Work accident to a subcontractor employee – division of liability between the subcontractor and the operating contractor
Sep 22, 2019
Case TA 9973-07-16
Construction sites frequently engage subcontractors. When one of the employees of these subcontractors is injured in a workplace accident, disputes may arise regarding who is responsible for compensation. For example, what portion of the compensation should be paid by the subcontractor (the direct employer of the injured worker) versus the main contractor?
An example of such an allocation of liability can be seen in the following case, which was heard by the Tiberias District Court.
Accident Circumstances:The claim was filed by an assistant electrician who was injured when he fell at the site due to a bag filled with plaster waste. The employee was transported from the site by ambulance and had to undergo surgery on his leg due to a comminuted fracture and displacement of the patella.
Parties to the Case:The plaintiff filed the claim against his employer, the subcontractor (Defendant 1), on a project executed by a main contractor (Defendant 3). The insurance companies were defendants 2 and 4, respectively.
Who Pays, and How Much?
The court ruled in favor of the injured worker, awarding compensation exceeding 500,000 shekels, due to a series of safety failures. It was found that the defendants did not implement a safe working method and were negligent toward the plaintiff, who was only on his second day of work. Among other failings, the defendants:
Allowed him to work without the required safety measures
Failed to ensure safe access paths
Did not remove hazardous obstacles
Did not supervise activities at the site
The court allocated liability as follows: the subcontractor (the injured worker’s employer) was responsible for 30% of the damages, while the main contractor (construction executor) bore 70%.
The legal aspect
Allocation of Liability Between Subcontractor and Main Contractor
The question of liability allocation between a subcontractor and the main contractor is examined according to the degree of fault of each party, as derived from their level of negligence. The allocation of responsibility is at the discretion of the presiding judge, based on their assessment of each party’s culpability, including moral fault.
The subcontractor’s liability (30%) arose from the fact that it sent its employee to the construction site without ensuring a safe working environment and failed to instruct him on safety rules, even though it was aware of hazardous obstacles, such as construction waste bags.
The main contractor’s liability was broader (70%). First, the court noted established principles that appointing a subcontractor does not absolve the main contractor, who continues to be considered the responsible party for the construction work. The court then found that the main contractor did not appoint a site manager as required by safety regulations, and failed to demonstrate that safety briefings were provided to employees. Additionally, although a workplace accident occurred that required
ambulance evacuation to the hospital, no accident investigation report was prepared.
As can be seen, construction site accidents can cause severe bodily injury. Even if the accident is not fatal, and even if it appears minor, it can escalate into a claim involving substantial sums. For example, a fall caused by a bag of construction waste led to a claim in which the injured party demanded (and received) compensation exceeding 500,000 shekels.
The insurance aspect
In every construction project, it is extremely important that all parties involved in the work insure themselves with an appropriate insurance policy—both the main contractor and each and every subcontractor who comes to the site. Since claims often climb to substantial amounts, the insurance policies must be arranged accordingly.
Unfortunately, we frequently encounter policies with insufficient coverage (to put it mildly). More often than not, we come across contractors’ works insurance policies that do not align with the most recent case law in the field of bodily injury. Therefore, pay close attention. It is essential to verify that the policy includes adequate sums to cover bodily injury, both under the employers’ liability section and under the third-party liability section. Likewise, it is necessary to ensure the inclusion of extensions to policy exclusions and to confirm that they are supported by appropriate coverage limits. Furthermore, care must be taken to properly extend the definition of the insured under the contractors’ works insurance policy, so that the rights of all parties are fully protected.
