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Sloan v. Luyando

305 N.J. Super. 140, 701 A.2d 1275 (App. Div. 1997)

CONTRACTORS; INDEPENDENT CONTRACTORS—A person’s substantial dependence on a particular construction company for work was far more persuasive than the superficial steps taken to be an independent contractor or any outside business in which the person may have engaged. The Worker’s Compensation Act was the sole remedy against the contractor for injuries suffered in an auto accident.

A construction company employee was a passenger in a car that rear-ended another car. The employee’s attorney decided the facts supported a civil suit rather than a workers’ compensation claim. The complaint did not name the plaintiff’s employer as a defendant, only the drivers of both cars. Both drivers filed motions for summary judgment, claiming that recovery was limited to worker’s compensation benefits. The employee claimed there was no employment relationship, but failed to support this assertion in any way. The Law Division dismissed the employee’s complaint on summary judgment, concluding that he was an employee, not an independent contractor, and, therefore, his exclusive remedy was under the Worker’s Compensation Act.

Under New Jersey law, an employee’s sole remedy is under the Workers’ Compensation Act and all tort claims are barred. Whether one is an employee or an independent contractor depends on many factors, including whether a person works “according to his own methods, and without being subject to the control of an employer as to the means by which the result is to be accomplished.” The Appellate Division first looked to this “control” test, considering whether the employer had “the right to direct the manner in which the business or work shall be done, as well as the results to be accomplished.” As long as the employer has control, there can be no finding of independent contractor status. The “relative nature of work” test considers whether there is substantial economic dependence upon the employer and whether there is a “functional integration of their respective operations.” The employee testified that no deductions were withheld from payments made to him by the company, that he supplied his own tools and equipment, and that the only control exercised by the company was with regard to completion time and scheduling of a particular job. The Appellate Division stated that even accepting these claims as true, he was still an employee under both the “control” and the “relative nature of work” tests. He was not paid by the job, but rather on an hourly basis, and it appeared that he could not choose what jobs to accept or reject when summoned by the company. The Court further stated that even a finding that he were an independent contractor would not mean he was not an employee. His substantial dependence on the construction company was far more persuasive than the superficial steps he took to be an independent contractor or any outside business he may have engaged in. However, the Court did permit the employee to file a motion to set aside the earlier dismissal of his Workers’ Compensation petition.


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