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NASDAQ: PTEN 9.71 +0.04 +0.41% Volume: 3,546,702 Pricing delayed by 20 minutes September 23, 2019

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At Patterson-UTI, our people are our most important asset and our greatest strength. We are committed to their safety, health and well-being and to the protection of the environment in which they work and live.

Health and Safety

Our goal is to provide an incident-free work environment. It takes everyone at the jobsite working together as a team to establish safe work practices and achieve this goal.

Safety and Environment

We believe that the safety and well-being of our employees and the protection of our environment is a cornerstone, and we are committed to providing a safe, incident-free work environment for all.

Our managers and supervisors are accountable for the safety of our people and committed to ensuring that they have safe working equipment, required personal protection and training for their tasks. We designed the Patterson-UTI Health, Safety and Environment management systems to document the policies, standards and procedures by which we conduct our business in order to achieve these objectives.

Health, Safety and Environment Incident Review

In our pressure pumping business, we review incidents to facilitate consistency regarding assignment of severity, reporting/recording practices and assignment of corrective actions, as well as to identify opportunities for communication of lessons learned.

Ongoing Assessment of Risk Potential

When assessing risks, all identified hazards are eliminated, if possible. For hazards that cannot be eliminated, our goal is to reduce them as low as reasonably practicable (ALARP) utilizing the hierarchy of controls (Engineering, Administrative, Personal Protective Equipment).

Our employees intentionally and continually assess risk potential to control the expected safe outcome of each task and, prior to performing any job, are instructed in every policy to complete an appropriate level of risk assessment. We expect employees to conduct dynamic risk assessment throughout the job and to exercise the authority to call a Time Out for Safety (TOFS) if identified risks are not mitigated.

Stop Work Authority

The safety of our employees and others is our highest priority. At any point, our drilling employees are empowered to call a TOFS. A TOFS is used when:

  • An identified risk cannot be mitigated.
  • An unsafe act or condition is observed.
  • Anyone is uncertain, concerned or confused about instructions for a job.

Our pressure pumping business empowers employees with a similar stop work authority. We believe there is no job worth performing if it cannot be performed safely. Safety meetings and "Energy Circle" briefings are also tools we use to identify risks.

Permission to Work

Our Permission to Work program is a formal system of control for all contract drilling jobsite operations. Our system focuses on the Jobsite Manager’s permission to control the job rather than a permit. Each job task is categorized based on a risk assessment associated with the expected scope of work, hazard associated with the job and the appropriate amount of supervision required. For example, we pre-categorize critical jobs utilizing a color code system that illustrates the severity of the activities, while defining the appropriate level of supervision. Our Jobsite Manager then verifies the work is ready to begin and gives permission for the job to start by signing the certificate. After completion of the work, the Jobsite Manager must conduct a post job examination of the worksite, close the operation by signing the certificate and conduct a post job review. The goal of this system is to help us to control the outcome of each job in a safe, efficient manner.

Maintaining Our Standards

In our contract drilling and pressure pumping businesses, we routinely evaluate contractors to ensure they have the ability to meet both Patterson-UTI and our customers’ HSE requirements. In our evaluation process, we review and evaluate contractors prior to hire based on HSE statistics and selected HSE policies and procedures. We are currently in the process of upgrading our evaluation system to more efficiently maintain our standards.

Industrial Hygiene Management Policy

We understand the importance of occupational health as our employees work in many different environments and conditions. We assess these conditions with industrial hygiene management policies that include: respiratory protection, hearing protection, hazard communication (HAZCOM), weather risk mitigation and industrial hygiene monitoring.

We perform industrial hygiene monitoring to evaluate and document potential exposure to biological, chemical and physical hazards at Patterson-UTI jobsites and facilities which includes:

  • Workplace hazard assessments conducted for each yard, shop and rig location
  • Crew houses monitored and inspected on a periodic basis
  • Periodic occupational exposure monitoring

Comprehensive Incident Management System (IMS)

In our contract drilling business, our policy requires that any incident, including any near hit, is reported to the Jobsite Manager on location and recorded and tracked into IMS. The incident is then reviewed and classified based on its actual and potential severity. The purpose of the IMS program is to establish the requirements for how work-related incidents and near hits are reported, investigated, corrected, recorded and communicated. We have a similar process in our pressure pumping business.

