Gore v. Hepworth

316 N.J. Super. 234, 720 A.2d 350 (App. Div. 1998)
  • Opinion Date: October 30, 1998

EMPLOYER-EMPLOYEE; WORKER’S COMPENSATION; SPECIAL EMPLOYEES—Where one company borrows an employee from another and then controls that employee on the job, the employee becomes a “special employee” and is subject to the Worker’s Compensation Act.

A worker, riding as a passenger in a truck, was injured when the truck struck a low overpass. Prior to the accident, the worker asked the truck’s driver, an employee of the trucking company, whether the truck would clear the overpass. He was assured that it would. After the worker received worker’s compensation benefits from his employer, a warehouse company, he sued a number of parties, including the trucking company. The trucking company defended by claiming that the worker was a “special employee” of the trucking company. An employee’s exclusive remedy against his or her employer for ordinary work injuries is a statutory remedy without regard to fault. A special employee is subject to that same limitation with regard to his or her special employer.

The establishment of a “special employment” relationship is governed by the “borrowed-employee doctrine.” When a general employer lends an employee to a special employer, the special employer becomes liable for worker’s compensation only if: (a) the general employer has made a contract of hire, express or implied, with the special employer; (b) the work being done is essentially that of the special employer; and (c) the special employer has the right to control the details of the work. When all three of these conditions are satisfied, both employers are protected by the worker’s compensation doctrine. In addition, the following two additional factors have recently been added to the test: (d) the special employer pays the employee’s wages; and (e) the special employer has the power to hire, discharge or recall the employee. The most important factor in determining special employer status is whether the special employer had the right to control the special employee’s work.

The president of the warehouse company certified that there was an agreement “wherein employees from one company would be hired as special employees of the other during times when work for either was lessened” and that the employee’s salary would be “paid by the special employer in one of two methods, either by direct monetary payment or the corresponding payment of the salary of the corresponding employee.” His testimony was that although the worker was on the payroll of the warehouse company, he was performing work as a special employee of the trucking company. Any high level supervisor of the trucking company could fire the worker and when the worker reported to the trucking company’s supervisor, the worker was under the supervisor’s control. It was not disputed the work being done by the worker was for the trucking company and that the trucking company clearly controlled the worker on the job. Consequently, this control favored the finding that the worker was a special employee of the trucking company. In addition, the Court ruled that the right to control whether the worker would be assigned to work for the trucking company was the equivalent of a power to discharge him. In summary, it was clear to the Court, after its consideration of the applicable factors, that the worker was a special employee of the trucking company and was therefore precluded from maintaining a tort action against the trucking company or any of the trucking company’s employees.