The Great American Ballpark (A)
Patrick was the county administrator responsible for safety on public construction projects, and one of his tasks was to oversee a safety program for the new Great American Ballpark, which is the new baseball stadium for the Cincinnati Reds. He cannot stop thinking about two recently completed high-profile stadium projects that ended with very different results. Miller Park, in Milwaukee, opened a year late after a crane collapsed during the construction killing three workers. Paul Brown Stadium (new home of the Cincinnati Bengals) was constructed on-time (in approximately 2.5 years) with a safety record far above industry averages. The safety program at Paul Brown Stadium was developed jointly by the Cincinnati Office of the Occupational Safety and Health Administration (OSHA), the County of Hamilton, and the major contractors on the project, and included budget resources for training, drug testing, and on-site medical facilities among other things.
With a sample size of two, Patrick was having a difficult time deciding if the safety initiative on the Paul Brown Stadium really made a difference or if one project had very good luck while the project at Miller Park simply had very bad luck.
In addition to formulating an overall safety plan, the county's legal council, Frank Jones, was really encouraging Patrick to push all potential liability to the contractors. This would be very different than the way business was conducted on the Paul Brown Stadium. In the Paul Brown Stadium, the county established an Owner Controlled Insurance Program, in which the county purchased third-party liability insurance for project contractors to cover workers' compensation and general liability. Individual contractors purchased first-party insurance to cover only losses to equipment or property owned or being installed at the site. Due to the size of the Paul Brown stadium project, higher limits, broader coverage, and greater retentions were obtained at lower cost to the overall project than individual contractors could have received. Despite the cost savings, Frank's argument was that the construction industry is far too risky for this county to accept that kind of liability.
Based on the cost and safety data available from the two projects, Patrick needed to develop his recommendations for the safety program at the Great American Ballpark jobsite including his response to Frank's concerns.
On July 14, 1999, three iron-workers, in a suspended personnel platform monitoring the hoisting of a roof section, died after falling approximately 300 feet to the ground when their platform was struck by the collapsing heavy-lift crane. The crane known as "Big Blue" was lifting a section of the stadium roof weighing over 450 tons. Several environmental factors contributed to the accident including the wind and soft soil. The wind speeds that day were 20-21 mph with gusts to 26-27 mph, and the boom on the crane was rated to 20 mph. Also, the crane sank about a foot into the soil when it initially lifted the roof section earlier that morning.
Was the safety program at fault or did they just have bad luck?
Following the crane collapse, OSHA investigated the job site and issued citations to three firms: Mitsubishi Heavy Industries America, Inc. ($240,500), Lampson International Ltd. ($131,300), and Danny's Construction Company, Inc. ($168,000). The final penalties were reduced later in litigation and settlement. The specific violations cited are listed in Exhibit 1.
The OSHA Area Director for Milwaukee believed that compliance with OSHA requirements would likely have prevented this tragedy. The failure to take into account the wind was considered a significant factor. After the accident and investigation, several changes were implemented for the completion of the project:
- A new crane was installed with anemometers at the tip of the boom and computerized load monitoring
- Mats were installed to ensure safe foundations
- Anemometers were mounted on the crane boom tip and stadium roof for continuous recording
- Wind loads and specific site parameters were calculated for all lifts
Even if that fateful day was to be ignored, OSHA had previously responded to several incidents at the site including:
- An employee fell about 80 feet and survived by hitting an occupied scaffold. The employee that fell was back at work in a few weeks while the person on the scaffold was put on disability.
- A grinding wheel bounced off the surface being smoothed and hit the user in the leg. There was no major damage.
- A 25-ton roof section shifted in a sling and broke a man's leg.
- An explosion occurred while a heater was being lit which burned two employees.
And the day of the crane collapse, OSHA investigators were inspecting the site because of concerns about visible fall hazards.
The park opened for the 2001 baseball season - a year late because of the crane accident. Total construction time including repair time for the crane accident was 53 months.
Through December 2001, $413.9 million has been spent on park construction, which was 28.5% more than the $322 million first anticipated. This cost figure does not include the $100 million in repair costs covered by insurance for the crane accident or the potential costs of $99.25 million in civil and punitive damages a jury awarded to the beneficiaries of the three ironworkers who were killed (also covered by insurance). An appeals court decision later reduced this award to $27 million, but other appeals are expected that could raise this figure. (It is not expected that the figure could be lowered any more). The total costs will approach $1 billion when all the lawsuits are finished, and the interest on the bonds is included ($330.8 million).
Paul Brown Stadium
Paul Brown Stadium was considered a major success for a large construction project. The stadium was constructed for $453 million in approximately 2.5 years. The stadium opened for the fall football season, September 10, 2000.
