AEU Longshore Blog ISSUE: Dredging Operations

Questions regularly arise with regard to Longshore Act coverage for dredging operations.  These operations present several key coverage issues worth discussing.

Overview

Dredging is usually done to remove sediment and debris in the process of creating new harbors and/or deepening existing harbors, channels, and waterways for the benefit of maritime commerce.  It is also done in connection with repair or construction of bridges and piers, environmental cleanup, replenishing sand on recreational beaches, harvesting of aquatic species, seabed mining, flood prevention, and any number of other purposes. Dredging is done on all bodies of water, from ocean waters to inland rivers, lakes, and reservoirs.

It is becoming more important as the need for improvement of infrastructure becomes crucial.  International ocean carriers are utilizing larger ships which require deeper channels, bigger harbors and berths, and higher bridges.

There are many types of dredging contrivances, including submerged vehicles, amphibious wheeled as well as tracked vehicles, and all sorts of special purpose platforms.

The varied jobs and mixed duties of employees along with the wide assortment of apparatus used in dredging operations puts us squarely within the so-called “Uncertainty Zone” where workers’ compensation exposure under the Longshore and Harbor Workers’ Compensation Act overlaps with maritime employers’ liability for injury or illness to crew members of vessels.

What is the “Uncertainty Zone”?

The federal Fifth Circuit Court of Appeals has observed, “Thus, despite our continued insistence that a Jones Act ‘seaman’ and a ‘crew member’ excluded from the Longshore Act are one and the same (in other words that the statutes are mutually exclusive) we recognize that in a practical sense, a ‘zone of uncertainty’ inevitably connects the two Acts.”

The Jones Act and other seamen’s remedies are only available to crew members (seamen), and the Longshore Act excludes crew members (seamen).

The broader the definition of “vessel” has become, however, and the less seaman status has to do with going to sea or vessel navigation, the more difficult it has become to sort out coverage issues in the Uncertainty Zone.  Clearly, there are coverage issues at the fringes of seaman status as well as the issue of what constitutes a vessel, and these issues are confronted directly in a typical dredging operation.

Situs and Status

For the purpose of distinguishing employer liability issues, there are questions of situs, vessel status, and worker status.

First, let’s briefly consider situs.  Liability under federal maritime law (the Jones Act, the General Maritime Law, the Admiralty Extension Act, the Death on the High Seas Act, Section 905(b), etc.), requires activity on the navigable waters of the United States which involves traditional maritime activity or has the potential to disrupt maritime commerce.  Liability under the Longshore and Harbor Workers’ Compensation Act also requires maritime employment on or near the navigable waters of the United States.

Dredging of one kind or another can occur wherever there is water.  But we’re interested in the “navigable waters of the United States”.  For our purpose that means water that carries, or is capable of carrying, interstate or international commerce.  This does not include land-locked intrastate lakes, sections of rivers or reservoirs that are dammed or closed off at both ends, industrial tanks or treatment facilities that are comprised of water that has been removed from a navigable body, and similar bodies of water that cannot carry interstate commerce.

Note:  If the dredging activity is being conducted on a body of water that does not constitute “navigable waters of the United States”, then the workers are most likely covered by state act workers’ compensation.

So, situs is the first box to check when considering issues of federal maritime liability, and the question is whether or not the waterway carries or is capable of carrying interstate or international commerce.  For the rest of this discussion, we’ll assume that our activity is occurring on the navigable waters of the United States.

Next, maritime liability usually requires the presence of a vessel.  The United States Supreme Court has considered the vessel question twice in the past twelve years, and one of the cases involved a dredging operation.  In the case of Stewart v. Dutra Construction Company, (543 U.S. 481 (2005)) the Supreme Court considered whether the Super Scoop, at that time the world’s largest dredge, was a vessel.  The Super Scoop is a massive floating platform from which a clamshell bucket is suspended beneath the water.  The bucket removes silt from the ocean floor and dumps the sediment onto one of two scows that float alongside.  It navigates short distances by manipulating its anchors and cables.  Otherwise it is towed into position.

The holding in the case was that the Super Scoop is a vessel.  Dredges had frequently been held to be vessels prior to the Stewart case, but the issue continued to arise.  Now, explicitly we can assume that dredges are vessels.

