Compensation Benefits: Vocational Rehabilitation Services
What are maritime injuries? A maritime employee is defined as any individual who works either on the water (a seaman, such as a ship’s captain or crew member) or along the water on the docks. When a seaman or harbor worker is injured on the job, it is considered a maritime injury.
Compensation Benefits for Maritime Employees
Unlike other industries where injured workers can simply file for benefits through their employer’s worker’s compensation insurance, benefits given to maritime employees are governed by federal maritime laws, including the Jones Act, Maintenance and Cure, and the Longshore Act.¹
Under the Jones Act, a seaman who was injured due to employer negligence can sue for appropriate damages.¹ Maintenance and Cure allows injured seamen to receive a daily allowance as well as compensation for medical bills. This compensation continues until such time that the worker is able to return to work.²
The Longshore Act applies to those maritime workers who are not seamen and do not work on the water. Benefits can include payments for disability and/or medical bills. If he or she is unable to return to work, the disabled worker is also offered vocational rehabilitation benefits. ³
Vocational Rehabilitation Services
When a maritime worker is injured significantly—particularly when one is rendered disabled for quite some time—he or she may require specialized vocational rehabilitation services to return to work. These services can include medical treatment, physical therapy, counseling, and even the provision of a personal assistant to help the worker perform daily tasks during the rehabilitation period.4
Seek the Help of a Professional Maritime Accident Lawyer from Maintenance and Cure
Whether you need vocational rehabilitation due to temporary disability or would like to seek damages for an accident caused by an unsafe workplace, it’s important to have the support and guidance of an experienced maritime lawyer.
At Maintenance and Cure, we strive to help all of our clients get the compensation benefits they deserve so that they can recover fully without struggling financially. To learn more about how we can help you with your personal maritime injury case, contact us online or call us today at 1-800-836-5830.
The 1920 Merchant Marine Act and Injured Workers
In 1920 Congress passed the Merchant Marine Act. This act has become to be known today as the Jones Act. The act contains federal laws which govern the maritime industry, including work-related injuries for those in the service of a vessel.
Unlike normal worker’s compensation and protections, negligent accident compensation under the Jones Act is typically higher and offers other added benefits for injured seamen. In addition, the statute of limitations to file a claim at either the state or federal level is three years.
Seamen have several rights under the Jones Act. It is to your benefit to be aware of these rights and what you should do in the event you are injured while in the service of a vessel. To learn more about seamen’s rights, employer responsibilities, and types of vessels the Jones Act covers, please continue reviewing the following infographic.
If you have or a loved one has been injured while in the service of a vessel, contact the maritime and Jones Act lawyers at Schechter, McElwee, Shaffer & Harris, L.L.P. for legal advice.
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What Is the Maritime Administration (MARAD)?
It’s certainly not a radical statement to say that the maritime sector in the United States plays an essential role in the maintenance of the nation’s economy and its military force. Corporations rely on the maritime transportation system to deliver goods safely and efficiently across the country and to foreign lands. In addition, the merchant marine serves the dual role of promoting maritime commerce and providing auxiliary support to national defense and emergency response efforts.
Given the centrality of the maritime sector, it makes sense that its various activities and responsibilities would be coordinated by a federal agency. This is where the Maritime Administration (MARAD) comes into the picture.
MARAD is one of the agencies controlled by the U.S. Department of Transportation (others include the Federal Aviation Administration and the Federal Highway Administration), and throughout its history, it has proven to be highly effective in overseeing the waterborne transportation sector. For maritime employees, understanding what MARAD does is important, as this organization touches on a wide range of matters relevant to this industry.
A Brief History of the Maritime Administration
The United States Maritime Administration was formed in 1950 in order to take over many of the regulatory responsibilities that had been handled by the recently dissolved United States Maritime Commission, which had been founded in 1936.
In 1961, MARAD expanded its scope of duties by assuming control of subsidization of the construction of merchant ships, a task that had previously been managed by the United States Federal Maritime Board (1950-1961). MARAD became an official administration of the U.S. Department of Transportation (DOT) in 1981, and it has remained under the oversight of this federal cabinet department ever since.
The Maritime Administrator
The head of MARAD is known as the Maritime Administrator. The occupant of this office reports to the Secretary of Transportation and advises them on matters pertaining to the U.S. maritime industry. Additionally, the Maritime Administrator serves as Commandant of the United States Maritime Service, the Chairperson of the Maritime Subsidy Board, and Director of the National Shipping Authority.
At the present time, the position of Maritime Administrator is held by Rear Admiral Mark H. “Buz” Buzby, USN, Ret., formerly president of the National Defense Transportation Association, who was officially sworn in on August 8, 2017.
The Role(s) of the Maritime Administration
In 2017, MARAD commanded an operating budget of $399 million and employed more than 750 personnel, who were spread among MARAD headquarters, the U.S. Merchant Marine Academy, and various fleet sites and gateway offices.1 These dedicated professionals are involved with supporting and managing many different facets of the maritime sector in America.
