If you run a construction business in New York, you know all about Labor Law 240 – the Scaffold Law. It’s a decades-old law that holds contractors, property owners, and developers 100% liable for accidents and injuries, even when an injured worker is 99% to blame for the accident.
Supporters of the law claim that it’s a necessary tool to ensure workers’ safety in the most dangerous jobs, especially those who work for contractors that routinely cut corners to save money. They say the law gives workers their day in court and preserves the right of injured workers to sue for punitive damages and compensation for pain and suffering. And in their view, the law makes jobsites safer.
But opponents say that’s simply not true. Bolstered by a study published in December 2013 by SUNY’s Nelson A. Rockefeller Institute of Government, they claim that the law actually makes construction sites less safe, while costing the public millions of dollars. According to the study, the law diverts at least $785 million of public money every year from schools and local governments to pay for lawsuits, legal fees, and insurance costs. The study also estimates that the law costs the private sector over $1 billion per year when you add up the legal costs, workers’ comp payments, medical costs, and other expenses. The School Construction Authority has estimated that the law cost them more $200 million in 2014, enough to build three or four new schools, and estimates have put the cost of the law for the $3.9 billion Tappan Zee Bridge project as high as $390 million.
Labor unions and other supporters of the law have criticized the report as inaccurate. The Center for Popular Democracy and the New York Committee for Occupational Safety & Health issued their own scathing reply to the report titled, Fatally Flawed: Why the Rockefeller Institute’s Scaffold Law Report Doesn’t Add Up.
Those who support the law want to keep it as is, while opponents want to replace the standard of absolute liability with the more equitable "comparative fault" standard in cases where an injured worker was intoxicated, violating safety standards, or committing a criminal act.
What’s happening in the state legislature?
Unfortunately, nothing. The Conference of Mayors, the School Boards Association, Habitat for Humanity, and dozens of construction firms, real estate developers, and local governments have been hounding Governor Andrew Cuomo and the New York State Legislature for years to reform the law, pointing out that every other state in the nation long ago phased out such regulations, relying instead on the workers’ compensation system. But for now, even the Governor has conceded the battle, stating, "You can't change it. The trial lawyers are the single most powerful political force in Albany."
While the chances of reforming the law still look slim, this decades-old heated battle isn’t cooling down anytime soon. And with multimillion dollar awards continuing to be handed out in the courts, the stakes are only getting higher.
Your best defense
With these kinds of odds stacked against you – and with the cost of insuring construction projects in New York being as much as 10 times higher than in other states – you have to work even harder to protect your bottom line.
With more than 150 years of experience in the New York construction market, BNC Insurance and Risk Advisors understands your challenges better than most. We have the expertise to help you navigate the laws and insurance requirements, get the most from your risk management and safety programs, and protect your business.
