How Much Could a Failed OSHA Inspection Cost Your Company?

Are you worried about the possibility of OSHA showing up at your front door for a surprise inspection and you’re not exactly sure how to prepare for that possibility? If that sounds like you, you’ve come to the right place!

If you’re not prepared for the possibility of an inspection, this can cost your company literally $tens or even $hundreds of thousands dollars. Those fines can stack up quickly so you may want to be prepared and prevent that from ever happening.

A real life example of this comes from Durcon Inc, a Texas manufacturer who was fined $459,918 after an employee complaint. This complaint resulted in 25 violations. The following violations were a combination of Serious, Repeat and Willful violations:

- Failure to manage a Hearing Conservation program
- Multiple Lockout/Tagout violations
- Failure to implement a Confined Space Program
- Failure to provide Forklift training
- Various Electrical violations
- Multiple Respiratory Protection Program violations
- Multiple Machine Guarding violations

There were more, but these were the most damaging ones and all of which were completely preventable. OSHA inspectors are very good at identifying and pointing out these very common OSHA laws that companies fail to manage. Citations and fines can easily add up to over $100,000. This is not uncommon. Just from this example alone, it is easy to see how bad it can get. It doesn’t matter if the company is big or small, OSHA is non biased when it comes to its’ standards. In reality, the average failed inspection of a small manufacturer will cost the company somewhere between $thirty five and $ninety thousand dollars. This is because on average, a failed inspection will result in anywhere between five and ten “Serious” violations each of which currently carries a maximum fine of $15,625 each!

You can be fined for failing to manage all “aspects” of OSHA standards including:

- Physical health and safety hazards that exist in your workplace that fall under the many OSHA 1910 Standards, including lockout tagout, PPE, respiratory protection, the general duty clause or hazard communication (for example: unlabeled chemical containers).
- Many OSHA standards have a written program requirement that goes with it. It cannot be a generic program bought online or downloaded from the internet. These programs have to be updated and customized to meet a company’s specific health and safety hazards.
- Most OSHA standards include an employee training requirement to cover the generic standard and then to also address companies’ specific health and safety hazards
- Procedures such as lockout tagout are imperative to meeting OSHA Standards. A company must develop lockout tagout procedures for every piece of equipment with multiple energy sources. This does not just cover the standard, it must cover all equipment.
- Personal Protective Equipment (PPE) Hazard Assessments have to be created, signed, certified and filed for every job task at your facility. These assessments must include specific PPE requirements for each job task and the company must provide all required PPE at no cost to their employees.

Health exposure testing is another OSHA requirement in situations where a company may have high noise areas or hazardous substances or chemical exposures. In these situation, these exposures must be assessed to ensure that the Permissible Exposure Limit is not being exceeded. Failure to perform those exposure tests can result in a citation.

Most programs have a requirement to perform annual updates and reviews in situations where new processes, equipment, chemicals, etc are added to the workplace. Those programs have to be updated. For example: if a company does not have an updated Hazard Communication program when new hazardous chemicals are introduced, this could result in several citations, not just one.

As mentioned in this video, “What Can Trigger an OSHA Inspection”, total fines are dependent on what triggered the inspection and the scope of the inspection. If an employee complaint triggered the inspection, that inspector may just focus on one hazard or just a few hazards that were included in the complaint. On the other hand in the case of an expanded inspection or a “comprehensive inspection,” a company could be subjected to scrutiny and an inspection of all aspects of their health and safety program. These are the inspections that most often result in the highest total fines, many times exceeding $100,000 or more.

If a company is found to be negligent about safety, then those could result in “Willful” and “Repeat” violations which result in the highest type of fines. Those fines could exceed over $100,000, $200,000 or even more. Remember that a “Willful” or “Repeat” violation both carry maximums of $152,000 each. Or if management creates a safety hazard intentionally or knew about a health or safety hazard and failed to take action to fix it, the inspector can find out about that by doing confidential interviews with your employees which again, can result in “Repeat” or “willful” violations that can quickly add up to over $100,000 in total fines.

So, with all of that being said, here is a simple yet very important question: Are you and your company really ready if OSHA shows up tomorrow in your lobby for a surprise inspection? The fact is, if you’re like most small manufacturing companies, the answer is probably no. And if that sounds like you, don’t feel bad, you’re not alone. The fact is that OSHA goes across the country every single day and hits small companies just like yours and issues all kinds of citations, fines and penalties that run into the $tens or even $hundreds of thousands of dollars. Could you really afford that?

Here’s our special offer:

The best preparation and the best way to pass an inspection is to know and have the confidence that you have a fully functioning OSHA compliant health and safety program.