Note:  This does not rule out the circumstances where a barge or work platform is permanently affixed to the seabed, and thus not “in navigation”, for use in a dredging operation.  If you do not have a vessel then you do not have crewmembers with seamen’s remedies.  In this case, you have workers’ compensation exposure, most likely under the Longshore Act.

Note:  The vessel question again went to the Supreme Court in 2013 in the case of Lozman v. The City of Riviera Beach, Florida.  This case gives us our present test for vessel status.  Essentially the test is whether, viewed through the eyes of a reasonable observer, the contrivance is practically capable of serving as a means of transportation of people or things over water.

This test would seem to encompass most of the contrivances used in dredging operations, since they are designed to and do in fact carry people and/or equipment over water.

So, on our second issue of federal maritime liability, if you are involved in a dredging operation you are most likely working from or in connection with a vessel.

We are discussing vessels performing dredging operations on the navigable waters of the United States.  That leaves the third, and most difficult, issue.  Do the workers have the status of crewmembers eligible for the seamen’s remedies, or are they land-based maritime workers covered for workers’ compensation under the Longshore Act but excluded from the seamen’s remedies?

Welcome to the Uncertainty Zone.

This is familiar territory for the AEU Longshore Blog;  issues of coverage between the seamen’s remedies and the Longshore Act have been discussed on several occasions, including a discussion of both vessel status and crew member status.

There was a time when dredge workers typically slept at and commuted from home each day, were paid by the hour, belonged to land-based unions, performed no navigation functions, and never “went to sea” in the traditional sense.  These workers were more likely to be considered land-based maritime workers covered by the Longshore Act than crew members entitled to the seamen’s remedies.

Then, as the test for crew member status, outlined by the U.S. Supreme Court in the case of Chandris, Inc. v. Latsis, (115 S.Ct. 2172 (1995)) came to be more broadly interpreted, involvement in navigation of the vessel ceased to be necessary for crew member status, and the “perils of the sea” was replaced by the “perils of a marine environment”.

Maritime construction workers building bridges, piers, and other structures who work from floating construction platforms now have a good case for crewmember status.  In a notable recent case from the federal Fifth Circuit Court of Appeals, a ship repair worker operating a land-based crane in a shipyard channel, who virtually never went to sea, was found to be a crew member of his employer’s vessels (Larry Naquin v. Elevating Boats, Inc., (5th Circuit, March 2014) discussed in an April 7, 2015 post on the AEU Longshore Blog)).

To complicate matters, the choice of remedy is with the injured worker.  He can file a lawsuit seeking recovery for negligence or unseaworthiness under his seamen’s remedies, or he can file a workers’ compensation claim with the U.S. Department of Labor (DOL) under the Longshore Act.  He can even file these claims simultaneously, inconsistently (but permissibly) claiming status under two mutually exclusive remedies.

Further complicating matters, the choice of forum may determine the outcome of the coverage issue.  The DOL may tend toward finding entitlement for an injured worker under the Longshore Act as a land-based maritime worker, while a jury may be convinced that the same worker is a crew member.  It may come down to which forum is first to issue a final Order adjudicating status in these Uncertainty Zone cases that can go either way.

There are peripheral jobs involved in dredging operations, where workers are working landside rather than from vessels. This is where the question of “harbor worker” comes up.  The phrase is not defined in the Act, but it is listed as a covered occupation (and it’s in the title!).  While these workers may have weaker claims to crew member status, we have the related problem of distinguishing state act workers’ compensation from Longshore Act exposure.  An extreme example is the case of Nelson v. American Dredging Co., 143 F.3d 789 (3rd Circuit, 1998), in which a bulldozer operator distributing sand dredged up from the ocean floor on a recreational beach was found to meet situs and status under the Longshore Act.

These dredging cases present coverage difficulties for claims specialists.  Did the injury occur on or around navigable waters?  Was a vessel involved?  Is the injured worker covered under the Longshore Act, or state act workers’ compensation, or is he a crew member?  These issues arise every day, and there are few bright lines.

 

 

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John A. (Jack) Martone served for 27 years in the U.S. Department of Labor, Office of Workers’ Compensation Programs, as the Chief, Branch of Insurance, Financial Management, and Assessments and Acting Director, Division of Longshore and Harbor Workers’ Compensation. Jack joined The American Equity Underwriters, Inc. (AEU) in 2006, where he serves as Senior Vice President, AEU Advisory Services and is the moderator of the AEU Longshore Blog.

