Legal Updates

Non-Business Exemptions

The workers' compensation system was designed to provide benefits to those employees who are injured in the course of employment. However, not all "employments" are considered to be within the contemplation of the system. By way of contrast, consider the factory worker who cuts his hand while working on an assembly line making car parts for the employer and the teenage boy who cuts his hand trimming hedges for his neighbor. Both the factory worker and the teenage boy were "employed" to perform a service for another. However, workers' compensation would only be applicable to the factory worker's injury. Other examples where resulting injuries would likely not qualify for workers' compensation, even though the individuals were paid for their services, include a housecleaner hired to perform a one-time spring cleaning on your home, a babysitter who cares for a young child on a weekend evening, and a mechanic friend who helps to fix a broken vehicle.

Loaned Employees

Responsibility for the payment of workers' compensation benefits is a joint affair when one employer loans its employee to another employer. If the employee is a party to a contract for hire with the third-party employer, the work performed by the employee is principally for the third-party employer, and the third-party employer controls the details of the employee's work, the third-party employer will be held responsible for workers' compensation benefits should the employee become injured. The element of control is a substantial factor is determining the employment relationship between the parties.

Res Judicata and Reopening of Social Security Decisions

The hallmark of res judicata is finality. Essentially, once a court has entered a final judgment conclusively establishing the rights of the parties on the merits of the dispute, such decision is final and will bar subsequent actions based on the same claim or cause of action. This rule of civil procedure has been adapted and applied to administrative actions, including social security decisions.

Domestic Servant Exemption

Workers' compensation coverage for domestic servants is limited. Such limitation is generally based on the exclusion for part-time employees or the statutory exemption for employers with less than the requisite minimum number of employees. Many states specifically exclude domestic servants from workers' compensation coverage. Others omit to place domestic servants on the list of covered employments. However, almost half of the states provide at least a measure of coverage for those employed as domestic servants.

Arbitration and Mediation

Alternative dispute resolution (ADR) has come to play an increasing role in the resolution of workers' compensation disputes. Almost half the states now offer arbitration and/or mediation as viable ADR methods.