What Indicators Determine the Employer-Employee Relationship in Longshore Cases?

At the starting point of any worker's compensation claim, there must be an employer, an employee, and an employer-employee relationship. According to the Longshore and Harbor Workers' Compensation Act (LHWCA), an employee is defined as "any person engaged in maritime employment, including any longshoreman or other person engaged in longshoring operations, and any harbor-worker including a ship repairman, shipbuilder, and ship-breaker." An employer is defined as "an employer any of whose employees are employed in maritime employment" [33 USCA 902(3) and (4)]. In most cases, there is no problem determining the existence of the employer-employee relationship. However, when independent contractors and other similar entities are involved, the employer-employee relationship is not so clear. The courts have addressed this issue and have provided a test to help in determining the employeremployee relationship. The test that best suits the principles of the LHWCA is the one applied by the ALJ (administrative law judge) and the Board, the relative nature of the work test. In determining the existence of an employeeemployer relationship pursuant to this test, one examines the nature of the claimant's work in relation to the regular business of the employer. This examination must focus on two distinct areas: the nature of the claimant's work and the relation of that work to the alleged employer's regular business. In evaluating the character of a claimant's work, a court should focus on various factors, including the skill required to do the work, the degree to which the work constitutes a separate calling or enterprise, and the extent to which the work might be expected to carry its own accident burden [Id. at 43.52]. In analyzing the relationship of the claimant's work to the employer's business the factors to be examined include, among others, whether the claimant's work is a regular part of the employer's regular work, whether the claimant's work is continuous or intermittent, and whether the duration of claimant's work is sufficient to amount to the hiring of continuing services as distinguished from the contracting for the completion of a particular job [Oilfield Safety and Machine Specialties v. Harman Unlimited, Inc., 625 F.2d 1248 (5th Cir. 1980)]. The Oilfield Safety case is unusual because two different companies were held to be the employer of the injured worker/claimant. The claimant was injured on Nov. 2, 1976. The claimant was one-half owner of Oilfield Safety, a company that performed safety inspections. The claimant was on an Amoco platform performing a safety inspection on the date of his accident. He wore Oilfield Safety coveralls. The helicopter pilot logged him in as an Oilfield Safety employee. The other one-half owner of Oilfield Safety admitted him to the hospital as an Oilfield Safety employee. He received wages after his accident from Oilfield Safety. The claimant testified that he was performing safety inspection work for Oilfield Safety. Oilfield Safety alleged that the claimant was not an employee of its company and had no control over the details of his work. The claimant had not undergone a physical, there was no employment contract, and he had terminated his ties with Oilfield Safety. Further, the claimant had been working with another company, Harman Unlimited, in October 1976, trying to obtain new business for Harman. Harman Unlimited also alleged that the claimant was not an employee of its company. Harman had no control over the claimant's activities, there was no employment contract, and no payments were made to the claimant. All normal employment indicators pointed to Oilfield Safety, i.e. payroll, tax withholdings, transportation, and the claimant's business address and phone.

The trial court found that, with these employment indicators, the claimant was an employee of Oilfield Safety. The court also found that the claimant was an employee of Harman Unlimited. The claimant had been contracted by Billy Harman to help obtain new business for Harman. The claimant would be paid a commission for any new business brought in by the claimant. While the claimant was on the platform, he handed out Harman Unlimited business cards and literature. Also, the platform had listed him as an employee of Harman Unlimited. As a result, both companies were liable for the payment of the claimant's LHWCA benefits. On appeal, the Fifth Circuit affirmed the trial court's decision that the claimant was an employee of both Oilfield Safety and Harman Unlimited. Whenever you are reviewing a matter to determine an employer-employee relationship, you must go beyond the usual indicators to determine an employer-employee relationship. The work performed by the claimant must be evaluated and the relationship of that work to the employer's regular business must be determined.