Monday, April 12, 2010

Humphrey...a case on what is a statutory employer

On April 1, 2010 the Colorado Court of Appeals decided the Humphrey case. It addressed the question of what is a statutory employer. An important purpose of a statutory employer is to impose responsibility often on the general contractor when a worker for a subcontractor is injured but that subcontractor has no workers compensation insurance. By statute the coverage is then to go through the general contractors insurance because it is deemed by statute the employer. But another impact of this is to prevent any further claims against the general contractor outside of workers compensation. So when the subcontactor does have workers comp and the employee does receive benefits but thinks there was negligence by the general and he tries to sue in a civil proceeding the general can assert it was a statutory employer and can't be sued even if it was negligent. In Humphrey a delivery person for Phil's burritos was hurt while in Whole Foods delivering and stocking Phil's burritos. He received workers compensation through Phil but then sued Whole Foods asserting they were negligent. Whole Foods said it was a statutory employer and can't be sued given he had workers compensation coverage. The court agreed. In a basic sense it is important to be aware that workers compensation law is set up to prevent an injured worker from suing his employer and yet also receiving workers compensation coverage. It is often considered to be an exclusive remedy. Clearly what is a statutory employer can turn on the facts. In Humphrey the court felt the delivery person was stocking and removing outdated burritos from Whole Foods shelves and active enough such that Whole Foods was a statutory employer. In any event it makes for interesting reading.

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