How Are You Preparing For The Oil Industry Rebound?

The much-promised rebound in oil prices is starting to look real.  Brent Crude has been over $50 all month.  Predictions of $60 by Christmas are looking like more than wishful thinking. Oil companies are entering their budget cycles with some level of optimism for the first time since 2014.

So are you ready to get back to work?   For many oil and gas service companies, the honest answer may be no.  We may not have the people in the right places to do the work.   By one estimate, the American oil and gas industry shed more than 220,000 jobs, but the true number may be much higher when you count trucking, construction and other providers who may not show up under the “oil and gas” category.   That is a lot of positions to fill. We’ve been to this rodeo before and we know that, when business ramps up, we see the big increase in injuries, accidents and claims.

So what should a company be doing now to take advantage of the coming upturn?  Here is a short checklist:

____ Safety Plan Review:  There have been some changes to regulations since the downturn and some new customer requirements.   More than that, operators are likely to want your safety program to follow a SEMS or other safety management format.   In most cases, I find companies already have the safety management elements; they just need to be revised and reformatted, but it can mean the difference between getting and losing a job.

____ Pre-employment and Post-Offer Testing:  Drug and alcohol testing is a must.   Depending on the job, compliance testing (audio, respiratory fit tests, etc.) may be required.  Physicals and physical assessments should be a part of your program.   Making sure new people can perform job functions is critical when there are so many new hires.  If you don’t budget for testing and have an organized process for onboarding, you risk having injury costs eat up any profits from the new work.

_____ Injury Case Management: Honestly, this hasn’t been much of a problem during the downturn.  Less work.  Fewer injuries.  More time for safety managers to stay on top of injuries.   That all changes when it gets busy.   One of the secrets of successful safety programs is that they focus on case management to keep unwarranted recordables down, help workers get well and back on the job more quickly and minimize workers comp costs.   This is the time to line up a provider who can help support case management so you can focus on preventing accidents.

____ Job Descriptions and Skills Assessments:   This may be a head-scratcher, but if you don’t have accurate job descriptions, how do you know what new hires will do?  And if you don’t have a methodology to assess workers on the particular skills that make up the job descriptions, how do you know whether you have the right people doing the jobs?   Sure, every company has a number of in-house subject matter experts who know every job inside and out. However, those people are worth their weight in gold and they won’t have time to look over every new employee’s shoulder.

_____ Operating Procedures: See above.   Too many companies rely on head knowledge, not written knowledge.  The most experienced people will be too busy to share everything they know.  You also run the risk that they will be hired away just when you need them most.  Operators and government inspectors have already said many service company SOPs are inadequate.   It only gets worse when a lot of new people head out into the field.   Now is the time to make sure procedures are correct and can guide a new employee in the job.

_____ Training:  Review your introductory training.    Does it meet your needs?   How will you make sure every new employee is ready when things get busy.    What about supervisory training?   Supervisors and mid-managers are the most important part of your workforce when new jobs start up.  They need to be ready to lead their crews.

That is a short list.  There are many other things that companies need to have ready when things pick up.  However, we need to remember that we call them “service companies” for a reason.  Service is delivered by people and having the right people ready to do the job is the most important investment you can make when business returns.

Lifeline Strategies has expertise in each of these areas.  If you want to be ready to take advantage of the upswing in the oil and gas cycle, let’s talk.   We can help develop a plan of action or provide you with solutions for any of the challenges listed above.  Contact us at info@lifelinestrategies.com or call at (985) 789-0577.

Pokemon Go: How Much of Safety is Protecting People From Their Own Stupidity?

pokemonWord from Washington State, where the Coast Guard is apparently investigating whether the popular game Pokemon Go is creating a safety hazard at a public ferry.  Players use their smartphone maps to track down  “Pokestops,” virtual hotspots where the game designers have placed Pokemon characters.   Unfortunately, a lot of Pokestops have been placed at ferry terminals, resulting in players wandering into unsafe areas, bypassing security rules and generally disrupting the operations, according to Maritime Executive magazine.

