SEPTEMBER 02, 1999 - The Michigan Department of Consumer & Industry Services  (CIS) has concluded its seven-month investigation of the fatal explosion at the Ford Rouge Complex power plant with an unprecedented and historic $7 million Settlement Agreement with Ford Motor Company and the UAW.

The tragic explosion was one of the worst automotive industry accidents in Michigan. On February 1, 1999, a catastrophic explosion in the power plant at the Ford Rouge Complex in Dearborn, resulted in the death of six workers and seriously injured 14 others.

This unique and innovative resolution to the Michigan Occupational Safety and Health Act (MIOSHA) and Bureau of Construction Codes (BCC) investigation was announced by CIS Director Kathy Wilbur in Detroit. "This historic agreement can never reclaim lost lives or restore injured bodies–but it can ease the suffering of the victims and their families by assuring a safer and healthier work environment for all Ford employees in the future," said Wilbur.

The settlement includes a record $1.5 million penalty, the largest monetary sanction ever levied in Michigan as a result of a MIOSHA investigation. The key elements of the $7 million agreement include:

n $1.5 Million - MIOSHA Penalty,

n $1.5 Million - Establishment of programs to achieve lasting improvements in safety,

n $1.0 Million - Research to increase the understanding of industrial safety and health,

n $1.5 Million - Medical research, facilities or equipment in the treatment of burns and

other critical care,

n $1.0 Million - Scholarship Fund, and

n $0.5 Million - Potential third-party reimbursement.

This Settlement Agreement is historic in many aspects, including the size of the penalty. The scope of the agreement goes beyond the boundaries of the Ford Rouge Complex. The establishment of significant safety and health research, monitoring and training programs will help Ford provide a safe working environment for its employees nationwide. Both Ford and the UAW came independently to MIOSHA to seek a constructive way to resolve this tragic incident. Because all three parties creating the agreement came together voluntarily, a non-adversarial environment evolved with a common goal of protecting workers and improving workplace safety.

BCC inspectors were able to establish cause in this incident. They determined that the explosion was caused by a natural gas build-up in Boiler No. 6. The build-up was a result of inadequate controls for the safe shut-down of the boiler. While BCC inspectors look for the cause of an accident, MIOSHA investigations focus on identifying violations of state worker safety standards.

MIOSHA and BCC inspectors worked cooperatively on this accident to assure that a comprehensive and thorough investigation was achieved. "Coordinating these state inspection efforts allowed us to utilize the expertise of our CIS employees to assure a thorough investigation with an emphasis on a safer workplace in the future at Ford," said CIS Director Wilbur.

The agreement is co-signed by CIS, Ford Motor Company and the leadership of the International Union, the United Automobile, Aerospace and Agricultural Implement Workers of America, and its Local No. 600. This agreement does not include the private settlement offers Ford has made to the victims and their families.

Ford Complex Background

On February 1, 1999, at approximately 1:00 p.m., there was an explosion in the power plant jointly owned by Ford Motor Company and Rouge Steel. By 3:00 p.m., a MIOSHA safety officer was on-site to start the investigation. Due to the size of the catastrophe and the number of employees involved, the CIS investigative team consisted of five MIOSHA safety officers and two BCC inspectors.

The 80-year-old Ford Rouge Manufacturing Complex on the Rouge River in Dearborn covers 1,110 acres and houses six Ford manufacturing companies and the Rouge Steel Company, and employs about 10,000 workers. The incident halted production at Ford’s Dearborn Assembly Plant, which makes Mustangs, at the five other Ford plants which supply a variety of automotive parts to most of Ford’s assembly plants in North America, and at Rouge Steel Company which produces steel for the automotive industry.

About 140 workers were employed at the power plant, which was scheduled to be replaced with a new facility in 2000. The Rouge power plant produced steam by burning a mixture of natural gas, pulverized coal, and blast furnace gas. The new facility, already under construction at the time of the accident, will use natural gas to generate electricity.

Investigation/Accident Details

Boiler accidents are rare in Michigan, but when they do happen the results are often devastating. The last boiler accident in Michigan occurred in 1989 at the Hiawatha Correctional Facility in Kincheloe. An industrial cooking kettle exploded, injuring seven people and causing damages of $250,000. There are more than 70,000 commercial boilers in Michigan, with 4,000 high-pressure power boilers like those at Ford. Power boilers are inspected annually by licensed inspectors.

Entry into the seven-story Ford Rouge building housing the boilers was, and still is, hampered by debris from the blast, making some areas unstable and impossible to enter until cleaned and stabilized. Also due to the blast, a large amount of asbestos was blown off the piping where it was used as insulation. This posed additional hazards for entry, requiring full protective suits and respirators to be worn. Electrical power was not available in the building, so the investigations could only be conducted during daylight hours.

The Rouge power house contained seven power boilers used to provide steam at the complex. All boilers were housed in the same building. At the time of the explosion, Boilers No. 2, 3, 4, 5, and 7 were operating. At 8:00 a.m., Boiler No. 6 was being shut down for annual maintenance. At 12:00 noon, workers were completing the shut-down process by blanking the natural gas supply. At about 12:45 p.m., the natural gas control valves were opened to facilitate purging any remaining natural gas from the supply lines through the boiler.

