>> Tonight on Frontline, an update of a story we first broadcast five years ago about one of the most dangerous businesses in America... >> Working conditions is probably the worst that you can imagine, even worse than underground in a coal mine.

>> ...McWane, an iron pipe company where workers risked their lives.

>> Fatalities, injuries and illnesses and amputations are not accepted practice.

>> After our original broadcast, the Justice Department investigated.

>> We had never seen a company that committed criminal violations at so many of its facilities.

>> Now, five years later, we return to the McWane plants... >> When the story first aired, I said to myself, "Yeah, get McWane, get them.

Get them.

Show them up for who they really are."

But after Frontline, things began to change.

>> ...and we find a company transformed.

>> The results speak for themselves.

There's been a dramatic turnaround in this company.

>> First, a story originally reported by the New York Times, Frontline, and the Canadian Broadcasting Corporation.

Then, an update-- "A Dangerous Business Revisited."

>> NARRATOR: Every morning, Marcos Lopez says, his day begins with pain.

He is 45 years old.

Since high school he has been working at a pipe foundry now owned by the McWane corporation.

Last March, while working on a pipe-molding machine, he suffered a serious back injury, becoming one of more than 4,600 McWane workers hurt on the job since 1995.

And like others, he is struggling with his disability.

>> I work all my life, I put all my time, my energy.

I put a lot of...

I'm a dedicated worker.

Never been late and everything.

And I feel destroyed.

>> NARRATOR: Marcos Lopez worked here, at Tyler Pipe in Tyler, Texas, McWane's largest plant.

Since they bought this plant seven years ago, federal officials say it stands out as repeat violator of safety rules with a workforce that has endured burns, amputations, and violent industrial accidents.

>> The workload will force you, you know, to care less about safety and just do your work.

And you got this point, you know, you reach this point that you just don't care about you and you set your mind on work.

And that's what they want, and that's how people get hurt.

>> NARRATOR: Many McWane workers say safety is sacrificed to increased productivity.

Since the 1970s, the McWane way of management has spread as the company aggressively expanded.

It has estimated annual revenues approaching two billion.

Buying up antiquated plants, they now have foundries across North America, increasing profitability through what they call "disciplined management practices."

Here in Tyler, Texas, disciplined management practices meant reducing the workforce by nearly two-thirds of the people working there.

>> There were a lot of changes, and it changed for the worse for every employee.

>> I'm embarrassed for people to even know that I have been employed by those people.

>> NARRATOR: Ron Howell worked at Tyler Pipe for 42 years as a design engineer.

Now retired, he blames McWane for increasing profits at enormous human cost.

>> A human being can only hit so many buttons on a machine.

If he's operating a machine, they put another machine behind him, now he's got to operate two machines.

Well, they got room to put another machine over here, now it's... he's got to work three machines.

>> Sometimes I worked 16 hours up there a day.

>> 16 hours?

>> 16 hours.

And I will find my supervisor and ask him, "Can I go?"

He said, "No, you will leave when I tell you to."

>> NARRATOR: In the relentless drive to increase productivity, Tyler veterans say McWane's disciplined management practices at times curtailed even the most basic human needs.

>> If you have a need, you just have to relieve it there at the machine.

>> You're saying that they're not allowed to go to the bathroom?

>> When they hold up their hand, they need to go to the bathroom, they're told, "You can hold it.

And they've had to sit there and-- excuse me-- they've urinated in their pants.

>> We were tired, exhausted.

Then... we work in a real dangerous environment, you know.

There's a lot of parts moving.

There's a lot of things, you know, going on.

>> NARRATOR: Dangerous moving parts are supposed to be covered with safety guards.

Equipment with moving parts must be stopped for adjustments or repairs.

These are the rules set out by the federal safety agency called OSHA.

But these basic safety rules have been repeatedly ignored in McWane plants, with tragic results recorded in the files of OSHA, the Occupational Safety and Health Administration.

We've reviewed thousands of pages from their files.

This is Ira Cofer.

He was a mechanic at Tyler Pipe, working around an unguarded moving conveyor in January 1997.

A sleeve became entangled in the machinery.

>> His arm was pulled under the belt system and trapped there.

>> NARRATOR: Because of layoffs, he was working alone.

The report of his accident is graphic.

"Cofer was missing for more than two-and-a-half hours, yet he was crying out for help the entire time.

When he was finally heard, they found him standing on top of his hard hat trying to relieve the pressure on his arm."

He watched helplessly as his left arm slowly disintegrated.

>> The belt rubbed it all down to the bone and took all my flesh off.

>> NARRATOR: He remembers that he talked to God, and that the pain eventually ceased.

But today he lives with the permanent result of an accident that could have been prevented.

>> I know that...

I know I got to get used to it, but some things you just can't never get used to.

>> NARRATOR: Every day he struggles with his disability.

But he was lucky.

Every year researchers say tens of thousands of American workers die from workplace diseases, and 6,000 workers die from accidents.

