According to Karl Silverberg, NYC/LI NARI General Counsel, there has been a buzz in the construction industry recently over New York State Labor Law § 240, commonly known as the Scaffold Law, and Labor Law § 241. Various contractor trade groups are calling for New York State to repeal Labor Law §§ 240 & 241. The recent action is the result of escalating insurance costs to cover Labor Law §§ 240 & 241 claims. Contractors are facing a threefold hit respecting these costs. First, recent large damage awards to injured workers have increased insurance premiums. Second, higher awards require contractors to carry higher limits. Third, there is word that certain carriers have left the market, thus decreasing competition.
New York Labor Law § 240(1) states: “All contractors and owners . . . in the erection, demolition, repairing, altering . . . of a building or structure shall furnish . . . scaffolding . . . which shall be so constructed, placed and operated as to give proper protection to a person so employed.”
This law is meant to protect workers from gravity related injuries. The statute dates to 1885, when “lawmakers reacted to widespread accounts of deaths and injuries in the construction trades.”
The statute is a “vicarious liability” statute. This means that one party is responsible for another party’s negligence. Under the law, if a subcontractor fails to properly protect its workers, then the owner and general contractor are automatically liable for the subcontractor’s negligence. The statute exempts residential home owners, but it still applies to general contractors and subcontractors on residential projects. Owners and general contractors are not completely out of luck: Owners and general contractors can seek indemnification from the negligent subcontractor, meaning reimbursement for their loss. Importantly, under the law, for the general contractor to seek full indemnification, the general contractor must have a written indemnification agreement with its subcontractor; otherwise, the general contractor will be limited to indemnification only for cost incurred due to “grave” injuries.
By judicial decree, Labor Law § 240 claims are not subject to the defense of contributory negligence. Contributory negligence allows a defendant to show that the plaintiff’s injuries were due in part to the plaintiff’s own actions. For example, if a worker fell from a ladder, and the worker had been drinking on the job or purposefully failed to follow safety instructions, the jury can apportion liability – say 90% of the fault is the worker, and 10% of the fault is the employer. In such a case, the worker would only get 10% of the damages he incurred. Under Labor Law § 240, however, contributory negligence cannot be raised as a defense. So even if a worker is 90% at fault, the employer is deemed 100% liable for the worker’s damages. The party being sued has to show that the injured worker is 100% at fault to avoid liability.
There is a misconception that every gravity related injury automatically results in liability under Labor Law § 240. This is not the case. The injured employee must still show that the employer failed to provide adequate safety protection. New York’s highest court, the Court of Appeals, stated: “[There is a] mistaken belief that a fall from a scaffold or ladder, in and of itself, results in an award of damages to the injured party. That is not the law . . . . ‘[N]ot every worker who falls at a construction site, and not any object that falls on a worker, gives rise to the extraordinary protections of Labor Law § 240(1).’. . . ‘[T]he mere fact that [a plaintiff] fell off the scaffolding surface is insufficient, in and of itself, to establish that the device did not provide proper protection . . . . Put differently, an accident alone does not establish a Labor Law § 240(1) violation or causation.”
Labor Law § 241(6) states: “All contractors and owners . . . , when constructing or demolishing buildings or doing any excavating in connection therewith . . . shall be so constructed, shored, equipped, guarded, arranged, operated and conducted as to provide reasonable and adequate protection and safety to the persons employed therein . . . . The commissioner may make rules to carry into effect the provisions of this subdivision.”
Liability under this provision exists when contractors fail to follow New York State safety regulations. This statute is a vicarious liability statute.
Both Labor Law §§ 240(1) & 241(6) are a break from the normal rule that an injured worker is limited to recovering damages from workers’ compensation insurance. Under Labor Law §§ 240(1) & 241(6), an injured worker can sue for pain and suffering, and any other damages not covered by workers’ compensation.
It is important that owners, general contractors, and subcontractors check that they have the proper insurance coverage to cover such claims. Parties need coverage for their employees, and the employees of their agents. It is important that you check with your broker, an insurance consultant, or an attorney to make sure you have the proper coverage. It is important that general contractors make sure that their subcontractors have the proper insurance coverage; otherwise, the general contractor’s insurance carrier will bear the loss, and the general contractor’s premiums can rise.
Karl Silverberg focuses his practice on construction law at Silverberg P.C. Prior to law school Mr. Silverberg worked as a civil engineer. Mr. Silverberg can be reached at 631-778-6077 or firstname.lastname@example.org. Mr. Silverberg is the General Counsel for NYC/LI NARI, Inc.
 Blake v Neighborhood Hous. Servs. of N.Y. City, Inc., 1 NY3d 280 (2003). New York Workers’ Compensation Law § 11.  Blake v Neighborhood Hous. Servs. of N.Y. City, Inc., 1 NY3d 280 (2003).  Id.