The BCC investigation determined that the accident was a natural gas fuel explosion and not a boiler steam explosion. BCC inspectors concluded that the cause of the accident was a result of inadequate procedural controls for the safe shut-down of the boiler. Improper valve line-ups and inadequate work group communication allowed natural gas to flow into the boiler furnace chamber. This is believed to be the source of the gas build-up which caused the explosion.

A large part of the BCC involvement consisted of working with Ford as they restored power to the complex. Several companies across the U.S. provided 38 temporary boilers. BCC worked closely with Ford to assure the safe installation and operation of the temporary boilers. Manufacturing resumed in the Ford companies at the complex within a week after the explosion. At Rouge Steel most of the production activities were down for more than three months.

The MIOSHA investigation was the most complex investigation ever conducted by safety officers. The investigation lasted seven months, and was hampered by several outside factors including: problems with access to the site; the need to conduct extensive interviews, including waiting until hospitalized workers were released; the delay and availability of key documents and the physical review of voluminous material; the instability of the structure itself; and finally, the large number of entities conducting investigations, including CIS, the Dearborn Fire Marshal Office, Ford Motor Company, the UAW, and at least three insurance companies.

MIOSHA safety officers reviewed: 689 blueprints; 324 binders of documents containing more than 200,000 pages; 29,000 photos; and 375 boxes of evidence, including 10 file cabinets and 20 blueprint file cabinets. MIOSHA safety officers conducted more than 300 interviews with approximately 150 Ford employees. MIOSHA also received assistance from the federal Occupational Safety and Health Administration (OSHA) Salt Lake City Technical Center, as well as advice from an explosion expert and a power plant engineer with 40 years experience.

MIOSHA safety officers found a significant number of workplace safety and health violations at the time of the explosion and a substantial lack of safe industry practices on the part of Ford. The MIOSHA compliance involvement in this lengthy investigation and the comprehensive and thorough nature of the investigation identified important deficiencies and unsafe workplace practices to both Ford and the UAW.

MIOSHA findings led to the inclusion in the Settlement Agreement of several items which will positively impact the working conditions for Ford employees nationwide. MIOSHA expended the necessary resources in this investigation to determine unsafe workplace practices and to identify viable solutions.

Violation/Citation Summary

Ford Motor Company has agreed to pay a $1.5 million penalty for violations of MIOSHA requirements. This agreement ranks as one of the largest monetary settlements for workplace safety and health violations in the U.S. CIS Deputy Director Dr. Kalmin Smith was actively involved in forging the Settlement Agreement.

"This historic agreement allows us to focus our efforts on helping Ford and the Union create a safe and healthy workplace in the future–rather than spending our limited resources on litigation," said CIS Deputy Director Smith. "This exceptional compliance resolution minimizes the possibility of a lengthy legal battle, and provides immediate benefit to Ford workers."

The violations found by MIOSHA were mainly associated with: physical controls on the boilers, written operating and maintenance procedures, housekeeping, and employee training. A complete list of the violations is included in the Settlement Agreement.

Agreement Highlights

The Michigan Department of Consumer & Industry Services (CIS), Ford Motor Company, and the UAW signed this historic Settlement Agreement on September 2, 1999. Ford will provide assurance of abatement for the cited conditions and will pay the proposed penalty. In addition, Ford will undertake the following activities outside the scope of abatement. Most of the activities will be initiated within 45 days of the effective date of this Agreement.

Safety Improvements in Ford facilities beyond the Rouge Complex

Ford will promote the establishment of programs to achieve lasting improvements in workplace safety and health beyond the Rouge Complex in Dearborn, Michigan. To achieve this goal, the Company agrees to expend up to $1,500,000 to do the following activities.

Additional Contributions by Ford for Occupational Safety and Health Enhancement

Scholarships in Memory of the Deceased

Ford will donate $1,000,000 to a scholarship fund for the benefit of UAW members and their families in memory of the workers who lost their lives as a result of the power plant incident.

Potential Third-Party Litigation Reimbursement

If CIS personnel are required to testify in third-party litigation, Ford has agreed to reimburse the state for the actual salary/wages, fringe benefits, and travel expenses incurred, up to a maximum of $500,000.

Conclusion

This historic resolution helps provide closure for the victims and their families, the employees and managers of Ford Motor Company, the UAW, and MIOSHA and BCC safety officers, inspectors and staff. It not only represents recognition by the company and the union that safety is a responsibility for all parties–it also represents a landmark approach to resolving the complex safety issues identified in this tragic explosion. Family members were notified by Ford, the UAW, and CIS prior to this announcement.

"It is our goal in Michigan to make sure employers do not place their employees at risk of injury or death," said CIS Director Wilbur. "We believe this proactive approach to a very tragic event and complex investigation will set the stage for all Michigan companies to establish leading-edge safety and health programs and policies which will ensure the safety of their employees and provide a work environment that minimizes the risk of accidents."

(The Settlement Agreement, with two attachments, and the BCC Accident Report are available.)

Read more Michigan Department of Consumer & Industry Services press releases.