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Legislative Memo

BILL:

A.571 (Robach) / A.203 (Volker)

Support

SUBJECT:

Third Party Liability Reform

 

DATE:

May 14, 2001

 

The Business Council of New York State, Inc., a broad-based, statewide membership organization of over 4,000 companies, chambers of commerce and trade associations has reviewed the aforementioned legislation and strongly supports its enactment.

This legislation would amend Sections 240 and 241 of the Labor Law, better know as the "Safe Place to Work" provisions. Sections 240 and 241 of the Labor Law establish the liability of contractors, owners and their agents for injuries which occur at construction and other worksites. Courts have determined that this liability is absolute and that a plaintiff's own culpability shall not be considered in determining fault. New York State is the only state which imposes such a liability standard.

This standard precludes contractors, owners and their agents the ability to prove that the failure to provide the specified safety devices did not constitute negligence. It also fails to take into account negligence, if any, on the part of a worker, and may include a case where alcohol or substance abuse has occurred. Simply stated, a contractor or owner is liable for virtually any gravidity related injury suffered by a worker on a job site. It does not matter that the employee ignored the company's safety policy or directions from a supervisor. The contractor or owner is liable even if the employee was intoxicated, drug induced or in the process of committing a crime when the injury occurred.

The courts have liberally interpreted this act to include any workplace accident (utility poles, fixed ladders within a manufacturing plant, staircases) which occurs on an elevation and is caused by gravity, witnessed or unwitnessed. These cases have expanded away from construction sites to include manufacturers, public utilities, residential homes, and governments. Safety is a major concern to the construction and manufacturing community, and their stringent compliance with OSHA rules not only produces adequate safety procedures, but limits expensive litigation produced by present language within sections 240 and 241 of the labor law.

Section 240-241 cases make up over 50% of all third party liability cases. Removing the absolute liability standard and imposing a negligence standard on these cases will increase safety on the worksite by creating diligence by both the owners and workers. This legislation will not eliminate the right of the worker to sue for damages, rather it changes the standard by which these cases are determined.

These lawsuits exacerbate the liability insurance crisis faced by construction industry employers, have a direct negative impact on workers' compensation costs, and increase court case load and costs. For these reasons, The Business Council of New York State, Inc., supports A.571/S.203 and encourages its enactment into law.