AEU Longshore Blog ISSUE: Review of Status, Part One: Truck Drivers, Nurses, Railroad Workers, Security Guards, and Safety Managers

Coverage questions about maritime “status” under the Longshore Act arise regularly, and the AEU Longshore Blog has addressed different occupations in various posts.  Most recently we have discussed the “clerical exclusion” and the maritime status of salesmen and estimators.

Following is a compilation of other occupation-specific status discussions from past blogs.  For more information, please refer to the original posts linked below.

First, a review of “status”:  A worker satisfies the status requirement of Section 2(3) (33 U.S.C. 902(3)) if he is an employee engaged in work which is integral or essential to the loading, unloading, construction, repair, or dismantling of vessels.  To satisfy this requirement the employee need only spend some of his time in covered operations.  There is no moment of injury test; status is determined by the overall nature of the employee’s duties.

Status is not limited to those employees who directly load/unload cargo, or build or repair vessels.  Workers who build, repair or maintain the buildings, facilities, and equipment involved in these operations are also covered.

Shipyard Nurses

For a review of status of shipyard nurses, the case of Lucille Galinas v. Electric Boat Corp is a good example.  The claimant’s duties consisted of treating injured employees at the employer’s shipyard medical clinic, responding to ambulance calls in the shipyard, performing physical examinations, audiograms, and EKGs, stocking RADCON (radiological controls) supplies, and participating in RADCON training drills.  The issue was whether this claimant’s duties met status for Longshore Act coverage as integral or essential to the employer’s shipbuilding operations.  The U.S. Department of Labor’s Benefits Review Board (BRB) found that she did not meet the status test for coverage.

While the nurse’s duties were certainly important and useful to the employer, the non-performance of those duties did not have the potential to directly interrupt or impede the ongoing maritime operations, so she was not a maritime employee covered under the Longshore Act.

 

Truck Drivers

Typically there are several steps involved in the process of loading/unloading cargo.  Containers or cargo in other forms come off ships, and are placed at dockside.  The cargo may then be moved by the same or different personnel into a warehouse or storage area.  It may then be emptied by the same or other workers, and again moved around the warehouse or storage area depending on the conditions of its storage and the timing of its delivery to the consignee.  Finally, it is moved to a railhead or trucking area for overland transportation and delivery.

The Longshore Act covers all of the employees involved in the series of intermediate activities up to the point at which the cargo is loaded for overland delivery (or vice versa in the other direction).  Truck drivers who move cargo around terminals and ports, or from one terminal or port to another, are covered by the Longshore Act.

The truck driver whose only duty is to drive the truck transporting cargo from the terminal directly to inland consignees is most likely not covered, as the loading/unloading process has stopped, and he or she is involved only in land transportation.

 

Divers

Coverage for divers is problematic.  They may be covered by the Longshore Act, by state act workers’ compensation, or they may qualify for the seamen’s remedies as members of the crew of a vessel.  Crewmember status was tested under the U.S. Supreme Court decision in Chandris v. Latsis, and described the “Uncertainty Zone” between the mutually exclusive Longshore Act and the Jones Act/General Maritime Law remedies.

Divers often have short-term assignments, mixed duties which can include loading/unloading, and vessel maintenance and repair, and work in a variety of locations ranging from docks and piers to the outer continental shelf to the high seas.

As previously reviewed, there are several examples of coverage situations for divers among the different remedies.  In the case of Chandris, it did not end on an optimistic note.  The conclusion was, “Due to the uncertainty inherent in coverage issues involving divers, the bad news is that maritime employers may find themselves fully insuring workers separately for mutually exclusive remedies.”

 

Railroad Workers

The same considerations of “status” apply to railroad workers as to any other employees, i.e., a worker whose duties are integral or essential to maritime activity has status for Longshore Act coverage.

In the U.S. Supreme Court case of Chesapeake & Ohio Railway v. Schwalb it was held that railroad workers who facilitate the loading or unloading of cargo – in this case, coal – onto vessels are covered by the Longshore Act, which is their exclusive remedy against their employer for workplace injuries.  This includes workers who maintain, repair, and generally clean up around the equipment used in the loading/unloading process.