>> He was a supervisor, as I understand it.

>> NARRATOR: Jerry Hopson died a long, slow death after an accident that happened at Tyler Pipe seven months before Ira Cofer's.

As Hopson was taking a familiar shortcut across an unguarded machine, the machine started up and crushed him.

Bobby Hopson used to work at Tyler.

He remembers his brother in grief and anger.

>> Me and him were real close.

The fact is, I never remember having a cross word with him.

And, you know, brothers don't do that.

>> Why didn't they wait, though, for him to get all the way through and clear before starting that machine back up?

>> Production.

The company should have had a shield up there, or some... some kind of guard where those guys could not walk across that cylinder.

>> Was it any kind of secret to supervisors, to management, that guys were taking that short cut?

>> Supervisors go across there, too.

>> So the company knew there was a hazard, knew that men were walking through this hazard, but took no steps whatsoever to prevent that from happening?

>> Right.

Exactly right.

>> NARRATOR: At the time the company denied responsibility for Mr. Hopson's accident.

A company official told the local Tyler paper he was a "good man who made a very big mistake."

The McWane company safety handbook spells out all the appropriate federal regulations, while instructing employees to work safely and as "efficiently and quickly as possible."

But on the shop floor, workers and managers told us there was a gap between policy and practice.

>> They preached it.

They're telling you, "Be safe, but you get down there and do it."

"But sir, I've got to have two or three guys with me."

"Well, you better round them up and be down there in 30 seconds.

And I want that thing fixed and running.

And if it's not, it's not making production, and we're going to see the numbers the next week, and it's going to be your fault if it didn't make those numbers."

>> NARRATOR: As productivity increased, so did the accidents.

There were four more amputations following Ira Cofer's-- 60% of the maintenance workers in one plant were injured-- and OSHA inspectors would find 30 more safety violations involving unguarded machinery in 1999.

Tyler Pipe and McWane continued to violate OSHA rules and put workers at risk.

>> When we have an... a rogue company, when we have a renegade company like this, and our local staff knows that there are problems, they send a message up the line that, "Hey, here's somebody, we need to get their attention."

>> NARRATOR: Charles Jeffress was OSHA's administrator in the late '90s.

He tried to get McWane's attention without much success.

>> The current law is inadequate to deal with serious violators, repetitive violators, situations where people are put at risk day after day.

>> It sounds like the law isn't... doesn't have significant penalties to it.

>> The penalties in the OSHA Act are inadequate to deal with people that don't take their safety responsibility seriously.

The penalties were first established in 1970.

They've only been increased one time since then, and it's very low.

A serious violation, something that might lead to someone's death, carries a maximum penalty of $7,000.

>> NARRATOR: In 1999, four years after McWane bought Tyler Pipe, an OSHA inspector's report described conditions there: "Many workers have scars or disfigurations, which are noticeable from several feet away.

Burns and amputations are frequent.

Throughout the plant, in supervisors' offices and on bulletin boards, next to production charts and union memos, is posted in big orange letters: REDUCE MAN HOURS PER TON.

In just a few years, the new management philosophy had turned Tyler Pipe into an employer of last resort, and the company tried to cope with heavy turnover in the workforce by recruiting ex-convicts from local prisons.

>> The word had got out about Tyler Pipe, what the management philosophy was, how the employees were treated.

You couldn't find a local in East Texas that really wanted that job.

And if they took it, they'd be gone in a month.

>> What... what was that management attitude?

What was that mindset?

>> Uh, did... didn't matter.

Just put another warm body in there.

>> NARRATOR: Rolan Hoskin was desperate for work.

His daughter and twin brother say he had nowhere else to turn.

He was divorced and in debt.

But in May 2000, he took a maintenance job on the graveyard shift at Tyler Pipe, and he was afraid.

>> He was always, you know, saying he... how dangerous it was out there.

I said... oh, you know, he didn't... really, the training wasn't adequate.

Or he didn't believe... nobody showed nobody how to do nothing.

You know, they just... you're on your own.

>> NARRATOR: Working alone at 4:00 in the morning with little experience, he entered a sand pit to adjust a moving, unguarded conveyor belt, a dangerous and illegal, but routine, practice.

The machine grabbed his arm.

The graphic photographs by investigators show Rolan Hoskin never had a chance.

After the accident, the company argued that it was his own fault.

>> My dad isn't the kind of person... he wasn't stupid.

He wasn't stupid, but he didn't want to lose his job.

And he felt like if he didn't do whatever he needed to do, that he would lose his job.

And he was just trying to make it, trying to get back on his feet and make it.

>> We all miss him, you know.

He just went to work and didn't come back.

>> NARRATOR: Rolan Hoskin was one of nine workers killed in McWane plants since 1995, and the only one whose death would result in McWane being held criminally responsible under federal law.

The company was charged with the maximum penalty, a misdemeanor, and then paid a fine of $250,000.

No one was sent to jail.

