We are continuing our discussion of a recent study of New York’s “Scaffold Law,” the state law that holds property owners and contractors strictly liable for injuries and fatal accidents at construction sites. We are the only state to have such a law, as most other states take care of workplace injuries through workers’ compensation insurance.
Workers’ comp is generally an employee’s sole remedy for an on-the-job injury. The employer guarantees that it will pay for injuries and deaths at the worksite, and, in turn, employees accept that they cannot file a personal injury lawsuit against the employer. The idea was to speed up payment to the workers (and, so, get them back to work more quickly) while reducing employers’ litigation costs.
Critics of the Scaffold Law say that it accomplishes the exact opposite. They argue that it encourages litigation, increases hazard insurance costs for contractors and property owners and, in the end, makes construction more expensive in New York than in surrounding states, if not every state.
The researchers found that the state’s workers suffer an additional 677 construction site accidents every year because of the Scaffold Law. They found, too, that the law costs the public $785 million and the private sector upwards of $1.5 billion. When other costs are factored in — medical costs, for example — the researchers estimate that the Scaffold Law costs the state between $2.92 billion and $3.01 billion each year.
There is a problem, though, which we will explain in our next post.
Sources:
Carrier Management, “N.Y.’s ‘Scaffold’ Law Increases Injuries, Costs $3B a Year: Study,” Young Ha, March 3, 2014
Insurance Journal, “Opinion: Study Suggesting N.Y. Scaffold Law Causes Injuries Misuses Statistical Techniques,” Richard Hurd, March 15, 2014