Opinions - Industrial exemption PE 1

[Rich2001]

What do you think/ ( Copied from a posted mid Aug 2002 - NSPE website)


Corporations that are public stock owned companies are created and financed with the sale of stock to investors (the public). They, the investing public, become the owners and look to their investment in companies for them to design, produce and sell products/services which are safe from harm and return a profit, from which they may receive a dividend and an increase in value of their stock as market forces give positive value to it.

These companies have a Board of Directors, which represents the owners (public), Management and Engineers. So in reality, engineering done in these publicly owned companies is really done with the intent to protect the owners (public) and in reality is done for and on the behalf of the investing public stock owners as well as the consuming public who buy the products/services.

How is this any different from a civil engineer consultant who designs a water treatment system for a public government entity (a town) being required to be licensed? They only differ in the manner in which the public (owner taxpayers) engages them. In the consultant's instance, the public goes through a governmental entity, maybe a town council or a county commission, which acts just like a publicly owned company's Board of Directors does. The governmental entity contracts for the P.E.s design services on a consulting basis rather than on a Manager/Employee basis in a company. But the end is the same, to affect a safe design so the ultimate public (a tax payer in one instance or a stock investor in the other) is protected. But in the case in industry, the powers to be were able to politically get engineer employees exempt in industry whereas the Consultants are not.

 

[MASSEY]

I think:

The NSPE is asking for trouble. The industry exemption will never be repealed or overturned.

Engineers in industry are exempt because the company principals are responsible for what the company does. One possible negative result that could occur from a debate such as this is that cities and boards may hire a non-licensed consultant if the city or board assume full responsibility for the entire project from start to finish and then on indefinitely.

I do not think that the NSPE would want to see that happen.

 

[Rich2001]

This was not posted nor developed/supported by NSPE it is a copy from their forumn that someone posted, awhile ago. I just thought that it was something to think about.

 

[GregLocock]

Look at it the other way - if all engineers were personally responsible for their work, and their employer was not responsible, then who would be a crash engineer in the car world? The system is too complex for any one person to be responsible, and in a very real sense the decision on cost vs safety is made by the entire product engineering process.





Cheers

Greg Locock

 

[MASSEY]

Isn't your source referenced "-NSPE website"?

It may one person's opinion, but by leaving it at a NSPE website it "appears" that they support such discourse.

In this one person's opinion.

 

[chubPE]

I'm thinking that the development cycle is beginning to far exceed the capacity filled by licensed engineers. You can not stop advancement, and you can not control innovation. You can not retard the desire of consumer satisfaction. Regulations are but an obstacle.

 

[PM]

Rich2001 poses at least one, if not more, interesting public policy questions. In Canada and much of Europe, they don't have the US system of industrial exemptions. In Canada you practice Professional Engineering, you must be registered. Yes there are Crown exemptions for Government P.Eng.'s, but to my knowledge all Canadian provincial and federal jurisdictions waive their exemptions and require their engineers to be registered. (This even includes the military.) Undoubtedly there is a substantial economic cost for this higher average cost to deliver engineering services as opposed to the US where registration is not universially required.

On the other hand, the US has demonstratively more product liability claims and associated injury litigation than almost all the remaining western economies combined. Some would argue this results from less professional engineering input to product development, design and manufacture. That's an open question. Undoubtedly there is a substantial economic cost for this higher average cost to deliver products than elsewhere. Before some jump on this point, remember that much of the higher product costs in Europe and Canada results from taxes unrelated to the costs of production. This is the way many public services are paid for in some countries.

The question is which costs more? If you're a person injured from a faulty product you may have a different opinion from others.

If I might add one other point to Rich2001's excellent post, namely that PE's, P.Eng.'s and CE's are all required by law to put their duty of care to the public ahead of their duty to their client or themselves. To this extent then, PE's working for an industrial client are not working on " . . .behalf of the investing public, stock owners, as well as the consuming public . . .", but in fact are serving the interest of the entire public, . . .even those who are not stock holders or consumers of the specific product.

Regards,

 

[testy]

Could it be the US is just a more litigious society? I think the problem is not too few Engineers, but too many Lawyers

 

[PM]

To be sure, the US is the most litigous in the world. Is this because of an excess supply of lawyers, or an excess demand due to faulty products? Some would argue that the supply of lawyers expands to fill the demand. For every US citizen that decries the glut of lawyers, there must be 2 or 3 that are hiring lawyers to recover damages.

I assume the premise of the original post, is whether greater effort should be applied in product development, design, et cetera.

Regards,

 

[testy]

Do people in other countries sue the manufacturers of US products as much as we American's do? I don't know, but if not, this seems to point more to greed and a lacking of self accountability. As a machine designer, I have to design guarding not so as an ingorant or inexperienced person won't get hurt, but so that a smart person can't easily defeat it.

 

[Hush]

I believe the primary reason for the excessive number of lawsuits in the US is the existance of punitive damages. These don't exist in most other countries so the most you will collect is your actual damages. In other words if you drop a hot coffee in your lap in Toronto you'll likely only collect for your cleaning bill and a weeks lost wages while you recover, not the millions you might expect south of the border.

Aside from that, why do we assume that a PE will exhibit a higher duty of care than an engineer practising under the industrial exemption rule, just because of a sentence in a code of ethics? Because of the litigation issue any engineer, PE or not, is likely to be more careful than a P. Eng. north of the border. I would think the larger issue would be whether a person practising engineering under the industrial exemption is technically qualified to be doing so. I have had experience dealing with small mom and pop shops in the states producing pressure equipment components where the 'engineer' has a high school diploma and a 2 week course in autocad.

 

[BobPE]

testy:

I would like to expand you comment to the following:

too few engineers, too many lawyers!!!!!!!


BobPE

 

[PSE]

As I write this I am reminded of a drawing sitting upon my work desk. It has five individual approvals on it. Say that they were all PE's and a problem arose that was traced to this component. Who would be responsible (liable) for potential damages caused? Perhaps some, or even all of the original approvers were no longer employed with that company. Should a statute of limitations apply to any approvals? This I believe is where the Industrial Exemption came into play. In a environment where the employee pool is in a constant state of flux, the corporate entity becomes responsible for the products they produce.

I do not see the industrial exemption going away within the US. I agree with testy that the allowance for punitive damages (awards) has created significant opportunities for abusive lawsuits. There seems a pervasive tendency to not take responsibility for one's own actions. It is much easier to blame someone else and then hopefully make them pay.

Regards

 

[BobPE]

PSE:

If the drawings were produced by a firm, the liability transfers to the firm since the liability insurance covers all the seals in the firm, regardless of where the person named on the seal is. The industry exemption will go away and I think the lawyers will make sure it does because in court, non PE's hold no credence and defense of companies is hard to do making large payouts common practice, unfortunately, even when the company was not in the wrong in some cases. These large payouts are a resuly of lawyers running rampent, you are right, but the lawyers are not being stopped by PE's in the battlefield of the courts. I think once industry sees this (their lawyers wont tell them on their own) you will see a fundumental change in PE's status simply because of the money factor.

BobPE

 

[Hush]

Question 1.

Why do you think anyone would anyone bother to sue the engineer of record when the company he works for has the deeper pockets? Unless of course the engineer of record owns the company. Having a PE isn't going to make you any more vulnerable to a lawsuit, it only makes you more accountable to your peers.

Question 2.

Why would an insurance company provide liabilty insurance to a consulting engineer who wasn't a PE? In the end I suspect it will be the insurance companies who force the issue.