Labor & Employment Law Daily Wrap Up, OSHA NEWS—New policy makes penalty reductions for small businesses more widely available, (Jul 15, 2025)

By Patricia K. Ruiz, J.D.

The new policies are effective immediately.

To minimize the burden on small businesses and increase prompt abatement of hazards, the Department of Labor (DOL) has updated its guidance on penalty and debt collection procedures. The updates are outlined in the Penalties and Debt Collection section of OSHA’s Field Operations Manual.

Increased access to penalty reductions. The revised policies make penalty reductions for small employers more widely available to make it easier for small businesses to invest resources in compliance and hazard abatement. For example, where a penalty reduction level of 70 percent was previously only applicable for businesses with 10 or fewer employees, businesses employing up to 25 employees can now benefit from this level of reduction. Additionally, for employers who take immediate steps to address or correct a hazard, the revisions include new guidelines for a 15 percent penalty reduction. The revised policies further state that employers who have been inspected in the previous five years and had no serious, willful, or failure-to-abate violations are eligible for a 20 percent penalty reduction.

Effective date. The revised policies are effective immediately. Penalties issued before July 14, 2025, will remain under the previous penalty structure, and open investigations where penalties have not yet been issued are covered by the new guidance.

“All employers should be offered the opportunity to comply with regulations that help maintain a safe working environment,” said Deputy Secretary of Labor Keith Sonderling. “Small employers who are working in good faith to comply with complex federal laws should not face the same penalties as large employers with abundant resources. By lowering penalties on small employers, we are supporting the entrepreneurs that drive our economy and giving them the tools they need to keep our workers safe and healthy on the job while keeping them accountable.”

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