General Contractor Liability for Subcontractor Negligence in Georgia

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A general contractor in Georgia is not answerable for a subcontractor’s negligence just because it hired the subcontractor. The starting rule protects an employer from the torts of one who runs an independent business, and a separate statute then lists six situations in which an employer is liable for a contractor’s negligence. Workers’ compensation law adds its own rule for a principal contractor, and a public policy statute limits how far a construction contract can shift liability for a party’s sole negligence.

The Starting Rule

“An employer generally is not responsible for torts committed by his employee when the employee exercises an independent business and in it is not subject to the immediate direction and control of the employer” (OCGA 51-2-4). A subcontractor that runs its own business and is not under the general contractor’s immediate direction and control falls within that rule, unless one of the exceptions applies.

The Six Exceptions

“An employer is liable for the negligence of a contractor” (OCGA 51-2-5):

  1. “When the work is wrongful in itself or, if done in the ordinary manner, would result in a nuisance”;
  2. “If, according to the employer’s previous knowledge and experience, the work to be done is in its nature dangerous to others however carefully performed”;
  3. “If the wrongful act is the violation of a duty imposed by express contract upon the employer”;
  4. “If the wrongful act is the violation of a duty imposed by statute”;
  5. “If the employer retains the right to direct or control the time and manner of executing the work or interferes and assumes control so as to create the relation of master and servant or so that an injury results which is traceable to his interference”; or
  6. “If the employer ratifies the unauthorized wrong of the independent contractor.”

On a construction project, the prime contract, the subcontract, the site safety plan, and the record of who directed the work on the day of the injury are records that can bear on the fifth exception: whether the general contractor kept the right to control how the work was done, or stepped in and took control.

The test looks at the right to control, not only at its use. In Atkins v. MRP Park Lake, L.P., No. A09A2125 (Ga. Ct. App. Nov. 20, 2009), the Court of Appeals asked whether the contract gave, or the employer assumed, the right to control the time, manner, and method of the work, and it held that the right need not have been exercised. The evidence it relied on came from how the job was arranged: a small repair business hired by the hour on an oral agreement with no written specifications or fixed price, given its tasks each day by a supervisor of the company managing the property, and told when to arrive. The court also treated a duty imposed by statute, there a landlord’s duty to keep rental premises in repair, as one that cannot be passed to a contractor, which is the fourth exception, and it reversed summary judgment.

The Principal Contractor and Workers’ Compensation

A principal contractor, an intermediate contractor, or a subcontractor is liable for workers’ compensation to an employee of any of its own subcontractors engaged on the subject matter of the contract, to the same extent as the immediate employer (OCGA 34-9-8(a)). That liability reaches only injuries that occur on, in, or about premises where the principal contractor has undertaken to execute work, or premises otherwise under its control or management (OCGA 34-9-8(d)).

The same secondary liability bears on whether the general contractor can be sued in tort by a subcontractor’s injured worker. In Yoho v. Ringier of America, Inc., 263 Ga. 338 (1993), the Supreme Court of Georgia tied tort immunity under OCGA 34-9-11 to secondary liability under OCGA 34-9-8(a): “it is only a ‘contractor’ who is secondarily liable for workers’ compensation benefits and who is, therefore, entitled to tort immunity.” The worker keeps the right to sue a third-party wrongdoer, with listed exceptions: an employee of the same employer, a person who provides workers’ compensation benefits under a contract with an employer, and, in stated circumstances, a construction design professional on the project (OCGA 34-9-11(a)). For an injured person outside that compensation scheme, such as a member of the public hurt near the site, a claim that the general contractor answers for a subcontractor’s negligence runs through OCGA 51-2-4 and 51-2-5.

Construction Indemnity Clauses

A construction contract term that purports to make one party “indemnify, hold harmless, insure, or defend” another against claims for bodily injury, death, or property damage “caused by or resulting from the sole negligence of the indemnitee, or its, his, or her officers, agents, or employees, is against public policy and void and unenforceable” (OCGA 13-8-2(b)).

Frequently Asked Questions

Does the indemnity rule block insurance requirements in the contract?
No. The subsection “shall not affect any obligation under workers’ compensation or coverage or insurance specifically relating to workers’ compensation,” and it does not apply to a requirement that a party buy a project-specific policy, such as an owner’s or contractor’s protective policy, builder’s risk insurance, or an owner or contractor controlled insurance program (OCGA 13-8-2(b)).

Where must an injured subcontractor employee file a compensation claim?
In the first instance against the immediate employer, and doing so does not waive the right to recover from the principal or intermediate contractor. If the immediate employer is not subject to the workers’ compensation chapter because it has fewer than the required number of employees, and OCGA 34-9-124 does not apply, the claim may be presented directly to the intermediate or principal contractor. Collecting full compensation from one employer bars recovery against the others (OCGA 34-9-8(c)).

Can a principal contractor that pays compensation recover it?
Yes. It “may recover the amount paid from any person who, independently of this Code section, would have been liable to pay compensation to the injured employee or from any intermediate contractor” (OCGA 34-9-8(b)).

Can a contract term make the general contractor liable for a subcontractor?
The third exception reaches a wrongful act that “is the violation of a duty imposed by express contract upon the employer” (OCGA 51-2-5(3)), so safety duties the general contractor took on in the prime contract can matter.

  • OCGA 51-2-4; OCGA 51-2-5
  • Atkins v. MRP Park Lake, L.P., No. A09A2125 (Ga. Ct. App. Nov. 20, 2009)
  • OCGA 34-9-8(a), (b), (c), (d); OCGA 34-9-11(a)
  • Yoho v. Ringier of America, Inc., 263 Ga. 338 (1993)
  • OCGA 13-8-2(b)

Disclaimer

This article provides general information about the Georgia statutes that bear on a general contractor’s liability for a subcontractor’s negligence. It is not legal advice and does not create an attorney-client relationship. Liability turns on the facts of each project and on the contracts involved, and deadlines can bar a claim. Anyone evaluating a particular situation should consult a licensed Georgia attorney.

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