Let’s explore the some of the activities in which MARAD is engaged as part of its mission to promote the U.S. waterborne transportation sector.
- Cargo Regulation – MARAD has the task of overseeing the transportation of the nation’s military and agricultural cargo in accordance with all applicable laws and statutes. Among these laws are the Cargo Preference Act of 1954, which mandates that at least 50% of cargo generated by the government be carried on privately owned commercial vessels that fly the U.S. flag, and the Military Cargo Preference Act of 1904, which requires all water-transported items intended for military use to be carried by vessels that fly the U.S. flag. To address the need for the ready availability of U.S.-flag, Jones Act-qualified ships, MARAD routinely assists public entities in their efforts to locate such vessels.
- The Office of Maritime Security – Another MARAD department, the Office of Maritime Security is involved with various efforts to protect the maritime industry from pirates, terrorists, and other criminal threats. MARAD has aided the Department of Homeland Security (DHS) and the Coast Guard in their attempts to combat piracy on the high seas in line with the United Nations Convention on the Law of the Sea (UNCLOS). Furthermore, the Office is involved with efforts to enforce the National Maritime Domain Awareness Plan (2013), intended to bolster maritime security on the global level, and provides support to the DHS in allocating port security grants to entities at the local and state levels.
- Office of Safety – This MARAD department is involved with developing safety standards for the national and international maritime industry, as well as promoting advances in practices and technology to protect the welfare of maritime personnel.
- Port Conveyance and Port Licensing Programs – MARAD helps federal agencies and departments comply with the Federal Property and Administrative Services Act of 1949, which compels such entities to transfer unneeded property to other agencies that need it. Since the 90s, the Administration has also had the authority to convey this property to state and local governments for the development of port facilities. In addition, MARAD licenses offshore liquefied natural gas and oil import/export port facilities in accordance with the Deepwater Port Act of 1974.
- National Defense Reserve Fleet (NDRF) – MARAD manages this small fleet of inactive ships for the purpose of providing auxiliary support, as needed, for national emergency response efforts. As of July 31, 2014, the NDRF consisted of 114 ships.2
- Ready Reserve Force (RRF) – Since 1976, MARAD’s Ready Reserve Force has served a backup support for the U.S. armed forces, especially the Army and Marine Corps. The RRF has been involved in Operation Desert Storm and the Hurricane Katrina response effort.
- Ship Disposal and Dismantling – MARAD runs a Ship Disposal Program to enable the agency to safely dispose of old vessels that are no longer adequate for national security purposes. The agencies achieve this goal through sales to domestic ship recyclers, participation in the U.S. Navy’s SINKEX “live fire” training exercises, and providing vessels for use as artificial offshore reefs.
- Federal Ship Financing Program (Title XI) – The agency takes part in Title XI financing, which is intended to bolster the U.S. merchant marine by funding the construction (or reconstruction) of vessels in compliance with environmentally friendly policies. The Program gives ship owners the opportunity to purchase vessels at affordable rates (low interest and long repayment terms) from U.S. shipyards. It also provides financial support to shipyards seeking to modernize their facilities.
- The United States Merchant Marine Academy – MARAD is responsible for administrating the U.S. Merchant Marine Academy (USMMA), in Kings Point, NY. This is one of the five military academies charged with the task of producing commissioned officers for the various armed forces. Graduates of the Academy go on to serve in the merchant marine or in the U.S. military. MARAD also provides funding to California Maritime Academy, Great Lakes Maritime Academy, Maine Maritime Academy, Massachusetts Maritime Academy, the State University of New York Maritime College, and Texas A&M Maritime Academy.
- The MARAD History Program – The Maritime Administration is also involved in preserving its own history, as well as that of the U.S. maritime industry as a whole. To that end, it operates the American Merchant Marine Museum and, through the Maritime Administration Artifact Loan Program, lends valuable historical artifacts to non-profit organizations and other public museums. It also maintains the MARAD Vessel History Database, which has data on over 12,000 vessels, past and present.
Given its role in enforcing the provisions of the Jones Act, battling piracy on the high seas, and promoting safety in shipbuilding and maritime employment conditions, the Maritime Administration is a name that sometimes arises in connection with offshore personal injury cases.
If you have or a loved one has been seriously injured while performing duties as a maritime or offshore employee, you should contact the maritime law firm Maintenance & Cure at 1-800-836-5830. A free consultation is available.
Protecting Your Rights Under the Jones Act
In 1920, the U.S. Congress passed the Merchant Act of 1920. This act has come to be known as the Jones Act. It contains specific provisions which outline specific requirements for those businesses operating in maritime industries. It also provides protections for employees in the event of negligence by their employer, fellow employees, captains, or other crew members resulting in accidents causing personal injuries.
The United States Supreme Court established the qualifications to determine whether an employee is considered protected under the Jones Act in the case of Chandris, Inc., v. Latis, 515 U.S. 347, 115 S. Ct. 2172 (1995).1 To qualify for seamen’s rights under the Jones Act, the employee must be in the service of a vessel in navigation for more than thirty percent of his or her time.