Because the Longshore Act covers these workers, they do not have the railroad employee’s negligence tort remedy under the Federal Employer’s Liability Act (FELA).

In these railroad cases, it is necessary to identify the point at which land commerce (traditional railroad activity) ends and cargo handling begins.

 

Safety Directors and Claims Professionals

Does the Longshore Act cover shipyard and terminal safety and claims personnel?  Do they meet the integral or essential test for status?

Duties include accident investigation, inspection of equipment and procedures, regulatory compliance, employee training, maintenance of logs and schedules, possibly emergency medical duties, and handling medical, legal and administrative aspects of injury claims. 

Safety professionals could make a strong case for Longshore Act status, but that the claims staff would have a more difficult time establishing maritime status, since they typically first become involved only in the aftermath of operations that have resulted in an injury.  They are not in a position to interrupt or halt maritime operations.  Their jobs are important, but meeting the “essential” test for maritime status is unlikely.

 

Security Guards

Section 2(3)(A) of the Longshore Act excludes from coverage “individuals employed exclusively to perform office … security … work.”  In order to be excluded from Longshore Act coverage the “security guard” must do “security” work “exclusively” in an “office”.  This is a narrow exclusion.

An occupational analysis of typical security guard duties indicates that if they are on a covered situs then they may have a good argument for status.

The federal Second Circuit Court of Appeals has stated, “… pervasive surveillance conducted by (security guards) on the pier and occasionally on board ship is essential to the longshoring operation” (Arbeeny v. McRoberts Protective Agency, 642 F.2nd 672 (1981)).  Based on this, many security guards have a good argument for status under the integral or essential test.

Duties along the lines of safety roles, fire watch, maintenance, cargo processing, or any work actually over the water strengthen the status case for security guards.

 

As with all of these status discussions, pay attention to the full range of actual job duties and not to the job title. Part Two of this post will include construction workers, bridge workers, and some unusual status situations.

 

 

 

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John A. (Jack) Martone served for 27 years in the U.S. Department of Labor, Office of Workers’ Compensation Programs, as the Chief, Branch of Insurance, Financial Management, and Assessments and Acting Director, Division of Longshore and Harbor Workers’ Compensation. Jack joined The American Equity Underwriters, Inc. (AEU) in 2006, where he serves as Senior Vice President, AEU Advisory Services and is the moderator of the AEU Longshore Blog.

AEU Longshore Blog ISSUE: Maritime “status” for “salespeople” and “estimators”

The question arose recently as to whether salespeople and estimators are covered under the Longshore Act.  This is a very imprecise and incomplete question, but it can be answered easily.  The answer is, “maybe.”

Ordinarily a question like this can only be addressed by asking an interminable number of context and background questions.  It may be useful to go through a “status” analysis of these two very broad occupational classifications, since it will require a consideration of a number of concepts central to the coverage issue of status.

But first we have to define what we mean by “salesperson” and “estimator”.

Salesperson means a person who sells goods and/or services.  It’s that simple.

Estimator, however, is more difficult.  Although it’s a somewhat vague noun, we can take it to mean one who evaluates and renders opinions as to value, time, and approximate charges for work to be done, and who performs appraisals, etc.  We will assume that our “estimator” is one who comes on to a maritime site to perform an estimate for someone seeking to perform work or assess condition.

For this discussion, we’ll assume that “situs” is met for Longshore Act coverage.  Now we can work through an analysis of whether salespeople and estimators meet “status”.

First, a very brief summary of broad general principles with regard to Longshore Act status:

  1. Status is determined by the overall nature of the worker’s duties, and the role of those duties in accomplishing, contributing to, facilitating, interrupting, impeding, and otherwise constituting a necessary part of cargo handling or shipbuilding/ship repair/shipbreaking.
  2. The test that is used is whether those job duties are essential or integral to traditional maritime activity such as cargo handling, shipbuilding, or ship repair.
  3. There is no moment of injury test for status. If any part of an employee’s regular duties is maritime in nature then he or she meets status for his entire employment, even if performing non-maritime work at the moment of injury.
  4. If an injury occurs while the employee is working over the navigable waters of the U.S., then he or she is covered by the Act unless an exclusion applies. The employee does not have to meet status for injuries over the water.

