It’s a longstanding and epic struggle, with billions of dollars at stake. No, it’s not the latest reality TV show. It’s the New York construction industry and its ongoing battle with Labor Law 240, otherwise known as the Scaffold Law.
And today, the stakes are higher than ever.
As already struggling businesses slowly begin to reopen after the coronavirus lockdown, they need all the help they can get. That’s why business and construction groups recently sent a letter to Governor Cuomo requesting a 12-month moratorium on the Scaffold Law.
Signed by Associated Builders and Contractors, the New York State Builders Association, the Capital Region Chamber, the New York Federation for Independent Business, and more than a dozen others, it was an ominous warning. Current civil unrest, bankrupted businesses, strain on public services, and other factors could send the economy spiraling into a full-scale depression.
Adding insult to injury
Working under the constraints of the Scaffold Law will only exacerbate the situation according to these groups. For instance, Gov. Cuomo is urging the Trump administration to provide more money for state infrastructure projects. But those projects can only be hindered by the Scaffold Law. The New York School Boards Association estimates the Scaffold Law costs upstate schools $200 million every year.
The recent 28-acre, $25 billion Hudson Yards mega-development project is another example. Since 2013, nearly 150 construction workers have filed personal injury lawsuits against Related Companies and Oxford Property Group, as well as general contractors like Tishman Construction, claiming injuries on the project. It’s a sure bet at least some of those claims can be attributed to the Scaffold Law. Fixing the law would be a shot in the arm to an economy that’s already taken a beating.
It's been a contentious battle for decades.
Supporters of the Scaffold Law claim…
- Too many construction accidents are the result of contractors and developers taking shortcuts with safety to get projects done and maximize profits.
- The law is a vital tool for increasing construction workers’ safety. Repealing it would reduce accountability on jobsites and dilute the incentive for property owners and contractors to take necessary safety precautions.
Those opposed to the law argue…
- The law disincentivizes investment in construction site safety because no amount of safety measures will reduce the absolute liability builders are subject to.
- Studies have shown the law doesn’t make construction workers safer, but instead increases the number of falls resulting in injury or death.
- Insurance costs on public works projects can be double due to the Scaffold Law. On average, projects in the city spend eight to ten percent of their budget on insurance policies, compared to two or three percent in other states.
Opponents of the Scaffold Law want the standard of absolute liability replaced with a more equitable “comparative fault” standard. That’s the way it’s done in every other state and in every other part of New York’s legal system. Unfortunately, reform is nowhere in sight. Two bills in the legislature in 2014 yielded no progress. Ongoing efforts to reform the law are keeping hope alive, but the battle lines haven’t moved.
For those in the New York construction industry, you’re stuck with the Scaffold Law for now. That means your risk management and safety practices are paramount as the economy struggles to come back.
It’s also crucial to partner with an insurance carrier who knows the ropes. With more than 150 years in the New York construction industry, BNC is the kind of partner you need to navigate New York’s challenging labor laws, get the most from your risk management strategies, and get the best rates on insurance. Contact us today to learn more.