White House Cancels 2026 OSHA Penalty Increases

Americans are suffering from higher prices everywhere they look, prices that are rising faster than their paychecks:  Moms and dads struggling to feed their families, fill their gas tanks or pay medical expenses. Farmers can’t buy fertilizer. Truckers can’t buy fuel. What is to be done?

Never fear! The Trump Administration has come to the rescue. Not to the rescue of families or workers, but of businesses who are being unfairly harassed by federal agencies just because they endanger and kill their workers.

Despite legislation passed in 2016 requiring certain federal agencies to raise their penalties every year to track the inflation rate, the Trump administration has decided to  give lawbreaking companies a break by cancelling this year’s OSHA and MSHA penalty increases, as well as penalties issued by other federal enforcement agency such as agencies such as EPA and the Department of Transportation.

OSHA Penalties

OSHA penalties are fixed by law and they have never exactly been crushing. When the agency was created in 1971, the maximum penalty for a serious violation was only $1,000 and $10,000 for a willful or repeat violation. In 1990, Congress amended the OSHAct to raise penalties to $7,000 for serious violations, and $70,000 for willful or repeat violations. Another 26 years would go by before raising penalties again.

In 2015, Congress passed the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 which not only raised penalties significantly (to $12,471 for a serious and $124,709 for a willful or repeat violation), but also required annual increases pegged to the inflation rate the previous October. The latest increase in 2025 put serious and willful/repeat OSHA penalties at $16,550 and $165,514 respectively.

But those are the maximum penalties.  In reality, after various reductions have taken effect, the average OSHA penalty that employers pay for a serious violation is only $4,678 for federal OSHA and $2,720 for OSHA state plans. Now,  it’s possible that a business could rack up several serious violations in one citation, but penalties ranging between $4,000 and $20,000 aren’t going to have a major impact from the bottom line of a medium-sized or large corporation.

But the Law Says….

According to the 2015 law, penalties were supposed to rise again last January, based on the October 2025 Consumer Price Index. But January came and went with no announced increase, and finally on April 17, OMB director Russell T. Vought issued a memorandum to all federal agencies cancelling penalty increases for 2026.

How are they justifying that? Well each year’s penalty increases are supposed to be pegged to the level of inflation in the previous October’s inflation report. But last October, the government was shut down, so there was no report. What is to be done? Maybe look at September or November’s report? Maybe using all the sharp minds at the Bureau of Labor Statistics to estimate the Consumer Price Index for October?

Nah.

OSHA’s May 27 Federal Register notice, filed to comply with Vought’s memorandum, stated that “The statute does not allow for an alternative method of calculating civil penalty amounts” and therefore “the Department of Labor is not making any adjustments to civil money penalties under the Inflation Adjustment Act in 2026.”

Possible work-arounds could be interpreted a not following the exact letter of the law and we all know that the Trump administration would never risk ignoring or violating — or even slightly bending — the laws that Congress passed.

We can overlook that Vought technically violated the law by not following the Act’s requirement that OMB “issue guidance to agencies on implementing the inflation adjustments required under this Act” by December 15 of every year.  Vought missed that date by just over 4 months.

He should resign.

Nevertheless, he persists.

No word yet from Vought about whether the next scheduled increase (in January 2027, unless they find another excuse) will combine the missed 2026 increase with the expected 2027 increase.

Bad For Workers

Needless to say, this development is very bad for workers. OSHA is a very small agency with a very big mandate. Because inspectors can’t be everywhere all the time, it must deter employers from endangering workers. But deterrence is a function to two elements: the likelihood of getting caught, combined with the impact of getting caught. The number of OSHA inspectors is currently at an all-time low with federal OSHA only able to inspect every workplace once every 191 years.  And the already low OSHA penalties are shrinking further as inflation undermines their impact.  In other words, the Trump administration is further weakening OSHA’s deterrence and increase the likelihood that workers will be injured or killed in the workplace.

On the other hand, if you think this is a bit of dirty politics, you’re clearly not thinking about the possibilities. If the Government is ever shut down on April 15, does that mean that no one needs to pay income taxes that year?