Under South Carolina law, companies with three or fewer full-time workers generally aren’t expected to provide workers’ compensation coverage. Still, even these firms may find it beneficial to do so even if they aren’t required because if a workplace injury does happen, the business could be found liable.
Sometimes, these smaller firms will secure liability insurance to provide coverage in case of a workplace accident.
That’s what happened in Canal v. National House Movers LLC, a case recently before the South Carolina Court of Appeals. Here, the court ruled – against the insurance company’s reasoning – that a man injured while working on a house-moving job for a small firm was in fact a temporary worker – not an employee – meaning the liability insurance policy did cover his injuries.
Small business in this case was a house moving company in which the sole, full-time employee was the owner/operator. The company had no written policies for hiring or firing, and workers were hired on a project-by-project basis, depending on the needs of a given job.
In February 2012, a man who had worked jobs for the company on-and-off over the past few years called another part-time worker to ask if there were any upcoming jobs for which help was needed. That other worker asked the owner, who answered in the affirmative. That part-time worker picked up up and took him to the job site to help with the move.
It was claimant’s responsibility to facilitate the movement of electrical cables and phone wires over the roof of the hose to prevent them from getting stuck or causing telephone pole damage as the house was moved. He did so by sitting on the roof of the house and, upon noticing any wires getting caught, moving them with a PVC pipe.
However, on one instance, the worker either came close to or touched a live power line. He was seriously injured.
The company did not qualify for workers’ compensation coverage, so the worker filed a personal injury action against the company, which had its commercial auto insurance liability policy. The policy provided indemnity coverage for all sums an insured must legally pay as a result of bodily injury caused by an accident resulting from ownership or use of a covered vehicle.
Coverage for injury to employees was excluded. However, the company asserted the injured worker was not employee, he was a temporary worker. The policy specifically states that employee does not include temporary worker, who is furnished to employer to complete a job as a substitute for a full-time worker or for short-term workloads.
Insurer defended the company, but with a reservation of rights, seeking a declaratory judgment finding worker’s injuries were excluded from coverage on grounds he was an employee. Circuit court agreed with the small business, finding this was seasonal employment that rendered claimant a “temporary worker” for purposes of the insurance policy.
The court of appeals affirmed. The court deemed the contract unambiguous as to the definition of a temporary worker. So all that needed to be determined was whether the small business hired the worker to meet a short-term or seasonal workload and if so, whether another part-time worker’s suggestion to hire him resulted in the policy requirement that the worker be “furnished” to the small business.
The court answered in the affirmative on both issues. The policy didn’t define the term “furnished,” so the court analyzed the plain dictionary meaning, finding that a third party was involved in providing or supplying the worker to the insured. The court decided that was technically the case here, and so the injured worker was covered under the commercial auto insurance policy.
If you have been injured at work, contact the Lee Law Offices at 800-887-1965.
Canal v. National House Movers LLC, Sept. 16, 2015, South Carolina Court of Appeals
More Blog Entries:
Hynes v. Good Samaritan Hosp. – Total Disability for Nurse After Patient Attacks, Sept. 17, 2015, Spartanburg Workers’ Compensation Lawyer Blog