>> You can't send someone to jail for any significant period of time for willfully violating the law and killing somebody.

That's the problem.

The law is inadequate.

>> NARRATOR: An injured worker like Ira Cofer will get medical bills paid, and a portion of his income through workers' compensation benefits.

But as he and Jerry Hopson learned before he died after more than 20 operations, workers' compensation isn't just about compensating workers.

It provides the company with immunity.

None of the managers at Tyler Pipe would speak to us about the deaths or injuries there, referring us instead to the McWane corporate headquarters in Birmingham, Alabama.

The company was started here in Birmingham by James Ransom McWane in 1921.

The McWanes are one of the wealthiest families in the South, known for their philanthropy, endowing museums and universities.

And they are also known for their avoidance of publicity.

This is the only photograph we could find of Phillip McWane, great-grandson of the founder and current head of the company.

He wouldn't talk to us, nor would he permit any company official to speak on camera, nor allow us access to any of their plants.

This is footage from inside the original McWane cast iron pipe foundry, filmed for a Hollywood movie.

We found a former plant manager who was willing to speak on the record.

>> Working conditions is probably the worst that you can imagine, even worse than underground in a coal mine.

I mean, it's hot, dirty, nasty, and... but they pay good money.

>> NARRATOR: Robert Rester has spent his entire career working in the dangerous world of pipe foundries.

>> It's metal against metal all day, pipe rolling down steel rails, pipe hitting pipe, pipe hitting kickers, kickers kicking pipe.

A lot of pinch points, a lot of heavy equipment.

And if it's not maintained, then you got danger spots.

>> NARRATOR: In his 24 years at McWane, Rester rose from the shop floor to become a McWane plant manager, a conservative Southerner with a no-nonsense leadership style.

When we met him he was on sick leave for stress and a heart condition, acquiring firsthand a whole new perspective on the McWane management philosophy.

>> Now I'd went off sick, first time I'd been... missed a day in 25 years and they started giving me a hard time about that and I never could understand why.

And then I finally realized that they were doing to me what I've watched them do for 25 years to other people.

You know, I been watching for-- and waiting and watching-- for years and the way people got treated and I was a part of it.

And I just...

I knew for a long time that sooner or later somebody's going to have to stop it, somebody's going to have to say something.

And I was always hoping it would be somebody besides me.

I never knew I'd be the end up one talking or pushing the issue.

But that's at the point I was at.

>> NARRATOR: Rester now laments having been part of what he says is an abusive management culture that placed the production of pipe above all else.

>> The job, like I said, it was a good job, money.

As far as conditions it was a big hole.

The way you treat people would be awful.

I mean, just, you know, the people, they're nothin', they're just a number.

You move 'em in and out.

I mean, if they don't do the job, you fire 'em.

If they get hurt, complain about safety, you put a bull's eye on them.

I mean, if they're a target, that means that they're going to... they're not going to have a job in the near future.

>> NARRATOR: While the company wouldn't meet with us they have responded in writing, denying Mr. Rester's allegations: "We do not put production concerns ahead of safety and environmental compliance."

In emails and letters, they point to recent multimillion dollar improvements at plants like this one, Union Foundry, in Anniston, Alabama, where, until six months ago, Robert Rester worked as a manager.

>> "Safety starts here with attitude."

That's to try to make the public look like that they're really concerned about somebody's health and all.

And they say it starts with attitude and you can walk through that gate and the attitudes in there, it's unbelievable how bad they are.

You know, every day somebody's forced to do a job out there while a piece of equipment's running or something like that and it's unsafe.

And these guys get to the point to where they just hope that, you know, they can make it another day without getting caught on one of these jobs that's dangerous.

>> NARRATOR: Reginald Elston's file is consistent with many others we've investigated: An electrician, out of the navy, had a baby daughter, needed work, took a job at Union Foundry on maintenance.

August 22, 2000: working at a conveyor belt that was running and unguarded, he was yanked headfirst into a machine, where he died, his left hand just inches away from a safety shutdown switch.

Clyde Dorn was in charge of safety at Union Foundry when Reginald Elston was pulled into the unguarded conveyor belt.

>> How had this escaped your attention?

>> There was new construction going on in that department.

As a matter of fact, they were putting in a whole new machine.

They told me that this particular belt was a part of the new construction.

I was not allowed to get involved in new construction.

>> But, in fact, this tail pulley was actually in regular operation.

>> From what I understand afterwards, yes.

>> NARRATOR: Clyde Dorn admitted to us that he was fired last year after he was arrested and convicted for trafficking in the painkiller OxyContin.

Before going to prison, he spoke with us about his six years working at Union Foundry.

>> Had you ever worked in a foundry before?

>> No, I had never worked in a foundry.

>> How many previous jobs had you held as a safety director before coming to Union?

>> That's actually the first job I had as a safety director.

>> As the safety director, did you have the authority to stop production?

>> No.

I had to go to the plant manager and the plant manager would make the decision.