It raises a serious and fundamental question about safety and prevention.   Is safety a matter of identifying hazards and then controlling them, the way they explain it in textbooks, or does it also include trying to anticipate every possible thing that humans can to to to under over or through the safety controls we put in place?

Ferry terminals barriers, fences and warning signs to protest passengers, but they are no match for a 22-year old with his nose in an I-phone wandering towards the edge of a pier.   As Albert Einstein famously said “Two things are infinite: the universe and human stupidity; and I’m not sure about the universe.”

To address this we can go to one extreme of banning any activity in the name of safety.  There is a famous story of a British man who has been mowing the grass by the roadside by his house in Wiltshire Council for 43 years, but was ordered to stop  by the town council for fear that he might get hurt “whilst working on land that was not his responsibility.”

In general we tend to go to the other extreme.  We develop safety plans and policies for a world where everyone behaves rationally and then we are surprised when they don’t.  For example, there are plenty of signs, walls and barriers at the edges of the Grand Canyon.  Yet, according to a book named Over The Edge: Death in Grand Canyon, two-to-three people fall from the rim and die every year.  Causes include:

  • Crossing retaining walls or guard rails
  • Walking off the trail
  • Jumping rock to rock or ledge to ledge
  • Snow and ice
  • Hiking at night

Would one more sign or barrier fix stupid?   Doubtful.

In every day practice we focus on the physical aspects of safety – the flammability of a chemical or the force of a falling object – because those are the aspects that are the most predictable and can be controlled.  We tend to shy away from the human factors, which turn out to be the least predictable aspects and, lets face it, uncontrollable.  When Yogi Berra said that “Baseball is ninety percent mental and the other half is physical,” he could have been talking about safety.

Or we could take the opposite approach, as outlined in a famous letter to the editor at the Arizona Republic by a man named Lawrence A. Bullis:

Every day, some new do-gooder is trying to save us from ourselves. We have so many laws and safety commissions to ensure our safety that it seems nearly impossible to have an accident. The problem is that we need accidents, and lots of them.

Danger is nature’s way of eliminating stupid people. Without safety, stupid people die in accidents. Since the dead don’t reproduce, our species becomes progressively more intelligent (or at least less stupid).

With safety, however well-intentioned it may be, we are devolving into half-witted mutants, because idiots, who by all rights should be dead, are spared from their rightful early graves and are free to breed even more imbeciles.

Let’s do away with safety and improve our species. Take up smoking. Jaywalk. Play with blasting caps. Swim right after a big meal. Stick something small in your ear. Take your choice of dangerous activity and do it with gusto. Future generations will thank you.

Pain From OSHA Fine Increase Already Being Felt

What a difference a day makes when if comes to OSHA penalties.  America’s safety watchdog had not raised its penalties since 1990, but last November Congress tied the agency’s fines to inflation and OSHA set August 1st as the day the penalties would go up.  So, if your company was cited by OSHA on Friday, July 29th, you would have been fined under the old penalty schedule.   However, starting on August 1, those fines went up almost 80% to reflect the inflation rate during the 26 years that the penalties were frozen.

So what happened at the beginning of August?  Clearly the price tag for violating safety rules jumped.  To get a feel for how much, I looked at the cases reported by OSHA online for the end of July and beginning of August. (Note: this is by no means scientific. Each case is different, citations change and the agency has a lot of discretion about its recommendations on total fines).

On Monday, August 1st, OSHA issued nearly $900,000 in fines.  All told there were six companies cited with an average fine of $148,617.

However, on Friday July 29th, OSHA cited 21 companies for a total of $3.9 million.   The average fine was $186,288.  That number needs some analysis to get true picture.  Three of those fines were  so high that they need to be considered individually:

  • Fraser Shipyards Inc
$1,400,000
  • Tyson Fresh Meats Inc.
$855,000
  • Material Handling Systems/MHS Technical Services
$320,000

If those three very large cases are taken out of the total, the fines against the remaining 18 companies averaged $74,281.   So one way to look at the difference for a “run-of-the-mill” case was $74,281 on July 29th vs. $148,617 on August 1st.    That is the type of difference that gets people’s attention!

