Attention Contractors – New Defense to Joint Liability Available
November 2, 2021
By now, most contractors are cognizant of the impact of Virginia Code § 11-4.6. Enacted in 2020, this statute allows general contractors to be liable if their subcontractors fail to properly pay their employees. In 2021, the General Assembly modified this statute and general contractors need to be aware of this revision.
The modified statute provides that a general contractor may provide a “certification” as evidence that they did not know, and had no reason to know, that their subcontractors were not paying their employees properly. The general contractor must obtain this certification, in writing, from their subcontractor, and the certification must be signed by the subcontractor under oath. The certification must also state that the subcontractor and its sub-subs, paid all of their employees all wages due for the work performed on the project. Construction companies should review this newly modified statute and update their subcontracts and lien waivers accordingly.