A A recurring theme in state Supreme Courts over the past few months has been perhaps the most fundamental issue of employee compensation – coverage.
Courts in Texas, Kentucky, Montana, and Missouri looked at the applicability of workers ‘compensation laws to workers with dual employers and in industries exempted from the workers’ compensation system with mixed results.
On April 30, the Texas Supreme Court ruled that an employee hired by a recruitment agency and assigned to a client qualifies as an employee of the client’s company under the state Workers’ Compensation Act.
In Waste Management of Texas v. Stevenson told a majority in the court that the test to determine whether an employee is an employee of a hiring employer revolves around the issue of control over the employee.
“Instead of focusing on the legal question of who has the contractual right to control the plaintiff’s work, we have instead looked at the factual question of who exercises the right of control in the day-to-day work of the parties as a practical matter, the court said.
Jeffrey Belfort, who represented worker Robert Stevenson, said his reasoning had centered on the appropriate standard for giving a summary judgment as opposed to the standard for determining coverage.
He stated that the benchmark for an overall assessment is “whether fair-minded people differ in their conclusions in the face of all the evidence,” and said the file contained ample evidence of the level of control that waste management exercised rather than exaggerating its borrowed funds Employee.
The evidence included a contract that said Mr. Stevenson was an independent contractor, which the court said was an “eat your cake and eat it too” argument made by Waste Management that Mr. Stevenson should be treated as an employee – Imparted taste. However, the court said the contract was not authoritative and it concluded that there was enough evidence to establish that Mr Stevenson was legally a waste management employee.
Judge Jeffrey Boyd wrote separately, arguing that the majority vote “created a new and different test to determine whether an employee hired by a recruiting agency and assigned to the agency’s client company is an employee of the client company under the Workers’ Compensation Act is qualified. ”
If an express contract provides that an employee is not an employee or deprives the employer of control, Justice Boyd claims that the contract should be in control unless evidence shows that “the true company agreement was one that was the alleged (employer). “
On March 30, the Kentucky Supreme Court also examined the safeguards available to a temporary worker – and reluctantly ruled that a statutory breach benefit increase was not available for such an employee.
Kentucky law provides for a 30% increase in employee compensation if an accident is in any way caused by occupational safety violations by the employer.
While lawmakers did not specifically exempt temporary employers from the law, the court said that the law required Nathaniel Maysey to prove that his employer, a recruitment company, was the perpetrator – not his employer’s customer.
Since there was no evidence that Mr Maysey’s employer knew of the unsafe practices at Magna-Tech Manufacturing LLC where he had sent him, the court said he could not receive expanded compensation under state law.
The court admitted that the outcome of the Maysey v. Express Services Inc. is “harsh”, especially given the gravity of Mr. Maysey’s breach and the “egregious” nature of the security breaches, but the court said the harshness was “potentially mitigated”. by the fact that a federal civil proceeding is pending in which Mr. Maysey is bringing claims against Magna-Tech’s parent company and the owner of the premises.
Attorney Thomas W. Davis, who represented Mr. Maysey, argued that HR company Express Services Inc. had “deliberately violated” its duty to provide Mr. Maysey with a safe job by placing the teenager in a workplace with “multiple obvious hazards” Placed and failed efforts to provide Mr. Maysey with a job free from hazards that could cause death or serious physical harm.
Mr. Davis advocated a review of existing Kentucky law that would allow a borrowing employer to “evade liability for any security breach, however serious,” which “creates a financial incentive for an employer to fill the most dangerous positions.” Temporary workers. ”
Alternatively, he asked the court to pass a rule stating that “if an employer fails to exercise due diligence in providing temporary work to provide a workplace free from recognized hazards likely to result in death or serious physical harm to its employees the employer of the temporary work “it should be established that he has accepted the unlawful acts of his client, the guest employer”, whereby the employer of the temporary work is made liable for increased benefits under state law.
H. Clay List, who represented Express Services, said the court’s ruling “appropriately places responsibility for ensuring a safe work environment on the host country employer rather than the temp / recruiting agency, as temp / recruiting agencies have little or no responsibility no control over the security policies and procedures that their customers have put in place. ”
Mr. List noted that “Client employers often use extremely complex and sophisticated technologies and / or machines that the temp agency has no knowledge or experience of and are therefore more likely to expect the temp agency to provide training and on a regular basis Inspection, maintenance, and / or monitoring of each and every one of these machines on the job site of each and every employer’s employer, Kentucky law places responsibility on the host’s employer. “
On April 8, the Missouri Supreme Court ruled that an unbroken chain of contractor-subcontractor relationships between an injured truck driver and an alleged perpetrator’s employer had created a legal employer-employee relationship.
Under Missouri law, an independent contractor is deemed to be an employer of the workers of his subcontractors and their subcontractors when they are employed on or near the main contractor’s premises, the court said in State ex rel. Beutler Inc. versus Midkiff.
That principle was used to prevent Joshua McArthur’s negligence suit against the George J. Shaw Construction Co., the court said, since Mr. McArthur’s actual employer was a subcontractor for Shaw.
Abigail Han, who represented Mr. McArthur, said she expected the decision “would not have a major impact” as it merely reaffirmed the existing Loan Act. She said she hoped the court would have used the case to resolve issues of the law.
On March 25, the Montana Supreme Court ruled that federal employer’s liability law did not prevent bad faith claims from an injured railroad worker.
In Dannels v BNSF Railway Co., the court said that the plain language of FELA shows that the purpose of Congress was to establish a compensation scheme for rail workers who suffered accidents at work through negligence of their employer but did not intend “through FELA regulate the full range of injuries and claims a railroad employee may have. “
Therefore, according to the court, “the FELA does not occupy the entire area of reparation for injured railway employees in order to anticipate unlawful claims based on the behavior of a self-insured railway company in handling claims.”
Mark Parker, who represented the Washington Legal Foundation as amici, said he feared the court’s decision “will further complicate an already complex area of law.”
Dennis Conner, who represented worker Robert Dannels, said the decision was good news for the railroad workers as they now know that they have “rights and protection from abuse and ill-treatment by the people who adjust and process FELA claims” .
Sherri Okamoto is a lawyer at WorkCompCentral, a sister publication of Business Insurance
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