While the law was originally enacted to protect construction workers from gravity-related injuries and unsafe working conditions, its unintended consequences have dramatically increased insurance costs and, ultimately, the cost of construction across the state.

As an insurance broker specializing in construction and real estate risks throughout New York, we have witnessed firsthand how the Scaffold Law impacts nearly every construction project. Whether the project involves affordable housing, schools, hospitals, infrastructure improvements, commercial developments, or bridge construction, the cost of insuring these risks has become a major component of project budgets.

The primary challenge stems from the law’s standard of absolute liability. Under current interpretations, owners and general contractors can be held fully liable for certain worker injuries involving elevation-related hazards, regardless of whether they exercised reasonable care. In many cases, liability can attach even when extensive safety procedures were in place and the worker failed to follow them.

This legal framework creates a difficult environment for insurers. Unlike most liability claims where fault can be evaluated and apportioned among the parties involved, Labor Law 240 claims often leave little opportunity to mount an effective defense once the statutory requirements have been met. As a result, insurers frequently face significant settlements and verdicts regardless of the facts surrounding the worker’s own conduct.

The financial impact has been substantial. Insurance carriers price policies based upon expected losses, and New York’s unique liability environment has led to significantly higher premiums for contractors, subcontractors, developers, and property owners. These elevated insurance costs are ultimately passed along to project owners and taxpayers.

The effect extends far beyond the construction industry. Every additional dollar spent on insurance is a dollar that cannot be used for labor, materials, equipment, or project expansion. When municipalities build schools, when state agencies repair bridges, or when developers construct housing, insurance expenses become part of the overall project cost. Those increased costs often translate into higher rents, higher property taxes, larger public budgets, and fewer projects moving forward.

Infrastructure projects are particularly affected. Public entities must account for these insurance costs when budgeting for roads, bridges, and public facilities. In an era when New York faces significant infrastructure needs and a growing demand for affordable housing, many stakeholders argue that reforming the Scaffold Law could help stretch limited construction dollars further without compromising worker safety.

Importantly, advocates for reform are not calling for the elimination of worker protections. New York has made significant progress in workplace safety over the years, and protecting workers should remain a top priority. Rather, many industry participants support bringing New York in line with the overwhelming majority of states by adopting a comparative negligence standard.

Under a comparative negligence framework, liability would be allocated according to the degree of fault attributable to each party. If an owner, contractor, or subcontractor failed to provide a safe work environment, they would remain responsible for their share of the loss. However, if a worker ignored safety protocols, failed to use provided fall protection equipment, or otherwise contributed to the accident, that conduct could also be considered when determining liability.

Such a system would not prevent injured workers from pursuing legitimate claims. Instead, it would allow courts to evaluate the facts of each case and allocate responsibility accordingly. This approach is used successfully in virtually every other state and is viewed by many in the construction, real estate, and insurance industries as a more balanced method for resolving workplace injury claims.

From an insurance perspective, reform could create a more predictable underwriting environment. Greater predictability often leads to increased market competition, improved availability of coverage, and more stable pricing. Over time, this could help reduce insurance costs for contractors and project owners while encouraging greater investment in construction and development projects throughout New York.

The discussion surrounding Scaffold Law reform has historically been contentious. Labor organizations, contractors, property owners, insurers, and lawmakers all have important interests at stake. However, the Governor’s willingness to revisit the issue provides an opportunity for meaningful dialogue focused on both worker safety and economic competitiveness.

As New York continues to confront housing shortages, aging infrastructure, and escalating construction costs, it is essential that policymakers examine every factor contributing to project expenses. Reforming Labor Law 240 and 241 may not solve every challenge facing the industry, but it could represent a significant step toward creating a fairer and more balanced system.

The construction and real estate industries remain hopeful that any future revisions will preserve critical worker protections while allowing liability to be apportioned among all responsible parties. Such a change would better reflect the realities of today’s construction environment and could help reduce the costs that ultimately burden property owners, taxpayers, businesses, and consumers across New York.

The coming budget discussions may provide the best opportunity in years to achieve that balance. For an industry that builds the homes, schools, hospitals, and infrastructure on which New Yorkers depend, that is welcome news indeed.

About the Authors: Ken Fuirst and Jason C. Schiciano are Co-Presidents of Levitt-Fuirst Associates, Ltd., an independent insurance brokerage headquartered in Tarrytown, NY. Both have extensive experience serving the construction and real estate industries, with a focus on insurance, risk management and liability issues affecting businesses throughout New York and beyond.

Published: November 12, 2026.