In order to determine whether or not salespeople and estimators may meet status, we’re going to have to separately consider several statutory provisions and coverage concepts.

 

Vendor Exclusion

First, let’s take the case of an injury to a salesperson or estimator that occurs while he or she is selling or estimating over the navigable waters of the United States.  We know from the U.S. Supreme Court’s decision in Director, OWCP v. Perini North River Associates (Churchill), 459 U.S. 297 (1983) (so-called Perini coverage) that situs confers status, and an injury over the water is covered under the Act.  This was the basis of coverage for an electrical repair estimator on board a vessel in the case of Scott v. Tug Mate, Inc., 22 BRBS 164 (1989).

So injury over the water is covered, unless a statutory exclusion applies – and there is one that might apply.

Section 2(3)(D) of the Longshore Act states:

“Sec. 2(3) The term ‘employee’ means any person engaged in maritime employment, including any longshoreman or other person engaged in longshoring operations, and any harbor-worker …, but such term does not include –

(D) individuals who (i) are employed by suppliers, transporters, or vendors, (ii) are temporarily doing business on the premises of a (maritime employer), and (iii) are not engaged in work normally performed by employees of that employer under this Act.”

This exclusion only covers 1) employees of vendors, suppliers, and transporters 2) who come on to a maritime situs temporarily and 3) are not engaged in work normally performed by employees of that employer under the Act.

Note:  the condition for the application of the exclusion is that the worker is covered by the state’s workers’ compensation law.

Examples of workers excluded under section 2(3)(D) include employees selling a product, such as the salesperson of cellular telephone air time (Daul v. Petroleum Communications, Inc., 196 F.3d 611 (5th Cir. 1999)) and the truck driver employed by a transporter whose sole responsibility was to pick up, transport, and deliver containers of sealed cargo from a storage area outside of the maritime facility who never left the truck.

So, a salesperson or estimator who is injured while working over the navigable waters of the U.S. is covered under the Longshore Act, unless this “vendor exclusion” applies. Although this exclusion is narrower than generally believed, salespeople are prime candidates for exclusion, depending on the circumstances and job duties.  Estimators, though, are less likely to be excluded by section 2(3)(D).  First, they have to be employed by a vendor, supplier, or transporter.  This rules out application of the exclusion for most estimators, who are more likely to be employed by a ship repairer, construction firm, insurance company, surveyor, etc.

For any injury that occurs over the water and coverage is uncertain, it is best first to consider whether Perini coverage applies and then consider whether any of the statutory exclusions in section 2(3) may apply.

To summarize so far, salespeople and estimators are covered by the Longshore Act if they are injured while working over the navigable waters, unless an exclusion such as the vendor provision applies to them.

 

What if the injury occurs on land and no exclusion applies?

We’re still assuming that they are on a covered situs, either an enumerated site or another adjoining area customarily used for maritime employment under Section 3(a).  In this case, we fall back on the general test for status, i.e., the employee has at least some regular job duties that are integral or essential to maritime activity.

This is a familiar issue, and it involves the question of whether the non-performance of the job duties in question has the potential to impede or interrupt the ongoing maritime activity at the site.  Under this test, I think that finding Longshore Act status for salespeople or estimators, as we have defined them, would be a stretch.  Their jobs are important, but they would usually fall short of the integral or essential test.

There is a broad range of jobs that have been found to be helpful and convenient to the maritime employer, but not essential.  These include shipyard nurses, claims adjustors, courtesy van drivers, terminal mess hall cooks, and office custodians. In most cases, salespeople and estimators can be added to this list.

Of course, there are other circumstances that can affect the coverage determination.

What if the salesperson delivers products on board vessels and actually helps to store/install the products?  The fact that he or she stores or installs the products most likely rules out the vendor exclusion (since the salesperson is doing work normally done by employees of the maritime employer), and if Perini doesn’t apply (injury not actually over the water) may he or she meet status?

The case of Felt v. San Pedro Tomco, 25 BRBS 362 (1992) involved a salesperson who delivered cleaning supplies and equipment to vessels several times daily.  Status was denied in this case since the time spent leading and discussing deliveries was minimal and episodic compared to his overall duties.  But this case could go the other way with a small change in circumstances.

