NFPA 70e is the short answer. Determining arc flash PPE, and when it's required can be difficult. Historically, you and I, and everyone else in the trade, would open 480v distrbution panels without a second thought, in the process subjecting ourselves to arc flash potential. To my knowlege, OSHA has not yet put effective teeth into NFPA 70e. Meaning, it's a good idea to protect yourself, but in most places there are no penalties. Someone please tell me if I am wrong. However, as a supervisor, I require my workers to wear appropriate PPE; including rated shirts, glasses, etc. when exposed to an arc potential. To me it's not worth the risk.
A label that states an 'arc flash hazard is present' is required, but what needs to be required is a label that states the hazard level. This is measured in the 'energy/calories per centimeter squared' that can be released. When you have this number you can look at the PPE table and it shows what level of PPE is 'required' to protect the worker. Mind you, protect in this case means that you survive. Second and third degree burns are considered acceptable in some sense. Determining the energy released is the result a rather complicated formula which includes distance from the arc, the amount of time it takes to trip the OPCD and available fault current. Even the most sophisticated computer programs used to determine these values are subject to intangibles. Fault current can be the most difficult to determine. Wire length (resistance) affects the value greatly, and who know the exact length of wiring that's been installed for years? OCPD trip time is essential, as is the type and rating of the OCPD. You would think that the further from the utility would be the safest. But if you have a large motor load on a circuit there can be a greater potential of arc flash for several cycles. The further away the OPCD the longer the trip time, etc, etc.
Arc flash protection and NFPA 70e are in their infancy. I believe we'll be seeing much more about this in the years to come, and we'll be required to provide protection-subject to fines through OSHA at some point. It not yet clear what path that will take or how long.