Effective July 1, 2022, Contractors Will be Liable for their Subcontractor’s Failure to Pay its Employees’ Wages and Benefits
July 25, 2022 —
Edward O. Pacer & David J. Scriven-Young - Peckar & AbramsonOn June 10, 2022, Illinois Governor J.B. Pritzker signed two House Bills that amend the Illinois Wage Payment & Collections Act, 820 ILCS 115 et. seq. (“Wage Act”), to provide greater protection for individuals working in the construction trades against wage theft in a defined class of projects. Pursuant to this new law, every general contractor, construction manager, or “primary contractor,” working on the projects included in the Bill’s purview will be liable for wages that have not been paid by a subcontractor or lower-tier subcontractor on any contract entered into after July 1, 2022, together with unpaid fringe benefits plus to attorneys’ fees and costs that are incurred by the employee in bringing an action under the Wage Act.
These amendments to the Wage Act apply to a primary contractor engaged in “erection, construction, alteration, or repair of a building structure, or other private work.” However, there are important limitations to the amendment’s applicability. The amendment does not apply to projects under contract with state or local government, or to general contractors that are parties to a collective bargaining agreement on a project where the work is being performed. Additionally, the amendment does not apply to primary contractors who are doing work with a value of less than $20,000, or work that involves only the altering or repairing of an existing single-family dwelling or single residential unit in a multi-unit building.
Reprinted courtesy of
Edward O. Pacer, Peckar & Abramson and
David J. Scriven-Young, Peckar & Abramson
Mr. Pacer may be contacted at epacer@pecklaw.com
Mr. Scriven-Young may be contacted at dscriven-young@pecklaw.com
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Read the Property Insurance Policy to be Sure You are Complying with Post Loss Obligations
January 04, 2021 —
David Adelstein - Florida Construction Legal UpdatesI have discussed this before in prior postings, but it is worth repeating. It is imperative for an insured to comply with post loss obligations in a property insurance policy. Not doing so gives the insurer the argument that its insured forfeited coverage under the policy. Naturally, this is never what an insured wants as this is contrary to submitting an insurance claim to begin with. To avoid this situation, an insured should consult with counsel and read the policy including endorsements issued to the policy to be sure that post loss obligations are complied with and, if they are not, there is a basis supported by case law.
In a recent case, Goldberg v. Universal Property and Casualty Ins. Co., 45 Fla. L. Weekly D2118b (Fla. 4th DCA 2020), the property insurance policy for hurricanes and windstorms contained the following through an endorsement issued to the policy:
You must give notice of a claim, a supplemental claim, or reopened claim for loss or damage caused by the peril of windstorm or hurricane, with us in accordance with the terms of this policy and within three years after the hurricane first made landfall or the windstorm caused the covered damage. For purposes of this Section, the term “supplemental claim” or “reopened claim” means any additional claim for recovery from us for losses from the same hurricane or windstorm which we have previously adjusted pursuant to the initial claim. . . .
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Real Estate & Construction News Roundup (06/28/23) – Combating Homelessness, U.S. Public Transportation Costs and the Future of Commercial Real Estate
August 07, 2023 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogIn our latest roundup, we examine the Supreme Court’s ruling regarding water supply responsibilities, the federal reserve chair’s reaction to possible banking losses, several analyses of the future of commercial real estate, and more!
- California Representative Maxine Waters has introduced several pieces of legislation aimed at combating homelessness and fixing the increasingly tumultuous affordable housing situation. (Eliza Relman, Business Insider)
- The Supreme Court ruled in favor of the federal government in a case that decided responsibility over water supply as well as the overall dissemination of water usage for the Navajo Nation. (Ariane de Vogue, CNN)
- Unlike other nations with similar construction, the United States’ public transportation has extremely high costs. (Darian Woods, Corey Bridges, Viet Le, NPR)
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Pillsbury's Construction & Real Estate Law Team
Arkansas: Avoiding the "Made Whole" Doctrine Through Dépeçage
April 09, 2014 —
Robert M. Caplan – White and Williams LLPIn Arkansas, a workers’ compensation carrier’s subrogated recovery is subject to a determination of whether the injured worker—or, as the case may be, the worker’s surviving beneficiaries—has been “made whole” by the worker’s recovery against the third party tortfeasor. See, e.g., Yancey v. B & B Supply, 213 S.W.3d 657, 659 (Ark. App. 2005) (“An insured’s right to be made whole takes precedence over an insurer’s right to subrogation, and an insured must be fully compensated before the insurer's right to subrogation arises.”) [1] More often than not, a “made whole” determination will completely eradicate the carrier’s lien.
But under the right circumstances, a workers’ compensation carrier may be able to avoid the harsh outcome of “made whole” by intervening in a pending third party action and subsequently filing a motion for dépeçage—i.e., the conflict of laws principle requiring the court to conduct a separate choice of law analysis for discrete issues in a given case. A motion for dépeçage, in this sense, would demand that the court conduct a choice of law analysis to determine what state’s workers’ compensation subrogation law will apply on reimbursing a carrier’s lien.
