The Scaffold Law (NYS Labor Law sections 240/241) imposes “absolute liability” for elevation-related injuries on contractors and property owners engaged in construction, repair, or demolition work. Absolute liability means that the contributing fault of an injured worker, such as failure to use provided safety equipment or gross negligence, is virtually irrelevant in court.
Because a settlement is virtually guaranteed, this law is generates an astounding number of expensive lawsuits. In fact, more than half of the most expensive New York settlements in 2012 were a result of the Scaffold Law, and the number of lawsuits has increased by 500% since 1990, despite a decreasing rate of injuries. Because of this, the cost of insuring construction projects is as much as 10 times higher than other states.
The tremendous costs of the Scaffold Law have an impact across New York: construction costs go up, fewer workers are hired (with some being laid off), consumers pay higher prices for goods and services, and the economy suffers.
The current standard of “absolute liability” must be replaced with a standard of “comparative negligence.” Under this standard, liability is apportioned by a jury, in proportion to actual fault. This common-sense reform would not prevent injured workers from bringing lawsuits for their injuries. It would simply give New York property owners, business owners, and contractors the chance to defend themselves in court when a worker’s own negligence is a contributing factor in an accident.This is the way every other state and virtually every other area of our civil justice system functions.
– The Scaffold Law costs taxpayers $785 million annually. 1
– The Scaffold Law is estimated to add $200 – $400 million in additional costs to the construction of the new Tappan Zee Bridge. 2
– Local governments pay higher costs for capital projects, whether the work is done directly or through private contractors. For example, liability costs on one joint NY-NJ bridge projects are more than double on the NY side (see graph at right). 3
– More than half of the top 30 highest settlements resulted from Scaffold Law claims, and of those, 25% were against public entities. 4
– The Scaffold Law adds as much as $10,000 to the cost of building a new home. 5
– In 2014, the New York School Construction Authority’s (SCA) insurance costs soared to $240M because of the scaffold law, nearly triple that of the previous year, and no guarantee of coverage after 2014. 6
– The SCA’s increased insurance costs are equivalent to 8-10 new schools over a 3 year period. 7
– Higher insurance costs for the SCA jeopardize the future of their Owner-Controlled Insurance Program, which provides insurance to over 800 M/WBE firms. Without this program, hundreds of M/WBEs may be put out of business.8
– According to many disaster relief groups, the Scaffold Law has severely impacted reconstruction after Superstorm Sandy.9
– The number of Scaffold Law cases has increased by 500% since 1990 even though the rate of injury has decreased. 10
– New York’s general liability insurance costs, the highest in the nation for construction (see graph at left), are directly correlated to the Scaffold Law, and the number of carriers that write general liability policies in New York is declining. 11
– The Scaffold Law costs the private sector an estimated $1.5 billion annually. 12
– When the Trial Lawyers tried to reinstate the Scaffold Law in IL after it was repealed, labor unions refused to back the effort because they did not want to hurt the industry. 13
– According to a recent study by Cornell University, the Scaffold Law is correlated with 677 additional construction injuries each year. 14
– Illinois repealed its Scaffold Law in 1995, and construction related fatalities decreased by 26% over 5 years. 15
– Reforming the Scaffold Law would create over 27,000 jobs in the construction industry. 16