Are you up-to-date on the many legal facets of running a construction company? Liability should be a major concern because the one thing you can expect is the unexpected. The unwary should take heed because they might face huge penalties unless they have the right construction insurance.
The issue of who is liable when an accident occurs is the catalyst for a great deal of legal debate. The wisest course for construction owners is to stay current on labor and litigation laws and take the proper steps to protect financial assets. There are many labor law challenges for your construction business, but knowledge and preparation help you build a firm foundation for moving forward safely.
Liability of Construction Managers
One of the most serious challenges for owners of construction firms is determining where construction managers fit into the equation. If construction managers are legally found to be agents or representatives of construction company owners, they will share in the liability of company owners.
Laws governing this industry put “absolute liability” on owners of construction companies, which means they are held legally responsible for physical injuries on construction sites without regard for any fault of the plaintiff who may have been injured.
Determining Agency
Identifying construction firm owners is not difficult. The problems come in determining who exactly are their agents. If construction managers have narrow duties focused on the overall organization and scheduling, they might not be legally deemed as representatives. However, when duties expand, the lines become blurred, and those managers who take on additional important responsibilities might find themselves liable according to labor laws.
For example, if a construction company hired for a project assumes responsibility for making sure all contractors comply with contracts, regulations, and statutes, in essence, that party represents the owner. If a managing company on a construction project takes on the power to provide safety equipment and training as well as the ability to control working hours and conditions. In that case, that managing company might well be legally considered an agent or representative, and it would share in the absolute liability imposed on owners. Thus, proper construction insurance is imperative.
Specific Wording
In determining legal responsibility, the wording of agreements is everything. Even if construction managers do not actively exercise power over working conditions, they can be considered legally liable if they have that authority given to them. Agreements should be worded carefully to avoid labor law challenges for your construction business. Thoughtfully drafting an agreement that limits liability for managers makes finding skilled and able managers easier.
The construction industry turns on many details, but determining the legal responsibility of construction managers is a vital aspect of firm owners’ duties. You should write contracts to express duties and expectations clearly. Such care and thought lessens the chances of liability and feeds into a general attitude of care that could ultimately help make worksites safer for everyone.
About Haughn & Associates
Founded by Michael Haughn in 1986, Haughn & Associates is a full-service, family-owned, independent insurance agency based out of Dublin, Ohio. H&A strives to provide the best possible price and unique insurance solutions across a myriad of industries, including construction, IT, Habitation & Commercial Property, Agriculture, and Engineering. Devoted to providing the best of business insurance, life and disability insurance, personal insurance, employee benefits, and bonds, H&A is proof that success lies in long-standing client relations and satisfaction. To learn more about how H&A can be of service to you, contact us at (877) 802-2278.
