When it comes to protecting public health and worker safety, fines against offending businesses are often the weapon of choice. But if a company stands to make a large profit by violating the law or by putting the health of workers at risk, fines may be viewed as just another business expense.
Pharmaceutical companies are notorious for this kind of behavior. They may market a drug for uses which have not been FDA-approved (known as “off label” marketing), which is illegal. Yet any fines they may face pale in comparison to the tens of millions of dollars they make as a result of their illegal activity.
The same unbalanced risk-reward system is behind many cases of asbestos exposure. Although it didn’t occur here in California, a recent case seems to be an example of this problem – particularly in areas with highly lucrative real estate markets.
In 2014, in the Portland area of Oregon, a real estate developer decided to have a house remodeled to increase the sales price – a practice commonly known as “flipping.” Although he had hired licensed asbestos-abatement professionals in the past, he apparently chose not to do so with this house. Instead, he hired a six-man crew from a temp agency to handle demolition work inside the house.
The men were exposed to high levels of dust, and the masks they were wearing were not enough to keep asbestos out of their lungs. When state inspectors tested the materials in the home, they found that some of it contained 50 percent asbestos and 6 percent lead.
The real estate developer was ultimately fined $8,000 by the state environmental agency and another $4,200 by the Occupational Safety and Health Administration. Those fines may have cut into his revenue somewhat, but he nonetheless made a very tidy profit. He had purchased the house for $325,000 and was able to sell it for $675,000.
Fines associated with violating some laws are often too small to be a deterrent – particularly when the potential for profit is so high. Sadly, the workers who were very likely exposed to asbestos may be paying much more dearly later in life.
