Posts By: Gregory Cokinos

Safety affects the bottom line of a company’s operations. On average, employers will spend $120,00 on each workplace injury. A company must create a response plan before an emergency and train personnel on OSHA Incident Investigations. OSHA must be contacted within 8 hours of a fatality or 24 hours of work-related in-patient hospitalization, amputation, or loss of an eye. Below is a quick summary of how to prepare for an OSHA incident investigation.

(1) Before on OSHA Incident Investigation

Before a workplace accident occurs, it is essential to have an Emergency Response Plan (ERP) in place. The ERP should be developed for your specific workplace environment and hazards. Communicate with your public emergency services beforehand, so they know your facility and its hazards.  Create a contact list for emergencies and appoint an individual who has the authority to make quick decisions on behalf of the company. Consider how your company would respond to media and press coverage in the event of an accident.

Remove all non-essential workers from the area and secure an area around any continuing danger or hazard to workers in the event of an accident. Call your attorney and critical corporate personnel to the scene to assist with the investigation and OSHA visit. Once the area is secure, conduct an accident investigation before the site conditions change, witnesses leave, and equipment is moved.

Planning before an OSHA inspection is a must. Ensure safety managers and supervisors know their roles and responsibilities during an OSHA inspection.

(2) During an OSHA Incident Investigation

Once an OSHA Investigator arrives, take them to a designated room or private place to talk during the Open Conference. Inform the OSHA Investigator that you will be taking detailed notes of everything discussed and that you would prefer them to advise the company of all suspected violations and the standard involved. Cooperate professionally with the Investigator.

Do not provide the OSHA Investigator with internal or subcontractor incident reports. Only prove the company’s safety programs. Other records can be sent to OSHA after your attorney and management approve.

During the walk-around inspection, have a company representative accompany the OSHA Investigator at all times. An OSHA investigator is not limited to the site of the injury when investigating an accident and may identify numerous citable conditions unrelated to the accident. If possible, take the Investigator directly to the location of the accident and return to the designated room after. Document everything discussed, seen, and noted by the OSHA Investigator.

During OSHA interviews, always tell the truth and ensure you understand the question. OSHA has the right to interview employees privately, but not a member of the management.

(3) After an OSHA Incident Investigation

The deadline to issue citations is six months after the inspection. Employers only have 15 working days to contest, attend an Informal conference, or pay the fine. Provide all citations issued immediately to your attorney to help prepare responses.

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

Real Clear Energy’s recent article focuses on the case U.S. Pipeline, Inc. v. Rover Pipeline, LLC in which Cokinos | Young successfully defended Energy Transfer against contractor’s $100+ Million claim. Reposted below:

A Texas court set an important precedent for contract law recently when it held that U.S. Pipeline, Inc. was responsible for ignoring its contract and abandoning a job to protest a dispute.

U.S. Pipeline was contracted to construct a portion of Energy Transfer LP’s Rover Pipeline. The natural gas pipeline, which was completed in 2018, runs 713 miles from the Ohio/West Virginia border to Michigan.

According to court filings and legal analysis, much of the dispute between the two parties revolved around which company was to pay to fix a botched restoration project that resulted in a series of small landslides or “slips.” Tensions further escalated when U.S. Pipeline wanted to recategorize and increase the charges for work that had already been invoiced by U.S. Pipeline and paid for by Energy Transfer.

Both matters were already clearly addressed within the existing contract, which was specific and carefully defined. In fact, the contract between U.S. Pipeline and Energy Transfer was negotiated and fine-tuned over the course of two years.

While the project continued, the two companies engaged in dispute resolution to resolve their differences, but they failed to come to terms on a solution.

At one point, Energy Transfer offered U.S. Pipeline $55 million to set the issues aside and complete the work. U.S. Pipeline rejected the offer and instead decided to pack up, go home and sue Energy Transfer.

The company’s mic-drop backfired.

U.S. Pipeline was awarded a small fraction of the more than $100 million the company sought in damages, additionally, the court ordered that U.S. Pipeline pay Energy Transfer’s attorneys’ fees and court costs.

The Houston-based state District Court’s decision indicated that U.S. Pipeline’s walkout came across as more of a case of ignoring the terms of the contract and choosing to hold its labor for ransom, rather than a good faith effort to solve a problem.

Further, the case established that walking off a job should be the last resort for a contractor, rather than a tactic to protest an agreed-upon contract or a scheme to unfairly extract money from a project owner.

While the decision is a victory for Energy Transfer, it has much wider ramifications. It affirms the notion that contracts are the ultimate authority during a dispute. The case also serves as a warning to contractors that work stoppages or walking off the job should be avoided when possible.  

The case highlights the importance of the contract negotiation process, as well as the consequences of failing to properly understand the contents of the contract once the document is signed.

U.S. Pipeline’s lawyers and upper management apparently did not anticipate issues that could arise during the project. The company also clearly failed to understand, or refused to accept, its responsibility related to a number of issues clearly covered within the contract.

As a result, the outcome of the case reads like a guide of “what not to do” when it comes to creating and abiding by a contract.

Perhaps most importantly of all, the court decision will force contractors to carefully consider the ramifications of walking off a jobsite during a dispute.

Before engaging in a work stoppage, contractors must take into account the wording of their contract, as well as state and federal laws related to the abandonment of work.

While contractors may view stopping work as a way to create leverage during a dispute, it is often a losing proposition. The potential legal ramifications of a work stoppage, alongside the multitude of other options available for resolving disputes, should encourage contractors to avoid abandoning a worksite. And the outcome of this case will only make it less likely that any benefit will come of a contractor walking off a worksite.

U.S. Pipeline’s devastating fiasco, in which the company paid a hefty price for flouting its contract then rejecting an eight-figure settlement, should serve as a cautionary tale for other companies considering work stoppages and abandonment.

By Drew Johnson
Real Clear Energy
September 01, 2021