This provision extends to oil rig workers, dock workers, and others, as allowed under the act. One of our Jones Act lawyers can help you determine whether you meet the qualifications to be considered a protected seaman under the Jones Act. If not, there may be other maritime laws or acts for which you could be entitled to for filing a claim against your employer in the event of an accident where you sustained personal injuries while in the service of a vessel or on the job.
What Rights Does the Jones Act Provide Seamen?
There are numerous risks and potential dangers seamen face every day. The Jones Act relates to specific working conditions, negligence caused by employers, ships’ captains, other crew members, and other such aspects of working in maritime industries. One of the key factors is the seaworthiness of the vessel.
Specifically, is the vessel in proper working order, is it correctly maintained, and does it provide a safe working environment for employees? If the vessel is deemed unseaworthy, for one or more reasons, seamen could have grounds to file for damages allowed under the Jones Act if they are injured while in the service of the vessel.
Employers have a responsibility to maintain safe working conditions at all times, which include:
- Properly maintaining the vessel for safe operations.
- Providing proper training for employees on specific job duties.
- Ensuring there is the correct number of employees available to complete tasks.
- Training employees how to correctly and safely use equipment, tools, and other such materials related to their jobs.
- Providing access to personal protection equipment (PPE), such as hard hats, work gloves, and other attire, as required for certain types of job functions.
- Verifying all equipment, machines, and tools used to complete tasks are functioning and operating correctly.
How Do Seamen Risk Their Jones Act Rights?
After being injured while in the service of a vessel, typically, the ship’s onboard doctor will provide an evaluation and emergency treatment. If the injuries are more serious, then efforts are made to transport the injured worker back to land for proper medical care and treatment.
It is not uncommon for the seaman’s employer to request the worker seek care and treatment through a company-approved doctor or health care provider. The company’s doctor may tell the worker his or her injuries are not as severe as they think. They may also release the seaman back to work sooner than the time they need to recover from the injury.
In addition, an injured worker may be contacted directly by the employer’s insurance company and offered a settlement, depending on the extent of injuries and recovery time needed. Many seamen risk their Jones Act rights because their employer, company doctor, and company insurance provider make it sound like they are working in the employee’s best interests when, in fact, this is not always the case.
The goal of any insurance company, whether it is to settle a conventional personal injury claim or a maritime claim covered under the Jones Act, is to get the person to settle for the least amount possible.
The amount being offered may not even cover future medical costs should additional treatments for the injury be required later. Seamen who sign off on accepting whatever settlement is offered, and who return to work once released, are essentially giving up their Jones Act rights.
Steps to Follow to Protect Your Jones Act Claim’s Rights
If you are insured while in the service of a vessel, it is important to report the accident and injury immediately. Even if a worker sustains minor injuries, they should seek medical care with the onboard or company doctor, as well as verify an accident/injury incident report is completed.
Next, as soon as possible, contact our Jones Act law firm. You have the legal right to consult with a maritime lawyer to determine whether your employer, their insurance company, and the company doctor are, indeed, serving your best interests.
If any individual representing the interests of your employer informs you there is no need for you to consult with your own lawyer, this should be a big “red flag” and warning that you probably should discuss your case with your own lawyer.
Your lawyer will review the cause of the accident, the extent of your injuries, what type of medical treatment and care are being offered by your employer, and other such aspects. They will provide you with sound legal advice, educate you about what rights you have, and lend their knowledge so you can make informed decisions on how you want to proceed.
What if I Were Partially at Fault for Causing the Accident?
Unlike conventional personal injury claims, where one party must be entirely at fault, with Jones Act claims the law works differently. You can file a claim even if you were considered partially at fault for causing the accident resulting in personal injuries to yourself.
The Jones Act treats all seamen equally and does not distinguish between deck hands, crew members, captains, and others. Furthermore, simply demonstrating partial negligence on the part of another seaman could be sufficient grounds for filing a claim, without having to prove negligence against your employer.
How Are Seamen Compensated for Injuries?
The Jones Act has a provision that refers to Maintenance and Cure. Maintenance is the compensation given to the injured party to cover their basic living expenses and lost wages. Cure is the compensation given for medical care and treatment until the seaman is released back to work.
Some employers and their insurance companies will use stall tactics to delay making payments to injured parties. If your employer does this, then it could create a situation where you could also be entitled to file for punitive damages against them with help from our maritime lawyers.
In cases where the vessel you were in the service of is deemed to be unseaworthy, there could be other types of compensation you could seek, such as pain and suffering. This is why it is best to talk to a lawyer at our Jones Act law firm.
What if My Spouse Died While in the Service of a Vessel?
Surviving spouses of seamen who died while in the service of a vessel due to personal injuries from an accident could have grounds for filing a wrongful death claim against the employer through the Jones Act. The amount of compensation sought in these types of cases depends on several factors and can be rather complex.
