Canada: When An Already Bad Day Gets Worse - Vessel Owners Responsible For Compliance With WorkSafebc Safety Regulations At Vessel Casualty Sites

If a casualty occurs in BC a vessel owner has a personal obligation to ensure the safety of all workers hired to help rescue his boat including the divers, repairers, marine surveyors, welders and contractual salvors.

If there are any worker safety infractions that occur at a vessel casualty site, the vessel owner may face significant penalties from WorkSafeBC unless the owner adequately protects himself by written contract.

To date in the marine industry, WorkSafeBC has primarily concerned itself with worker safety issues on fish boats and marine terminals. However, their inspectors have started to show up at casualty sites in BC waters when companies have been hired to salve vessels, including pleasurecraft.

Under the B.C. Workers Compensation Act ("Act"), a "Prime Contractor" must exist at every work place wherein two or more employers have workers working at the same time. The Prime Contractor's role is ensure that the activities of employers, workers and other persons at the workplace relating to occupational health and safety are coordinated, and to do everything that is reasonably practicable to establish and maintain a system or process that will ensure compliance with the Act. If a breach of the Act occurs with respect to the duties to be performed by a Prime Contractor, the Prime Contractor may be assessed significant penalties.

The Act mandates that there can only be one Prime Contractor for any multiple employer workplace and that unless there is a written agreement to transfer the Prime Contractor's responsibility, it is deemed to be the owner of the workplace. This is the case even if the vessel owner itself is not a registrant with WorkSafeBC. The definition of owner extends to include bareboat charterers and anyone who has possession of the vessel. As well, as a warning to marine surveyors,  the person identified as "owner" can include any party who is acting on behalf of the owner as an agent.

"Workplace" is broadly defined in the Act as "any place where a worker is or is likely to be engaged in any work and includes any vessel, vehicle or mobile equipment used by a worker in work". A "multiple-employer workplace" is defined as "a workplace where workers of 2 or more employers are working at the same time". Furthermore, where there are two or more groups of workers present at a workplace "over an appropriate interval", even if those workers are not all present at any precise point in time, that workplace could be deemed a multiple-employer workplace.

Every vessel casualty site will almost certainly involve the attendance of at least a marine surveyor and a contractual salvor which would make it a multiple employer workplace.

It is no solution to require each contractor at a multiple employer workplace to be its own Prime Contractor. If that occurs, by default, the owner remains the Prime Contractor.

Insurers should by ready to educate their vessel owning assureds that when a casualty occurs and various contractors are hired to attend at the salvage site, a Prime Contractor with the responsibility to fulfill the obligations set out in the Act must be designated in writing. Assuming that the marine surveyor appointed by the insurer is not prepared to take on this role, the insurer or its surveyor may wish to assist the vessel owner to confirm in writing with the contractor that is handling the majority of the salvage work that it is the Prime Contractor.

In the agreement, the Prime Contractor should clearly assume the responsibilities contained in the Act. The agreement should include at least the following elements:

  • a statement that the contractor has assumed the duties and obligations of a Prime Contractor for the purposes of s. 118 of the Workers Compensation Act and any applicable regulations, which includes the responsibility to ensure continuing coordination of the occupational health and safety activities of all employers and workers;
  • an indemnification provision whereby the Prime Contractor indemnifies the owner with respect to all losses, costs, damages, and liabilities which may arise from a failure of the Prime Contractor to properly carry out its duties and obligations as Prime Contractor.

Under all circumstances, the owner retains the responsibility under the Act to provide the employer or Prime Contractor at the casualty site the information known to the owner that is necessary to identify and eliminate or control hazards to the health or safety of persons at the workplace. The agreement with the Prime Contractor should confirm that the relevant information has been given by the owner to the Prime Contractor.

It is also prudent that any marine surveyor, insurance adjuster or insurance representative make it clear that he is not acting as the owner's agent at a salvage site, or he may risk being designated the "owner".

The application of the Act to maritime matters is an evolving scenario as it was only in August 2013 that the Supreme Court of Canada confirmed that the provincial health and occupational safety laws could be applied at a maritime work place, as long as the law did not directly conflict with a federal law governing the matter. 

We are pleased to assist should you seek to draft some standard contractual language to have at hand to be used when maritime casualties occur in order to educate and assist the vessel owner in delegating the "Prime Contractor" responsibility at a casualty site and communicating that the owner has provided the necessary information to eliminate or control hazards.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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