Catching a Jones Act Seaman’s 'Golden Parachute'
A challenging offshore environment produces a different but equally difficult development. Will you be ready when it comes to your fleet? Unfortunately, our industry continues to suffer due to the depressed oil prices that started in 2014. When the price of oil initially dropped, the industry’s outlook remained positive, and I remember hearing the mantra: “Stay lean for 2015.” Everyone thought that oil prices would rebound in short order and that we were only weathering a short downturn.
For Payroll Purposes, is Your Seaman Really a Seaman?
For operational purposes, it is critical to know what type of employees you have on your vessel. Failure to do so could be expensive. As vessel operators, we pay close attention the provisions of the Jones Act and how they affect the operation, crewing and administration of our marine-based operations. A determination that your vessel-based crews are seamen under maritime law creates a different employment relationship when compared to employees designated as longshoremen or land-based employees.
Plan for Safety: Leadership is Key
Effective leadership and a safety management system are the keys to success. Failure to lead has consequences. Over the last 20 years we have seen a dramatic shift in the way that our industry operates. When I started practicing law, many companies looked at safety planning as a balancing act where you weighed the costs associated with safety against the costs associated with working through employee claims. Unfortunately, our employees often ended up on the losing side of the balancing test. The industry goal seemed to be completing the task at hand, regardless of the risk.
Clear Contractual Language: What Are You Agreeing To?
The tightening of the marine markets over the last two years have pushed some companies to do everything that they can to avoid obligations that they feel are burdensome or take advantage of obligations that provide them with a competitive advantage. Unfortunately, many of these agreements were crafted during happier times, by employees who were motivated by simply closing the deal and without any real regard for the legal technicalities of the agreement. However, as the market has changed, these contractual details can have a long term lasting impact upon your company.
Limit Exposure with the Uniform Commercial Code
Demanding assurance pursuant to the UCC may save you from sinking on someone else’s ship. Vessel operations require a large network of companies that come together to keep the entire business chain – including yours – running smoothly. Keeping the lights on and the boats running requires agreements with banks, investors, shipbuilders, component manufacturers, designers, technical specialists, repairmen, suppliers, agents and countless other entities. Many of these agreements involve relationships that have developed over time during differing market conditions.
Safety and the Law Collide on the Water
We all can agree that the safety of our employees is critical; if not the most important concern of each of our companies. Our marine-based employees face day-to-day perils that are not encountered by the average American office worker. It is our duty to do everything that we can to ensure that each of our employees returns safely to his or her family once their hitch is over. Our industry has made great strides in improving safety over the years by utilizing improved training programs, safety policies and safety programs.
Alternative Dispute Resolution Provisions
Do they save you time, money, and aggravation? Over the last decade, the legal community has embraced alternative dispute resolution modalities, such as mediation and arbitration, as tools to resolve disputes between litigants. Both of these options can be very effective in quickly resolving claims. That said, it is prudent to consider other methods before entering into any such agreement. Mediation and arbitration can be very positive for the company, but blindly agreeing to arbitrate a claim may cost your company hundreds of thousands of dollars in costs…
Seaman or Longshoreman: The Zone of Uncertainty
Historically in our industry, there has been a clear dichotomy between companies whose employees are seamen that are covered by the Jones Act and those that are longshoremen and covered by the Longshore and Harbor Workers’ Compensation Act (LHWCA). The difference was very simple, Jones Act employers and their seamen were responsible for vessel-based duties and operations. Longshore employers hired longshoremen that were land-based although they performed a portion of their duties aboard vessels.
Don’t Get Burned By a Poorly Implemented Training Program
By Lawrence R. All vessel owners and operators will agree that employee training and education is of prime importance when it comes to running a safe operation. A considerable amount of time, effort, expense and other resources are usually allotted to such programs. Although some programs are implemented with very little fanfare, other programs are often rolled out with a great amount of attention and the highest of expectations. Unfortunately, many of these programs, after the initial enthusiasm has worn off, are often shifted to the back burner and rarely used.
The Government Made Me Do It
When I was a child, I spent a good part of my time getting into trouble, as most children do. My favorite excuse was “someone else made me do it.” Unfortunately, my father was not a big fan of that excuse and I cannot recall one incident that was overlooked based on this defense. However, the Supreme Court of the United States has carved out such an excuse for equipment manufacturers that sell equipment or supplies to the United States military. This excuse is commonly referred…
Avoid Poorly Implemented Training Programs
All vessel owners and operators will agree that employee training and education is of prime importance when it comes to running a safe operation. A considerable amount of time, effort, expense and other resources are usually allotted to such programs. Although some programs are implemented with very little fanfare, other programs are often rolled out with a great amount of attention and the highest of expectations. Unfortunately, many of these programs, after the initial enthusiasm has worn off, are often shifted to the back burner and rarely used.
Settling With An Unrepresented Seaman Making The Settlement Stick
Unfortunately, personal injury claims brought by seamen against vessel owners are part of everyday life in running a boat company. As such, vessel owners have become very sophisticated in the management of these claims. As the cost of litigating these matters is very high, often, the claim's handler will attempt to settle a seaman's personal injury claim prior to his retention of counsel and filing suit. In most cases, this is a win-win for both the employee and the company. The company is able to settle the claim with its employee quickly without engaging counsel or incurring the costs associated with litigation. The employee wins because he is able to keep 100 percent of the settlement without having an attorney take 30 to 40 percent.
