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Crisis Management:

Prepare for the Worst in

Order to be Your Best

Karen L. Johnston, Esq.1099 18th Street, Suite 2150, Denver, CO 80202

Phone: (303) 390-0003 • Fax: (303) 390-0177

kjohnston@jacksonkelly.com • www.jacksonkelly.com

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Numerous safety precautions are taken on a

day-to-day basis to ensure against the

occurrence of safety or health mishaps at the

work sites. However, on the rare occasion, the

extraordinary event may occur and crisis

management is needed.

Are you ready to handle a crisis?

Emergency Response and

Risk Management

From the standpoint of controlling legal

liability and loss, a company’s

effectiveness in coping with the

investigation arising out of a crisis

situation is determined within the first 24

hours of the event.

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CASE STUDY:

At approximately 5:14 p.m. on January

19, 2006, a fire occurred underground in

the Aracoma Alma Mine #1, resulting in

the deaths of two miners.

What went right?

What went wrong?

Emergency Response and

Risk Management

In order to effectively manage the event, two things must occur:

1. You must have a process in placewhich can be immediately accessed toimplement the necessary precautionarymeasures.

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Emergency Response and

Risk Management

2. You must understand the issues

presented and the ramifications of each

decision made during the investigation.

Did Aracoma accomplish these goals?

Emergency Response and

Risk Management Plans

• Elements of emergency response

planning include:

– Facility and process assessment

– Evaluation of applicability of local, state,

and federal laws and regulations

– Facility audits for compliance in advance

of any crisis

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Emergency Response and

Risk Management Plans

– Establish a clearly articulated and communicated emergency response plan which assigns responsibility to key positions

– Identification of personnel to serve as backup to key positions

Emergency Response and

Risk Management Plans

– Key Positions:

• rescue and recovery

• agency interface/compliance

• family/survivor assistance

• internal investigation

• document control

• legal assessment of liability/notification to carriers

• media interface

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Overlapping Jurisdiction

Depending on the nature of the crisis or

emergency, various agencies may have shared

or overlapping responsibility:

• Federal

• State

• Local

Overlapping Jurisdiction

• The burden often falls on the operator

to sort through the procedural morass

and keep all involved agencies

apprised of the facts.

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Overlapping Jurisdiction

• Every contingency plan should include

notification requirements for those other

agencies (i.e., MSHA, OSHA, EPA, DOT),

since all will differ slightly.

Notification

Whom to notify:

• MSHA 800 number OR

• Area Office of OSHA nearest to the site where the accident occurred

• Company management

• Counsel

• Affected families of employee(s)

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Notification to Federal

and State Agencies

Immediate notification to MSHA is

mandatory when an accident occurs.

Is there a state agency that must be

notified as well?

Notification to MSHA

• The types of accidents for which immediate notification of MSHA is required are set forth in 30 C.F.R. § 50.2(h) and include: – a death at a mine;

– an injury which has a reasonable potential to cause death;

– an unplanned inundation of a mine by liquid or gas; and,

– an unplanned mine fire not extinguished within 30 minutes.

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Notification to OSHA

• Employers must notify OSHA within 8 hours

if an employee is killed on the job

• Employers must notify OSHA within 24 hours

if an employee suffers a work-related

hospitalization, amputation, or loss of an eye

CASE STUDY:

• The first carbon monoxide (CO) alarm

signal from the Atmospheric Monitoring

System (AMS) occurred at 5:14 p.m.

• The AMS operator did not notify the

appropriate personnel, including the

affected miners or the designated

“Responsible Person” for the shift.

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CASE STUDY:

• The second CO alarm signal from the

AMS occurred at 5:16 p.m. Again, the

AMS operator failed to notify the

appropriate persons.

• Evacuation of the miners on the

affected section started at

approximately 5:42 p.m.

CASE STUDY:

• At 6:00 p.m., the miners who had

evacuated realized that two miners

were not with the group.

• At 6:01 p.m., the initial search for the

missing miners began.

