Are Employers Who Use Temporary Service Workers
Exempt from Civil Actions?
Workers' Compensation Law in general was created as a compromise between labor and management; one of the purposes was to remove claims of work-related injuries from the arena of civil litigation. In general, employers benefited from the compromise because the type of damages an employee may receive are controlled by statute, and usually do not include abstract elements such as pain and suffering and punitive damages. Economic damages are also generally limited to some percentage of lost wages. Employees also benefited by not having to establish negligence on the part of the employer as a prerequisite to liability.
As long as an employer provides the statutorily required coverage, it is exempt from civil actions involving personal injuries which arise out of and in the course of its employment. An employee may, however, file a civil action against a third party and allege that the third party's negligence was responsible for the alleged injury.
Temporary service agencies have become a popular way for businesses to control the cost of supplementing their permanent work force. The immunity provision of the Maine Workers Compensation Act includes a provision which purports to provide protection to employers using these agencies, as long as the agency in question has workers' compensation coverage.
Unfortunately, users of these temporary service agencies may no longer assume that they are immune from third-party suits by workers employed by a temporary service agency, even if that agency has obtained workers' compensation coverage. The Maine Law Court, in the case of Marcoux v Parker Hannifin/Nichols Portland Division, 881 A.2d 1138, (Me. 2005), held that the injured worker must work under the direction and control of the employer in order to be precluded from suing the employer and employees.
Plaintiff Christine Marcoux worked as an on-site coordinator for Kelly Services, which in turn provided temporary workers to Parker Hannifin. Ms. Marcoux filed a civil action against Defendant Parker Hannifin, alleging that she fell and was injured on account of Defendant's negligence. Defendant filed a motion for summary judgment in Superior Court, citing among other defenses, the immunity provision of Title 39-A M.R.S.A. §104. That provision states in pertinent part:
An employer that uses a private employment agency for temporary help services is entitled to the same immunity from civil actions by employees of the temporary help service as is granted with respect to the employer's own employees as long as the temporary help service has secured the payment of compensation...Temporary help services means a service where an agency assigns its own employees to a 3rd party to work under the direction and control of the 3rd party to support or supplement the 3rd party's work force in work situations such as employee absences, temporary skill shortages, seasonal work load conditions and special assignments and projects.
Ms. Marcoux argued that as an "on-site coordinator" she was not working under the direction and control of Defendant Nichols. She further argued that since she did not work under the direction of Defendant, she did not fall within the definition of "temporary help" within the construct of section 104. Defendant Nichols in turn argued that since Kelly Services was hired for the purpose of supplying employees to work under its control, it did not matter if Ms. Marcoux, who was at Nichols for the purpose of coordinating these workers, was under its control or not.
The Maine Law Court held that even though the arrangement between the temporary service agency and Defendant was to supply employees to work under Defendant's control, the prohibition against suing Nichols would not extend to Ms. Marcoux, supplied by Kelly in a supervisory capacity if she was not also under the direction and control of Nichols.
The Law Court further held that since an issue of material fact existed as to whether or not Ms. Marcoux was working under the direction and control of Defendant, that issue must be remanded for adjudication by the fact finder.
Another holding of significance by the Law Court is that the issue as to whether or not Ms. Marcoux was under the direction and control of Nichols is a mixed question of fact and law.
The practical consequences of the Marcoux decision are significant. The purpose of summary judgment is to quickly and efficiently defeat frivolous claims at the beginning of the lawsuit. Now, if a temporary worker can allege facts which arguably buttress the position that he or she is not under the direction and control of the third party, that worker will be able to withstand a summary judgment motion, and the law suit may go to trial.
If a temporary employee does sue the third party employer, the fact finder will be asked to weigh a number of factors in its determination of whether or not that employee falls within the protection of section 104. These factors include, but are not limited to, who controls the worker's schedule and job duties.
Hence the question arises: What can an employer utilizing a temporary service agency do to protect itself from this type of law suit? A simple contract specifying that all workers supplied by the temporary service will be under the employer's control is not sufficient. In fact, Nichols had such a contract with Kelly Services, but the Law Court held that the contract was ambiguous in respect to the duties of the on-site coordinator.
One thing that an employer may be able do is to make sure that each individual supplied by the temporary service is supervised only by the employer's supervisors. In practice, this may prove to be unwieldy for large employers.
Another suggestion is that employers utilizing the services of a temporary service include within the contract an indemnification clause, requiring that the temporary agency indemnify the employer for damages in the event that any of the agency's employees successfully files a third-party claim, rather than a workers' compensation claim.
In sum, employers - particularly large employers who rely on temporary services to support or supplement their work force - should be aware that the possibility of a third-party suit exists even if the temporary service has obtained workers' compensation coverage.
- Lawrence B. Goodglass, Esq.
