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LOS ANGELES-The Los Angeles subway project will conduct a wall-to-wall safety inspection after the Feb. 15 death of a construction worker.

Meanwhile, liability insurers for the Metropolitan Transportation Authority have agreed to pay $12.3 million to three men injured in a July 1994 subway tunnel explosion, settling a lawsuit that had gone to trial earlier this month.

The subway project's safety record is once again under fire, with critics accusing subway contractors of underreporting workplace injuries to state and federal authorities.

The latest developments come less than two weeks after former MTA Risk Manager Abdoul Sesay was sentenced to 14 months in federal prison for accepting more than $140,000 in bribes.

MTA Chairman Larry Zarian ordered the subway tunnel inspection after Jaime Pasillas, 52, died when one of two chains holding a half-ton refuse bin broke, sending it crashing onto his head.

A four-man team of inspectors, led by MTA Construction Safety Director Dan Jackson, "will walk every inch" of the tunnel segment being dug just east of the intersection of Hollywood and Vine, according to Mr. Zarian.

"Every piece of equipment, including chains, will be checked," he said at a news conference last week.

"MTA safety inspectors also will meet with the contractors to review how the equipment is maintained as well as conduct a thorough review of all onsite safety policies, procedures and programs," Mr. Jackson said.

MTA officials also are cooperating with the California Occupational Safety and Health Administration, the Los Angeles County District Attorney's Office and other authorities investigating the fatal accident, Mr. Zarian said.

The accident occurred less than a week after attorneys representing the MTA settled a lawsuit filed by three construction workers injured in a July 1994 tunnel explosion.

The MTA carries a $500,000 deductible. Beyond that, the first $2.5 million of the $12.3 million settlement will be paid by Argonaut Insurance Co., an MTA spokes-man said.

Argonaut served as the primary liability insurer on the project until last year, when American International Group Inc. took over (BI, July 8, 1996).

The remaining portion of the settlement will come from excess coverage underwritten by syndicates at Lloyd's of London, the MTA spokesman said.

Although the employees received workers compensation benefits from their employer, they also were able to seek damages from the MTA as the project's owner, explained Robert Cardwell, a partner with Tharp & Howell in Los Angeles who defended the case at trial.

"It's illogical, but it's still possible for them to do that," he said.

The workers were employed by contractor Shea-Kiewit-Kenny, which the MTA hired to help build the subway, he explained.

Meanwhile, critics again are charging that more injuries may be occurring during subway construction than the MTA is reporting to state and federal workplace safety authorities.

The MTA reports only lost-time cases, not less severe injuries that require only first aid.

But Mr. Zarian insists the MTA's safety record compares favorably with other major transit projects in the United States.

For example, the incidence of lost-time cases for contractor Tutor-Saliba/Perini in the section of tunnel where the worker died was 2.2 per 200,000 man-hours, compared with the national average of 4.9 in 1996.

However, the incidence rate of recordable injuries for that section was 15.5, compared with a 1996 national average of 11.8, MTA critics point out.

The MTA's safety record has repeatedly come under fire since the subway project began in September 1986.

A 1992 engineering report and a congressional analysis found that the project safety incentive program may lead to underreporting of accidents (BI, June 17, 1996).