Claims from US offshore maritime workers

In the latest edition of its offshore publication, The Field, Norwegian marine insurer Skuld has noted that, when it comes to dealing with claims from US maritime workers, there was an additional layer of complexity, with an assessment having to be made of the category of legislation into which the worker falls.

Pamela Milgrim of Skuld North America analyzed the differences between the way in which the two main pieces of legislation covering this area respond, and then offered some thoughts on how to assess which would be appropriate to particular circumstances, as well as guidance on the application of both.

US Offshore maritime workers who are injured on the job are covered by general maritime law and two specific compensation laws: The Jones Act andthe Longshore and Harbour Workers’ Compensation Act (LHWCA). These two compensation schemes have three key differences:

  Jones Act LHWCA
Fault Fault or negligence of employer or crew must be proved Right to compensation regardless of fault
Oversight Not overseen by state or federal agency – presented in and decided by court Worker’s compensation claims are handled by a state or federal agency
Scope of compensation Payments usually higher and more expansive, covering things such as medical care, loss of wages, loss of earning capacity and fringe benefits, pain and suffering, disfigurement and more. Compensation payments are designed to provide for medical care, disability payments and income benefits to the injured employee, replacing money the worker is losing because of an injury or illness

As a result of the more expansive compensation available under the Jones Act, when an offshore maritime worker is injured on navigable waters, the question frequently arises as to whether the injured worker is a “seaman” working aboard a “vessel” for purposes of the Jones Act.

To qualify as a seaman under the Jones Act, a worker must demonstrate, among other things, that they have a connection to a vessel in navigation or an identifiable group of such vessels that is substantial in terms of both its duration and its nature.

When it comes to deciding what constitutes a Jones Act vessel, the US Supreme Court defined the term “vessel” for Jones Act purposes in the case of Stewart v Dutra Construction. The SC held that a vessel was “any watercraft practically capable of maritime transportation regardless of its primary purpose or state of transit at that particular moment.” This meant that something might be a vessel even if its primary purpose was not transportation, so long as its use as a means of transportation remained a practical (not theoretical) possibility.

In that sense, wrote Milgrim, a watercraft was not capable of being used for maritime transport in any meaningful sense if it had been permanently moored or otherwise rendered practically incapable of transportation or movement.

This meant that mobile offshore drilling units were vessels under general maritime law; US courts had held in separate cases that:

  • a floating drilling platform was a vessel, despite the fact that it was not self-propelled and that its primary purpose was oil drilling;
  • a jack-up rig and other mobile oil-extraction vessels such a drill-ships also were vessels;
  • a dynamically positioned, semi-submersible, deep-water drilling platform was a vessel because it was only attached to the wellhead by a 5,000-foot string of drill pipe.

The courts have also considered whether a floating, production, storage and offloading unit (FPSO) was a vessel, ruling that while the primary purpose of an FPSO was oil production, it was a vessel as it retained its own propulsion system and could detach itself from the well and relocate under its own power within six hours, transporting the crew, equipment and stored oil along with them. In so ruling, the court specifically rejected the argument that an FPSO that had not moved in six years would lose its status as a vessel.

On the question as to whether any watercraft fell outside the Jones Act definition, Milgrim wrote that the courts had advised that Spars, which are large production platforms that float on the ocean’s surface but moored to large anchors in the seabed, were not vessels. In making that ruling, the courts cited their limited movement capabilities, the time and expense necessary to render such a structure capable of marine transport, and the permanence of their attachment to the sea floor.

Application to claims by injured workers

What constituted a vessel was once again considered recently, in the case of Ross v W&T Offshore. The plaintiff raised a claim after he was injured while working as a cook aboard an oil and gas production platform which did not float, had no navigational equipment or means of self-propulsion, could not be towed, was permanently affixed to the Outer Continental Shelf in the Gulf of Mexico by eight pilings and had not moved from its location in over two decades.

His counsel alleged his client was a Jones Act seaman and the structure, called SS 349-A, was a vessel which, if accepted, could lead to the Jones Act applying.

Counsel for W&T Offshore argued that SS 349-A was not a vessel and that plaintiff’s claim was governed by the Outer Continental Shelf Lands Act (OCSLA), which mandated the application of Louisiana law. As a result, counsel for W&T Offshore argued that plaintiff’s claim for Jones Act negligence and unseaworthiness must fail.

The Court reviewed Fifth Circuit precedent which has held that fixed platforms are not vessels for the purposes of Jones Act or unseaworthiness claims and that floating work platforms, not used in navigation, do not constitute vessels. As a result, the Court held that cooking on a fixed platform bore no relationship to traditional maritime activity and, since the platform was not a vessel, plaintiff’s Jones Act negligence, unseaworthiness and general maritime law claims must fail.

The ruling from the Ross Court did not leave the injured worker without a remedy. In fact, plaintiff could proceed with his claim for injuries sustained on a fixed oil and gas platform in the Outer Continental Shelf by pursuing his worker’s compensation claim under the LHWCA.

Milgrim noted that injury claims in the US could be as complex as they could be costly. Even before dealing with the prospect of a court action, there were a number of statutory requirements which needed to be taken into consideration. Failing so to do could have seriously detrimental consequences in the event that a claim was raised. It was therefore important that proper and early advice was received when facing the prospect of a claim in the US.

https://www.skuld.com/topics/people/crew/a-guide-to-us-crew-claims/