Summary

Here is the checklist for coverage for a salesperson or estimator:

  1. Does Perini apply, i.e., did the injury occur over the water?
  2. If so, does an exclusion, such as the vendor exclusion in section 2(3)(D), apply?
  3. If neither 1 nor 2 apply, then does the worker meet the integral or essential test for status?

 

 

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John A. (Jack) Martone served for 27 years in the U.S. Department of Labor, Office of Workers’ Compensation Programs, as the Chief, Branch of Insurance, Financial Management, and Assessments and Acting Director, Division of Longshore and Harbor Workers’ Compensation. Jack joined The American Equity Underwriters, Inc. (AEU) in 2006, where he serves as Senior Vice President, AEU Advisory Services and is the moderator of the AEU Longshore Blog.

ISSUE: Recurring Question

Some questions come up over and over again.  One such question involves foreign workers and/or foreign employers in the United States.  Does the Longshore Act cover foreign workers?  Does the Longshore Act apply to foreign companies?  The answers are yes.

If we look at the definitions and coverage provisions in the Act we do not find anything that pertains to nationality or citizenship, with one minor exception.

Section 2(3) (33 U.S.C. 902(3)) defines “employee” as, “any person engaged in maritime employment, including any longshoreman or other person engaged in longshoring operations, and any harbor-worker including a ship repairman, shipbuilder, and ship-breaker …”. 

Section 2(4) defines “employer” as, “an employer any of whose employees are employed in maritime employment, in whole or in part, upon the navigable waters of the United States (including any adjoining pier, wharf, dry dock, terminal, building way, marine railway, or other adjoining area customarily used by an employer in loading, unloading, repairing, or building a vessel)”.

Section 3 is the Coverage provision.  Section 3(a) states, “… compensation shall be payable under this Act in respect of disability or death of an employee, but only if the disability or death results from an injury occurring upon the navigable waters of the United States (including any adjoining pier, wharf, dry dock, terminal, building way, marine railway, or other adjoining area customarily used by an employer in loading, unloading, repairing, dismantling, or building a vessel).”

Section 3(b) states that, “No compensation shall be payable in respect of the disability or death of an officer or employee of the United States, or any agency therof, or of any State or foreign government, or any subdivision thereof.”

So that’s it.  Section 2(3) is the “status” provision, and Section 3(a) is the “situs” provision.  Together they provide the tests for coverage for employees under the Longshore Act.  A maritime employer is any employer who employs a worker who meets the “status” and “situs” tests.

With the exception of employees of a foreign government, there is no nationality or citizenship component to Longshore Act coverage.

If a domestic U.S. company hires foreign workers to work in the U.S., either permanently or temporarily, these workers are covered by the Longshore Act if they meet the status and situs tests.

If a foreign company sends foreign workers to work in theUnited States, either permanently or temporarily, these workers are covered by the Longshore Act if they meet the status and situs tests.

All employees, working in maritime employment on covered sites as specified in Section 3(a), and not specifically excluded somewhere else in the Act, are covered.  Nationality or citizenship is not part of the coverage analysis.  It all comes down to status and situs, period.

Now bear in mind that we’ve been discussing the coverage issue of foreign workers working in the U.S. The coverage issue presented by U.S. citizens working overseas or on the high seas is an entirely separate question.  We discussed this back on August 21, 2009, and we will have the opportunity to pick up the issue again when the Ninth Circuit issues its decision in the pending appeal of Joseph Tracy v. Keller Foundation, Inc./Case Foundation Co. and ACE USA/ESIS v. Global Offshore Int’l, Inc., Liberty Mutual Insurance Co., and Director, Office of Workers’ Compensation Programs (Ninth Circuit Nos. 11-71703, 11-71800)(Yes, that is a long caption with a lot of parties).  This case involves aU.S. citizen performing maritime work in Singapore and Indonesia.  One issue is, “Does the Longshore Act cover an American citizen injured on foreign territorial waters in the course of his maritime employment?”

Finally, congratulations to David Widener, who has been selected for the position of Longshore District Director in the U.S. Department of Labor’s Houston district office.  Dave, formerly with The American Equity Risk Services (AERS),ALMA’s claims unit, and most recently with the Department of Labor as a Claims Examiner in the DOL’s Houston office, is an excellent choice.