If your loved one died and his or her employer or the employer’s insurance company contacts you directly to make a settlement offer, do not agree to it until you consult with your own lawyer. Potentially, you could be entitled to receive a higher amount of compensation than what they are currently offering.
In summary, as a seaman working in the maritime industry, you have certain legal rights and protections provided by Jones Act Law. In order to preserve your rights, you need to refrain from signing any documents or accepting any settlement offer until after you have sought your own legal advice from Maintenance and Cure. Call us at 1-800-836-5830 to speak with a maritime lawyer now!
Is Maritime Piracy Still a Thing?
For centuries, pirates have been a cultural institution of sorts, glamorized in classic literature (Treasure Island), the cinema (the Pirates of the Caribbean movies), and various other productions of Western society.
The origins of piracy reach back literally thousands of years, yet the iconic image of the pirate—complete with eye patch and heavy jewelry—stems from the classic period of piracy, roughly the 17th to 19th centuries, when these hardy adventurers wreaked havoc along the Persian Gulf and the Caribbean.
It took a concerted effort from European powers, including legislation such as the General Maritime Treaty of 1820, to put an effective end to pirate activity, at least as it was understood at the time.
Pirates did not go away for good, however. In fact, they constitute a serious threat that plagues the contemporary maritime industry, resistant to coordinated attempts to eliminate them. It’s not difficult to understand the persistence of this sort of criminal activity.
Piracy, like all crimes motivated by a desire for financial gain, is always a possibility wherever valuable goods can be seized. This is certainly true on the high seas, where substantial revenue is there for the taking in the form of cargo and even hostages.
Maritime piracy is far from an insignificant phenomenon in the modern era, and its reach is more widespread than most people suspect. Let’s take a closer look at this problem.
Where Piracy Happens
Piracy in the modern era is not restricted to any geographic region. In fact, the locus of piracy continues to shift as economic conditions and anti-piracy activities make their influence felt.
Somalia – For many casual observers, modern piracy is strongly associated with this beleaguered African country—and for good reason. In 2009 alone, there were no fewer than 51 incidents off the coast of Somalia.1 This made Somalia virtually synonymous with piracy, but it has to be said that this isn’t an altogether fair assessment.
In recent years, the incidence of Somali piracy has dropped precipitously, to the point where this country no longer holds the distinction of being the world’s hotspot for this type of criminal activity. Even so, Somali piracy is still a phenomenon that must be contended with.
Indonesia – The world’s largest island country, Indonesia is an archipelago in Southeast Asia that encompasses over 17,000 islands. It is also notorious for a very high rate of pirate activity, much of which occurs in the Strait of Malacca (pictured below), an extremely busy shipping route used to transport a vast amount of merchandise from Japan and China.
All that valuable cargo passing through the strait has proven to be an irresistible target for pirates. The year 2003 saw a staggering 121 hijackings of commercial vessels in this region—over 20 percent of the global total.2 Since then, piracy has declined dramatically, but it remains a major problem in Indonesian waters.
Bangladesh – Widespread poverty and an understaffed national coast guard have left the nation of Bangladesh vulnerable to pirates, who have eagerly exploited local conditions for their own profit. Piracy attacks, mostly dealing with kidnapping fishermen for ransom, has taken its toll on the national economy, which is heavily dependent on its fishing industry.
The good news is that Bangladesh has taken steps in recent years to quell this problem. Its participation in the U.S.-led Cooperation Afloat Readiness and Training (CARAT) exercises is considered largely responsible for reducing—though not eliminating—the threat of piracy in the Bay of Bengal.3
Nigeria – In West Africa, over seventy percent of all maritime piracy can be traced to Nigeria.4 The Gulf of Guinea is the local playground for regional pirates, whose activities are mainly devoted to capturing valuable cargo, often oil, rather than taking hostages.
These are not the only areas where piracy happens—Peru and the Ivory Coast have also encountered pirates, to name a few other examples—but they are the primary locales. As we shall soon see, maritime piracy is more than just a nuisance—it’s a wide-ranging social problem that gobbles up huge amounts of resources.
Why Piracy Is Harmful
Piracy causes major harm to society. The organization Oceans Beyond Piracy calculated the global cost of piracy for the year 2011 at $6.6 to $6.9 billion.5 The damage wrought by piracy takes a variety of forms, including but not limited to the following:
Fatalities – Many pirates operate by taking hostages and holding them for ransom. It’s a tactic that has proven quite profitable—but it can also lead to tragedy. Some encounters between commercial vessels and pirates devolve into violence. In Southeast Asia, 136 people were killed at the hands of pirates over the years 1995 to 2013.6 A far greater number of innocents have suffered serious injury during pirate attacks.
Costlier Shipping Practices – One tactic for keeping away from pirates is to ship materials at very fast speeds across the water. That’s what a lot of shipping companies have resorted to in an effort to reduce the risk of encountering unfriendly ships.
Unfortunately, this practice substantially increases the expenses involved in maritime transportation. Another tactic that shipping vessels sometimes use is to follow an indirect route to their destination—which, of course, takes longer and costs more money.