>> No matter... no matter what?

>> Well, if somebody was caught in the machine I could shut it off.

>> So you have no budget, you have no staff, you have no authority.

How can you possibly be effective, then, as a safety director?

>> It's difficult.

>> NARRATOR: Clyde Dorn's job was also to deal with OSHA and its inspectors.

Soon after he started work, there was a fatality on his watch.

Johnny Brewster was a machine operator temporarily assigned to clean-up duties.

He was working in the bottom of an elevator shaft.

The elevator continued operating.

It descended and crushed him.

When OSHA fined the company $12,000, the safety director fought it and got the fine reduced to $4,500.

>> You took offense to that fine.

>> That's my job.

>> NARRATOR: Dorn says he not only fought OSHA fines, but on occasion he withheld information from federal inspectors.

>> You lied to OSHA?

>> Yeah.

The McWane way is don't tell anybody anything, especially if they're going to do the testing.

We know that... >> Meaning don't tell anybody, even if the anybody is government regulators?

>> Yeah.

Well, I mean, you don't convict yourself.

Let them do it, that's what they get paid for.

>> NARRATOR: Over the last 20 years, the judgment in Washington has been that regulation was strangling business.

After heavy lobbying by industry, OSHA's authority and budgets have been curtailed, making it easier for some companies to dismiss the agency.

>> They consider OSHA a mosquito.

That they'd rather pay the fines than bring their plants into compliance.

That they think the law is so ineffective that it's more profitable for them to take the risk by not having safety programs in place than to comply with the law.

That is a serious problem.

>> NARRATOR: But Jeffress' successor, John Henshaw, who was appointed by President Bush, believes he has the tools to do the job.

>> Are the laws tough enough?

>> They are strong.

Obviously we're constantly looking at where we need to improve that and we'll continue to make those improvements as we go forward.

>> BERGMAN: What happens when you come across a company that has, as in the case of Tyler Pipe, repeated violations and then, it turns out, repeated instances in other plants owned by the same people?

>> With Tyler Pipe or McWane or other organizations, when they have a pattern, we need to take special attention to make sure that we don't have the same kind of pattern going throughout the organization.

>> How many criminal referrals have there been since you've been the head of OSHA?

>> I don't have that statistic.

>> NARRATOR: After our interview, Mr. Henshaw told us he had referred five cases to the Justice Department.

But if history is a guide there is little likelihood of stiffer enforcement.

Since OSHA was established 32 years ago, there have been more than 200,000 workplace-related deaths.

In all that time there have been only 11 short jail sentences handed out.

>> It appears to be true that under federal law you get a more severe penalty for harassing a wild burro on federal land than you do for willfully killing a worker in your factory.

>> That's true and we have many more wildlife protectors than we have industrial plant inspectors.

>> Why hasn't this situation changed?

>> There hasn't been a groundswell from the public to get Congress' attention to change the situation.

Any change in the law has to come from Congress and in this era, regulatory programs, enforcement programs are not popular in Congress.

>> NARRATOR: And enforcing OSHA misdemeanors is not popular with federal prosecutors around the country.

>> The U.S. attorney is generally going to spend his or her time on felony convictions, on things with big fines.

And if all you can bring is a misdemeanor case it just doesn't get the attention that a felony case would.

>> NARRATOR: These are the faces of the workers who have died at McWane plants since 1995.

All these deaths were declared accidents by local authorities, so tougher state felony charges were never filed.

Pipe foundries like the McWane plant in Birmingham are not only inherently dangerous, they are dirty.

And McWane plants have been declared in violation of pollution laws and emission limits more than 450 times in the last seven years.

>> McWane's attitude is, "Unless you catch us, unless you push us, unless you... we're right up to the... to it, to the limit, we're not going to do anything we have to do."

>> NARRATOR: Bart Slawson ought to know.

He's an Alabama environmental lawyer who threatened to sue McWane for problems at their Birmingham foundry.

>> There had been complaints from people who work in downtown buildings about McWane because they'd be sitting in their offices and here would be this big cloud of junk coming up from McWane.

They'd get mad and they'd call the health department.

Well, the health department didn't do anything about McWane's air pollution and I got asked to look into it.

And I did and I found this long line of air pollution violations.

So I wrote them a 60-day notice that said, "Under the Clean Air Act, in 60 days we're going to sue you for several million dollars for violating your air permit and polluting the air in that area."

>> NARRATOR: The company reacted to Slawson's notice and agreed to clean up the emissions from their Birmingham plant.

But environmentalists would discover that air pollution wasn't the only problem.

>> Well, apparently they were dumping, you know, pollution from their process waste water and runoff from the plant into... into basically a pipe that ran into Village Creek, an illegal discharge of polluted water.

>> NARRATOR: A pipe foundry like the McWane plant in Birmingham uses vast quantities of water for cooling pipe.

Wastewater contains oil, silica and heavy metals.

The law requires that it be collected in holding ponds, then treated and recycled.

