Fourth Circuit upholds dismissal of South Carolina’s OSHA penalty-rule bid—what it means

The U.S. Court of Appeals for the Fourth Circuit upheld the dismissal of South Carolina’s attempt to revive a challenge to an OSHA rule on how workplace safety civil penalties are set in OSHA-approved “state plans.” The decision, dated June 24, 2026, narrows one path for states and regulated parties that want to contest the penalty framework under the Administrative Procedure Act (APA) — largely because the lawsuit was filed too late.

For employers and workers operating under OSHA-approved state plans, the practical takeaway is straightforward: the procedural bar in this case does not automatically settle the underlying policy dispute about “penalty alignment.” But it does make it harder to restart a broad, facial challenge years after the rule was first published, shifting more arguments toward later, enforcement-stage situations.

What the Fourth Circuit decided (and when)

In McMaster v. Department of Labor, No. 25-1986, the Fourth Circuit affirmed dismissal of South Carolina’s APA claims. The court’s reasoning centered on timing: the panel held that the state’s APA challenge was time-barred because the relevant six-year statute of limitations began running when OSHA’s rule was originally published.

In other words, the court did not decide whether OSHA’s penalty-alignment approach was substantively correct. Instead, it ruled that the lawsuit could not proceed because it was filed after the deadline allowed for this type of APA challenge.

Background: why “state-plan” penalties are a recurring flashpoint

OSHA’s state-plan system allows certain states to run workplace safety enforcement programs that OSHA has approved. Under that structure, states must maintain a level of enforcement that is “at least as effective” as federal OSHA for key elements, including how violations are penalized. OSHA explains that federal and state roles are coordinated through the approval framework, and that penalty concepts under state plans are tied to how OSHA ensures comparability with federal enforcement.

The dispute in McMaster focused on a 2016 interim final rule that addressed how to align certain civil penalty levels in OSHA-approved state plans with corresponding federal OSHA levels. OSHA’s state-plan FAQ provides additional context for how oversight and the “at least as effective” framework work in practice.

What South Carolina challenged

South Carolina’s case was framed as an APA challenge tied to OSHA’s 2016 interim final rule governing how state plans set (and structure) certain workplace safety civil penalties. The state’s argument, as described through the procedural record, sought to reopen or re-litigate the rule’s validity through an APA lens.

The Fourth Circuit affirmed that this APA route could not be used after the statute-of-limitations clock had run.

What this ruling does NOT decide

Because the court’s decision turns on the statute of limitations, the merits of the penalty-alignment policy were not conclusively resolved in this case. That distinction matters for readers trying to understand what changed for future enforcement.

The ruling mainly limits options for bringing a late, broad challenge to the framework itself. It does not automatically foreclose every future dispute about penalties in particular cases.

What employers and workers should watch next

Even with this procedural loss, the fight over workplace penalty outcomes is unlikely to disappear. Because the holding is about timing for an APA facial challenge, the next phase for many regulated parties may focus on later, context-specific proceedings — for example, disputes that arise during enforcement actions rather than attempts to restart an old APA challenge.

Employers operating in OSHA-approved state-plan jurisdictions should continue treating state-plan penalty expectations as enforceable under the existing framework unless and until a properly timed challenge succeeds in a way that changes the legal landscape.

For workers and safety advocates, this decision signals a likely shift: fewer broad “framework restart” lawsuits, and more attention to how penalty rules are applied case-by-case when enforcement becomes concrete.

Sources

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