Increased Insurance Rates – The likelihood of stolen cargo means that shipping valuable goods is more risky than it would be under normal conditions. This also means that insurance rates must be raised to compensate for the increased risk.
Higher Security Expenses – There was a time when it was considered unnecessary for shipping vessels to employ armed guards and utilize anti-piracy equipment. That time is in the past, however. The price of maintaining adequate security is another expense that shipping companies must bear.
Damage to Local Economies – As we have mentioned, piracy in Bangladesh has caused serious injury to the nation’s fishing sector—and this is only one example of a country-wide economic devastation that can be attributed to these maritime interlopers.
Drain on Limited Military Resources – Many impoverished nations struggle to mobilize the kind of military response needed to discourage piracy.
There are a variety of laws on the national and international level aimed at prosecuting pirates and reducing the incidence of these types of crimes.
The State of Piracy Law
Piracy that takes place within the territorial waters of a nation can be prosecuted by that nation. In the U.S., the crime of maritime piracy falls under 18 U.S.C. § 1651, which states, “Whoever, on the high seas, commits the crime of piracy as defined by the law of nations, and is afterwards brought into or found in the United States, shall be imprisoned for life.”
However, what happens when piracy occurs out on international waters? In this case, international law takes over—specifically, the United Nations Convention on the Law of the Sea (UNCLOS). This international agreement stipulates that “all States shall cooperate to the fullest possible extent in the repression of piracy on the high seas or in any other place outside the jurisdiction of any State.”
In practice, there has been some confusion as to which country should take on the responsibility of prosecuting pirates captured out on the high seas. When the United States has assumed this role, it has often imposed very harsh penalties, in accordance with 18 U.S.C. § 1651.
If you or a loved one has been injured during the commission of a pirate attack, it is important to understand that there is legal recourse available. Under the Jones Act, victims of pirate assaults may be entitled to substantial compensation. Contact Schechter, McElwee, Shaffer & Harris, L.L.P., for a free consultation.
Death On the High Seas Act: What Are Your Rights?
When someone dies due to the negligence or misconduct of another, it’s called wrongful death. Their families have the right, under various state laws, to sue the responsible party. The same is true for those who die at sea, only their case comes under the purview of maritime law, specifically, the Death On the High Seas Act (DOHSA).
The Death On the High Seas Act
The Death on the High Seas Act (46 USC 761) has been around since 1920 when Congress decided to make provisions for the families of seamen who had been killed in international waters. Legislators have since expanded and amended the law, but the premise remains the same.
When a commercial maritime worker dies at least three nautical miles from U.S. shorelines, DOSHA permits dependents to recover damages. (A dependent is anyone who relies on the deceased for financial support—a spouse, children, siblings, parents, etc.)
Over the years, the law has come to include commercial aircraft accidents that take place over international waters at least 12 nautical miles from shore.
It’s important to note that DOSHA applies only to workers killed on commercial vessels—it does not cover those who work aboard non-commercial or privately owned ships. It also does not cover maritime injuries, which come under the aegis of the Jones Act.
What the Law Does and Does Not Cover
Under the Death On the High Seas Act, dependents are allowed to recover damages for such things as:
• Loss of financial support
• Funeral expenses
• Counseling expenses
• Other pecuniary (financial) losses
Since DOSHA preempts state law, however, families of victims cannot file claims through traditional wrongful death statutes. Historically, that has prevented dependents from recovering damages related to non-pecuniary losses (e.g., mental anguish, loss of companionship, loss of emotional support).
In addition, a maritime accident attorney must be able to show that the death was the result of another party’s negligence, whether that is the ship’s owner or a fellow worker. Negligence may occur when:
• An employer fails to equip the ship with the necessary safety gear.
• Employers or owners fail to maintain the seaworthiness of the vessel.
• An employer or manager fails to maintain or repair safety gear.
• An employer forces a seaman to work in unhealthy or hazardous conditions.
• A co-worker engages in risky behavior or fails to carry out duties.
The Death On the High Seas Act Statute of Limitations
Like all maritime injury cases, DOSHA comes with a statute of limitations—a deadline of three years. That means family members must file a claim within three years of the accident if they hope to receive compensation.
Given the narrow window of opportunity, it’s crucial for dependents to seek the help of a dedicated maritime law firm immediately after losing a loved one. At Maintenance and Cure, we work hard to secure justice on behalf of our clients. Contact us as soon as possible to speak with a skilled maritime accident attorney.
The International Polar Code
Earlier this year (2017), new polar water regulations were rolled out that will affect the shipping industry and ships operating in Arctic and Antarctic waters. These waters pose special threats, mainly from ice and icy conditions ship operators need to take into consideration to ensure their vessels are fully compliant with the new code.
The new requirements focus on every aspect of a ship’s operations, stability, structure, and safety, as well as what training the crew has received. The code applies to specific vessels based on their classification as either:
Keep in mind, the International Polar Code does not apply to all ships operating in these waters. Expectations are made for ships weighing less than 500 metric tons, fishing ships, and structures that are fixed in place.