We recently exploited this often underutilized tactic—to avoid Arkansas’ made whole doctrine—in a case involving a fatal plane crash in Louisiana. In that case, the deceased worker and his beneficiaries were residents of Louisiana; the accident took place in Louisiana; the worker was officially employed in Louisiana; and the workers’ compensation insurance policy was governed by, and benefits were paid under, Louisiana law. The only “contact” with Arkansas [2], meanwhile, was that Arkansas was the defendant’s domicile.
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Robert M. Caplan, White and Williams LLPMr. Caplan may be contacted at
caplanr@whiteandwilliams.com
CCPA Class Action Lawsuits Are Coming. Are You Ready?
March 23, 2020 —
Daniel Schneider & Jeffrey Dennis – Newmeyer DillionThe only certainties in life used to be death and taxes. In 2020, it would be safe to add California Consumer Privacy Act (CCPA) class actions to that "distinguished" list. On February 3, Barnes v. Hanna Andersson, LLC, N.D. Cal., Case No. 20-cv-00812, was filed in the Northern District of California, setting in motion the certainty that CCPA class actions are on their way, if not already here.* Filed on behalf of all California residents, the Barnes complaint alleges that between September and November 2019, clothing retailer Hanna Andersson and Salesforce, its online payment services provider, failed to properly safeguard the personally identifiably information (PII) of its customers after hackers stole customers' private information and posted it to the dark web for sale.
What You Need to Know
- Under the CCPA, a data breach is any unauthorized access, theft or disclosure of a consumer's non-encrypted and non-redacted personal information that results from a company's failure to implement and maintain "reasonable" security procedures and practices. Here, the complaint alleges that the defendants failed to maintain reasonable security procedures and practices in order to protect the consumers' PII.
- Although the CCPA is largely viewed as new law related to California consumers' privacy rights (and placement of subsequent obligations to companies doing business in California), the CCPA includes potentially draconian damages for a data breach permitted by unreasonable cybersecurity. Under the new law, an individual need not show any actual harm caused by a data breach, yet he/she may seek statutory fines of up to $750 per incident per individual in the event of a breach. Plaintiffs estimate that at least 10,000 California residents could have been affected by this breach, thereby exposing defendants to up to $7.5 million dollars in damages if proven true.
- There exists a duty to monitor and ensure that third party organizations are properly safeguarding a company's data. During the course of the investigation into the breach, it was discovered that the Salesforce ecommerce platform was infected with malware which allowed the hackers to steal consumers' PII from Hanna Andersson's website.
- The CCPA went into effect on January 1, 2020, yet enforcement by the California Attorney General is not allowed until July 2020. However, no such delay is required for private litigation under the data breach portion of the CCPA. Interestingly, although the complaint alleges that the data breach occurred in 2019, the court could choose to apply the CCPA but that is still yet to be determined.
While Barnes may be the first class action lawsuit to mention violation of the CCPA, it certainly will not be the last. In fact, numerous class actions lawsuits have been filed in the new year which either mention the CCPA or utilize CCPA-like language to style particular claims. As such, it is evident that the Plaintiffs' bar sees the CCPA as a potential for extensive class action litigation. Expect to see an ongoing deluge of class action litigation in California under the data breach portions of the CCPA. In addition, although the Barnes' plaintiffs may not be able to invoke the CCPA due to the data breach occurring in 2019 (before the CCPA took affect), Barnes serves as a stark reminder that implementing and maintaining reasonable data security is vital to defend a business against CCPA claims. Newmeyer Dillion can assist companies analyze their cyber risk profile, and provide access to experienced forensic teams which can ensure reasonable security exists in your organization.
*While Barnes does not yet expressly state a cause of action under the CCPA, relying upon violations of the California Unfair Competition Law in its place, we anticipate that an amendment will soon be filed to include a CCPA claim.
Daniel Schneider is a Partner in Newmeyer Dillion's Privacy & Data Security group. Focused on advocating on behalf of clients when cyber threats inevitably happen, Dan also advises on best practices to help protect the company and mitigate future concerns. Dan can be reached at daniel.schneider@ndlf.com.
Jeff Dennis (CIPP/US) is the Head of the firm's Privacy & Data Security practice. Jeff works with the firm's clients on cyber-related issues, including contractual and insurance opportunities to lessen their risk. For more information on how Jeff can help, contact him at jeff.dennis@ndlf.com.
About Newmeyer Dillion
For 35 years, Newmeyer Dillion has delivered creative and outstanding legal solutions and trial results that achieve client objectives in diverse industries. With over 70 attorneys working as a cohesive team to represent clients in all aspects of business, employment, real estate, environmental/land use, privacy & data security and insurance law, Newmeyer Dillion delivers holistic and integrated legal services tailored to propel each client's success and bottom line. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California and Nevada, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949.854.7000 or visit www.newmeyerdillion.com.
