OceanGate asked workers to forego paychecks, former employees tell investigators probing Titan implosion

(CNN) — The company that built and operated the Titan submersible asked employees to forego their pay as it faced economic challenges, according to former employees testifying before the US Coast Guard panel probing the vessel’s deadly implosion last year.

OceanGate employees were asked to “defer our paychecks” at the start of 2023, Amber Bay, the company’s former director of administration, said Tuesday as part of a two-week hearing before the Marine Board of Investigation – the highest level of Coast Guard inquiry.

The board is reviewing the cause of the June 2023 implosion during the submersible’s dive to the Titanic, which claimed the life of OceanGate CEO Stockton Rush and four others: businessman Shahzada Dawood and his 19-year-old son, Suleman Dawood; businessman Hamish Harding; and French diver Paul-Henri Nargeolet.

“We were looking to make ends meet,” Bay said, describing “an offer that Stockton had derived, I believe with an attorney or whomever, that we could delay our paychecks and be paid a small amount of interest and recapture it at a specific time.”

“I believe the finances were just getting very tight at that time,” Bay said. She said she and Rush delayed their paychecks. She said the request was made only once.

Bay’s testimony echoed that of Phil Brooks, OceanGate’s former director of engineering, who indicated he believed the request illustrated economic challenges for the Everett, Washington-based company – challenges that resulted in sacrifices to safety.

OceanGate, Brooks said Monday, asked employees to volunteer “to forego getting paid for periods of time with the promise that they would get us caught up in paychecks after the first of the year.”

“I don’t think anybody did it, but it was clear that the company was economically very stressed and, as a result, that they were making decisions and doing things that resulted, I felt, that the safety was just being compromised way too much.”

Regarding safety, Brooks specifically pointed to a need for him and others under him to work on the submersible at sea, as it rested on a platform that “bobs up and down” while being towed by its mother ship or anchored.

“I just did not see that I could do that … The reasons were economic reasons, and I suggested that they not go, that it was just not a workable solution … It was just too dangerous,” he said.

The company’s economic and safety issues caused Brooks to leave OceanGate, he said.

Bay, however, denied witnessing “a desperation” within the company to meet expectations. While Bay acknowledged an “urgency to deliver on what we had offered, and a dedication and perseverance towards that goal,” she said the company “wouldn’t do anything from my purview or conduct dives that would be risky just to meet a need.”

“There was definitely checks and balances in place to make certain things were operating as safely as possible,” she said.

In a statement to CNN, OceanGate expressed its “deepest condolences to the families and loved ones of those who died in the tragic implosion of the Titan.”

“OceanGate, which is no longer an operating company, having ceased all business activity shortly after the tragedy, and which has no full-time employees, is a party in interest in the Coast Guard proceeding,” the statement said. “The Company has been fully cooperating with the Coast Guard and NTSB investigations since they began, including at the ongoing public hearing convened by the Coast Guard.”

Since the Marine Board of Investigation hearing began September 16, the board has heard testimony portraying OceanGate and Rush as prioritizing profits over science and safety, disregarding repeated warnings from individuals like David Lochridge, the company’s former director of marine operations.

Lochridge raised safety concerns about the company’s operations, he testified, saying he had “no confidence whatsoever” in how the Titan was built.

“It was all smoke and mirrors,” Lochridge said. He was fired from OceanGate in 2018.

‘Mission specialist’ term was meant to dodge US regulations, witness claims

The Marine Board of Investigation also heard testimony Tuesday from Karl Stanley, a submersible operator who claimed OceanGate’s decision to call clients “mission specialists” was meant to help it flout regulations.

“I don’t agree with the term ‘mission specialist,’” said Stanley, who told the board he knew Rush for more than a decade. Asked why, Stanley responded, “It’s clearly a dodge of trying to get around US regulations with passengers.”

Bay was also asked a series of questions Tuesday aimed at discerning whether “mission specialists” – OceanGate’s clients who paid for their voyages to the site of the Titanic – were true employees.

She acknowledged they were not – that they were not given shares of the company, did not qualify for workmen’s compensation benefits if they got hurt, did not receive OceanGate’s health care benefits and the company did not collect income taxes from mission specialists.

Stanley also testified about participating in a dive off the coast in the Bahamas in April 2019, when loud noises were heard from the Titan’s hull.

“The cracking sounds would amplify when you got deeper. And at some point, I don’t remember who, we were all like, well, that’s probably close enough. We’ve been down here long enough, and we went back up,” Stanley said.

As the submersible got closer to the surface, Stanley testified, “There was a grand finale of cracking sounds.”

When he learned of the Titan’s disappearance, Stanley said, “I was 100% sure they had imploded.”

“The definition of an accident is something that happened unexpectedly and by sheer chance,” he said of the Titan’s implosion. “There was nothing unexpected about this, this was expected by everybody that had access to a little bit of information.”

CNN’s Ray Sanchez contributed to this report.

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