Hazmat Civil Penalty Inflation
Just when you thought the inflationary pressures were easing up, the U.S. DOT imposed a 7.745% increase across the board on all civil penalties that it assesses, including minor and major infractions of the Hazardous Materials Transportation Uniform Safety Act and its corresponding regulations.
On November 2, 2015, the President signed into law the Federal Civil Penalties Inflation Adjustment Act Improvements Act (FCPIAA) of 2015 (or the 2015 Act), which was designed to improve the effectiveness of civil monetary penalties and to maintain their deterrent effect.
The 2015 Act requires Federal agencies to:
- adjust the level of civil monetary penalties with an initial ‘‘catch-up’’ adjustment through an interim final rule (IFR); and
- make subsequent annual adjustments
Consequently, the U.S. DOT’s Pipeline and Hazardous Materials Safety Administration, along with other agencies within the DOT, published in the Federal Register (88 FR No. 4, 1114, January 6, 2023) a Final Rule which adjusted civil penalties for violations of many different regulations including the Hazardous Materials Regulations.
The following chart summarizes these inflationary adjustments:
| Description | Citation | Existing Penalty | New Penalty (Existing Penalty |
| Maximum penalty for hazardous materials violation | 49 USC 5123 | $89,678 | $96,624 |
| Maximum penalty for hazardous materials violation that results in death, serious illness, or severe injury to any person or substantial destruction of property | 49 USC 5123 | $209,249 | $225,455 |
| Minimum penalty for hazardous materials training violations | 49 USC 5123 | $540 | $582 |
While it may not appear to be much – be careful – it is a little deceptive. Let me explain.
Hazardous Materials Transportation Training Requirements
The U.S. DOT’s Pipeline and Hazardous Materials Administration requires all hazmat employees (as defined in 49 CFR 171.8) to receive four types of hazardous materials transportation training:
- General Awareness & Familiarization
- DOT General Safety
- HM Security Awareness
- Function-Specific training
Therefore, for every “hazmat” employee that has not received the requisite training in all four areas, there are four distinct violations. For example, if you fail to train hazmat employees in your facility, the minimum penalty is $582/violation x 4 violations or $2,328. While technically each hazmat employee that has not received training would constitute additional offenses, it is unlikely the DOT would stack the case, except in cases resulting in death, serious illness, or severe injuries to persons or property.
Furthermore, if you do not maintain the training records appropriately, the minimum penalty is increase by another $582, at a minimum. Consequently, these civil penalties can add up quickly.
Consider this scenario…
A parts counter operator has an air bag module to ship to a customer. The package received has some minor damages to it, but the part has not been compromised. The parts counter operator repacks the air bag module into a new fiberboard box, but the new box does not contain any marks, labels, or other forms of hazard communication.
The part is intercepted at a small package dispatch delivery service or is discovered by the authorities or carriers (who are obligated to report hidden shipments) enroute.
The maximum civil penalty in this case is a staggering $2,318,976. How, you ask?
When a hazardous material is offered for transportation in commerce and there are no marks, labels, or documents disclosing what the item is, the DOT considers this to be a “hidden shipment.” The DOT has already ruled, through judicial precedents and policy, that even though you may not have been subject to all of the Hazardous Materials Regulations had you shipped it correctly, you are not entitled to receive any regulatory relief that would otherwise be available, and you would be subject to full regulation. That means that you may have committed as many as 24 separate, but distinct, violations of the Hazardous Materials Regulations.
The DOT takes this subject very, very seriously. The number of incidents involving lithium batteries is proving this out. This is serious business!
Of course, you can manage your risk by first identifying who your hazmat employees are, and then providing them with the requisite training.
CCAR
Because these requirements are very detailed and complex, the NAAHAC (North American Automotive Hazmat Action Committee) had chosen CCAR® and ShipMate to provide a Hazardous Materials (HazMat) and Dangerous Goods web-based training program for automotive dealers.
Working together, CCAR® and ShipMate have created an automotive dealer training program that meets the DOT and Transport Canada (TC) requirements for the preparation and transportation of dangerous goods by all modes of transport. CCAR® HazmatU was officially launched in 2005 and has provided very high quality, industry-specific training to hundreds of thousands of users since it was launched.
CCAR’s training programs are designed to educate, and encourage, companies to comply with these laws and regulations. These rules exist to ensure a minimum level of safety which is acceptable.
The cost of CCAR hazmat training is less than 1$ per day regardless of the number of people you train at your facility. It really is a wise investment! Protect yourself – take the training!