The hidden headline may be that so many companies were cited right before the deadline went into place.  On most days OSHA cites a handful of companies maybe four-to-six, but on the last day for the lower fines, OSHA cited 21 companies.  Why so many?  The simple answer is that each case is different and it may be impossible to draw conclusions.   There is a lot of communication between OSHA and companies that are under investigation.  It may be that the companies worked hard to clear up problems in order to get the citations handled under the deadline.

Does the abnormal number that “lucked out” matter in terms of a deterrent?  Maybe not. The objective of fines is to cause companies to address safety concerns.  If you were cited under the old schedule and you know that the next violation would skyrocket, you are probably going to do everything possible to fix the problems.

The bottom line is that Congress and OSHA wanted to make sure that penalties have some bite to them.   Looking at the difference in fines from one day to the next shows OSHA is wasting no time in driving home that message.


Worried about the potential impact that higher fines may have on your business?  Contact us at info@lifelinestrategies.com for a company safety audit or help in developing an effective safety management program to ensure compliance.

Did The U.S. Government Just Change The Game on Offshore Safety?

In the spring, the Bureau of Safety and Environmental Enforcement (BSEE) published its new rules on blowout preventers and well control for offshore oil and gas companies.    Most of the attention was focused on impacts to drilling operations through tighter regulation of blowout equipment, maintenance and mud densities.

However, a new analysis indicates that the impact may be much broader, forcing changes to the entire offshore oil and gas industry.   The analysis comes from the Van Ness Feldman law firm and it focuses on one small section of the rule.  

Under the section of 30 CFR 250.107 titled “What must I do to protect health, safety, property, and the environment,” BSSE added this:

(a)(3) Utilizing recognized engineering practices that reduce risks to the lowest level practicable when conducting design, fabrication, installation, operation, inspection, repair, and maintenance activities; 

The article points out three reasons why that is important:

  1. It applies to just about everything that happens on offshore leases.  Instead of specifically targeting activities which control hydrocarbons in drilling and production, the section of the regulations applies to the entire process of exploration and development.
  2. What does the term Lowest Level Practicable mean?  It doesn’t mean “lowest priced” and it may not even mean “reasonable.” One definition is “capable of being put into practice.” In BSEE regulations, a reference to “maximum extent practicable” means “within the limitations of available technology.”  Chances are the courts will have to weigh in on what practicable means here.
  3. It is now the law!  Industry experts will tell you they are always looking for ways to reduce risk and they are right.  The challenges of offshore work, the costs of making a mistake and the level of government oversight have driven industry to work at a high level of safety.  But now there is a regulation that says, if the decision is between two options, engineers needs to choose the one that presents the lowest level of risk and there are penalties for the operator and the contractor is that doesn’t happen.

How much offshore activity does this cover? Since almost all significant activities offshore take some level of engineering, it will impact a lot of activities.  How about well interventions?   Liftboat or crane operations? Pipelines that are regulated by BSEE?

What changes could it force?  Here is a partial list:

  • Construction and maintenance records.   No documentation, no proof the rule is being followed.
  • Documentation of engineering processes.  Engineering is usually focused on designs and processes.  Now it may need to look at how options were weighed in reaching decisions.
  • SEMS compliance, especially contractor oversight.  This has largely been performance-based, but this change could mean operators need to get into the decisionmaking process of their contractors.
  • Coordination.   What happens when an operator or contractor choice of the lowest risk option raises the risk for some other contractor or phase of a project?   For example, a larger BOP with redundant systems may be better for preventing a blowout, but it may be too big to be safely installed by the driller.   Who’s risk is more important?

This would be a good time to review your policies and decisionmaking processes, especially management of change.  If you want to make sure your safety management system addresses this new change, contact us at Info@lifelinestrategies.com.

