Failing to comply with business regulations can bring serious consequences for construction companies, from government fines to class-action lawsuits.
That’s why Daniel Terrell and his legal team have embarked on a major initiative to ensure PLH Group Inc. and its 13 businesses across North America are fully compliant with the myriad laws and regulations that apply to PLH. “The scope of government requirements that apply to business in general—and construction specifically—is becoming larger and more complex,” he says. “So, compliance is a common theme and increasing concern among the in-house counsel with whom I network.”
As chief legal officer and secretary for PLH Group, Terrell oversees the legal, compliance, and risk-management functions for the parent company and its subsidiaries. The Irving, Texas-based firm is a leading provider of pipeline and electric-infrastructure solutions.
Terrell, 36, earned his bachelor of science in finance from Southeastern Louisiana University and a juris doctorate and bachelor of civil law from Louisiana State University. After graduation, he turned down job offers from large New Orleans law firms in favor of more hands-on work at a smaller business firm. A couple of years later, he joined a national firm, where he handled transactions and disputes for clients in the construction industry. He was then recruited to join the Shaw Group, Inc., a Fortune 500 engineering, procurement, and construction firm that has since been acquired by Chicago Bridge & Iron Company.
“Shaw promoted me after eight months on the job and gave me a chance at a division general counsel role that would normally be reserved for a lawyer with more years of experience than I had at the time,” he says. “I’m grateful they took a chance on me and allowed me that opportunity.”
Terrell joined PLH in 2012. The company employs more than 3,000 people and has more than 4,000 pieces of equipment that help serve more than 750 clients. Its 13 subsidiaries, which range from a pipeline-construction firm in Alberta, Canada, to a California-based electrical-substation contractor, were largely brought together through a series of acquisitions. The $1 billion company is itself owned by Energy Capital Partners, a private equity firm with more than $13 billion in capital commitments.
Last year, Terrell and his team of six employees in the legal department began compiling and cataloguing every regulatory and statutory requirement that applies to PLH and its subsidiaries. “That was a herculean effort,” he says.
The legal team did its own research and worked with human resources, finance, and other departments to gather compliance requirements. While some regulations impact several PLH subsidiaries, others don’t overlap, including various Canadian requirements that apply only to a company called Pipeworx in Alberta.
By the end of 2014, the group had identified more than 200 compliance areas, from medical marijuana laws and state privacy laws to requirements concerning on-premises weapons, employee privacy, and franchise tax reporting. The compliance tracking tool the group created lists all applicable regulations and statutes, a description of the requirement, and who specifically in the business is responsible for ensuring compliance. Terrell and his team also developed a risk-assessment rating for each compliance area, based on factors such as the cost for noncompliance, risk of government review, enforcement activity, the potential for litigation, and possible business impacts. The team also identified 17 higher-risk areas to give additional attention and resources to.
For example, the company is providing additional training in the areas of I-9 and E-Verify compliance, overseen by United States Citizenship and Immigration Services. “These I-9 forms are particularly fraught with opportunities for noncompliance where, for example, use of an outdated form or attaching photographs are potential violations,” Terrell says. “With the government continuing to set new records for I-9 enforcement initiatives, we are intent on making sure every responsible individual in our business receives additional training and is fully aware of the pitfalls in this area.”
Requirements from the Occupational Safety and Health Administration (OSHA) also play a key role in the construction industry. “Safety is a PLH core value,” Terrell says. “We belong to the strategic partnership between OSHA and the electrical transmission and distribution construction contractors. OSHA has recently added new regulations and amended others. For example, starting this year, OSHA has new rules that require companies to report employee hospitalizations and amputations, including soft-tissue amputations. The agency has also amended its standards for electric-power generation, transmission, and distribution work.”
Ensuring full compliance is not an easy task, especially given the diversity of businesses under the PLH umbrella. Some have union workforces, others don’t, and some joined as small operations that grew in revenue but not necessarily administrative maturity. “Ensuring 100 percent compliance in some areas can be a challenge for any business,” Terrell says, “but I’m proud of our team and their collaboration with all stakeholders to ensure we do our very best to lead in the area of compliance.”
