Preventing Legal Liability Related to Independent Contractors

Legal Definition One who: Contracts to do work According to own methods Not subject to control Except as to product/results

Relationship to Mine Is not an employee May be an agent May create liability Contractor’s employees Owner’s employees Third parties

Limiting Liability Civil Liability

Contractor personnel are business invitees Property owner has duty of care To not injure invitee To warn of hazards Contractor personnel may sue owner for injuries Owner personnel may sue contractor

Limiting Civil Liability Traditional Approach Owner: Discloses hazards on property Tries to remain separate Owner does not: Direct contractor work Tell contractor how to be safe

Limiting Civil Liability Traditional Approach Make sure: Contractor has workers’ compensation Contractor has adequate insurance Insurance protects owner Obtain waiver of liability and promise of indemnification Maintain independent liability insurance

Workers’ Comp Limitations Only limits employer’s liability to employer’s own employees Employees are free to sue third parties

Independent Contractors Limiting Liability Regulatory Responsibilities

On mine property MSHA requirements Off mine property OSHA requirements

Independent Contractor On Mine Property “Miner” status Is an individual Is working in a mine “Operator” status Operates, controls or supervises part of a mine Is independent contractor performing services or construction

“Agent” status Charged with responsibility for operation of part of mine Charged with supervision of miners Independent Contractor On Mine Property

Regulatory Liability Most Severe Effects High negligence can produce maximum penalties for operator Serious violations prompt special investigations Agents of contractor or owner may be prosecuted

Independent Contractor Regulatory Liability Contractor’s goal: Avoid violations against self and owner Owner’s goal: Avoid imputed liability Two avenues Contractor accepts responsibility Owner encourages compliance

Independent Contractors at Mines Contractors are responsible as operators Responsibilities vary depending on regulations and work done Enforcement is controlled by MSHA policy

MSHA Policy: Cite Only Contractor, Unless Owner: Contributed to violation Contributed to prolongation Controls abatement Employees were exposed

Trend in Serious Cases Cite contractor and owner But owner may avoid citation by demonstrating vigorous efforts to require, assist and enforce contractor compliance

Latest Developments Twentymile decision (on appeal) Factors critical to shifting responsibility: Level of experience and knowledge of contractor Specificity of information provided by owner Level of owner vigilance and response

Before Permitting Contractor Work: Choose responsible contractor Require MSHA identification Check record with MSHA Verify required MSHA training Require to plan for safety Provide written materials on MSHA duties

Implementing Contractor Safety Requirements: Provide hazard training Do not direct work Talk to management Check for violations Record enforcement Stop unsafe work immediately

Precautions for Contractors Learn MSHA responsibilities Obtain MSHA legal identification Train employees per MSHA Keep owner informed on training Report Injuries to MSHA Insist on Employee Safety Make Records of Enforcement

CONCLUSION Cooperation by mine operators & contractors to manage safety, will prevent injuries, improve legal compliance, and reduce potential liabilities