To help those of you who are looking to be proactive and make sure that your safety program is up to date, I’m going to make a very special free no obligation offer to you to help get you on track if you don’t have a safety program right now.

Both give you the training, the knowledge and the resources so you can actually start to build a customized safety program and get prepared for that OSHA inspector.

Here they are:

FREE Mini OSHA crash course designed specifically to meet the needs of small manufacturing and industrial companies. I’m going to walk you step by step through the process of determining which OSHA compliance requirements apply to your company and how to build that program and how to manage that program for the long term. Another really important thing to understand about this crash course is that it’s built for non experts. Most of the companies that come to us don’t know anything about safety, so I have built this program with that in mind. So even if you know nothing about safety, you’ll really benefit from it.
FREE Manufacturing OSHA Risk Assessment If OSHA shows up tomorrow, what will they find? Avoid massive fines, protect your employees and save money. Book your free safety assessment, consult with Berg manufacturing safety experts on your current operations, status and risks, and get a FREE roadmap for OSHA compliance and risk reduction!

Thanks for reading and we look forward to hearing from you soon.

By Russell Carr|2023-12-08T16:57:42-05:00December 8th, 2023|OSHA Health & Safety, OSHA Texas Laws & Regulations, Safety Training, Texas OSHA Compliance|Comments Off

About the Author: Russell Carr

How A Sales Guy Transformed Into An Environmental, Health & Safety Expert & Advocate For Small Businesses I've spent my entire 30+ year career working within the manufacturing and “industrial services” sectors. The first 15 years of my career focused on sales of hazardous materials related products and services to the manufacturing sector, then for the last 16+ years transitioned into entrepreneurship, founding 3 small industrial services related contracting businesses. As you’ll see below, running these companies eventually lead me to found yet a 4th business, but more on that in a minute…. Here’s a brief description of the first 3 companies: Berg Environmental Services, Inc.: hazardous waste disposal & transportation services, founded in August of 2003 3rd party wind energy operations & maintenance services provider to utility scale wind farms throughout the US, founded in September 2007 3rd party oil & gas exploration & production services provider, founded in August of 2011 Each of these companies operated in extremely dangerous working conditions and exposed my employees to a wide range of serious health & safety hazards on a daily basis. To complicate matters, 2 of the companies also exposed the environment to significant potential harm. In other words, I learned very early the critical importance of managing environmental, health and safety issues so as to ensure the safety of our employees and the environment, as well as minimizing related risks. But I also learned how incredibly difficult and challenging this endeavor can be due to the wide range of complicated and continually changing environmental, health and safety rules and regulations that impacted the companies. To summarize the challenges: First I had to determine which regulations applied to each company, then I had to build compliance programs to meet those regulations, and finally I had to ensure that the programs were being managed and followed by our staff on a daily basis. All while trying to run and grow 3 profitable businesses…. It was overwhelming and I always struggled to keep up. To make matters worse, throughout this time I also witnessed the devastating price that companies, management and ownership can pay for failing to manage EHS compliance. This included seeing one of my hazardous waste management clients get sent to jail over environmental issues, another client’s management team threatened with jail time, a direct competitor get fined $378,000 by OSHA fine after an employee was nearly killed, and many others face major fines and penalties. Full disclosure, one of my companies got fined by OSHA at one point, & another was cited by TCEQ, so I know how it feels. In summary, I learned first hand how incredibly difficult it is for small companies to manage EHS compliance due to a common lack of the critical expertise, time and resources that are needed to keep up, and how this situation then ends up exposing them to these potentially catastrophic risks that can literally destroy lives and businesses. This later inspired me to found my 4th company, Berg Compliance Solutions in 2012, which is dedicated to helping other small businesses, and business owners, to manage EHS compliance and risk. Education BA, Philosophy, University of Colorado, Boulder, December, 1990. Summary of Professional Experience & Qualifications: 30+ years serving the manufacturing & industrial services sectors 30+ years of sales and marketing experience 16+ years as small business owner & entrepreneur: Founded and operated 4 small businesses since 2003. Environmental, Health & Safety Compliance & Program Related: 19 plus years of hazardous waste management including EPA, TCEQ & RCRA regulations 8 years of DOT/FMCSA compliance experience, including hazardous materials transportation 8 years of combined experience implementing and managing OSHA health and safety compliance programs for 2 high risk energy services businesses Successfully implemented and gained ISO 9001 Quality Management Certification and OHSAS 18001 (Occupational Health & Safety Advisory Service) Certification for wind energy maintenance business. Regulatory Enforcement Related Experience: Served as expert witness in criminal environmental compliance enforcement cases Superfund-CERCLA OSHA enforcement inspections, investigations and resolution in following industries: industrial services, manufacturing & construction. TCEQ enforcement inspections, investigations and resolution in manufacturing.