amNY: Op-ed | An open letter to City Hall on Scaffold Law reform

By: Letter signatories

Editor’s Note: The following is an open letter addressed to Mayor Zohran Mamdani, Housing Preservation and Development Commissioner Dina Levy, and City Planning Commissioner Sideya Sherman regarding the Scaffold Law.

It is signed by the following organizations: Associated General Contractors of New York State; Building Trades Employers’ Association; Business Council of New York State; Center for New Liberalism; Citizens Budget Commission; Empire Center for Public Policy; Lawsuit Reform Alliance of New York; National Federation of Independent Business/NY; New York City Minority Small Business Chamber of Commerce; New York Insurance Association; Regional Plan Association; and the Staten Island Chamber of Commerce.

We write to respectfully request that you add the recommendation that the State reform Labor Law § 240/241, also known as the “Scaffold Law,” to New York City’s Fair Housing Growth Strategy. The resulting savings would lower insurance and construction costs, supporting 8–10% more affordable housing units per project, and helping fulfill the City’s housing and affordability goals.

The resulting savings would lower insurance and construction costs, supporting 8–10% more affordable housing units per project, and helping fulfill the City’s housing and affordability goals.

Although originally intended to protect workers, research from the RAND Institute supported by the Robin Hood Foundation highlights that the statute may in fact contribute to increased accidents. RAND recommends reforming the law to “fall in line with nationwide standards” noting that reduced costs would help build an additional 38,000 units of affordable housing.

The sections that make up the Scaffold Law, enacted more than a century ago, are an only-in-New York statute that has been expanded by lawyers and the courts to impose “absolute liability” on contractors and property owners for gravity-related injuries on worksites, regardless of the injured party’s own responsibility for the accident.

The Scaffold Law generates a high volume of litigation and enormous settlements, even when defendants are only 1% at fault. As a result, New York City construction and development projects face insurance premiums 2-5 times higher than in comparable markets, adding about 7-10% to overall construction costs. Affordable housing and disaster relief organizations struggle to build, with Habitat for Humanity citing the Scaffold Law as a barrier to reconstruction after Superstorm Sandy.

Furthermore, bad actors exploit the law to defraud the legal system, further driving up insurance and construction costs.

A recent New York Times investigation uncovered that networks of lawyers, doctors, and lawsuit-funding firms are alleged to recruit immigrants, low-income individuals, and other vulnerable New Yorkers to stage construction site accidents, undergo medically unnecessary surgeries, and file fraudulent insurance claims.

Gov. Kathy Hochul’s recent car insurance reforms targeted fraud and legal system abuse to lower costs for all New Yorkers. To further these efforts, New York City must recommend that th eState amend the Scaffold Law’s liability standards to deter fraudulent claims and decrease construction costs.

We urge you to include Scaffold Law reform as a priority in New York City’s Fair Housing Growth Strategy to reduce barriers to building new affordable dwellings across the five boroughs. In addition, we would like to formally request a meeting with the administration to discuss this critical issue. We look forward to working with City Hall to make New York more affordable for all.