Cloud-Based Feedback System

We expect our employees to actively participate in crafting our processes and procedures, and we encourage everyone to approach their supervisor with suggestions for improvement and, in our contract drilling business, to use our readily-available computer-based feedback system. Our contract drilling business’s cloud-based Management System houses the policies, procedures and standards that define the Company’s expectations concerning safety and operational processes. The Management System also includes technical standards, forms, inspections, audits and other supporting documentation for daily operations. Employees have the opportunity to take ownership of Patterson-UTI policies and procedures by providing direct feedback and/or suggestions using our Policy Improvement Request (PIR) system. If there is a need for clarification or the expansion of existing processes, employees can submit their requests. Since this program started, we have received over 700 Policy Improvement Requests, averaging approximately 100 per year.

Ongoing Safety Training

At Patterson-UTI, we invest in training our employees to be responsible for the safety of their own actions in order to protect themselves, their team members and others. Learning is a core focus. Our training programs, both classroom and on-the-job, give our people a clear path for success right from the start. We coach and we mentor. Continuous learning is our way of life.

As such, we require all field-based employees to take Employee Safety Orientation (ESO). Courses include content on Behavior-Based Safety, Hazard Awareness, Safe Systems of Work, Permission to Work, Time Out for Safety, Energy Isolation, Hazard Communication (HAZCOM), Material Handling, etc.

Spotlight on Employee Safety Training Courses

Course Name 2018 Attendance YTD 2019 Attendance
Employee Safety Orientation (ESO) for New Employees >3,700 >400
Rig Fundamentals* >2,700 >300
Well Control for Drillers* >400 >100
Well Control for Supervisors* >600 >300
Cold Weather Training (eLearning) >5,300 >400
Hot Weather Training (eLearning) >6,700 >4,500

*Applies to contract drilling business.

Our goal is for 100 percent of relevant personnel to be trained on HAZCOM. This comprehensive HAZCOM program is in place to classify and relate health information of all chemicals and products used at Patterson-UTI jobsites to all personnel and includes:

  • Safety Data Sheets (SDS) for Patterson-UTI purchased chemicals available in an online database at all our jobsites.
  • Guidelines to ensure proper container labeling using the Globally Harmonized System (GHS).
  • Employee training for all personnel on potentially hazardous chemicals in the workplace.

Cornerstones for Life

The “Cornerstone for Life” rules provide our employees with extra focus on potentially high-risk activities where we believe failure to follow rules could lead to a much higher probability of serious injury or fatality.

Cornerstones for Life are tailored for our contract drilling and pressure pumping businesses to highlight safety expectations at all jobsites. Patterson-UTI employees, contractors and visitors are required to adhere to these rules. Some examples of our Cornerstones for Life include:

  • Utilize our Permission to Work process without fail.
  • Follow our Fall Protection Policy.
  • Properly isolate energy to equipment when appropriate.
  • Follow appropriate Management of Change protocols.
  • Take appropriate precautions when working around overhead power lines.
  • Wear seatbelts when operating a Company vehicle or forklift.
  • Ensure that appropriately sized Tubular Handling Equipment is utilized.

Health and Benefits

Our health and benefits program provides for extensive preventative care and is designed to improve our employees' fitness for work, personal safety on the job and overall well-being.

Diversity and Inclusion

At Patterson-UTI, we are committed to fostering a work environment where all people feel valued and respected. We are proud of our workforce, where all employees can contribute to the success of the Company, drawing upon their unique backgrounds, perspectives and life experiences. In return, Patterson-UTI embraces its diversity of people, thoughts and talents, and combines these strengths to pursue extraordinary results for the Company, our employees, and our stockholders.

