08/06/2007
CONTACT: Melissa Sharp, 202-314-2068
Washington, D.C.--The National Federation of Independent Business Legal Foundation has filed a petition to participate as amicus in a critical case now under consideration at the United States District Court for the Western District of New York. The case examines two New York statutes that create excessive liabilities for businesses, especially firms in the construction industry.
The statutes at issue are New York Labor Law section 240(1), often referred to as the "scaffold law" or "ladder law," and 241(6). NFIB is concerned that a decision upholding these laws will cripple small firms that struggle to operate under labor laws that impose absolute liability and needlessly drive up costs for businesses and consumers.
"Evidence shows that insurance companies have ceased to issue policies that cover injury due to these specific New York labor laws," said Mike Elmendorf, state director for NFIB/New York. "As a result, contractors are unable to obtain this insurance at any price. In a poll conducted by the Independent Insurance Agents Association of New York, over 90 percent of the insurance agents who responded reported that the companies they represent have stopped issuing contractor-liability policies. If contractors are unable to obtain liability insurance, they are unable to do business in the state of New York. This antiquated law saps New York's competitiveness, costs businesses and consumers far too much, and flies in the face of fairness."
Section 240 imposes "absolute liability" on contractors and work site or property owners who fail to provide adequate safety equipment to protect workers from falls and falling objects, regardless of the negligence of the worker or safety precautions taken by the employer. This liability bars defendant small businesses from raising the contributory negligence defense where the plaintiff’s injuries result from an accident involving gravity. Section 241(6) imposes safety regulations upon owners and contractors regardless of their elevation.
"These statutes discriminate against individuals who own construction firms in New York and who must pay higher insurance liability rates as compared with individuals who own businesses in other industries," said Karen Harned, executive director of NFIB's Legal Foundation. "This court should declare these laws unconstitutional because they have denied individuals who own and operate construction firms equal protection of the laws of New York."
The case at issue is Business for a Better New York v. Angello, Civil No. 06-CV-669.
