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With last November’s 5th Circuit Court ruling (Acosta v. Hensel Phelps Constr. Co.) affirming the multi-employer worksite doctrine of the Occupational Safety and Health Administration, owners and their construction managers and general contractors all may be held directly responsible for any worker injuries or accidents sustained at worksites, regardless of whether or not they were directly at fault or if their employees were involved. 

Specifically, OSHA stipulates that: “On multi-employer worksites (in all industry sectors), more than one employer may be citable for a hazardous condition that violates an OSHA standard.” Thus, at any worksite, OSHA lists four classes of employers who may be subject to citations for a hazardous condition. They are the: 

  • “creating employer,” which “caused the hazardous condition that violated the OSHA standard”; 
  • “exposing employer,” whose “own employees are exposed to the hazard”; 
  • “correcting employer, … responsible for correcting a hazard”; and 
  • “controlling employer,” which has  “general supervisory authority over the worksite, including the power to correct safety and health violations itself or require others to correct them.”

Depending on the circumstances, owners, construction managers and general contractors conceivably might be cited by OSHA in any of the four categories. However, their vulnerability as the “controlling employer” most certainly expands their potential liability; this might be a focal point as they evaluate their exposures and reassess and adjust their risk management practices. 

Besides being at risk of lawsuits from non-employee workers injured at jobsites – as well as subrogation from workers’ compensation insurers of subs, trades and other project participants – owners, constructions managers and general contractors are now more likely to receive OSHA citations for any accidents that occur, or related hazardous conditions that exist at their worksites and/or are identified and inadequately remediated. 

OSHA citations for repeat and willful violations now come with a fine of $132,598, which by itself may cut significantly into a project’s profit margin. Even though their general liability insurance coverage may provide some protection against the financial consequences of  lawsuits brought against them by employees of subcontractors, trades and other project participants who sustain injuries at a worksite, by law, their insurance policies can offer no coverage for OSHA citations, fines and penalties. 

In light of their expanded exposures, owners, construction managers and general contractors should review their contractual arrangements with all project participants, and consider revisiting and strengthening their oversight of all project-related safety practices. Here are some areas where they may want to place extra emphasis: 

  • OSHA safety training requirements. Construction managers and general contractors should designate a qualified supervisor to conduct regularly scheduled safety inspections covering every aspect of the worksite. Notably, these individuals must have an OSHA 30-hour training card; non-supervisory personnel involved in safety inspections have a 10-hour OSHA card minimum requirement. Furthermore, state laws, such as the City of New York Local Law 196 of 2017, and local laws may exceed these requirements. 
  •  Site safety inspections and walk-arounds. Any safety issues identified should be documented and reported to the appropriate sub or trade for prompt remediation; work in any areas or operations deemed to pose safety risks should be suspended until the exposure is remediated. If the hazard is the result of an issue created by a sub or trade, they should be held directly and contractually responsible for the cost of any delays arising while repairs are implemented. 
  • Shoring up multi-site responsibilities. Construction managers with simultaneous projects at multiple sites need to ensure that appropriate safety inspections and walk-arounds are completed on a scheduled basis without exception and that timely and appropriate follow-up is conducted with relevant contractors to make sure any hazards, risks or unsafe practices identified have been addressed and corrected. They also need to be available to ramp up safety inspections to respond to changing job conditions brought about by inclement or severe weather conditions and other developments that might produce potential hazards at a given worksite.    
  • Subcontractor and trade selection criteria. A heightened focus on worksite safety practices might also call for greater scrutiny in the selection of subcontractors and trades based on their safety records in addition to their overall performance track records on similar types of projects. Prequalification companies can help construction managers and general contractors identify candidates that meet their needs and screen out those with spotty records. 
  • Contractual safety requirements. Construction managers and general contractors might consider inserting language in contracts with subs and trades requiring strict adherence to site safety guidelines and practices established by the construction managers and/or general contractors. 
  • Hazardous area designation. Any areas of the worksite that pose potential hazards, including those arising from sudden changes in weather or other temporary situations, should be clearly marked to be avoided by all workers or restricted solely to workers with required training and equipment. Requirements for workers to wear appropriate safety gear, including helmets and other protective equipment, and to comply with worksite safety practices should be strictly enforced. Furthermore, those in violation should be subject to disciplinary measures, including termination, and their employers subject to financial and other consequences.    
  • Owner- and contractor-controlled insurance programs (OCIPs and CCIPs or wrap-ups). Owners and general contractors implementing wrap-ups typically exercise greater control over worksite safety practices. Certainly, the structure of the project-specific workers’ compensation and general liability insurance programs with high levels of risk retention gives them, as well as all participating subs and trades, a strong incentive for reducing risks of workplace injuries and accidents. Whether or not an owner or general contractor has implemented a project-specific wrap-up, they should consider adopting and implementing the same project-wide approach to safety and accident prevention. 
  • High-risk operations. If they’re not already doing so, owners, construction managers and general contractors need to place greater emphasis on higher risk activities at all of their worksites and revisit their related oversight practices. The use of cranes, mobile equipment and handling of explosives and hazardous materials, electrical equipment, gas line installation among other activities that pose significant dangers not only call for the careful selection of appropriate subs, but also the diligent monitoring of their activities and safety practices, as well as the timely identification and rapid remediation of any potential hazards.  

By revisiting and strengthening their worksite safety practices, owners, construction managers and general contractors will not only be in a better position to avoid costly OSHA penalties and reduce the likelihood of any accident-related liability exposures, but may also be maintaining or enhancing their reputations as responsible leaders and business partners in the construction industry as well as in the communities in which they operate.   

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