Major oil companies would face tougher workplace safety standards and be prevented from dodging responsibility when workers are killed or injured under legislation in the early stages of development by two North Dakota state lawmakers.
The bills are expected to be introduced in January 2017, when the North Dakota Legislature meets for its next regular session.
State Rep. Joshua Boschee and state Sen. George Sinner, both Democrats from Fargo, announced their plans in response to an investigation by Reveal, which examined how major oil companies avoid accountability for workers’ deaths. Over the past five years, federal regulators have cited just one major energy operator for a worker’s death in North Dakota or Montana.
Oil companies offer financial incentives to workers for speeding up production – potentially jeopardizing their safety – and shield themselves through a web of companies to avoid paying the full cost of settlements to workers and their families when something goes wrong, Reveal’s investigation found.
“We want to make sure that employers are held accountable for workplace accidents in the oil fields,” Boschee said. “It’s obviously too late for a lot of workers and their families. But this boom is supposed to go for 50 years so there are still several generations that would be affected by this new legislation.”
Boschee will push for reform on two fronts. First, he and Sinner intend to propose separate anti-indemnification bills in each chamber of the Legislature, inspired by similar legislation that ultimately failed after being proposed in the state Legislative Assembly in January 2011.
The 2011 measure barred companies from adding provisions to oil and gas production contracts that required smaller contractors to indemnify them when workers are hurt. It passed the House Judiciary Committee but died nearly a week later after heavy lobbying from the oil industry. The bill was defeated 63-27 on the House floor, records show.
“The bill’s sponsors (in 2011) were Republicans, many who represent oil development districts,” Boschee said. He added that the bill was backed by the insurance industry and that “the only opposition appears to have been from the oil industry.”
Boschee and Sinner said they intend to draft their bills during the coming year after meeting with the main backers of the 2011 proposal and consulting with advocates and lawmakers who successfully passed anti-indemnification laws in other oil-producing states, including Wyoming, Texas, Louisiana and New Mexico.
“If the companies that hire these workers are fully responsible for accidents, then they should bear some responsibility for the compensation for the workers and their families,” Sinner said. “We must incentivize companies to do better.”
Secondly, Sinner and Boschee intend to propose bills that would increase oversight of workplace safety throughout the state, including the Bakken oil fields. The effort would be modeled after a rail safety program that the state established earlier this year, which provided funding to hire two new safety inspectors to examine rail cars carrying crude oil.
Boschee wants to take the same approach to workplace safety in the state, hiring inspectors to investigate workplace accidents to complement the work of the federal Occupational Safety and Health Administration in the oil fields and elsewhere. The effort would be funded by premiums that employers pay to the state’s Workforce Safety and Insurance agency, which administers benefits to workers injured on the job.
“OSHA doesn’t have nearly enough inspectors to make it safe for everybody,” Sinner said. “We need to have state safety inspectors that could work in conjunction with OSHA to make sure employers are complying with federal laws.”
Sinner noted that under his version of the bill, new state inspectors would be dispatched to perform unannounced inspections of employers in oil and gas, as well as other higher-risk industries.
Safety advocates and labor leaders applauded the lawmakers’ proposals.
“Anything they can do to improve safety and oversight is positive and welcome,” said Rebecca Reindel, a senior safety and health specialist at the AFL-CIO. “The lack of accountability and oversight of these companies has killed workers, damaged their lives and devastated their families. … On their own, companies have not provided systemic and effective safety and health protections, but instead have incentivized production over safety.”
Energy industry representatives said the industry already has made safety its top priority.
“The industry puts a lot of emphasis on training and safety,” said Tessa Sandstrom, a spokeswoman for the North Dakota Petroleum Council, which represents more than 550 companies. “We would have to see how this legislation would complement or work with what the industry already has for its safety programs.”