Indiana: State Supreme Court Says Subcontractor’s Employees are Owed a “Duty of Care”

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April 26, 2017

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In the aftermath of Ryan v. TCI Architects/Engineers/Contractors, et al., Indiana employers should review their standard operating contracts and subcontracts to determine if they have an unexpected “duty of care” to workers of other entities.  The Indiana Supreme Court’s ruling in this case determined that certain language in a general contractor’s form contract extended a duty of care to a sub-subcontractor, despite the general contractor’s arguments otherwise.

The general contractor, TCI, had subcontracted work out to a number of vendors.  TCI utilized a “form contract” that contained language specifically stating that the subcontractors were responsible for monitoring and ensuring workplace safety.  In addition, TCI designated a safety representative, who would be responsible for overview of all safety precautions and programs related to the work.  When an employee of a sub-subcontractor was injured and sued, the Indiana Supreme Court reviewed the contract language and determined the following:

  1. Typically, a general contractor does not owe a duty of care to a subcontractor or sub-subcontractor’s employees, largely because the general contractor has little to no control over the conditions of work.
  2. However, there are a number of exceptions to this rule, including instances where the general contract “affirmatively evinces an intent to assume a duty of care.”
  3. In reviewing TCI’s form contract with the client, the Indiana Supreme Court found a section heading titled “[TCI’s] Responsibility for Project Safety.”
  4. This section, paired with the fact that the contract did allow TCI a degree of control over the worksite—in the form of TCI’s chosen safety representative, with which the subcontractors needed to comply—led the Supreme Court to state that TCI did assume a duty of care to its subcontractors.

Indiana employers should review their contracts or staffing arrangements to determine if they have inadvertently assumed a duty of care for third-party workers.

 Action Items

  1. Review subcontracts or other staffing arrangements with legal counsel for potential exposure.
  2. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2017 ManagEase, Incorporated.

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