Shippers must be proactive on compliance
The transportation of hazardous materials was once an arcane subject known to an esoteric coterie of specialists, but of late the subject has hit the radar screens of ordinary citizens with the advent of exploding smartphones and lithium ion batteries. Now, air travelers know they aren’t allowed to bring certain devices on board aircraft, and air cargo movers have their own set of regulations to follow when it comes to the errant power sources.
Transportation companies and third-party logistics providers can do a lot to help shippers of hazardous materials comply with an ever-changing maze of regulations, but shippers can’t expect their service providers to do all the heavy lifting. To the contrary, shippers must be intimately familiar with the regulations governing hazmats, become certified under them, and provide required training to their employees in the handling of the materials. Shippers are the ones responsible for the proper packaging and labeling of hazmats, and the regulations governing these items aren’t simple.
If shippers fail to comply, the Pipeline and Hazardous Materials Agency (PHMSA) of the United States Department of Transportation will come after them and fine them, sometimes to the tune of tens of thousands of dollars for each incident. The Federal Aviation Administration, not to mention agencies of foreign governments, also have jurisdiction in enforcing hazmat regulations. (See sidebar.)
“Shippers need to know the format and structure of the regulations governing hazardous materials,” said Chris McLoughlin, a risk manager at CH Robinson Worldwide. “They are very prescriptive and product specific.”
That means that having a general overview of the regulatory regime won’t do. “Lots of times people want to know the generalities of hazmat regulations, thinking that they’re one size fits all,” said McLoughlin. “But the regulations are very specific to the commodity being shipped, the quantity being shipped, and the mode of transportation—all these nuances dictate individually how the regulations are executed.”
That’s why it might be necessary to go so far as to sit down with engineers to review product specifications to figure out where the product and the company stands with respect to compliance. Shippers are required to provide training to employees who handle hazmats, to document that training, and to get certified by PHMSA to handle and ship hazmats. PHMSA has a website (http://www.phmsa.dot.gov) that covers a great deal of useful information to shippers.
The regulations also cover things like packaging and labeling, so that employees way down the pay scale will need to be trained and to exhibit knowledge of regulatory compliance as it is relevant to their job descriptions.
Some commodities defined as hazmats might come as a surprise to the shipper. It won’t be a shocker to learn that solvents and cleaning fluids require special attention, but certain food ingredients are also regulated hazardous materials. “Food items that can be considered corrosive include highly acidic beverage mixes and concentrates of various products,” said McLoughlin. “These can be subject to packaging and labeling requirements, among other things. Products may be considered placardable under the regulations depending on the quantities being transported.”
Another important thing to understand is that the regulations are a moving target because they are constantly being revised and updated, so it’s important to keep track of what’s going on. One significant trend in recent years has been that PHMSA and other regulatory agencies often update regulations to harmonize them with international standards.
For example, on March 29, PHMSA issued a final rule amending the US Hazardous Material Regulations (HMR) with respect to shipping names, hazard classes, packing groups, packaging, air transport quantity limitations, and vessel stowage requirements to maintain consistency with international regulations and standards including the International Maritime Dangerous Goods Code, the International Civil Aviation Organization’s Technical Instructions for the Safe Transport of Dangerous Goods by Air, and the United Nations Recommendations on the Transport of Dangerous Goods.
In December 2016, PHMSA proposed to harmonize hazmat regulations for air transportation with international standards. The agency issued a notice of proposed rulemaking that would amend certain special provisions of the HMR with respect to packaging requirements for certain materials, quantity limits for lithium batteries carried on an aircraft by passengers for personal use, and notification requirements for pilots regarding the contents of hazardous materials onboard an aircraft.
PHMSA often gets involved in enforcement actions when there is an accident or an incident, such as a leakage of hazardous materials, but agency personnel may also just show up at industrial sites to perform inspections and audits. These examinations will include, not only observing the state of affairs with regard to the handling of hazmats, but also the required documentation that is supposed to be kept in conjunction with that. Paperwork violations could also include failing to document the training of employees. In other words, it’s not enough to perform the required training, it’s necessary to record for posterity that all relevant employees have completed that training.
When PHSMA finds a violation, it will fine the business in question, with penalties ranging from hundreds of dollars to thousands to tens of thousands of dollars. The biggest fine handed out by PHMSA in 2016 was over $66,000; in 2015, it was $50,000. Hundreds of US businesses are fined each year by PHMSA. Other agencies, like the FAA, are also in the business of penalizing non-compliant entities, and their fines can be much more egregious. (See sidebar on page 13).
Logistics providers can help shippers in the compliance process, first and foremost, by qualifying transportation providers capable of complying with the regulatory requirements. Of course, since hazmat handling is such a specialized field, it’s also important to choose a 3PL with good hazmat competencies. Also, as McLoughlin pointed out, 3PLs can’t be on the loading dock to make sure that operations are running compliantly, but they can and should review paperwork to make sure that the hazard class is properly noted and that the documentation is otherwise in order.
“PHMSA takes it job seriously,” said McLoughlin. “It’s all about ensuring that products are not being released that pose a significant risk to individuals or property. And besides the fines, you really don’t want to be in involved in an environmental cleanup.”