High inflation continues to impact businesses. One of the latest examples? Costlier penalties for breaking workplace laws. Several federal agencies released final rules, announcing increased amounts for 2023.
Here’s a brief rundown of five of the workplace laws included in these final rules:
Law #1: ERISA
If your retirement or health plan is subject to the Employee Retirement Income Security Act (ERISA), the list of penalties is long. They include the following:
- For failure to furnish reports to certain former employees or maintain employee records, the maximum penalty is $36 per employee (up from $33 per employee). Penalties apply per plan year.
- Failing or refusing to properly file a plan annual report will cost up to $2,586 per day. Last year, the amount was $2,400 per day.
- Each failure to provide the Secretary of Labor requested documentation can run a business $184 per day. There’s a cap of $1,846 per request. In 2022, those numbers were $171 per day and $1,713 per request.
- A fiduciary who fails to make a proper distribution from a defined benefit plan under Section 206(e) of ERISA will face a maximum fine of $19,933 in 2023 (was $18,500).
Law #2: OSHA
Penalties under the Occupational Safety and Health Act (OSHA) are some of the steepest among workplace laws, and for 2023, the amounts are even steeper.
- For a serious or other-than-serious violation, an employer will pay a maximum penalty of $15,625 (increased from $14,502).
- Watch out for repeated violations under OSHA! For 2023, fines can be as high as $156,259, up from $145,027 last year.
- Not meeting posting requirements will put a business at risk of penalties that can top out at $15,625 (was $14,502).
- Failure to correct a problem means a potential penalty of $15,625 per day (previously $14,502 per day).
Law #3: FMLA
Under the Family and Medical Leave Act (FMLA), employers must post a notice containing facts such as how to file a complaint. Both employees and job applicants must be able to easily view the poster, so it’s worth ensuring that you’re prominently displaying your FMLA poster and other posters covering workplace laws.
- Violations of this law will cost up to $204 in 2023. Last year, the penalty amount was capped at $189.
Law #4: FLSA
The Fair Labor Standards Act (FLSA) is among the oldest workplace laws, dating back to 1938, and businesses are still running into compliance problems with this one in 2023. Check out these maximum fines:
- For not following the requirements of tip regulations, employers can end up paying $1,330 (was $1,234).
- Repeated or willful violations of the minimum wage and overtime provisions of the FLSA mean even higher penalties – $2,374 (up from $2,203).
- Child labor violations are capped at $15,138. In 2022, that number was $14,050.
- Child labor violations that cause serious injury or death have strict consequences – $68,801 (previously $63,855). That’s doubled if the injury or death was caused by willful or repeated violations – $137,602 (an increase from $127,710).
Law #5: IRCA
The Immigration Reform and Control Act (IRCA) establishes penalties related to hiring individuals who aren’t authorized to work in the U.S. Here’s a brief overview of some of the fines:
- For the unlawful employment of aliens, first order, the minimum penalty is $676 (up from $627) and the maximum penalty is $5,404 (up from $5,016).
- For the unlawful employment of aliens, second order, the minimum fine is $5,404 (was $5,016) and the maximum penalty is $13,508 (an increase from $12,537).
- For the unlawful employment of aliens, subsequent order, the minimum penalty is $8,106 (previously $7,523), and the penalty is capped at $27,018 (up from $25,076).
- Paperwork violations under IRCA have increased for 2023. The minimum is $272 (was $252) and the maximum is $2,701 ($2,507 in 2022).
- Failure to notify an individual that you’ve received a final nonconfirmation regarding his or her employment eligibility can lead to fines. For 2023, they range from $942 to $1,881 (the range had been from $874 to $1,746). That’s per individual.
Complying with workplace laws
Finance pros may want to review the additional 2023 penalty amounts for these and other laws, such as the Employee Polygraph Protection Act.
The final rules were published in the Federal Register on January 13 and January 30.