The US Department of Labor recently announced that it is increasing the penalties associated with violations of several employment laws. The penalty increase applies to all penalties assessed after January 2, 2018 for violations that took place after November 2, 2015.
The increase in penalties applies to the following violations, among others:
||Old Maximum Penalty
||New Maximum Penalty
|Family Medical Leave Act
||Failure to post required FMLA notices
|Fair Labor Standards Act
||Willful or repeated violations the FLSA minimum wage and/or overtime provisions
|Violations of the FLSA child labor law provisions
|Violations of the FLSA child labor law provisions that result in serious injury or death
|Willful or repeated violations of the FLSA child labor law provisions that result in serious injury or death
|Occupational Safety and Health Act
||Violations of the OSHA provisions
|Willful or repeated violations of the OSHA provisions
|Failure to post required OSHA notices
|Failure-to-abate violations of the OSHA provisions
In addition to the above-listed laws, the DOL also increased the penalties for violations of several other laws, including the Employee Retirement Income Security Act, the Immigration and Nationality Act, and the Employee Polygraph Protection Act, among others.
For a complete table of the increased penalties, click here.
Under the Inflation Adjustment Act, the DOL is required to adjust its civil monetary penalty levels to account for inflation no later than January 15 of each year. In accordance with this obligation, the DOL recently issued a final rule that increases penalties assessed or enforced in its regulations.
These increased penalties apply to regulations enforced by the following federal agencies:
- Office of Workers’ Compensation Programs;
- Wage and Hour Division;
- Occupational Safety and Health Administration (OSHA);
- Employee Benefits Security Administration; and
- Mine Safety and Health Administration.
Most significant to most employers are those penalties under the laws enforced by the Wage and Hour Division, which include:
- Fair Labor Standards Act;
- Family and Medical Leave Act;
- Migrant and Seasonal Agricultural Worker Protection Act;
- The Immigration and Nationality Act (INA) (regarding the H-2A, D-1 and H-1B visa programs); and
- Employee Polygraph Protection Act (EPPA).
There is a new incentive for employers to comply with Hawaii’s workers’ compensation and temporary disability insurance laws.
With the passage of Act 187 this summer, the Hawaii Legislature has significantly increased the penalties for violations of these laws. Specifically, this Act increased the penalties for violations of Hawaii’s workers’ compensation and temporary disability insurance laws as follows:
- $1 per day to $100 per day for temporary disability insurance law violations and
- $10 per day to $100 per day for worker’s compensation law violations.
In addition, the Wage Standards Division of the Hawaii State Department of Labor & Industrial Relations has not hesitated in taking advantage of these new penalties. Recently, this agency levied $767,095 in penalties against a construction company remodeling a hotel in Waikiki, Hawaii for its failure to provide Prepaid Health Care, Temporary Disability Insurance and Workers’ Compensation insurance.
It is recommended that all Hawaii employers take steps to verify that they are complying with these laws to avoid similar penalties.
Penalties that can be assessed against employers who fail to comply with IRS filing requirements for their employees under the Affordable Care Act (“ACA”) have recently been doubled. Many employers are unaware that starting in February 2016, employers and healthcare providers will be required to file IRS information returns in connection with employer-provided healthcare coverage, new under the ACA.
Additionally, employers will be required to provide a copy of the return to each corresponding employee. Penalties for failure to provide accurate information on these returns has increased from $100 to $250 per inaccurate return, and penalties can be assessed twice for each employee, once for inaccurate information provided to the IRS, and again for inaccurate information in the copy of the return given to the employee. Thus, an employer may face penalties of up to $500 for inaccurate information provided in each employee’s return.
If employers have not already done so, they should begin preparing information in anticipation of filing these returns. Deadlines for filing these returns vary depending on if it is done in paper form or electronically. Paper filings will be due February 29, 2016 for the 2015 tax year. Electronic filings will be due March 03, 2016. Employers should also note that a copy of the return must be provided to the corresponding employee no later than February 01, 2016. For more information, the IRS publication relating to these penalties can be found here.