But what happens when the holding ponds become full?

According to Robert Rester, you break the law with a little help from Mother Nature.

>> Any time there was excess oil or something in there they would wait till a big storm or something come along.

Then go out there and open that up and then that way the storm water and all would just flush the oil and everything all out at one time in the middle of the night or whatever and... >> Did that happen when you were the plant manager?

>> Yes.

>> More than once?

>> Yes.

>> Did the general manager know this?

>> Oh, yeah.

The executive vice president of the corporation knew what was going on.

We had to do... he said... all he would ever say is, "Whatever we had to do to run, we need to do it."

You know, "Get rid of the water, we got to run."

>> NARRATOR: We tried to contact the general manager and the vice president but they refused to speak to us, referring us to McWane headquarters.

The problem with wastewater wasn't just in Alabama.

The Delaware River flows by Phillipsburg, New Jersey, and millions have been spent over the years to clean it up.

But on the morning of December 5, 1999, residents noticed this oily sheen on the river.

It grew into an oil slick eight miles long.

Investigators eventually found the source: a city storm drain somehow turned into an industrial sewer.

They started pulling manhole covers to find where the oil was coming from.

The trail led them here: to Atlantic States Foundry, a pipe plant owned by the McWane corporation.

Even after the F.B.I.

and state officials raided the foundry, they were unable to find out who at the plant released the contaminated wastewater.

To dispose of the case McWane paid $50,000 to an environmental group.

But we found former employees who told us that this was not an isolated incident.

Getting rid of wastewater was a constant headache for Brad Schultz.

>> Once or twice a week we were told that we had to pump it out.

That's 100,000-some gallons of fluid that you're losing every single day.

It's got to go somewhere.

>> NARRATOR: And the nearest somewhere was through a storm drain that led here, the Delaware River.

>> My supervisor gives me that order.

>> And who was that?

>> At the time it was Bobby Bobinis.

>> Come on out, Bob.

>> NARRATOR: Bobby Bobinis wasn't supervising much when we found him.

He was in the Sunbury, Pennsylvania, jail.

He was in for a driving offense, but he worries about the legality of some of the things he did when he worked for Atlantic States Foundry, like getting rid of contaminated wastewater the easy way.

>> You had to pump it out.

>> And held in what, in holding tanks?

>> There's holding tanks but they can't hold their capacity.

When you pump 20,000 gallons of water into a 10,000-gallon tank and it overflows, it runs down out of the storm sewers, it goes wherever storm sewers end up, which is usually in the Delaware River.

>> But I just want to get this clear-- the water's overflowing every day.

>> Uh-huh.

>> Did your supervisor know that?

>> Yes.

>> You mentioned it?

>> Yeah, because I... me and my supervisor were sitting out on a bunch of pipes about 5:00 one morning and I looked at him and I says, "I don't want to go to jail for this," because I realized what was going on.

And that's... >> And what'd he say?

>> "Shhh."

That's when I realized how... what the magnitude of what was going on was, when he said that.

He just looked at me and, "Shhh."

>> NARRATOR: The supervisor in question would not talk to us.

In an exchange of letters and emails, company officials have assured us that overall they are trying to do better.

McWane says it's spending tens of millions to clean up the air and water pollution from their foundries around the country; five million alone at the Atlantic States, where they say they have sealed off the foundry from the town's storm drains.

In a letter to us McWane pointed out that, in the real world, they're fighting for survival, competing against foreign manufacturers who have "little or no regard for the safety of their workers or the environment."

But in Washington, McWane's record may finally be getting some attention.

OSHA administrator John Henshaw.

>> We counted up 420 OSHA violations over a seven-year period.

How can that possibly happen if there's an effective enforcement program going on?

>> I can't speak to the past.

But the fact is McWane has had 595 violations and we've had over 111 inspections of those facilities.

So, clearly they have a serious record with us and we need to do something different.

Because my only concern is that they get the message, that they turn themselves around and manage that company more appropriately.

And fatalities are not accepted practice.

Injuries and illnesses and amputations are not accepted practice.

>> And you think they're going to change?

>> Proof's in the pudding.

>> NARRATOR: McWane says in emails to us that a new company-wide emphasis on safety has lowered their injury rate.

At Tyler Pipe, the company says hundreds of safety hazards have been eliminated.

But a month after our interview with Mr. Henshaw, there was another accident at Tyler Pipe in Texas.

A worker was crushed by a vehicle.

The accident happened October 29, in the middle of an OSHA inspection.

Doctors fought for days to save Guadalupe Garcia's life.

His pelvis and his legs were crushed.

It took hundreds of units of blood to keep him alive.

A week after the accident, they had to amputate both legs.

The accident is still being investigated.

(sobbing) Another family devastated by a workplace accident.

A family friend expressed their grief and anger.

Eloisa Soriano.

>> You hear about "OSHA this, OSHA that."

They should force them to be more safety cautious and avoid this.

