Longshore Act Civil Money Penalties Adjustment [10/17/1997]
Volume 62, Number 201, Page 53955-53957
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DEPARTMENT OF LABOR
Employment Standards Administration
20 CFR Part 702
RIN 1215-AB17
Longshore Act Civil Money Penalties Adjustment
AGENCY: Office of Workers' Compensation Program, Employment Standards
Administration, Labor.
ACTION: Final rule.
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SUMMARY: On July 2, 1997, the Department of Labor published a proposal
to amend various provisions of the regulations implementing the
Longshore and Harbor Workers' Compensation Act (LHWCA). More
specifically, the amendments, which are now being published in final
with only minor word changes in Secs. 702.204 and 702.236, will
increase the maximum civil penalties that may be assessed under the
LHWCA as required by the Federal Civil Penalties Inflation Adjustment
Act of 1990 (FCPIAA), as amended by the Debt Collection Improvement Act
of 1996 (DCIA).
EFFECTIVE DATE: The rule is effective on November 17, 1997.
FOR FURTHER INFORMATION CONTACT:
Joseph F. Olimpio, Director for Longshore and Harbor Workers'
Compensation, Employment Standards Administration, Room C-4315, Frances
Perkins Building, 200 Constitution Avenue, NW., Washington, DC 20210;
Telephone (202) 219-8721.
SUPPLEMENTARY INFORMATION: The LHWCA authorizes the assessment of a
civil money penalty in three situations: (1) Where an employer fails to
file a report within sixteen days of the final payment of compensation,
it shall be assessed a $100.00 civil penalty (LHWCA, section 14(g));
(2) where an employer, insurance carrier, or self-insured employer
knowingly and willfully fails to file any report required by section
30, or knowingly or willfully makes a false statement or
misrepresentation in any required report, the employer, insurance
carrier, or self-insured employer shall be assessed a civil penalty not
to exceed $10,000.00 (LHWCA, section 30(e)); and (3) where an employer
is found to have discriminated against an employee because the employee
had claimed or attempted to claim compensation, or has testified or is
about to testify in proceedings under the LHWCA, the employer shall be
liable for a civil penalty of not less than $1,000.00 or more than
$5,000.00 (LHWCA, section 49). The DCIA, amending the FCPIAA, requires
each agency to issue regulations adjusting the amount of civil money
penalties they may levy. The DCIA requires that the civil money
penalties be adjusted by a cost-of-living increase equal to the
percentage, if any, by which the Department of Labor's Consumer Price
Index for all-urban customers (CPI) for June of the calendar year
preceding the adjustment exceeds the June CPI for the calendar year in
which the civil penalty amount was last set or adjusted. Due to
inflation since the LHWCA civil money penalties were last set or
adjusted, the increase will, in every case, be the maximum 10%
initially permitted under the DCIA. The adjusted civil penalties will
apply only to violations occurring after the regulations become
effective.
The Department did not receive any comments concerning the
substance of its proposal. It did, however, receive a letter from the
Chief Counsel of the Office of Advocacy at the Small Business
Administration requesting clarification on whether the expected
increase in the amount to be collected under the revised regulations is
$2,500.00 in the aggregate, or $2,500.00 per case. Under the revised
rules, the Department expects to collect an additional $2,500.00 for
all cases in
[[Page 53956]]
which civil money penalties are assessed. This estimate is based on an
analysis of the penalties collected in 1995 and 1996. During that
period the total civil penalties collected for all cases was
$50,000.00, or an average of $25,000.00 for each year. Each year
penalties were collected from an average of 206 cases, so that the
average penalty in each case was $121.36. Thus, assuming the maximum 10
percent increase is collected in each case under the final rule, the
average increase for each individual case is estimated to be $12.14.
Executive Order 12866
The Department has determined that this regulatory action is not a
``significant'' rule within the meaning of Executive Order 12866,
because it is not likely to result in: (1) An annual effect on the
economy of $100 million or more, or an adverse and material effect on a
sector of the economy, productivity, competition, jobs, the
environment, public health or safety, or State, local or tribal
governments or communities; (2) the creation of a serious inconsistency
or interference with an action taken or planned by another agency; (3)
a material alteration in the budgetary impacts of entitlement, grants,
user fees, or loan programs or the rights and obligations of recipients
thereof; or (4) the raising of novel legal or policy issues arising out
of legal mandates, the President's priorities, or the principles set
forth in Executive Order 12866.