By November 2000 with only minor finishing work remaining, the project had logged 3.35 million man-hours, with a job-lost time rate of 0.95 (national rate for construction industry: 4.0) and an OSHA recordable rate of 5.48 (national rate for construction industry: 10.4).2 The project was completed with 92 OSHA recordable accidents, 16 involving lost time, no fatalities, and one fall injury. Actual losses due to accidents were only 42% of the original estimated losses, and the net program savings were estimated at $4.6 million through reduced workers' compensation and general liability costs due to the low injury and illness rate.
Safety efforts at the job site have been exceptional and this has been attributed to the jobsite's participation in the MASTER project. The Cincinnati Area Office of OSHA developed a voluntary cooperative partnership with the contractors and Hamilton County to enhance overall job safety at the Paul Brown Stadium. The partnership, known as Mobilized Alliance for Safety, Teamwork, Education and Results (MASTER) was designed to increase employee involvement, joint safety oversight by labor and management at job sites, teamwork between labor and management, and education of construction workers on construction sites. Details of the MASTER project criteria are described in Exhibit 2. Some of the important program elements include training, on-site medical facilities, and drug testing.
Patrick was contemplating whether or not he believes the additional costs associated with the MASTER project were justifiable or if he could accomplish an acceptable level of safety with only some key initiatives. Also, he was preparing a list of additional information that might be necessary to make his decision.
Exhibit 1 - OSHA violations cited after crane collapse
- Failure to factor wind into the crane loading
- Lifting workers during high winds
- Three people in the personnel platform (exceeded the number required for the work being performed)
- Failure to follow the manufacturer's limitations on the crane
- Lifting loads in excess of the crane's rated capacity
- Not keeping workers clear of suspended loads
- Failure to properly calibrate the load indicator
- Improper ground loading conditions
Exhibit 2 - MASTER project
The goal of the MASTER project is self-compliance through the cooperative efforts of labor, management, and OSHA in the construction industry. According to the 1999 BLS, construction had a fatality rate of 14.0 per 100,000 employees compared with general industry's 3.6 per 100,000, and on average OSHA has traditionally devoted roughly 40-50% of its compliance resources to enforcement activities within the construction industry.
The MASTER project was developed in 1993 to not only address the hazards within the construction industry but also to promote and recognize those jobsites controlled by a contractor that had a demonstrated and effective safety and health program in place.
Important program criteria include:
- Contractor selection criteria
To be selected as a MASTER project, the contractor must have:
- an established and implemented comprehensive safety program with a written safety and health program submitted to the OSHA Area Office
- the authority to require and enforce the use of conventional fall protection when their employees or sub-contractor employees are performing work that is in excess of six feet above a lower level
- all supervisory personnel complete the OSHA 30-hour course for the construction industry
- all non-supervisory personnel engaged in construction activities complete the OSHA 10-hour course for the construction industry
- all employees on the project receive at a minimum a 2-hour safety orientation covering general job site safety and health rules when hired and before accessing the job site. Records of training certification will be maintained and made available for review upon request
- signs posted near the main entrance of the site of at least 3 feet by 5 feet that recognize the site as a MASTER project
- submitted Experience Modification Rates and OSHA 200 logs for the three previous years
- no OSHA citations in the past three years
- no fatalities or catastrophes which resulted in accident-related serious violations within the past three years
In order to retain a "MASTER" project designation, the incidence rate for the project for the total number of recordable injuries must remain below the construction industry average, and they must agree to provide OSHA with access to the work site.
- High visibility of safety personnel on the job site
Safety personnel will include three levels of safety supervision on the job-site with every contractor having a responsible person in a safety role reporting to the prime contractor, and weekly meetings between all site safety personnel keeping open the lines of communication.
The job site must have a safety manager with at least three years experience overseeing safety and health programs on construction sites. The safety manager is responsible for conducting frequent and regular job site inspections and holding job site safety meetings at least weekly with safety representatives for labor and the contractor.
The job site will also have a labor representative as a liaison to the safety manager. The representative must have completed a construction apprenticeship program that included safety and health issues as part of the curriculum, and will accompany the safety manager on job site inspections and attend safety meetings and will be involved in all accident investigations.
Also, each prime or subcontractor will appoint an on-site safety representative to be the contractor liaison to the safety manager. The representative will accompany the safety manager and labor representative on job-site inspections in their respective area, and will attend the regular job-site safety meetings.
- An above average rate of training that focused on highest risk areas
The program requires a minimum of 2-hour safety orientation covering general job-site safety and health rules when hired, plus weekly tool box talks covering areas related to planned work activity and significant risk areas. Significant risk areas include: Falls, Being stuck by equipment or machinery, Electrocution, and Caught-in between equipment, buildings, and/or materials
- On-site medical personnel and facilities
The goal of an on-site medical facility is to decrease the chance of a minor injury becoming more serious and thus resulting in lost-time. However, having the on-site facility on the Paul Brown stadium project meant that many minor injuries that in the past would have gone unreported were now seen by the nurse. This lead to a rise in overall injuries reported. But a decrease of lost-time accidents is attributed to a pro-active environment where workers were encouraged to seek medical attention even for would-be minor injuries, and the employees are generally able to return to work without delay.