This is unnecessary.

The sad thing is this keeps happening over and over and over.

>> NARRATOR: After the McWane story first aired, the Department of Justice took action.

>> The 35-count indictment against Atlantic States and five of its top managers alleges a far-reaching conspiracy within a division of McWane Incorporated.

>> NARRATOR: In all, federal felony charges would be filed against McWane at five separate plants-- Pacific States in Utah; Union Foundry and McWane Cast Iron Pipe in Alabama; Tyler Pipe in Texas; and Atlantic States in New Jersey.

>> Mr. Matlock, would you like to say something at all, sir?

>> NARRATOR: And charges were also returned against ten of McWane's vice presidents, plant managers and supervisors.

>> To cover up those crimes through lies and false statements and to obstruct justice by silencing witnesses.

>> NARRATOR: At the time David Uhlmann was the head of the Justice Department's Environmental Crimes Section.

>> Across the five facilities where we prosecuted McWane, we saw every kind of environmental criminal violation and worker safety violation that you could see, and they were all there at McWane.

>> NARRATOR: He told us that the Department of Justice knew little about McWane before 2003.

>> The reality of how we found out about McWane was we found out about McWane from the news media.

We found out about McWane from Frontline and the New York Times.

>> NARRATOR: Uhlmann led a nationwide investigation of McWane that relied not just on worker safety law, but on the much tougher provisions of environmental law.

>> And the penalties for an environmental crime are greater than the penalties for, let's say, a workers' safety crime?

>> On the criminal side?

They're not even in the same ballpark.

For better or worse, under the current occupational safety and health law in the United States there's not a lot in the way of criminal sanctions available.

The environmental laws provide heightened penalties-- 15 year felonies for knowingly endangering others while committing an environmental crime.

>> NARRATOR: The indictments produced a cascade of convictions.

By 2006, McWane, the corporation, and eight of its executives and managers had been convicted of 125 environmental, health and safety crimes, including violations of the Clean Water Act and the Clean Air Act, as well as obstruction of justice, lying to government officials and conspiracy.

>> The prosecutors who worked in the case said they'd never seen anything like it.

They'd never seen an environment quite like McWane, and they'd never seen a culture of fear quite like the McWane employees described to them.

In addition, the courts imposed nearly $20 million dollars in criminal fines, and government regulators levied millions more in civil penalties.

>> During the 20-year history of the Environmental Crime Section, we had never seen a company that committed criminal violations at so many of its facilities.

There was, in effect, a culture of lawlessness.

This was the McWane way.

>> NARRATOR: In the past, McWane refused even to meet with us.

But this time, when we contacted them, we received an immediate response.

McWane president Ruffner Page wrote a letter saying that, "I welcome the opportunity to share information and talk about the dramatic transformation of our company since the original publication and broadcast."

He also gave us an invitation to "see for yourself what we have accomplished."

And so reporter Lowell Bergman went to Birmingham, Alabama, home to the McWane Corporation for over 80 years.

McWane told us we might be able to interview Ruffner Page at a later time, but first they insisted we hear about their "turnaround."

>> Welcome to McWane.

We're very happy we have the opportunity.

>> NARRATOR: McWane set up a briefing with these new executives, who told us that since our initial broadcast many of the old managers have been forced out.

>> 90% of our senior management is new and we've added over 125 new environmental, health and safety and H.R.

positions.

>> NARRATOR: They told us the company now uses advanced computer programs to track environmental compliance and injuries.

>> Every single recordable injury within the company is posted on the website within 24 hours.

>> NARRATOR: And they told us they have spent more than $300 million on improvements.

>> Money is being spent at a rate as fast as we can manage it.

>> NARRATOR: One of the things they spent money on was hiring new high-powered consultants-- three former government officials-- who McWane says are among the principal architects of the "new McWane": Hank Habicht, a former federal prosecutor who was second in command of the E.P.A.

; Pat Tyson, a former acting head of OSHA; and a familiar face, John Henshaw, who was formerly responsible for overseeing investigations of McWane.

Henshaw, when we first met you were the Assistant Secretary for the Department of Labor.

>> That's correct.

>> BERGMAN: And you were familiar with McWane.

>> I was familiar based on the information that the agency had in regard to their compliance situation.

>> So what was your assessment when they called you up when you got contacted, of the company and what needed to be done?

>> Certainly, I knew they had a considerable amount of issues that needed to be addressed.

They did not have control of their safety and health and environmental issues.

And I thought my conversation was going to be short, but it wasn't.

And it really took... to be convinced, senior management had to tell me.

It had to be Ruffner Page and his direct reports.

Are they really serious about making these improvements?

And they convinced me that's what they intended to do.

>> And when faced with the news reports, the prosecutions and so forth, a company in this kind of an industry and situation is faced with a choice of either making major commitment to accelerate change and become a leader or go out of business.

There really is no middle ground.

>> I met with Ruffner Page, the president.

I was convinced that they were committed to do the right thing.

