By: Thomas H. Welby Thomas H. Welby Published: May 2005

Safety Policy: Contractors' and Subcontractors' Liability Under OSHA's "Multi-Employer Doctrine"

In last month’s article, we discussed how it may be a defense to an OSHA violation that the party cited was not the employer of affected workers at the jobsite. This month, we will look at OSHA’S “multi-employer doctrine,” and how a general contractor or a subcontractor can be cited even for conditions it did not create, and which affect only other contractors’ employees.

Universal Construction Co., Inc. v. OSHRC was an appeal to the U.S. Court of Appeals for the Tenth Circuit from a decision of the Commission imposing penalties for “serious” OSHA violations. In that case, Universal Construction Company (Universal), as general contractor, contracted with UMB Bank to construct a branch bank office in Missouri. Universal then subcontracted parts of the work to A. Zahner Sheetmetal Company (Zahner). An OSHA compliance officer observed a Zahner employee violate two OSHA standards. Universal’s field manager and personnel were at the site, and in a position to observe the violations. They had authority to correct the hazards, or to direct Zahner’s foreman to do so, but failed to use that authority. It was not disputed that Zahner created the hazards, and that only Zahner employees were exposed to any danger.

OSHA cited Universal for a “serious” violation, based on Universal’s ability to correct the hazardous conditions. An administrative law judge, relying upon the multi-employer doctrine, upheld the citation.

The Court of Appeals’ decision upholding the violations explains the origins of the multi-employer doctrine. Not surprisingly, it arose from construction industry cases, in which hazards created by one employer often pose dangers to employees of other entities. The OSHA statute does not expressly create liability outside the employer-employee relationship. Rather, the multi-employer doctrine is an interpretation of 29 U.S.C. § 654(a)(2) (which requires each employer to “comply with occupational safety and health standards promulgated under this chapter”). The Secretary of Labor has asserted the doctrine since the 1970s, and all but one of the federal Courts of Appeals that have considered it (including the Second Circuit, which embraces New York) have approved it.

Under the multi-employer doctrine, a general contractor or subcontractor may be cited for a hazard it created, even if none of its own employees are endangered. While rules of craft jurisdiction or other factors may limit an employer’s authority to abate hazards created by other contractors, a contractor of any tier is not excused from taking reasonable steps to protect its own employees (for example, by alerting the contractor causing the danger and asking him to abate it, or by directing one’s own forces to avoid an unsafe condition). Normally, it is the general contractor who has overall control of the site, and the ability to assure that other contractors fulfill their OSHA obligations.

The Universal court, endorsing the majority view, held that it is reasonable, and consistent with the purposes of the Act, to hold a general contractor liable for violations which it could reasonably have been expected to prevent or abate, by reason of its supervisory capacity. The general contractor’s duty runs not only to its own employees, “but extends to protection of all worksite employees.”

While the “multi-employer doctrine” may sustain an OSHA claim against a contractor exercising control over the worksite, generally the duty imposed will not run against the owner. In Jordan v. NUCOR Corporation, the injured employee worked for one of several contractors constructing an addition to a NUCOR steel plant. The contract between NUCOR and Jordan’s employer denied that NUCOR was acting as a general contractor, and assigned to the contractor the duty to ensure the safety of its work force. The rights reserved to NUCOR — essentially, the boilerplate rights to terminate a contractor in default, take possession of the site and complete the project — were held to be insufficient to impute to NUCOR general supervisory control over the jobsite, or control over the crane operator whose negligence resulted in Jordan’s injuries.

In Jordan, the U.S. Court of Appeals affirmed the lower court’s grant of summary judgment dismissing Jordan’s action against NUCOR. The decision overstates matters, perhaps, in saying that “[t]he multi-employer doctrine applies only to general contractors, not the owner of the property.” Cases have applied the doctrine to subcontractors, and it does not appear settled that an owner exercising actual control at the jobsite could not be held responsible — even if, formally, it was not acting as general contractor.

However, no such scenario was presented in Jordan. The court determined, and noted also the finding of OSHA inspectors, that the owner had not acted as a general contractor. Accordingly, and as NUCOR did not exercise actual or contractual control over the project, or supervise the use of the crane involved in the accident, it could not have been expected to prevent the safety violations, and the multi-employer doctrine was held not to apply.

It should also be noted that the multi-employer doctrine does not independently establish tort duties between a contractor and employees of other contractors or subcontractors. In Jones v. Parsons Transportation Group, Inc., the plaintiff was the widow of a laborer electrocuted while operating a chipping hammer on an airport expansion project in Maryland. The decedent, Jones, an employee of Whiting-Turner, the general contractor, had been working in an excavation pit. An employee of one of Whiting-Turner’s subcontractors, Belfast Valley Contractors, asked him to chip a piece of concrete obstructing the area where Belfast planned to install the grade beam. While operating the chipping hammer in the area indicated by Belfast’s employee, Jones was electrocuted when the hammer penetrated a concrete utility duct bank, and struck a high-voltage electrical line.

Jones’ widow commenced a negligence action against the Parsons Transportation Group (Parsons) which, as construction manager pursuant to a contract with the owner, was responsible to monitor the general contractor’s work, and to assure compliance with safety standards. The widow relied in part on principles found in Section 324A of the Restatement (Second) of Torts, which states that a person who undertakes to render services to another that he should recognize as necessary to protect a third party can be subject to liability, should he fail to exercise reasonable care and (a) his failure to exercise reasonable care increases the risk of such harm, or (b) he has undertaken to perform a duty owned by the other to the third person, or (c) the harm is suffered because of reliance of the other or the third person upon the undertaking.

Because of Maryland case law precedents that are not directly germane to our discussion, the plaintiff in Jones could not maintain her negligence cause of action against the construction manager. She argued, based on OSHA’s multi-employer doctrine, that Parsons was responsible for her husband’s injuries caused by Parsons’ failure to comply with OSHA regulations governing work in proximity to an energized electric circuit.

The Jones court acknowledged that, since a construction contractor must comply with OSHA to protect its own workers, it is “sensible to think of him as assuming the same duty to the other workers at the site who might be injured or killed if he violated the regulations.” However, the court said, OSHA does not independently establish tort duties between a contractor and employees of other contractors or subcontractors. The Act is express that it is not to be construed to affect worker’s compensation laws, or to alter common-law or statutory duties or liabilities of employers as to injuries to their employees. A breach of an OSHA violation is evidence of the standard of care exacted of employers, the court said, but OSHA creates no private right of action, and one will not be implied.

Because Mrs. Jones could not establish a duty owned by Parsons to her husband under a theory of liability independent of OSHA, her action against the construction manager was dismissed.

The fundamental lesson from the above is that general contractors, particularly, should be conscientious in policing potential OSHA violations not only by its own forces, but by all lower-tier contractors subject to its control. Both construction contracts and jobsite practices should be tailored to ensure that general contractors and others who may be liable for OSHA violations, by reason of their supervisory authority, will be aware of their duties, and have the means to carry them out.

Thomas H. Welby is a licensed professional engineer, as well as an attorney and managing partner of Welby, Brady & Greenblatt, LLP, a construction law firm with its main office in White Plains. Articles in this series are for general guidance only, and should not be relied upon as providing all information necessary for compliance with OSHA and other legal requirements.

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