 

 

 

Nothing Fake About Pro-Wrestler Injuries – Workers Comp For the WWE?

Pro-wrestling is big business.   Big contracts.  Big money.  And apparently big injuries.

More than 50 former wrestlers, with stage names like Road Warrior Animal, the Crippler and the Bezerker, have sued World Wresting Entertainment Inc. over head injuries.  At the heart of the case is the allegation that the wrestlers were misclassified as independent contractors.  If the courts agree, the wrestlers may be eligible for workers’ comp benefits.   WWE calls the claims “patently false” and “ridiculous.”

Many of the wrestlers say that repeated blows to the head and concussions left them with chronic traumatic encephalopathy (CTE), a progressive degenerative brain disease which has been cited in other sports cases, like the quits against the NFL.  No telling when this video was shot, but the WWE says it banned head blows ten years ago.  The wrestlers in the lawsuit say their injuries preceded that ban:

Thanks for the SafetyAlert Website for this story.  Safety Alert points out that disputes over whether workers are independent contractors are tricky, whether they take place in the office or the ring.  On the one hand, wrestlers sign contracts that explicitly state that they are independent contractors.  On the other hand, courts have held that one test of employment is whether the hiring entity determines how the job is done.   So what about wrestling, where, as the lawsuit claims,

“WWE wrestling matches, unlike other contact sports, involve very specific moves that are scripted, controlled, directed and choreographed by WWE … as such the moves that resulted in named plaintiffs’ head injuries were the direct result of WWE’s action.”

The case will have to go through the courts.  When I was a kid, pro-wrestling was held in school gyms or anywhere else the promoters could get a crowd.  Recently, the WWE was valued by Forbes magazine at about $1.5 billion.   So WWE has a lot of money to spend fighting the lawsuits, but there is also a lot of incentive for retired wrestlers to look for their share.

OSHA Delays Portion of New Injury Reporting Rule.

The Rule: OSHA dropped a surprise in industry’s lap when it put out its new regulations on reporting injuries and illnesses.  As expected the rule requires electronic reporting of OSHA recordables.   However, the rule also included language preventing employers from discouraging reporting of injuries and that section was supposed to be enforced starting in August.

The Delay: After a lot of pushback from industry and a lot of confusion over how companies were supposed to comply, OSHA has delayed enforcement until November.   That will give OSHA time to release guidance for companies on compliance and companies to get their policies in place.

The Reason: The provision that is being delayed makes companies responsible for making sure that workers report injuries.  It says companies need policies to:

“establish a reasonable procedure for employees to report work-related injuries and illnesses promptly and accurately. A procedure is not reasonable if it would deter or discourage a reasonable employee from accurately reporting a workplace injury or illness.”

The provision also says employers “must not discharge or in any manner discriminate against any employee for reporting a work-related injury or illness.”  What does that mean?  In the background to the rule, known as the Preamble, OSHA says companies cannot use drug and alcohol testing as a way to discourage reporting.  That has a lot of experts scratching their heads over how they can prove that tests were warranted, not to mention that one of the reason to test in the first place is to help make sure workers are not impaired on the job.  Theoretically that will be sorted out in the new guidance.

Why November?   It does give industry another three months to implement the change.  It is also so close to the election that Congress will be out of session and, unless there is a lame duck session, may into be back until the new year, making it harder for opponents to block the new rule.

What Companies Should Do? Don’t drag your feet.  November will be here in no time! 

  1. Do a gap analysis of your existing policies.  Do they say anything about encouraging employees to report?  How do you communicate with employees on the subject of injuries?  
  2. Start drafting new policies or figuring out how to spread the word.   It would be good to let your employees know in writing that you encourage reporting of injuries.
  3. Consider holding off on the final policy change until OSHA issues guidance.  That way you can make that your approach is in line with OSHA’s directives.  
  4. Don’t ignore the main point of the regulation.   The requirement for many companies to start reporting their injury statistics on line kicks in on January 1st, 2017.  

