Small and mid-sized employers now have a greater opportunity to reduce penalties when cited for workplace safety violations, thanks to new guidance from the U.S. Department of Labor.
The revisions to OSHA’s penalty framework, which took effect on July 14, 2025, aim to ease financial burdens on small businesses while still holding them accountable for keeping workers safe.
The updated rules encourage prompt hazard abatement and reward employers with clean safety records. Employers who act quickly and in good faith may see a significantly reduced financial impact from an OSHA citation.
New penalty reduction opportunities
OSHA’s revised policy, outlined in its “Field Operations Manual,” introduces three paths to lower penalties:
- Quick hazard correction — Employers that immediately fix a hazard identified during an inspection are now eligible for a 15% penalty reduction. “Immediate” abatement must be documented and verified.
- Expanded small business relief — Under long-standing OSHA policy, small businesses with 10 or fewer employees were eligible for a 70% penalty reduction when cited for workplace safety violations. The reduction reflects OSHA’s recognition that smaller firms often have fewer resources for regulatory compliance than larger companies. The new guidance expands eligibility to employers with up to 25 workers.
- Clean inspection history credit — Employers can receive a 20% reduction in penalties if:
- They’ve never been inspected by federal OSHA or a state plan, or
- They’ve had an inspection in the last five years with no serious, willful or failure-to-abate violations.
Qualified employers may combine these credits for a total reduction of more than 80%.
However, OSHA retains discretion and may deny reductions if it determines that doing so would undermine the goals of the Occupational Safety and Health Act, especially in egregious or repeat violation cases.
What employers can do to benefit
Employers hoping to take advantage of the new guidance should take several proactive steps:
Monitor your workforce size. Businesses with 25 or fewer employees qualify for the 70% reduction.
Prepare a quick-response protocol. Train supervisors and safety managers to address and document hazard corrections immediately during inspections or shortly after.
Review your OSHA history. If you haven’t been cited for serious violations in the past five years, or have never been inspected, you may qualify for a clean history discount.
Be ready to negotiate. If cited, work with legal counsel or a safety consultant to confirm your eligibility for any applicable reductions.
The takeaway
This move reflects a broader strategy by OSHA and the Department of Labor to support small businesses while maintaining strong safety enforcement. By incentivizing immediate hazard correction and rewarding clean records, the agency encourages a more proactive approach to compliance.
That said, OSHA is clear that these changes do not lessen its commitment to enforcement. Penalties may still be substantial for businesses with a history of violations or those that fail to act in good faith.
