The Chase Sensale Group Logo

Leave Good Law Alone

Debate Heating Up over 128-Year-Old Scaffold Law:

By Michael Whiteley,

 

 

Eastern Bureau Chief Debate over efforts to add a comparative-negligence provision to New York's 128-year-old scaffold law appears to be heating up in advance of the 2014 session of the New York Legislature amid reports that difficulty in obtaining liability insurance will force the New York School Construction Authority to cancel its coverage for school contractors and that major insurance carriers are withdrawing from the market.

 

The Lawsuit Reform Alliance of New York said at a hearing called by the New York Senate Majority Coalition on Sept. 25 that more than half of the 30 largest legal settlements in New York during 2012 were a result of the scaffold law. New York Labor Law Sections 240 and 241 give contractors and property owners absolute liability for injuries suffered by workers as a result of a fall from any height.

 

A coalition of construction associations and business groups, including the Business Council of the State of New York and the New York Conference of Mayors, has called on Gov. Andrew Cuomo to support Assembly 3104, filed by New York Assembly Majority Leader Joe Morelle, D-Irondequoit, and Senate 111, a companion bill filed last January by Sen. Patrick Gallivan, R-Elmira.

 

The bills would require judges and juries to apportion lawsuit awards to account for a worker's share of negligence from a fall if the worker committed a criminal act associated with the fall, was using drugs or alcohol at the time of the fall, failed to use safety devices provided at the job site or failed to comply with safety training provided by his or her employer.

 

So far, Cuomo has not weighed in on the issue. Cuomo's press office did not return a call for comment Thursday.

 

Thomas Stebbins, executive director of the Lawsuit Reform Alliance, said Thursday support for reform is growing.

 

"We’re hearing from more and more people because the insurance crisis is just getting worse and worse," Stebbins said.

 

Stebbins said the Senate Majority Coalition's Sept. 25 hearing was focused on regulatory reform in the construction industry and is expected to intensify debate next session about the scaffold law.

 

In written testimony to the coalition, the Lawsuit Reform Alliance reported:

 

• Insurance premiums for general liability policies in the New York construction industry have increased by between 10% and 20% during recent years.

• Loss costs for general liability policies issued to provide coverage for bridge and elevated highway projects in New York City are equivalent to 74.7% of payroll costs – compared to 15.7% in Chicago and 11% in Los Angeles.

• Construction insurance costs in Illinois, which repealed a similar scaffold law in 1995, have declined by 91% since then, while construction employment increased by 54,000 workers – or 25%.

 

The New York Workers' Compensation Alliance, a claimants' attorneys group, is alerting members that scaffold law reform will be a key issue when lawmakers convene the 2014 session next January.

 

"The debate certainly seems to be intensifying. I fully expect this to be a heavyweight issue next session," said Robert Grey, chairman of the alliance. "It's not our fight, but we're certainly watching it to make sure it doesn’t spill over into workers' compensation issues in the Legislature."

 

Robert Danzi, president of the New York State Trial Lawyers Association, told the policy and government publication City & State that the construction industry in New York is booming and large contractors aren't having difficulty in obtaining liability coverage.

 

"As many men and women die in construction-related accidents each year in this country as die in wars," Danzi said. "The law, as it exists, gives workers the very best chance of being safe."

 

Michael J. Elmendorf II, executive director of Associated Contractors of New York, said his group is awaiting final word from the New York City School Construction Authority on whether it will cancel its Owner Controlled Insurance Program on Jan. 1, 2014, because it has been unable to find an insurer to continue writing the coverage.

 

The program provides contractors on New York City school projects with workers' compensation, general liability, pollution liability and builder's risk coverage. The company warned school contractors in July that they may have to secure their own coverage in the future.

 

Marge Fineberg, communications director for the New York City Department of Education, did not respond to a request for information on the status of the program Thursday.

 

The School Construction Authority said recently that the scaffold law is boosting the cost of genera liability insurance for school projects by $75 million a year – the average cost of building two new schools.

 

But Elmendorf said last July's announcement by the SCA has intensified the years-long discussion about scaffold law reform.

 

"This is certainly something that's now being discussed at the very highest levels of government," Elmendorf said. "But it's still an issue that's apparently up in the air. If SCA cancels its insurance program, it would cause unprecedented disruption and devastation in the New York construction industry."

 

The New York Legislature adjourned last June with scaffold law reform bills stranded in the Assembly and Senate Judiciary committees. Similar bills died in Assembly and Senate committees during the 2012 session of the Legislature amid opposition from the trial lawyers, the New York AFL-CIO and the state's construction trade unions.

 

The trial lawyers argue that, despite the scaffold law, New York City approved construction permits for 34,000 new residential units in 2008 – up from 5,100 approved in 1995. Between 2002 and 2008, construction employment increased by 15% on Long Island and 14% in the Hudson Valley region of New York.

 

"The downturn in construction all across New York State over the last few years obviously cannot be blamed on the scaffold law, which existed when construction was thriving in much of the state before the recent national recession," the trial lawyers' group said in a civil justice brief issued last summer.

 

"The ups and downs of local economies, not the lifesaving scaffold law, determine construction activity and employment."

 

The Lawsuit Reform Alliance testimony to the Senate Majority Coalition is here.

 

Danzi's interview with City & State is here.

Back to news >>>