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Coppola v. Salitsky Alloys, Inc., 30 Mass.L.Rptr. 56; Can I Sue an Employer When I am Paid Through a Payroll Company

A case out of Worcester Superior Court on July 2, 2012 again addresses the issue of whether an injured party can bring an action against an "employer" when the employee is technically employed by a payroll company.

In it's opinion, Justice Wrenn discusses the Defendant's pending motion for summary judgment and the applicability of Fleming v. Shaheen Brothers, Inc.. As Fleming tells us, although an injured individual may believe they have action against the company for whom they performed services, "the performance of payroll functions does not amount to a working relationship and is not sufficient to demonstrate the type of direction and control required under the applicable statute." Fleming v. Shaheen Brothers, Inc., 71 Mass.App.Ct. 223 (2008).

"For an employer to be immunized pursuant to the Workmens' Compensation Act, a direct employment relationship must exist between the injured party and the person claiming immunity and the employer must be an insured person liable for the payment of compensation." Fleming v. Shaheen Brothers, Inc., 71 Mass.App.Ct. 223 (2008).

This is count-intuitive for most laypersons considering the issue. The logical purpose for Worker's Compensation is to redress injuries occuring on the job while protecting employers from business-destroying loss. The creation of payroll companies or temp companies who essentially, on paper, treat the employee as their own. Benefits exist for employers who will need not worry about unemployment claims or other employee benefits typically accruing under state and federal law. One could easily conclude that a trade off for the company is that they lose the immunity provided under Workmen's compensation laws.

Not so. Here's why. Under Massachusetts law, who pays you is not conclusive as to who is an employer and, accordingly, who is immune under Workmen's Compansation law. The focus of the immunity is not whether a party is an employee on paper. Rather, the focus is on who is acting as the employer. Who is directing the employee on a day to day basis? Who has the power to hire and fire this position?

Under Lang v. Edward J. Lamothe Co., Inc., a two-prong test exists to establish immunity of an employer: “(1) the employer must be an insured person liable for the payment of compensation, and (2) the employer must be the direct employer of the employee.” Lang v. Edward J. Lamothe Co., Inc., 20 Mass. App. Ct. 231, 232, 479 N.E.2d 208, 209 (1985)

The lesson of this line of cases? If you are an individual who has been injured on the job and you are payed by a company other than the one who directs and controls you on a day to day basis, consider this two-prong test to see whether you are barred from bring an action against the company who controls and directs you.

The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.

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