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Gaughan v. Joseph Polt Construction Company

A-5591-02T3 (N.J. Super. App. Div. 2004) (Unpublished)

WORKERS COMPENSATION—In determining whether an injured worker is an employee, only if the “right to control” test is not satisfied, is it necessary to apply the “relative nature of the work test,” so a self-employed carpenter who receives detailed work instructions from a contractor may be an employee of that contractor for the purpose of the workers compensation act.

A self-employed carpenter entered into a contract with a homeowner. The carpenter then contacted with another self-employed carpenter, as a construction specialist, to assist him on the project. At that time, the specialist was working on a separate job; however, he took time off in order to help the first carpenter. As a result, he was not receiving income from any other source. It was agreed that the first carpenter would pay the specialist daily. There was never an agreement that the first carpenter would provide the specialist with a W-2 or 1099 form, nor did the parties agree that workers compensation insurance would be provided. This conformed with how the two had worked together in the past. The carpenter testified that he told the specialist when he was needed and where the job site was located. And, the specialist testified that he brought his own hand tools to the job site, but that the carpenter supplied the power tools and heavy equipment.

The specialist testified that the carpenter was in charge of the job. However, the carpenter claimed that he worked around the specialist’s schedule and that the specialist arrived at the job site whenever he chose, and took lunch breaks whenever he chose. To the contrary, the specialist alleged that the hiring carpenter decided when the job would start and when they would stop working.

During the course of the job, the specialist was injured. As a result, he filed a workers compensation claim against the carpenter. The carpenter denied that the specialist was an employee. The lower court held that the specialist was an employee and qualified for compensation benefits. Specifically, the court held that this was the contractor’s project and that he was receiving help from the specialist. “[I]t was a definite relationship to do a definite job designed an[d] entered into before the work started, did not happen by chance and it was not work that was not associated with the general work of the carpenter.” On appeal, the carpenter argued that the specialist failed to satisfy the “right to control” test, as well as the “relative nature of the work” test.

The Appellate Division pointed out that the “right to control” test focuses on whether the employer had the right to direct the manner in which the business or work was to be done, as well as the results accomplished. Therefore, actual control by the employer is not necessary because on many occasions, the expertise of an employee precludes an employer from giving him any effective direction about the method used. The Court held that this test was met. Specifically, the specialist testified that the carpenter told him “what he wanted done.” Therefore, the carpenter had the right to control, and did control, the “results accomplished.” In addition, the contractor had the right to direct the manner in which the business or work would be done. This was demonstrated by the specialist’s testimony that despite his practice of doing this type of job a certain way, he changed how he worked because that was how the carpenter wanted the job to be done. The fact that this job was a “one shot deal” did not affect the specialist’s status as an employee.

The Court held that only in instances where the “right to control” test is not met should the “relative nature of the work” test be applied. Therefore, it held that since the “right to control” test was met in this case, it was unnecessary to discuss the “relative nature of the work” test. Satisfaction of either test is sufficient to qualify a worker as an employee. As a result, the Court affirmed the lower court’s decision holding held that the specialist was an employee and was entitled to compensation benefits.

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