Prior to entering Arctic and Antarctic waters, ships that must satisfy the rules and regulations contained within the International Polar Code must be certified. To learn more about the new code and how it could affect your operations, equipment, and crew in polar waters, please continue reviewing the following infographic.
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The Severity of Maritime Piracy Crimes
Pirates—those much-romanticized scourges of centuries past—are still very much with us today, as viewers of the nightly news can attest. The unlawful activities of modern-day pirates on the high seas have achieved notoriety around the globe.
Even so, piracy is still a shadowy subject for most people, and understandably so. Few of us, even in the maritime industry, have first-hand experience with pirates. Piracy is, however, a serious problem that has far-reaching effects on the international stage.
A Worldwide Phenomenon
The general public has come to associate modern-day piracy with activities occurring off the coast of Somalia, specifically in the Arabian Sea (particularly the Gulf of Aden) and the Indian Ocean. These goings-on can be traced to the deleterious societal effects of the ongoing Somali Civil War, which have made maritime piracy an attractive alternative to poverty. Piracy in these seas diminished significantly over the last decade or so, but, in early 2017, a burst of renewed pirate activity made it clear that this problem hasn’t gone away quite yet.
Piracy is not limited to this region, however. Nor is Somalia the only nation that harbors pirates. Another hotspot for criminal activity is the South China Sea, where pirates from Malaysia and Indonesia often harass maritime vessels. In addition, the Gulf of Guinea, in the eastern Atlantic Ocean, has seen dozens of incidents in recent years.
How It Happens
Pirates use a variety of tactics to capture and board unsuspecting maritime vessels. Sometimes they use high-speed engines to quickly catch up to vessels, often approaching from a blind spot, before defensive action can be taken. Another tactic is to pose as a friendly vessel in order to gain the trust of the crew on the targeted ship.
Once aboard, pirates frequently seize hostages, demanding a sizable payout for their release. Alternatively, they may simply raid the vessel for its cargo.
The Cost of Piracy
Wherever it occurs, maritime piracy enacts a steep cost. According to the non-profit group Oceans Beyond Piracy, Somali pirates caused $1.7 billion in financial losses in 2016. If that sounds steep, consider that this figure represents a dramatic drop from $7 billion in the year 2010. In West Africa, piracy accounted for nearly $800 million in losses (2016).1
In addition to incurring heavy losses in ransom money and lost goods, the actions of pirates force local governments to devote a substantial amount of resources to counter-piracy measures, such as providing military escorts to cargo ships.
The United Nations Convention on the Law of the Sea (UNCLOS) of 1982 is the primary piece of international legislation covering piracy.
In recent years, the U.S. has assumed a more central role in the prosecution of captured pirates, often imposing harsh sentences up to life in prison. Schechter, McElwee, Shaffer & Harris, L.L.P., has helped a number of piracy victims obtain suitable compensation under the guidelines of the Jones Act. If you have been harmed during the course of a pirate assault, you should contact our office as soon as possible for a free consultation.
6 Reasons You Should Be Talking About Oil Rigs
The importance of oil rigs, oil production and oil prices in 2017 can’t be overstated. Oil has a profound effect on the world economy and the American economy. It also affects the lives of people all over the world. Spikes in oil production can spur jobs and convert economies of developing nations into first world economies. On the other hand, production from oil rigs can harm the environment. An overlooked issue, perhaps, is that oil rigs can also be dangerous.
Offshore accidents, of course, are in the news from time to time. The 2010 Gulf of Mexico oil spill demonstrated that. To refresh your memory, BP’s Deepwater Horizon oil drilling rig exploded, with catastrophic results. Almost five million barrels of oil were spilled into the Gulf of Mexico. Eleven people on the oil drilling crew died. Many others were injured and needed the help of a personal injury attorney or an offshore injury attorney to repair their lives. In addition, the spill destroyed many marine and wildlife habitats and damaged the area’s water, air and beaches.
The possibility of accidents is one reason that people should be talking about oil rigs. Here are six others:
1. The American Economy:
Oil production in the United States has doubled in recent years. When oil production doubles, the number of oil rigs also approximately doubles. A chart in the article “US Oil Rig Count Surges to Highest Since First Week of January” shows an incredible correlation between oil rigs and oil production. When the number of rigs in the U.S. increases, gas prices at U.S. pumps fall. This is great news for Americans who now have more money to spend on other goods and services. This also helps American companies producing those goods and services.
2. The World Economy:
Good news for Americans might be bad news for other nations. The Huffington Post article “Why Oil Stocks Will Be the Best Investment in 2016” reports that excess oil production has harmed the economies of other oil-producing nations. Companies in Algeria, Canada, Iraq, Nigeria, Russia and Saudi Arabia have had to cut their prices because demand is so high. Consequently, their profits have dropped. This has spurred the closure of 65 percent of foreign nations’ oil rigs.