And I think the results speak for themselves.

There's been a dramatic turnaround in this company.

>> I'm just wondering if people out there would say, "Well, of course these guys are saying this because they're making all this money," right?

You're on their side.

>> I think I can speak for John, I can speak for Hank, and I can speak for myself-- we're not being bought to say what we're saying here.

>> NARRATOR: To back up their claims, McWane provided boxes of documents that describe a concerted effort to improve worker safety and environmental compliance.

>> They say they've changed.

Do you believe it?

>> I think I'm an agnostic on the subject of whether McWane has changed.

I hope they have changed.

I hope they have learned their lesson.

Only time will tell.

>> NARRATOR: To evaluate McWane's claims, we wanted to talk to workers on the plant floor to see if things had changed for them, so we accepted the invitation to tour McWane's plants.

>> What are we going to see now?

>> What we're going to do is we're going to go into the main plant and we're going to see some of our ironworks.

Again, that iron is I say about 2,600 degrees.

Now he's going to slag off, he's going to pull the impurities off the top of that iron.

>> NARRATOR: One thing has not changed: the foundry business is still hot and dangerous.

And there's a nearly constant siren, signaling molten metal on the move.

But the "McWane way" does appear to have changed.

In our original report, unguarded conveyor belts were a major hazard leading to deaths, like Rolan Hoskin at Tyler Pipe.

Today, in every plant we went to, conveyor belts were secured.

And there were guardrails around all the platforms and large machinery.

Another change, because of the investment of tens of millions of dollars in environmental equipment, the air in the plants appeared much cleaner and clearer.

McWane said we could talk to any worker on the plant floor, but they also gathered several for us in a quiet space in the foundry.

>> So, have things have changed since you first came?

>> Things have changed drastically here at McWane Cast Iron Pipe.

When I first started, it was no way safe around here.

You know, it was like I say, "Make pipe, make pipe."

You know, we weren't worried about safety if something broke down, everybody just want to jump in right quick and fix it and try to get back going.

But now we are more safety conscientious here.

>> NARRATOR: And McWane workers told us there are now strict requirements to shut down and lock down machines while they are being repaired.

It's the kind of safety practice that in the past could have saved lives.

>> Five years ago, there wasn't no lock.

>> Didn't exist?

>> You just jump in there and get it done, we got to make a pipe.

>> NARRATOR: Local Union treasurer Samuel Thomas has worked at McWane's Birmingham foundry for 16 years.

He remembers the documentary.

>> When the story first aired, I said to myself, "Yeah, get McWane, get them.

Get them, show them for who they really are."

But after Frontline, things began to change.

>> NARRATOR: Samuel Thomas says they now have a more stable workforce.

>> Five years ago or more, there was a lot of turnover here, people were leaving.

>> Yes, people was leaving because they couldn't put up with the harassment.

We were being harassed a lot.

>> You couldn't speak to management?

>> Oh, no.

Some of them would turn their head before they get to you to keep from doing.

>> Really?

>> Yeah.

>> Because?

>> The McWane way.

>> That's the way the McWane way was then.

>> The old McWane way.

>> And now?

>> The new McWane way-- not only will they speak to you, they'll grab your hands and shake your hand and say, "How are you doing today?"

It mean a lot.

>> NARRATOR: Independently, Frontline spoke to dozens of other workers here in Birmingham and at McWane's once-troubled foundries across the country.

They all confirmed that McWane has changed, even in Tyler, Texas, where so many deaths and injuries had occurred.

>> Well, it's really improved.

I feel a lot safer working here, to be honest.

I wouldn't say that if I didn't mean it.

>> You can always get better.

But right now, it's a whole lot better than what it was.

>> NARRATOR: McWane insists that some of its 27 plants, like this one in Iowa, have never had serious problems, and, in fact, have been recognized by OSHA for their safety record.

According to outside audits, McWane's injury rates for 2007 will now be below the industry average.

>> They're not perfect and they're going to make mistakes.

But they're committed to doing the right thing, and they're on the path to being the industry leader.

And I think many people would say they are already well, well on their way to being there.

>> Their environmental performance has improved and their record has improved dramatically and they actually encourage and reward people to find things early and take action to correct them.

>> NARRATOR: Even one of McWane's severest critics, the man who sued them in Birmingham for environmental violations, says they have cleaned up their act.

>> Well, they're not dumping all their excess stuff in the creek at midnight anymore.

They went from being a real crappy organization where they were very low level in compliance, and now, you know, they're paying attention to safety, they're paying attention to environmental law.

They have spent a hell of a lot of money.

They also got sued civilly, so they've had to pay a pretty high price for, you know, running barefoot there with ignoring the regulations for years.

So I gave them, at this point, I guess I give them a nine, or something like that.

>> NARRATOR: But Bart Slawson says that without the prosecutions, publicity and lawsuits, the company would not have changed.

