinney also rejects corporate complaints that OSHA inspections and regulations are intrusive. "The National Association of Manufacturers finds all these problems with OSHA," he said. "Yet, the reality is that in other areas [corporations] deal with government on a daily basis. There is a double standard here. Somehow, when it comes to employee safety, government is intrusive, but they sure don't raise any complaints about the fact that the IRS is there. One kind of intrusiveness is taken for granted because we value tax collection, but ... employee safety and health, is not valued."

As part of its "voluntary compliance" strategy, OSHA frequently reduces penalties after negotiating with a violator. A 1989 study by Kinney's National Safe Workplace Institute found that between 1986 and 1989, OSHA reduced the total amount of fines (involving multiple violations) exceeding $100,000 by 67 percent. Collectively, the 10 largest U.S. corporations paid only 54 percent of the initial penalties assessed in the nine- year period surveyed by the Monitor.

Since the Occupational Safety and Health Act of 1970 was passed, hundreds of thousands of people have died due to occupational hazards. Each year, roughly 10,000 people are killed in industrial accidents, 70,000 become afflicted with permanent disabilities and 9 million are injured. Tens of thousands more die from workplace-induced disease.

Even OSHA's current enforcement strategy reveals a consistent pattern of corporate violations of occupational health and safety laws. As long as the current climate prevails, with the agency understaffed and unable and unwilling to levy harsh penalties on corporate lawbreakers, a continued epidemic of occupational tragedies is virtually guaranteed.

OSHA Citations & Penalties

1982 Through 1990

Corporation # Citations # Penalties Initial Penalty Final Penalty
General Electric 1495 382 $252,894 $151,003
General Motors 747 262 $796,894 $609,004
Ford Motor 663 254 $721,497 433,624
Chrysler 350 168 $1,075,442 $390,257
Mobil 176 78 $57,135 $21,377
Exxon 150 34 $39,630 $17,230
Texaco 107 37 $32,651 $23,773
DuPont 85 19 $77,580 $19,120
Philip Morris 24 3 $2,280 $1,700
IBM 15 1 $24,640 $437

Table of Contents