Volume 42, Issue 7 - July 2007
OSHA Commission Rejects Multi-Employer Enforcement
The Occupational Safety and Health Administration’s (OSHA) policy of citing general contractors for safety violations committed by subcontractors on a construction site, has been overturned by OSHA’s Review Commission. The Review Commission’s decision gives general contractors a stronger stance in contesting OSHA citations on multi-employer sites.
In overturning the 30-plus year multi-employer work site policy, OSHA’s Review Commission held that OSHA no longer can cite a “controlling employer” when that employer did not create, or subject its employees to the cited hazard. Under the policy, OSHA could cite general contractors for safety violations committed by subcontractors on the site, even though the general contractor did not create the hazard, or expose its own employees to the hazard.
Mike Monaghan, owner of Glass Doctor in Quincey, Ill., says it’s up to the subcontractor to take care of the local site, though general contractors do step in if a situation becomes unsafe.
“It’s generally the subcontractor’s responsibility to take care of the site,” says Monaghan. “If it’s a major violation or it’s totally unsafe, than the general contractor will see that and take care of it too.”
Texas Governor Signs Contingency Pay Law
According to the Texas House of Representatives, SB 324 “governs the enforceability of contingent payment clauses in construction contracts and defines the rights and duties of the parties involved.” The Prompt Pay Act details circumstances in which a contingent payment clause may, or may not, be enforced when working with subcontractors. The strength of the bill lies in the following clause: “A contingent payor or its surety may not enforce a contingent payment clause to the extent that the obligor’s nonpayment to the contingent payor is the result of the contractual obligations of the contingent payor not being met, unless the nonpayment is the result of the contingent payee’s failure to meet the contingent payee’s contractual requirements.”
The Prompt Pay Act also enables both contractors and subcontractors to cease work after a reasonable period of nonpayment, after giving notice to the owner, until they are paid for the project.
According to Virginia Lee, executive director of the Texas Glass Association, the progress of the bill realizes the founding principle of the organization.
“It has taken from 1990 to 2007 to get this accomplished,” says Lee. “We are really tickled that it has gone to the governor to sign.”
Top Domestic Contractors Named
Revenue (in millions $)