We understand that in today's dynamic marketplace, a diverse workforce is imperative in order to remain competitive and to meet our customers' ever-changing needs and expectations. The blend of our employees’ different backgrounds, cultures, skills and experiences enables us to develop and implement cutting edge technology, utilize collaborative problem solving and foster innovation. We are committed to the recruitment and retention of candidates from all different backgrounds and ethnicities, including current and former members of the United States military.

Our leaders are responsible for promoting and maintaining Patterson-UTI’s commitment to a diverse and inclusive workplace. To ensure we are adhering to this commitment at all levels of the organization, our Vice President of Diversity & Compliance, in coordination with our Vice Presidents of Human Resources for Patterson-UTI’s respective businesses, meets periodically with our business leaders to review and discuss our efforts regarding diversity and inclusion, which may include reviewing information regarding hiring, promotions, and the retention of employees.

A Respectful Workplace for All

Patterson-UTI’s Equal Employment Opportunity and Anti-Harassment Policy (“Policy”) prohibits discrimination or harassment of any type and affords equal employment opportunities to all employees and applicants, without regard to age, race, sex, color, religion, national origin, disability, marital status, covered veteran status, genetic information, sexual orientation, gender identity or any other characteristic protected under state, federal or local law.

Respectful Workplace

We are committed to providing a working environment for all employees that is inclusive, respectful, and supportive

This Policy also sets forth reporting procedures for raising workplace concerns. We expect and encourage employees to report concerns and provide several avenues through which they can do so: a supervisor or manager, Human Resources or our anonymous hotline (referred to as the “SHARP Hotline”) by phone or web submission. We take each complaint seriously, investigate it and take appropriate disciplinary action as needed. All of our Human Resources professionals receive robust investigation training from a third-party expert, which includes education around employment laws and best practices for conducting neutral and objective investigations. We are also committed to providing a work environment free from any form of retaliation for those that report a workplace concern.

Each employee is expected to share Patterson-UTI’s commitment to mutual respect for all co-workers, vendors, customers, third parties, and business partners by demonstrating common courtesy, civility and professionalism. In return, each employee should expect to be treated the same way.

Patterson-UTI also requires all of its employees to complete training on an annual basis regarding its commitment to a respectful workplace for all. Supervisors and managers are required to complete additional respectful workplace training each year to ensure that they understand our expectations for them regarding their obligations to promote a work environment where all employees feel valued and respected.

Talent Management

Developing our people is one of our core values. We are committed to the growth and development of every employee. To that end, we have established a culture of learning delivered in the form of classroom-based instruction, eLearning and on-the-job training. We are committed to recruiting, hiring and retaining the highest caliber talent for our business by utilizing outreach initiatives and partnerships with a diverse group of organizations, industry associations and networks. We offer our workforce the opportunity to advance in their professional careers through intensive, multi-day classroom training programs in numerous skills and competencies as well as management training programs. These programs are geared to providing our employees with opportunities to advance throughout our Company.

Development of our People

We are committed to the growth and development of every employee

Our people are our most important asset, and the development of our employees is key to the long-term success of our Company. Training in our contract drilling business is centered around four principles:

  • Lead and manage our people.
  • Manage the business to achieve our goals.
  • Efficiently and proficiently operate and maintain our equipment.
  • Partner with our customer to achieve both our goals.

The purpose of this policy is to see to it that every contract drilling business employee has access to quality training and development both internally and externally to ensure operational excellence, personal and professional growth and an incident-free workplace.

Employee Engagement

We periodically hold employee engagement sessions, which can take the form of small group sessions or larger town halls. The feedback from these events is reviewed by business management and Human Resources for further action.

For example, after reviewing the feedback received during an employee focus group session, we developed a new course, The Art of Communication Workshop, which provides the tools and tips to help leaders have more meaningful and effective communications with others.

