Most contractors are somewhat familiar with Labor Law, which was designed to provide protection to workers injured on the job. Some general liability insurance policies cover it, and some don’t. Even if it’s excluded on your policy due to cost or availability, there are ways to protect yourself.
A Bit of NY History:
Labor Law, sometimes called Scaffold Law (a law unique to NY), was first enacted in our state in 1885.
Unlike other states, New York has Labor Law 240 and 241. Both allow injured workers to collect workers compensation benefits from their employer and litigate against other responsible parties.
Responsible parties are subject to absolute liability. Common law negligence standards don’t apply; an employee who got hurt could be inebriated and at fault, and it does not matter.
Third-Party-Over-Action:
When an injured employee collects workers compensation benefits and sues a third party for contributing to their injury, it’s referred to as “third-party-over action”. The third party is usually the GC or the building owner, and liability is normally passed back to the employer by prior agreement. In order to sue under Labor Law, the injury must have resulted from some kind of a fall (ladder, scaffold, stool, or even tripping and falling over a 2X4.) The law does not apply to the owners of 1 or 2 family dwellings.
Key Questions:
The key to protecting your company is to know your exposures.
Have you signed “hold harmless” agreements with the GC or the owner?
Does your policy provide the coverage?
If you hire sub-contractors do they have the coverage and have they signed hold harmless agreements in your favor?
If you have any questions regarding commercial insurance matters, including but not limited to Workers Compensation, please contact us toll-free at 1-888-455-2880 or 631-224-1000. With over 30 years in the insurance industry, Tony Salvaggio and his friendly staff at Twin Forks Insurance Agency have been serving the needs of Long Island’s residents and business owners. Why not see how we can help you?
