$9.5B NYC airport project adopts ADR for workers’ comp

Dive Brief:

  • The consortium behind the $9.5 billion JFK International Airport construction project has implemented a new system for workers’ compensation claims. The New Terminal One team partnered with labor group insurer Ullico Casualty Group and insurance broker NFP to integrate an alternative dispute resolution program on the project.
  • The independent system for administering union workers’ compensation claims is intended to provide improved medical care and lower insurance costs. It is the first ADR program agreed to by the Building & Construction Trades Council of Greater New York 20 years, according to a release.
  • “The ADR program creates a safer and more equitable system with implications far beyond New York,” said Gerrard Bushell, president and CEO of the New Terminal One, in the release.

Dive Insight:

The 2.4 million-square-foot New Terminal One project broke ground Sept. 8. The project, with a 2030 deadline, is expected to create 6,000 jobs under a project labor agreement. The project’s design-build team is AECOM Tishman and Gensler. The New York Port Authority is in charge of the project, privately financed by Ferrovial, JLC Infrastructure, Ullico and The Carlyle Group.

ADR programs, which use mediators to more rapidly resolve disputes or claims, have gained popularity on some projects, Carol Sigmond, partner at New York City law firm Greenspoon Marder, told Construction Dive.

A common use of an ADR could be when multiple parties or contractors need to work in the same area on a jobsite. A mediator can come in for arbitration, and help find the most cost effective scheduling for groups to finish work.

When it comes to workers’ compensation issues, Sigmond said ADRs can help circumvent the often tedious or frustrating process of going before a judge. A project labor agreement provides a much better fit for an ADR, though, as there is a preset notion of how injuries and incidents are recorded and corroborated.

“Our program commits to delivering enhanced healthcare for union workers, so they receive the resources they need and return to work without encountering delays or complications common in a traditional claims dispute system,” said Edward Smith, president and CEO of Ullico, in the release.

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