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CASE STUDY:

• At 6:20 p.m., five mine management

officials who were on-site when the fire

was reported go underground.

• At 6:21 p.m., mine management

officials who were not on the mine site

begin to be notified, including the Mine

Superintendent.

CASE STUDY:

• According to MSHA, by approximately

7:00 p.m., mine management knew the

fire was not controllable, but they did

not evacuate those miners who were

not needed to fight the fire.

• At 7:18 p.m., section and longwall

crews given the message to evacuate.

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CASE STUDY:

• At 7:33 p.m., the mine operator reports

the fire to State safety and health

agency.

• At 7:55 p.m., the mine operator reports

the fire to MSHA.

– Notification was made to the DM at his

home. The mine operator did not use the

800 number.

Other Immediate Concerns

• Rescue and Recovery

• Scene and Equipment Preservation

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CASE STUDY:

• At approximately 7:00 p.m., the mine

operator begins contacting mine

rescue teams.

• Other mine rescue teams continue to

receive notice to mobilize as much as

45 minutes to two hours later.

CASE STUDY:

• Mine rescue team members begin

arriving between 8:30 and 9:30 p.m.

• The first two complete mine rescue

teams were assembled by 10:30 p.m.• A total of 26 teams were contacted with 24 teams

directly participating in rescue and recovery activities.

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CASE STUDY:

• MSHA issues Section 103(k) Order at

8:40 p.m.

• Twelve management officials remained

underground after all other miners were

safely evacuated (except the two

missing miners).

CASE STUDY:

• MSHA orders all remaining personnel

to be removed from the underground

areas of the mine, as required by the

order.

• At approximately 9:30 p.m., the mine

operator tells those underground to

evacuate. By 10:30 p.m., all personnel

are evacuated.

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Crisis Management: Stage Two

• Crisis Management does not end once

the immediate event is handled and

notifications are made:

– Internal Investigation

– Government Agency Investigations

• potentially federal and state

– Media Coverage

– Insurance

The Investigation

Operators are required by § 103(d) of the Mine Act and 30 C.F.R. § 50.11(b) to conduct their own investigations of all accidents and occupational injuries (defined in 30 C.F.R. § 50.2).

Operator’s Responsibility to Investigate

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The Investigation

The Mine Act grants MSHA broad

authority to enter upon mine property to

investigate the cause of accidents,

determine appropriate remedial

measures and to determine whether any

willful or knowing violations occurred.

MSHA’s Authority to Investigate

The Investigation

OSHA compliance officers do not have

warrantless entry authority, unless the

circumstances constitute an exception to the

warrant requirement. Warrants must be

obtained to conduct searches of sites and

records if the business will not waive the

warrant requirement.

OSHA’s Authority to Investigate

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The Investigation

• MSHA or OSHA Personnel – May include specialists in ventilation, electrical

standards, etc.

– If a serious accident or fatality is involved, an MSHA special investigator may accompany the team

• Management Representatives

• Employees’ Representatives

The Investigation Team

The Investigation

• Removal of evidence from the site, establish chain of custody records.

• Determine whether destructive testing will be necessary.

The Collection of Evidence

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The Investigation

• MSHA is permitted to review any records

which the operator is required to keep under

the Mine Act and regulations.

• OSHA will also request records required to

be kept under the OSH Act and regulations.

Inspection of Records

The Investigation

• Both agencies may also request documents which

are not required to be maintained under the Mine

Act or OSH Act and related regulations.

• Often a judgment must be made whether to

voluntarily produce “non-required” records.

• Analyze whether the request is reasonably related

to the incident.

Inspection of Records

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The Investigation

• Interviews are an informal device used by MSHA or OSHA to gather information.

Witness Interviews

The Investigation

• Objectives of the interviews are to:

– Determine the cause of the accident;

– Uncover evidence of violations;

– Evaluate inconsistent statements;

– Determine whether the accident resulted from a knowing or willful violation; and

– Discover evidence of a history of unlawful activities or practices.

