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There are many instances in which an injured worker argues that he was not employed so as to be able to bring a negligence action. The case ofHernandez v. Port Logistics, A-3558-12T3 (App. Div. 2014) illustrates this situation.
Daniel Hernandez was placing a box onto a load of pallets on August 23, 2011, when a wood splinter broke off and struck him in the eye, causing total loss of vision in the left eye. Hernandez was employed by Staff Management, which had entered into a “Service Agreement” with Distribution Solutions, Inc. doing business as Port Logistics Inc. Hernandez sought workers’ compensation benefits from Staff Management. Then he sued Port Logistics Inc. contending that the company was negligent in not providing him with eye protection.
Port Logistics Inc. argued that Hernandez was its employee and could not sue the company because his exclusive remedy was workers’ compensation. In his deposition, Hernandez acknowledged that he was doing work for Port Logistics in loading and unloading trucks. He worked under the direct supervision of Port’s managers, who provided him with his assignments and directed his work at the loading docks. Port controlled his work hours and lunch time. Port Managers could send Hernandez home early if work was lacking.
For his part, Hernandez argued that the Service Agreement said he was an employee only of Staff Management and that Staff Management was exclusively responsible for payroll, taxes and workers’ compensation. The trial judge rejected this argument that only Staff Management was Hernandez’s employer. The judge found that Hernandez was a special employee of Port Logistics. Hernandez appealed.
The Appellate Division noted that it is quite common for an employee to have two employers. The court said that the language of the Service Agreement alone did not control the outcome of the litigation. Instead, the court reviewed all the factors noted above showing that Port Logistics exercised tremendous control over the day-to-day activities of Hernandez. “In short, under the precedent cited, defendant (Port) was a special employer of plaintiff, despite any contract language to the contrary. As a result, plaintiff’s tort claim against defendant was barred by N.J.S.A. 34:15-8.”
The lesson in this case is that sometimes an employer wants coverage under workers’ compensation because the exclusive remedy provision offers powerful protection for an employer faced with a potentially large negligence law suit.