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Governor Inslee’s Recent Vaccination Mandate Applies to Many Construction Contractors and their Workers
September 13, 2021 —
Brett M. Hill - Ahlers Cressman & Sleight PLLCThis month Governor Jay Inslee enacted COVID vaccination requirements that apply to certain construction contractors and their workers in Washington state. Inslee’s vaccine proclamation becomes effective October 18, 2021 and requires construction contractors, subcontractors, and their workers to be fully vaccinated to perform work onsite on certain covered projects.
The following are types of covered projects where the vaccine mandate applies:
- State agencies: All contractors working at projects for Washington state agencies (including WSDOT, DES, DNR, etc.) if the work is required to be performed in person and onsite, regardless of the frequency or whether other workers are present. The vaccine mandate applies to indoor and outdoor settings and there is no exemption even if social distancing requirements can be met.
- Education/Higher Education/Child Care: All contractors performing work onsite for K-12, higher education (community colleges, technical colleges, and 4-year universities), child care and other facilities where students or persons receiving services are present. New and unoccupied projects are exempt but it does apply to public and private projects.
- Medical facilities: All contractors performing work at a “healthcare setting” where patients receiving care are present. “Healthcare setting” is defined as any public or private setting that is primarily used for the delivery of in-person health care services to people. “Healthcare setting” includes portions of a multi-use facility, but only the areas that are primarily used for the delivery of health care, such as a pharmacy within a grocery store. Additional information is on the state’s Q&A page.
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Brett M. Hill, Ahlers Cressman & Sleight PLLCMr. Hill may be contacted at
brett.hill@acslawyers.com
Hirers Must Affirmatively Exercise Retained Control to be Liable Under Hooker Exception to Privette Doctrine
September 12, 2023 —
Garret Murai - California Construction Law BlogDon’t drink and drive people. I mean seriously. It’s been over 40 years since California native Candace Lightner formed
Mothers Against Drunk Driving in 1980 after her 13-year-old daughter, Candace, was killed by a drunk driver who later served just 9 months in jail before getting out and getting into his sixth (yes, sixth) drunk driving accident. It hurts the victims and their families, makes a mess for the offender (and their family), and, as the next case,
Marin v. Department of Transportation, 88 Cal.App.5th 529 (2023), illustrates, can needlessly draw out the pain as the victim’s family seeks financial recourse for their emotional loss from others.
Miguel Angel Rodriguez De La Cruz, a highway construction worker, was killed by a drunk driver. I’m not sure what his family did on the legal front after his death – perhaps sued the drunk driver – but among possible others they sued the California Department of Transportation. And they lost. Although there is no such thing as “winning” and “losing” in these types cases. It’s just losing and losing.
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Garret Murai, Nomos LLPMr. Murai may be contacted at
gmurai@nomosllp.com
Pennsylvania Superior Court Fires up a Case-By-Case Analysis for Landlord-Tenant, Implied Co-Insured Questions
February 03, 2020 —
Gus Sara - The Subrogation StrategistIn Joella v. Cole, 2019 PA Super. 313, the Superior Court of Pennsylvania recently considered whether a tenant, alleged by the landlord’s property insurance carrier to have carelessly caused a fire, was an implied co-insured on the landlord’s policy. The court found that the tenant was an implied co-insured because the lease stated that the landlord would procure insurance for the building, which created a reasonable expectation that the tenant would be a co-insured under the policy. Since the tenant was an implied co-insured on the policy, the insurance carrier could not maintain a subrogation action against the tenant. This case confirms that Pennsylvania follows a case-by-case approach when determining whether a tenant was an implied co-insured on a landlord’s insurance policy.
The Joella case stems from a fire at an apartment building in Northampton County, Pennsylvania. The landlord’s property insurance carrier paid the landlord $180,000 to repair the damages resulting from the fire. In March 2018, the insurer brought a subrogation action against Annie Cole, a tenant in the building, alleging that Ms. Cole’s negligent use of an extension cord caused the fire. Ms. Cole raised the affirmative defense that she was an implied co-insured on the landlord’s insurance policy. The subrogating insurer filed a partial motion for summary judgment seeking to dismiss Ms. Cole’s defense. In response, Ms. Cole filed a cross motion for partial judgment, arguing that because the lease specified that the landlord would maintain fire insurance for the building, there was a reasonable expectation that she would be a co-insured on that policy. The trial court found in favor of Ms. Cole, holding that the landlord’s insurer could not maintain a subrogation action against her because she was an implied co-insured of the landlord’s insurance policy under the terms of the lease. The landlord’s insurer filed an appeal with the Superior Court of Pennsylvania.
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Gus Sara, White and WilliamsMr. Sara may be contacted at
sarag@whiteandwilliams.com
