COVID-19: Dealing with Contractors that Have Not Taken Proper Measures

By Anthony G. Stergio

Contractors across Texas have taken aggressive steps to protect their workforce from COVID-19 by implementing measures such as:
  • Entry point temperature checks and questionnaires.
  • Monitoring of employee symptoms.
  • Follow-up questionnaires for employees that have had close contact with positive or potential positive individuals.
  • Virus testing for active and/or returning employees.

As we have seen, however, the virus does not respect state or international borders. Likewise, the virus does not draw distinctions between the employees of one contractor or another. Therefore, in the multi-employer construction environment, one employer’s efforts can be thwarted if that employer’s employees work side-by-side with the workforce of a contractor that has not taken COVID-19 preventative measures.  

OSHA liability is definitely a concern when dealing with COVID-19 infections among employees.  Remember that if an employee becomes infected with the coronavirus, an employer must investigate to determine if such infection was contracted at the workplace.  If the infection was likely contracted at work, that employee’s infection is recordable on the employer’s 300 log.  If the infection results in an inpatient hospitalization within 24 hours (or a fatality within 30 days) of the work-related infection, the incident becomes an OSHA reportable incident.  OSHA’s guidance indicates that a cluster of infected employees at any worksite is an indication that the infection occurred at the workplace.  The problem is further exacerbated by OSHA’s multi-employer responsibility doctrine.  Under the multi-employer doctrine, even if the employee does not create a hazard, an employer can be cited if its employees are exposed to a hazard created by others.  Such exposing employer citations can be handed down if the employer knew or failed to use reasonable diligence to discover the hazard and failed to take action to abate that hazard.  Thus, if a vigilant contractor’s employees are working in close proximity to employees of a contractor who has not taken appropriate mitigation measures, both contractors (the Creating Employer and the Exposing Employer) can be cited under the General Duty Clause.  

Responsible contractors must plan a course of action to take when working near contractors who have failed to take measures to protect against the virus or, worse, are actively avoiding quarantining and furloughs by permitting symptomatic and directly exposed employees to work.  

Contractual Remedies:

Contractors with general or sub-contracts with noncomplying contractors can often use standard contractual terms in an attempt to force these contractors to take appropriate COVID-19 related measures.  Such contractual clauses include:
  • Safety Clauses – Such clauses usually provide that a contractor is responsible (often “exclusively” or “solely”) for the safety at the job site and health of the workers, etc.
  • Compliance-with-law Clauses – Such clauses include compliance with OSHA regulations. While neither OSHA guidance nor CDC guidelines related to the virus generally rise to the level of law, contractors must comply with OSHA’s General Duty Clause.
  • Indemnity Clauses – If a contractor disregards reasonable safety measures, it could rise to the level of “negligence” or even worse (gross negligence, intentional/willful misconduct, etc.), especially in cases of employee injury or death. Contracts that provide a full/broad-form indemnity to employee injury/death claims may leave a contractor with significant exposure.

Contractors without Contractual Remedies Working Side-by-Side with Subcontractors:

Fellow subcontractor or lower-level contractors likely do not have these contractual terms to rely upon.  Notifying owners or upper-level contractors of COVID-19 related hazards, however, will hopefully spur them to pursue contractual remedies into action. This is especially true when knowledge of such COVID-19 related hazards can expose these upper-level contractors to possible OSHA citations or a personal injury lawsuit.  Further, projects with numerous COVID-19 infections have been put in the spotlight by local health departments and the media.  Upper level contractors risk such unwanted publicity if they do not take action against lower-level non-complying contractors.