In addition, management participates in field-based audits. These audits contain questions to verify our employees’ awareness and understanding of the Company’s policies, procedures and expectations. During these audits we engage our employees to determine their overall well-being, their perspective on issues regarding the development and advancement of their career path and any other concerns they may want to share.

PTEN Path

PTEN Path, a development program, provides employees with the tools, knowledge, skills and abilities needed to successfully work on and progress through the various positions on the drilling rig. PTEN Path is currently being used for our contract drilling employees, and we expect to expand this program to our pressure pumping employees. From an employee who is new to the industry, to one in a supervisory position, PTEN Path provides employees with a clear career Path within Patterson-UTI. As employees progress though the program, they complete classroom-based training (which includes instructor-led and self-paced E-Learnings), mentor-guided on the job training and specialized training with industry professionals for advanced rig technologies and drilling practices. Throughout the process, employees are evaluated by their mentors and supervisors to ensure their proficiency.

PTEN Path Completions

Position Date training launched Total in 2018 YTD Total in 2019
Floorhand October 2018 >900 >900
Motorhand February 2019 >600
Derrickhand May 2019 >400
Driller August 2019 - -

We also offer the following learning and development programs:

  • New Employee Orientation (NEO): All new hires are required to attend the NEO class. In 2018, over 4,100 employees attended, and over 400 attended YTD as of the second quarter of 2019.
  • New hire onboarding classes: These classes provide new employees with an overview of Patterson-UTI and introduce them to our core value of safety.
  • N2I hands-on station training: This training teaches New to Industry (N2I) employees the fundamental competencies needed to work on a rig.
  • Rig on-the-job training: Employees are assigned to a rig to work as an extra member of the crew. A qualified rig employee will be assigned to train, mentor and verify that the new employee can safely and effectively perform the required job tasks.
  • Teaching and mentoring: Employees are taught how to complete each task using the training checklists and policies provided. We use the See One, Do One, Teach One method of training.
  • Supervisory training: Our employees are trained and developed in various skills and competencies and provided further leadership and management skills training in order to be able to progress within our organization.
  • Frontline leadership: Frontline Leadership is a class designed to teach leadership content to employees who are working in their first official leadership role. Over 500 employees took advantage of this course in 2018 and over 300 had attended YTD as of the second quarter of 2019.
  • Introduction to successful rig management: Employees in supervisory positions attend this highly interactive three-day course. Leaders of the Company from a variety of areas discuss with our employees:
    • How to Lead and Manage our People
    • Managing the Business of the Rig
    • Maintaining our Equipment through Asset Integrity
    • Customer Focus through Supply Chain
    • Working Incident Free – Root Cause Analysis

Human Rights

Patterson-UTI respects and values human rights. We aim to treat all human beings with honesty, fairness and dignity in all aspects of doing business. We are committed to compliance with all applicable employment, labor, and human rights laws of the countries in which we operate.

Human Rights Policies

Our Equal Employment Opportunity and Anti-Harassment Policy prohibits discrimination or harassment of any type and affords equal employment opportunities to all employees and applicants, without regard to age, race, sex, color, religion, national origin, disability, marital status, covered veteran status, genetic information, sexual orientation, gender identity or any other characteristic protected under state, federal or local law.

We have a Conflict Minerals Policy that outlines our commitment to responsible sourcing of materials for our products.

Our Code of Business Conduct and Ethics outlines the standards and principles that all employees, officers and directors must follow when working with co-workers, vendors, customers or other third parties. The policy addresses conflicts of interest, confidentiality, fair dealing with others, proper use of Company assets, compliance with laws (including anti-money laundering laws, anti-trust laws, anti-boycott regulations, and global trade laws), insider trading, keeping of books and records, zero tolerance for discrimination and harassment in the work environment, as well as reporting of violations.

Stakeholder Engagement

We integrate public comments and official guidance from regulatory and enforcement agencies in formulating our policies. We are members of industry groups (such as International Association of Drilling Contractors (IADC)) and attend roundtables where stakeholder issues are discussed and consider peer company practices. We also take into account employee feedback and suggestions on our policies.