3. The Trump Administration:
Increasing the number of jobs in the United States was a key platform in the presidential campaign of Donald Trump. Although many economics experts dispute that building oil pipelines will produce a lot of jobs, President Trump has reversed Obama Administration decisions on two pipelines: The drilling rigs at the Keystone XL and Dakota Access pipelines — the kinds of rigs needed for on-land oil drilling — are now active.
4. The Environment:
Oil rigs are also an ongoing issue because many people believe that oil production harms the environment. Fear about oil’s impact on the environment was a factor in the Obama Administration’s decisions on the Keystone XL and Dakota Access pipelines. Environmentalists were also enraged that the Obama Administration approved opening up areas adjacent to the Atlantic Ocean for offshore oil drilling. The oil platforms — the kinds of rigs needed for offshore oil drilling — have had problems in the past with safety. The BP case was an example of that.
Working on an oil rig can be very lucrative. An engineer with no experience — a trainee — can earn $60,000 per year plus an additional $90 per day working on an oil rig. That is what Vice Magazine reports in the article “What It’s Like Working on an Offshore Oil Rig as a Woman.” People who are promoted get raises of $7,500 per year. In addition, directional driller salaries are “ridiculous,” the article reports. What’s “ridiculous”? How about $220,000 per year? In an era of dramatic income inequality — when salaries in numerous professions are way down — people should be talking about the salaries of oil rig workers.
6. Working Conditions:
Why can’t all news about jobs be good news? That’s not the real world. While salaries are good — often great — on an oil rig, working conditions are often difficult. The bad news is that workers can be told to work for more than 24 consecutive hours, according to the Vice article. That’s a formula for accidents. In addition, many people work night shifts. Others work every day for a month. Working like a dog also crimps workers’ personal lives. The bottom line is that turnover at rigs is very high. “They just work you until you’re broken and then you’re done,” said one worker.
Working on an oil rig is one of the most dangerous occupations in the United States. The risks are numerous. Explosions. Falling. Dangerous machinery. Dangerous chemicals. Isolation. Fatigue. Schechter, McElwee, Shaffer & Harris, L.L.P is so concerned about the dangers that it has established the Maintenance and Cure team at its law firm to help people who have suffered because of the risks of oil rig work.
The law firm has local maritime lawyers and offshore lawyers who are experts in maritime law. Our attorneys understand the Jones Act and many other laws that oil companies often violate. Our expertise in maritime law has helped more than a number of oil rig workers. Many workers have won more than $1 million in court cases and settlements.
If you are an oil rig worker who is concerned with conditions at your workplace and/or has been injured because of bad workplace conditions, please phone Schechter, McElwee, Shaffer & Harris, L.L.P at 1-800-836-5830. Calling us could be the best investment you ever made.
2017 Oil Prices, Rig County & the Economic Impact
How oil prices rise and fall is one of the many ways to determine the rate of economic growth. Oil prices are mainly determined by demand and supply forces in the market. The rate at which a country is producing oil will determine how the prices will be, and thus, the impact on the economy.
Various analysts have different views on what we should expect the oil prices to look like in 2017. There are those that expect prices to rise, and then, there are those that foresee a decline in prices. Whatever the case, the economy will be affected as well as the rate at which drilling activities will be carried out.
What’s the forecast for prices in 2017?
The consumption rate of natural gas in 2015 was 74.7 billion cubic feet (BCF) per day. In 2016, it was 75.1 (BCF) per day. In 2017, the rate is expected to be 75.4 (BCF) per day, according to a report given by The EIA (U.S. Energy Information Administration). The high consumption rate expected in 2017 is due to high commercial, as well as residential, use of oil during the winter season.
According to Bank of America analysts, there have been consistent low oil prices in the U.S. This has led to demand growth over the past years. When there is a gap between supply and demand, prices tend to go up, and therefore prices are expected to be on the rise this year.
Additionally, the recent decision made by OPEC to reduce oil production will definitely push prices up. However, if the OPEC members, as well as non-members, refuse to adhere to the dialing back on production law, the pressure on pricing should be expected.
U.S. drillers are expected to react to the high prices by drilling more oil in an attempt to increase supply, which, in return, may reduce prices. And with the increase of drilling, maritime accident attorneys are likely to be impacted in 2017 as chances of drilling accidents will increase
What is the expected Rig Count in the year 2017?
The movement to reduce oil production by OPEC, with an attempt to boost oil prices, is a great enforcement to the U.S. rig count in the year 2017, according to Platts RigData. The rig count is expected to grow by 27% in 2017. With these forecasts, the following is expected:
- Oil prices will increase as supply levels match that of the demand
- Increase in oil production levels. Operators will focus on getting the best wells to drill oils. In this case, local maritime lawyers will be incorporated just in case something happens out in the field.
- Production volumes will not increase largely as earlier expected.
The fact that the production volumes per well will be less only means that more wells need to be drilled. Platts RigData says that more than 11,000 wells are expected to be drilled in the year 2017. This is an increase in number of wells compared to the year 2016, which was 8,900 wells in total.
