Monday was an interesting day. Three contractors called me for some advice on; being cited and fined by OSHA, a revoked HIC registration from the Office of Consumer Affairs and Business Regulation and a Mass RRP Department of Labor Standards violation. Two shared some bad news about getting fined and said they don't have the money in their budget to pay them. The third is thinking from what he was told by a board of health inspector he will likely be cited and fined.
The details;
- One contractor got whacked for a $12,000 OSHA fine for fall protection and asbestos exposure violations.
- One contractor is going to be fined for violating the home improvement law. He had his registration revoked preventing him from legally working on home improvement projects in Massachusetts.
- One contractor was told he is in violation of the RRP law, was told to stop work, and the board of health wrote up a report to send of to the Mass RRP police (DLS).
All three said they do not have the money in their company budget to pay fines at this time. I asked them where they would come up with the dough to pay the fines and they said "out of their pocket".
I asked all three if they intended to rectify the situation and get up to speed with complying with the required regulation.
Here are some of the comments shared;
- Two said they will do what they need to do because they definitely do not have it in their budget to handle fines now and they cannot afford to deal with this again.
- One said he has been meaning to get the guys trained on fall protection and put together a safety program but he is so busy he can't find the time. He said now he has the incentive (fine) to train and properly protect is men.
- One said he is seriously thinking about adding OSHA and RRP fines to his yearly budget. He thinks he is likely to get fined again so why not just put OSHA and RRP fines into the budget! He said RRP training is a joke and the men won't listen to him. His conclusion; give up on his men and pay the fines!
Then I got an answer from the third person that blows my mind.
He said "it isn't in my budget to do what is necessary to comply."
"I can't afford to train my guys or pay for equipment and then have to compete with the underground economy. Besides they are suppose to know what to do, I shouldn't have to wipe their A$$."
This got me thinking should contractors include money in their budget to pay OSHA and RRP fines? At least that way they won't have to take it out of their savings or pocket to pay them.
A few years back OSHA did a study and found some contractors figured the cost of fines in their annual budget. Then OSHA decided to increase the fine structure citing that the fines were not high enough to deter contractors form working unsafe. Since then OSHA has stepped up their citing and fining especially in the residential construction industry. Figuring fines into the budget is just going to cost contractors who get cited and fined for violations more money.
On the RRP front, the State of Mass continues to methodically cite and fine contractors who do not comply with the RRP law. The EPA just audited 200 companies in New Haven, CT and we will see the results of those audits very soon. Many contractors will be required to renew their RRP Certification in 2015. Those who do not will be getting fines if they are not re certified.
I personally, do not think it is wise to include the costs of fines into the annual budget. I think it is better to figure what you need to do to protect your people and work safe. In the long run it is better for your men and much cheaper.
What are your thoughts? Should contractors just add OSHA and RRP fines to the budget and worry about fines if they are discovered?
