Builders battle safety liability Subcontractors balk at bid to shift costs

November 19, 1991|By Michael K. Burns DHC jB

A major homebuilder's attempt to shift the cost of construction safety violations to its Maryland subcontractors has prompted protests and a call for state legislation to define responsibility for the fines.

Subcontractors fear that the total shift in liability to them could spell their economic ruin and thwart the intent of state and federal job safety rules by completely exculpating big builders.

The state's job safety agency says the legal move may impair enforcement of the law against prime contractors, who share responsibility for worker protection.

"They have put all of the onus back onto the subcontractor. . . . It's not fair," said Timothy C. Kraus, president of Catons Plumbing in Catonsville. "A lot of little guys will go broke if this becomes widespread."

Maximum safety fines in Maryland will increase 600 percent on Jan. 1 to $70,000 for a single "willful" violation, and legal costs to defend the citations can be just as costly, he said.

Pulte Home Corp., one of the nation's largest builders, required its Maryland subcontractors two months ago to sign a contract amendment that requires them to pay all fines and legal costs of safety citations received by Pulte because of subcontractor infractions.

Mr. Kraus refused to sign the contract and complained to state officials. As a result of his campaign, the House Economic Matters Committee will consider the issue at a hearing in Annapolis today.

Even if the citations against Pulte are rescinded, the subcontractors -- who do the carpentry, painting, plumbing and electrical work on a project -- would have to pay the builder's legal expenses, Mr. Kraus pointed out.

"I do not believe that Pulte had any malicious intent," said Mr. Kraus, who has been in the business for 40 years. But he said the builder is "attempting to absolve themselves of any problems or responsibilities."

Other builders will likely follow suit across the United States, using their economic leverage to force subcontractors to comply, he warned.

The Maryland Occupational Safety and Health office has been fining prime contractors for subcontractor violations for nearly two years -- but only for serious violations that are under the prime contractor's control. The effort focuses on eliminating injuries from falls, cave-ins and electrical accidents.

"They [primes] don't get fined every time a subcontractor does," noted Craig D. Lowry, enforcement chief for MOSH. "They must have control of the hazardous condition" to be cited.

For example, if employees of a plumbing firm are working unsafely without adequate fall protection around an open stairwell, both the plumber and the prime contractor would be cited, he said. The prime has the obligation to erect safety rails or other devices, and the plumbing firm must ensure that its employees are properly protected, he explained.

While the dispute over who is responsible for job safety on a multiemployer project is longstanding, Pulte's effort to legally limit its liability from subcontractors' conduct is apparently unique, Mr. Lowry said.

"I want to see how it works in practice, but it sounds like it could be unfairly shifting the brunt to the little guy."

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