>> Finally, now that they got caught and they got all this negative attention here and all over the United States and the civil suits, I think they're finally realized that, "Yeah, we got to join the 20th century and we got to operate like a regular citizen here in this community."

>> NARRATOR: McWane had held out the possibility that Frontline could interview this man, company president Ruffner Page.

After intense negotiations, he finally agreed to appear on camera, but not to answer questions-- only to read from a written statement.

>> In 1999, when Phillip McWane, our chairman, and I, became responsible for this 80-year-old collection of heavy foundry businesses, we learned we had work to do and we started immediately.

>> NARRATOR: Ruffner Page had told us during negotiations that they started the process of correcting the problems "long before the prosecutors interviewed their first witness."

>> Changing a culture takes time.

We set out our expectations of workplace behavior and teamwork that we were looking for from our employees.

>> NARRATOR: He also maintained that in the 1990s, the company grew rapidly with plants spread across North America, and that, "McWane in Birmingham really did not have a handle on all the problems."

>> Some of our managers decided not to follow this vision of teamwork, and retired, resigned, or were terminated.

>> They say, "Well, these were just a bunch "of bad supervisors, but this isn't the company as a whole."

>> I don't see how you can say this is just a bunch of bad managers.

You don't have the kind of violations that we saw at multiple facilities within a company and not have a cultural problem within the company, not have a culture where it's okay to break the law.

>> NARRATOR: Ruffner Page would not comment on any of their criminal cases, including convictions related to the deaths that had happened while he and Phillip McWane were running the company.

As in the past, Phillip McWane would not talk to us.

But in 2005, he did go into federal court in Birmingham, and made a statement apologizing for the company's conduct at McWane Cast Iron Pipe.

For some of the people who used to work at McWane foundries across the United States, the coming of the new McWane was too late.

Marcos Lopez, who broke his back at work, is still partially disabled.

Ira Coffer says he was forced to retire from Tyler Pipe last year.

>> I lost what I should have had the rest of my life.

If it hadn't been for, you know, them working people like they were working people, I don't think I would have lost my arm.

>> NARRATOR: Guadelupe Garcia, the man who was crushed by a truck in late 2002 and barely survived, is getting along as best as he can.

Mr. Garcia told us that he could not talk to us because of the terms of the settlement of a lawsuit he had brought against McWane.

As for former plant manager Robert Rester, who blew the whistle?

He struck a deal with prosecutors, and then testified against McWane in Birmingham.

>> Before I became a whistleblower I was making as much as $130,000 a year.

A few years ago working for McWane, Incorporated-- a company that I worked for for 24 years-- and now I'm a garbage man making $20,000, $25,000 a year and starting all over again.

I lost it all, everything I had-- horses, Harley, guns, the house and land where I used to live.

I don't regret it.

I mean, of course, sometimes I look at what I've lost and what I could have now.

But I still feel like I did the right thing.

>> NARRATOR: Rester says he is disappointed that despite all the convictions, to date, only one McWane executive has served any time in jail.

>> I just wonder sometimes why, when supposedly I did something good, that it cost me everything I've worked for all my life.

But yet the ones that did all the bad stuff are still getting big paychecks and driving fancy cars.

And, you know, the bad ones, and I'm supposedly a good one that helped a lot of people but yet I lost it all.

I don't understand that.

>> You never charged Ruffner Page, the C.E.O., or Philip McWane, the owner, he owns the whole company.

>> In terms of individuals and corporate officials within McWane, we went as high within the organization as the evidence allowed us to go.

For us to have brought charges against anybody higher up in McWane, we would have needed cooperation that we never got from the plant managers at the various McWane facilities.

>> NARRATOR: The final chapter in the story of the old McWane is not yet over.

This spring, the company faces sentencing in the Atlantic States case, where they were convicted of 52 felonies after the longest environmental crime trial in U.S. history.

In the Birmingham case, almost all of the charges against McWane and their employees resulted in convictions.

These convictions were reversed on appeal, with the court ordering a new trial for the company and two of its executives.

All of the McWane prosecutions have given the Department of Justice a new model, a way around, in some cases, the weakness of the OSHA law.

But the OSHA law itself still has not changed.

>> It should be a felony violation if you willfully commit a worker safety violation that results in a worker death.

I don't think there's any question that that should be a felony.

Do you think we'd be talking about a new McWane today if all we could have done in the various McWane prosecutions was hit them with misdemeanor sanctions?

We wouldn't be hearing about a new McWane today.

There's always companies that don't think it's important to comply with the law, and for those companies you need a strong enforcement scheme to bring them in line and to make sure that crime doesn't pay.

>> Next time-- once, Mormons were hated, persecuted, exiled.

Today, they're 12 million strong.

Follow their astonishing journey from the margins to the mainstream and discover the truth about America's most controversial faith.

"The Mormons"-- a Frontline/American Experience special presentation.

>> To order Frontline's "A Dangerous Business Revisited" on DVD, call PBS Home Video at 1-800-PLAY-PBS.