Witness Interviews

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Interviews

• All individuals being interviewed have rights under the Mine Act.

• Know your rights.

• Exercise your rights.

• Communicate those rights to all involved.

MSHA Investigation Interviews

Interviews

• Employee interviews are voluntary.

However, an employee’s refusal to talk will

generally result in a subpoena.

• The interviews are private.

• The employee may request to have a

representative present, but typically

management will not be permitted to act as

that representative.

OSHA Investigation Interviews

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Interviews

• Conduct a confidential investigation that generally will be protected by the attorney work product doctrine.

• Monitor the government investigations to promote fairness and ensure the statements prepared by investigators are complete and accurate.

• Determine if conflict exists between agents and the corporation or potential of criminal liability.

Company Interviews of Employees

Interviews

• Written statements from employees may

become evidence.

• If a statement is given, it is important that

it recounts the facts fully, clearly, and

accurately.

Company Interviews of Employees

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• Attorney Client Privilege

• Attorney Work Product Privilege

Privileges

Know That They Exist and, Once Waived, Are Lost

Privileges

• Where an investigation is conducted by or at the direction of

counsel, or in anticipation of litigation, the attorney-client

privilege or the attorney work product privilege may apply to

the materials generated and information learned during the

course of the investigation.

• Neither the attorney-client privilege nor the work product

privilege is absolute.

Know That They Exist and, Once Waived, Are Lost

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Pitfalls and Strategies to Consider

• Production of documents or other materials to enforcement agencies may waive privilege as to all third parties.

• Establish a document control system.

Pitfalls and Strategies to Consider

How to Establish a Document Control System

– Designate a person(s) to coordinate all document control.

– Ask that all requests be made in writing and establish ground

rules.

– Keep required documents in a central location to the extent

possible ahead of time.

– Number and index all documents.

– Maintain originals.

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Pitfalls and Strategies to Consider

How to Establish a Document Control System (cont.)

– Limit the subject of internal memoranda to that which is

clearly privileged. In other words, do not tack on other

unprivileged subject matter to such communication.

– Stamp or otherwise designate privileged documents in a

conspicuous manner so that they are not inadvertently

mistaken for non-privileged communications.

– When in doubt as to whether a privilege applies, consult

counsel before turning any materials over to third parties.

Media Coverage During

Investigations or

Following Enforcement Actions• The Blame Game and other public fascination with

tragedy.

– Interaction with families, sensitivity on

communication.

– When there are victims of tragedy, the perception of

indifference on behalf of companies, governments,

or leaders is the single largest harm to an

organization’s reputation in the aftermath of crisis.

– Timeliness and effectiveness of the response to a

crisis is key.

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Media Coverage During

Investigations or

Following Enforcement Actions

• Control the agenda: don’t let the media define

your situation.

– What should your message encompass?

– Consult professionals and counsel.

– How best to communicate the message and

who should communicate the message.

Liability Assessment

• Assessment of potential enforcement/

compliance issues as to the operator,

agents, directors, and officers, specifically

under the Mine Act.

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CASE STUDY:

• MSHA issued 25 enforcement actions

for violations which contributed to the

cause or severity of the accident,

including 21 alleged to result from the

reckless disregard of the mine

operator.

CASE STUDY:

• National media attention followed.

• Significant civil and criminal penalties

resulted, along with individual agent

liability.

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Liability Assessment

• Analysis of potential tort liability

issues:

– employer’s protection under the state

workers’ compensation exclusivity provision

for injuries to employees;

– statutory employer issues and liability for

injuries of non-employees.

Liability Assessment

• Potential for product liability claims against

third parties, including equipment

manufacturers.

• Contractual agreements, including

indemnification pursuant to agreements with

independent contractors or other potentially

involved parties.

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ANY QUESTIONS?

For more information on these and other

occupational safety and health topics,

please visit:

http://safety-health.jacksonkelly.com/