As employers may recall, OSHA is a federal agency that maintains a big database of citations issued to employers across the nation for violating health and safety regulations. A decision to pay or settle a seemingly “small” citation can come back to haunt a company when a similar citation is issued at a different location.

Consider the following example: A minor incident at one Company plant in Texas results in OSHA issuing a single citation for failing to properly machine guard a particular piece of machinery. The initial penalty is $2,500, but the OSHA Assistant Area Director in Texas offers to resolve the case by reducing the penalty to $1,500. In doing so, the Area Director says she is only concerned with this plant in Texas. The plant knows that the incident occurred because the employee violated a number of safety precautions for which the Company has disciplined employees in the past. If these safety precautions had been followed, the employee would never have been exposed to the machine. While the Company might have been able to defend the citation or maybe negotiate better terms on abatement, the amount of money involved in paying the penalty is small and the local Texas manager settles the matter.

Four years later, another accident happens at one of the Company’s plants in Pennsylvania and involves the same piece of machinery that resulted in the Texas facility citation. This time, however, the accident is more severe and a contractor loses an arm. OSHA’s investigation shows that the employer has plants throughout the country with the same piece of machinery. Even though the contractor failed to comply with applicable safety rules, such violations are rampant, which was known by Company supervisors who did nothing to stop it. OSHA issues a willful or repeat citation of $125,000 for every machine that was missing a guard. The company is also sued by the injured contractor.

Can OSHA consider a four year old citation when assessing a new citation? The answer is “Yes.” While the OSHA Field Operations Manual states the look-back period for repeat citations is only three years, the OSHA Commission in Washington, DC has decided that the Field Manual does not bind it and it can look back as far as it wishes to do. In February, the U.S. Court of Appeals for the Second Circuit agreed with the Commission’s position.

Careful thought needs to go into settling OSHA citations. Something that looks simple can become complicated and expensive. A company has 15 business days to contest a citation, but if this is an insufficient amount of time to consider all the ramifications of settling the citation, the employer should file a notice of contest. An employer can always settle the case later if it decides to do so after careful thought and reflection. The important takeaway is not to allow OSHA to bait you into settling with a small penalty, only to later use that same settlement against you to much greater effect.