You Be the Judge

Does Exclusive Remedy Provision Block Worker’s Suit?

By: | January 14, 2014

Christina Lumbreras is a Legal Editor for Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at [email protected]

A general contractor subcontracted with a crane service company to provide crane operations on a construction project. A crane operator who worked for the company was assigned to the project. A worker for the contractor was injured when a wooden form broke apart and fell from the operator’s crane.

The operator had worked at the jobsite for several weeks. The contractor and its employees directed his work. The contractor told him what materials to move and when and where to move the materials. The contractor provided the rigging and straps used to attach the materials to the crane. At the end of each day, the contractor approved the hours worked by the operator before turning his time sheet over to the company. The contractor’s employees built the wooden forms, attached them to the rigging and straps, and acted as signal men directing the operator’s operation of the crane.

The worker sued the company. The company argued that the worker’s exclusive remedy was to pursue a claim for workers’ compensation benefits. The worker asserted that he was entitled to recover against the company because the operator was not his coworker. The company contended that an employer-employee relationship existed between the contractor and operator. The trial court dismissed the suit. The worker appealed.

[poll id=”86″]

How the court ruled: The Indiana Court of Appeals held that the exclusive remedy provision of workers’ compensation barred the worker’s suit. Johnson v. Poindexter Transport, Inc., No. 49A02-1212-CT-1027 (Ind. Ct. App. 09/11/13).

The court explained that control is the most important factor when determining whether an employer-employee relationship exists. Here, the contractor’s employees controlled the operator “almost completely” throughout each day he worked at the jobsite.

The court found that the contractor had a right to indirectly discharge the operator from his employment. Also, the contractor supplied the equipment to move the forms and set the boundaries within which the operator worked. The evidence did not indicate that either the contractor or the operator believed that they had an employer-employee relationship. Balancing the factors of the employment relationship and giving considerable weight to the element of control, the court found that the operator was a borrowed employee of the contractor. Therefore, the answer is B: The worker’s exclusive remedy was under workers’ compensation.

A is incorrect. The court explained that although the operator only worked on the project for several weeks, balancing the factors of the employment relationship established that the operator was a borrowed employee of the contractor.

C is incorrect. Because the contractor did not pay the operator, directly or indirectly, the court said this factor weighed against a conclusion that he was a borrowed employee. However, taking into consideration all of the factors, the court concluded that the operator was a borrowed employee.

Editor’s note: This feature is not intended as instructional material or to replace legal advice.

More from Risk & Insurance

More from Risk & Insurance