Regulatory Flexibility Act
The Regulatory Flexibility Act, 5 U.S.C. 601 et seq., requires each
agency to perform an initial regulatory flexibility analysis for all
proposed rules unless the head of the agency certifies that the rule
will not, if promulgated, have a significant economic impact on a
substantial number of small entities. Small entities include small
businesses, organizations, and governmental jurisdictions. This rule
does no more than mechanically increase certain statutory civil money
penalties to account for inflation, pursuant to specific directions set
forth in the FCPIAA, as amended. The statute specifies the procedure
for calculating the adjusted civil money penalties and does not allow
the Department to vary the calculation to minimize the effect on small
entities. Moreover, as noted above, the total additional amount
collected from all projected cases will not exceed $2,500.00.
Therefore, the Assistant Secretary hereby certifies that the rule will
not have a significant impact on a substantial number of small entities
within the meaning of the Regulatory Flexibility Act.
Unfunded Mandates Reform Act
For purposes of the Unfunded Mandates Reform Act of 1985, as well
as E.O. 12875, this rules does not include any federal mandate that may
result in increased expenditures by State, local or tribal government,
or increased expenditures by the private sector of more than $100
million.
Paperwork Reduction Act
The rule does not contain any collection of information
requirements.
Submission to Congress and the General Accounting Office
In accordance with the Small Business Regulatory Enforcement Act of
1996, the Department will submit to each House of the Congress and to
the Comptroller General a report regarding the issuance of today's
final rule prior to the effective date set forth at the outset of this
notice. The report will note that this rule does not constitute a
``major rule'' as defined by 5 U.S.C. 804(2).
List of Subjects in 20 CFR Part 702
Administrative practice and procedure, Claims, Insurance,
Longshoremen, Vocational rehabilitation, and Workers' Compensation.
For the reasons set forth in the preamble, part 702 of chapter VI
of title 20, Code of Federal Regulations, is amended as follows:
PART 702--ADMINISTRATION AND PROCEDURE
1. The authority citation for part 702 is revised to read as
follows:
Authority: 5 U.S.C. 301, 8171 et seq., Reorganization Plan No. 6
of 1950, 15 FR 3174, 3 CFR 1949-1953, Comp., p. 1004, 64 Stat. 1263;
28 U.S.C. 2461, 33 U.S.C. 930, 36 D.C. Code 501 et seq., 42 U.S.C.
1651 et seq., 43 U.S.C. 1331; Secretary's Order 5-96, 62 FR 107.
2. Section 702.204 is revised to read as follows:
Sec. 702.204 Employer's report; penalty for failure to furnish and or
falsifying.
Any employer, insurance carrier, or self-insured employer who
knowingly and willfully fails or refuses to send any report required by
Sec. 702.201, or who knowingly or willfully makes a false statement or
misrepresentation in any report, shall be subject to a civil penalty
not to exceed $10,000.00 for each such failure, refusal, false
statement, or misrepresentation. Provided, however, that for any
violations occurring on or after November 17, 1997 the maximum civil
penalty may not exceed $11,000.00. The district director has the
authority and responsibility for assessing a civil penalty under this
section.
3. Section 702.236 is revised to read as follows:
Sec. 702.236 Penalty for failure to report termination of payments.
Any employer failing to notify the district director that the final
payment of compensation has been made as required by Sec. 702.235 shall
be assessed a civil penalty in the amount of $100.00. Provided,
however, that for any violation occurring on or after November 17, 1997
the civil penalty will be $110.00. The district director has the
authority and responsibility for assessing a civil penalty under this
section.
4. Paragraph (a) of Sec. 702.271 is revised to read as follows:
Sec. 702.271 Discrimination against employees who bring proceedings,
prohibition and penalty.
(a)(1) No employer or its duly authorized agent may discharge or in
any manner discriminate against an employee as to his/her employment
because that employee: (i) Has claimed or attempted to claim
compensation under this Act; or (ii) has testified or is about to
testify in a proceeding under this Act. To discharge or refuse to
employ a person who has been adjudicated to have filed a fraudulent
claim for compensation or otherwise made a false statement or
misrepresentation under section 31(a)(1) of the Act, 33 U.S.C.
931(a)(1), is not a violation of this section.
(2) Any employer who violates this section shall be liable to a
penalty of not less that $1,000.00 or more than $5,000.00 to be paid
(by the employer alone, and not by a carrier) to the district director
for deposit in the special fund described in section 44 of the Act, 33
U.S.C. 944; and shall restore the employee to his or her employment
along with all wages lost due to the discrimination unless the employee
has ceased to be qualified to perform the duties of employment.
Provided however, that for any violation occurring on or after November
17, 1997 the employer shall be liable to a penalty of not less than
$1,100.00 or more than $5,500.00.
* * * * *
[[Page 53957]]
Signed at Washington, D.C., this 14th day of October 1997.
Bernard E. Anderson,
Assistant Secretary for Employment Standards.
Shelby Hallmark,
Acting Director, Office of Workers' Compensation Programs.
[FR Doc. 97-27593 Filed 10-16-97; 8:45 am]
BILLING CODE 4510-27-M
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