 

Calendar: Safety Meetings on the Gulf Coast This Summer

FYI –   Here are a few of the safety-related meetings going on on the Gulf Coast this summer:

Lafayette STEPS Group

8:30 a.m., Thursday July 21 @ Safety Management Systems, 2916 N. University Ave., Lafayette, LA 70507

Please come hear my colleague from CORE Occupational, John Landry, and I talk at this meeting about the importance of handling worker injuries quickly and effectively, as well as answering questions about OSHA recordkeeping. The meeting is free.

Houston STEPS Group

Tuesday, July 19th from 8:00 a.m. to 11:00 a.m. @ Groves Industrial Supply, located at 7301 Pinemont Dr., Houston 77040, off of U.S. 290.

All of the STEPS meetings are valuable opportunities for oil and gas industry to interface with OSHA.

Offshore Operators Committee SEMS Forum

Wednesday, July 27, 8:00 AM, Shell Robert Training and Conference Center, 23260 Shell Lane, Robert, LA

Important opportunity to stay current with the offshore safety rules. You must register and pay a fee: http://oocmain.theooc.us/semsforum2016.html

Texas Safety Summit 

Monday, August 8-10, Sheraton Austin at the Capitol Hotel, 701 East 11th Street, Austin, Texas

20th annual summit put on by the Texas Department of Insurance. The Department is one of the unsung heroes of state government, providing a lot of valuable safety expertise to industry. You must register and pay a fee: http://www.cvent.com/events/20th-annual-texas-safety-summit/event-summary-bf46f11e3dc6476999eda95782f17edc.aspx.

Let me know if you need more information or about other safety-related meeting notices on the group site.

Thanks,
Ken Wells
Lifeline Strategies
kenwells@lifelinestrategies.com

Video: Building Demolition Goes Terribly Wrong in Houston

Safe or just lucky?   That is the big question when you talk about company injury rates.   One company may have a low rate, but when you dig a little deeper you find a history of near misses that could have killed people.

That was brought home by an amazing video from a demolition project in Houston.   It appears that the operator walked away unhurt, but that is a wonder.  Note: If bad language offends you, turn down the sound.

On a whole other subject, commentary  from the guy with the camera and his friends show how, in the heat of the moment, humans tend to downplay the negative (a potential death) while they focus on the exciting part (a parking garage coming down).

The Houston Press ran a kind of greatest hits of building implosions in Houston recently.  You can find it here.

 

How Will OSHA Enforce The New Hazard Communication Update?

logo & ghsJune 1 was a big deadline that got very little attention.   It was the drop-dead date for American companies to update their Hazard Communication Programs.  More than a dozen years ago, regulators started work on an update called the Globally Harmonized System (GHS), which brought an international approach to communicating chemical hazards.  OSHA set a series of deadlines over the last three years in an attempt to give industry time to train workers on the new standard, reclassify chemicals under the new rules, switch over to new labeling and, finally, update company hazard communication plans.

Last week at the ASSE conference in Atlanta, Sven Rundman, of OSHA’s Office of Health Enforcement, gave an overview of implementation and some of the details of the program.  A few of the takeaways:

The Changes Are Complex and Companies That Think They Are In Compliance May Not Be – GHS is a completely new way of looking at chemical hazards.  For example, for companies that may put chemicals into smaller containers, there are very clearly prescribed rules for what must be on the company’s internal labels

Even If Companies Provided Training on The GHS Update, They May Still Need to Provide Updated Training –  The first GHS deadline hit on December 1st, 2013.  By that date, companies were required to give their employees training on the new system.   However, now OSHA expects employers to provide any necessary updates on the specifics of the company’s new Hazard Communication Plan, especially on any newly identified physical or health hazards.


Do you need help getting your own HazCom program in shape? Do you have new Safety Data Sheets on chemicals? Have you updated the program to include the GHS changes?   Are your employees trained on your program?   If you need an audit/gap analysis, help developing a program or training for employees, contact us at info@lifelinestrategies.com. 