- Pre-employment drug testing plus drug testing after all accidents involving personnel or equipment or any observed suspicious behavior
- Thorough accident investigations
OSHA will be given access to the job site to review records, attend job-site safety meetings, and conduct limited site audits. OSHA will conduct enforcement investigations on major accidents and fatalities. All non-formal complaints received by OSHA will be referred to the safety manager and the labor/building trade representatives who will conduct an investigation and report their findings and corrective actions to OSHA within two working days. Formal complaints will be handled in this manner if agreed upon by the complainant otherwise OSHA will conduct an enforcement investigation. If the job-site appears on OSHA's current programmed construction cycle, the inspection will be limited to a review of compliance with this directive except where high-gravity serious or imminent danger conditions exists. OSHA may participate in job-site safety activities, and as needed, OSHA may provide on-site training to workers and their representatives.
The MASTER project must submit every six months and upon completion of the project the following measurements:
- Number of recordable injuries compared to the industry average incident rate
- The Days Away, Restricted, Transferred rates compared to the industry average
- Survey of labor and management to determine their personal views of how the program worked.
The Great American Ballpark (B)
It was decided that the Great American Ballpark would participate as an OSHA MASTER project, and the safety record for the site was impressive. After more than 1.2 million construction hours, the jobsite had logged a job-lost time rate of 0.8 (national rate for construction industry: 4.0 and below the 0.95 achieved on the Paul Brown stadium project). This success was in conjunction with an Owner Controlled Insurance Program (OCIP).
The project attempted to quantify the savings from this approach. For example, one estimate of workers' compensation is $8 per $100 of payroll. Since the contractors will participate in the OCIP program, if the awarded contract shows $2 million in labor costs then, the avoided costs are: $2,000,000/($100*$8) = $160,000. Expenses related to job-related injuries and illnesses are subtracted including workplace safety expenses, insurance premiums, drug-free work place programs, on-site safety and health professionals, and incurred workers' compensation losses. Using this formula, the estimated savings for the project from July 1999 to May 2003 was $3.125 million (project is on-going until July 2005).
For future projects, the project managers involved in the Great American Ballpark recommended:
- Formalized training conducted by in-house staff
- Site safety training and orientation for new workers
- Pre-project planning for job-site safety
- Alcohol and substance abuse programs
- Incident investigations
The Great American Ballpark - Teaching Note
In making the decision to commit the additional resources to participating as a MASTER project, it is important to remember:
- Safety must be considered at every step in the value chain and designing safety into a process is cheaper than retrofitting for safety later.
One of the key steps in the MASTER project is choosing contractors with proven safety records to be partners. Choosing the right partners is the first step in the value chain. For example, Turner Construction (the lead on both the Paul Brown Stadium and the Great America Ballpark) will fine subcontractors for safety violations.
- Leadership and employee empowerment are keys to creating a proactive safety culture.
The contractors at the Miller Park site had extensive safety manuals that included for example 100% Fall Protection where all employees working above 6 feet required tie off, and if there is no place to tie off safely then the rules state that no one is allowed to work until lifelines have been extended. But they were still cited by OSHA for violations regarding fall protection.
- To be able to improve safety, it is important to measure leading indicators in addition to traditional lagging indicators.
Sites should be documenting leading indicators such as near-misses to learn what went wrong and safety perception surveys to determine how safe worker's feel on a project. Prior to the actual collapse, there were many precursor events in the morning that should have warned of problems including the crane sank about a foot into the soil at the time of the pick earlier that morning.
In discussing additional information that could be gathered to make the decision, financial costs associated with becoming a MASTER project may be useful (i.e., how much do those additional safety initiatives cost?). These costs could then be compared against the $4.6 million that was believed to be saved through reduced worker's compensation and general liability costs due to the low injury and illness rate on the Paul Brown stadium project.
1This case is based on publicly available information from OSHA regarding experience at several stadium projects including: Miller Park, Paul Brown Stadium, and Great American Ballpark, and was developed with the cooperation of Turner Construction, the prime contractor on the Paul Brown Stadium and the Great American Ballpark. This case was prepared as part of an Alliance between Georgetown University's Center for Business and Public Policy, OSHA, and Abbott. Participation in an Alliance does not constitute an endorsement of any specific party or any party's products or services. This case was prepared as the basis for class discussion in the "The Business Case for Safety." The decision makers and their associated thoughts and actions are fictionalized.
2A job-lost time rate of 0.95 is determined first by dividing the number of job-lost time incidents by the number of employee man-hours and then by converting it to an annual rate for 100 full-time employees. The recordable rate of 5.48 is determined in a similar way but considers the total number of OSHA recordable incidents.