This is an interesting case because it analyzes joint employment following a petition for contribution and reimbursement by one employer against another.
The facts are that the liable employer, Salrecon, entered into an agreement with BT-PCE (alleged joint employer) in which BT-PCE found employees for Salrecon, paid them through BT-PCE’s payroll service and Salrecon believed that BT-PCE would provide workers’ compensation insurance for these employees. Initially, BT-PCE’s manager found potential employees for Salrecon, Salrecon interviewed these employees and decided whether or not to hire them. These employees were put on BT-PCE’s payroll.
However, the employee in this case was hired directly by Salrecon as he had worked for them in the past Salrecon directed him to go back to Minnesota where they provided him lodging, tools, directed his work, and determined his wage. He was paid by BT-PCE.
Then, BT-PCE required I-9 employment eligibility documentation of all employees, including Mr. Guevara, and informed those employees that it would withhold any paychecks if they did not receive that by a set deadline.
On Nov. 15, 2007, debris fell on the employee and he was rendered quadriplegic. This resulted in well over one million dollars of benefits paid on behalf of or to the employee. Then, Salrecon filed a petition for contribution and/or reimbursement against BT-PCE.
At trial, the main issues were whether or not the employee was employed by BT-PCE or at least jointly employed by BT-PCE and Salrecon, and if so, whether or not BT-PCE was liable for the workers’ compensation insurance or there would be some level of apportionment between the two. However, the compensation judge found that the employee was only employed by Salrecon and that there was no entitlement to reimbursement or contribution from BT-PCE.
The compensation judge used a five factor test to determine whether an employer-employee relationship existed, and found that those factors supported that Salrecon was the employer, but not BT-PCE. The most key ingredient to the employment relationship test was the right to control the performance of the employee’s work duties, and BT-PCE had no control whatsoever and simply ran payroll for Salrecon.
Finally, the court rejected Salrecon’s argument there is a joint employment relationship in which BT-PCE was acting as the general employer and Salrecon was the special employer. The court found that BT-PCE did not find the employee as is usually the case in a lone servant doctrine/joint employer situation, and the only contact BT-PCE had with him was simply providing payroll services.
Thus, the compensation judge’s findings were affirmed, and therefore Salrecon was solely liable for the ongoing permanent and total disability and medical benefits of the employee.