How local maritime lawyers can be of use to workers drilling or third parties
With the increase in number of wells, more people are likely to be employed to help in drilling. These will, therefore, increase employment levels, hence improving the standards of living. With all these employees working out in the field, the employees should at least have insurance coverage that can be used in case of an accident. This is where maritime lawyers come in.
While drilling, oil may spill into the water causing human and environmental harm in the sea. Harm may also be done to sailors especially if oil tanks being transported leak oil into the sea.
As for sailors who get into accidents either transporting oil or gas tanks, the Jones Act should be their way of getting compensation. The employers of sailors should be able to compensate sailors when an accident occurs during work. Nevertheless, the Jones Actis able to protect Americans injured at sea and therefore, sailors should familiarize themselves with such laws.
Forecast on the effect of increasing wells or drilling
There are those of others who are bearish in nature, while there are those who are bulls. As for the bulls, the factors below are the key determinants of oil prices in 2017:
- Demand for US gasoline
- Low levels of production and the law on reducing production by OPEC
- Imports and demands of India’s crude oil
- Decline in Russia’s crude oil production
- Imports from China
Bearish people, on the other hand, believe that oil prices will decrease once wells are increased. The main drivers for most bearish beliefs include:
- Energy policy implemented by Donald Trump
- High U.S. oil inventories
- High production of crude oil in Nigeria and Libya
- Supply outages globally
With all these facts, there is a likelihood of supply imbalance all through the year, despite increased spending.
What to look out for as you invest in the oil sector in 2017
So many factors indicate an increase in oil prices as well as rig count in the year 2017. However, competition from other producing countries can cause a major drift in demand. This means that demand may increase or decrease but in most cases, it is likely to go down due to stiff competition. When this happens, prices will definitely go down.
Another thing to look out for is natural disasters that are completely unexpected. Such disasters may lead to oil depletion and thus low supply. Anything like a terrorist attack on oil hubs can also cause a major impact on demand and supply of oil.
With all these facts, it is good that you make an informed decision before investing your money based on forecasts.
How will oil prices and rig count affect the US economy?
In the year 2015, prices of oil were quite low. This impacted the US economy in various ways. Some of these ways included:
- High rate of unemployment. This was mainly for those workers in the oil industry
- Increased rate of spending
- Increased consumption rate and thus economic growth
- Decline in corporate profitability
2015 was a year when oil prices declined. As we said earlier, prices are determined by two forces namely demand and supply. In the year 2015, demand was low whereas, supply was very high. In order to determine how forces of demand and supply affect prices, a model showing a correlation of oil prices with other financial variables is used.
Using that model, the World Economic Forum was able to know that demand for oil toward the end of 2016 was declining at a high rate. With the same model, the prices in 2017 are likely to be high.
Let’s look at how this increase in prices will affect the economy. Some of the implications include:
- Employment opportunitiesMost wells have a short production life. This means that there is always another well being drilled in search of oil. All this drilling requires truck drivers, drilling machines and drilling workers among others. Apart from that, whenever there is an activity going on, businesses arise. For example, hotels, hospitals and other social platforms are likely to emerge. All these lead to job growth.
- Low standards of living
Most people use oil in one way or another. When prices increase, it only means that they spend more on oil and less on buying household items. It is not only households that are affected by the high oil prices, businesses also suffer a great deal. This is because most of their goods are transported or shipped from one place to another by cars or vessels that use oil. This makes production costs very high which, in turn, makes all the prices to hike.
Increase in prices leads to inflation. Oil prices affect all prices of goods made with crude oil, and it affects the cost of transportation, production and heating. With all the prices hiking, the value of a dollar declines and, thus, one may have a lot of dollars but just manage to buy very few items.
- Slow or low economic growth
With oil prices rising, the cost of production also increases. The demand and supply of goods get affected in the long run. For instance, supply of goods will reduce since the cost of production is very high, whereas demand reduces because people prefer to save their money for future days or for more basic things.
Decrease in demand and supply means that the level of consumption is also decreasing and, thus, low economic growth.
When oil prices increase, people tend to use their money just on basic things. This is because, despite the prices rising, the salaries or wages remain the same yet the cost of living has increased. When fewer people go on vacations or to restaurants for leisure activities, then the economy is no longer growing. A country can, therefore, be said to be undergoing a recession period.
- Government finances reduce
Since the rate of unemployment is very high, the government is forced to spend a lot of money on unemployment benefits. On top of that, taxes reduce since few people are working and for those working, the salaries are too small to generate enough income in the form of taxes for the government. In the end, the government ends up spending more than it receives, and this may cause the country to take loans from other countries and thus debts increase.
With all these facts in mind, investors need to invest wisely in oil companies, and citizens need to prepare for what is expected to happen in the year 2017. As for employees working in the sea or those drilling wells, it is recommended that you familiarize yourself with maritime laws just to be on the safe side in case of any accidents or oil explosions.
For more information on maritime lawyers or the Jones Act, please read more from the Maintenance and Cure Company, and also visit our contact us page today. We care about your problems, and you can be assured of getting the best services from us.