Do You Use Temporary Workers or Outside Consultants?   Better Make Sure They Are Trained – OSHA has been emphasizing the host/staffing agency relationship and its role in safety.  Host employers and staffing companies are both responsible for worker safety and temporary workers are entitled to the same protections as other workers on site.  That means both the host and staffing agency need to ensure that workers have been trained on the general changes to HazCom and any specific information on hazards at the host site.

How Will OSHA Enforce The New Deadline?   By Hitting Companies Right in The Wallet – While OSHA has worked to get the word out on the specifics of the change, it has not been aggressive about communicating the deadline to the vast majority of American businesses, which may explain why surveys show a lot of companies are not aware of the deadline or have not met it.   What OSHA has been doing is fining violators.  OSHA has cited businesses for more than 14,500 Hazard Communication Standard violations since the end of 2013 when the training deadline went into place.  More than 8,000 of those were deemed serious.   Most of the penalties appear to be because companies had not plan or the plan was found to be lacking.

With OSHA fines going up by nearly 80 percent on August 1st, the cost of ignoring the GHS update could be very expensive.

 

Safety Updates: Fines, Reporting Rules and Slips, Trips & Falls

Just a few updates on some of the regulations that have been released in the past couple of months.

OSHA Fines to Jump 78% on August 1st – OSHA fines had not risen in 25 years, but that changed last November when Congress passed and the President signed a bipartisan budget bill that included a provision that pinned fines to the inflation rate.   OSHA has finally released an Interim Final Rule that raises the fines on August 1st.

Because the fines were way behind,  inflation there will be quite a sticker shock in the first year.

  •  Serious Violation: Penalty goes from $7,000 to $12,471.
  • Other-Than- Serious: Penalty goes from $7,000 to $12,471.
  • Willful or Repeated Violation:  Maximum Penalty goes from $70,000 to $124,709.
  • Posting Requirement:   Penalty goes from $7,000 to $12,471.
  • Failure to Abate: Penalty goes from $7,000 to $12,471.

The fines will automatically rise by the inflation rate in future years.

New OSHA Injury Reporting and Post Incident Drug Tests –  OSHA’s new rules on recording injuries contain some language that attempts to stop employers from overusing post-injury drug testing.  At first read, it could leave employers wondering if they can still order tests after an incident. OSHA’s intention is to keep employers from using drug tests as a way to discourage workers from reporting injuries.   The change takes place August 10.

Several legal experts have started to weigh in and their message is:  Don’t Panic!.   They refer to the OSHA Final Rule, which said that companies should not have a blanket policy to drug test all workers involved in injuries.  OSHA uses three examples when a drug test would not be warrented:

  • An ergonomic injury, such as a repetitive stress ergonomic injury,
  • A bee sting, or
  • An injury where the worker was blameless, such as getting hit by a forklift where the operator was clearly at fault.

The law firm of Constangy Brooks Smith & Prophete LLP has written a very good analysis of the new rule and how employers should address it.   For a number of reasons laid out in their review, they believe that most employer post-injury substance testing is still acceptable.

That said, employers really need to review their existing policies, probably with the help of their lawyer, to ensure that they are not simply requiring a blanket testing protocol.   The other important takeaway is that the new rule could put a lot of emphasis on testing being done with cause.  Since any legal action may come down to a question of what reasonable suspicion the company had for authorizing tests.  That means companies should consider whether they need to train supervisors and managers to recognize signs of impairment.

Slips, Trips, and Fall Prevention Rules Under Final Review – OSHA’s long awaited update to its Walking Working Surfaces and Personal Fall Protection Systems regulations have been sent to the White House for review.   The agency released its first effort to update the rules with a Notice of Proposed Rulemaking in 1990.  It released a second attempt in 2010.   Now, the Final Rule is apparently finished.  While it is not known what the rule says in detail, it is an attempt to incorporate widely accepted industry practice.

In a normal year, the White House review could be finished later this summer and could have been released in early fall.  However, since this is an election year, it is likely to carry over into the next President’s term.