TO BE, OR NOT TO BE CLASSIFIED A BORROWED EMPLOYEE
Skipper v. A&M Dockside Repair, Inc., No. 20-30278, 2020 WL 5550997 (5th Cir. filed Sept. 16, 2020); Skipper v. A&M Dockside Repair, Inc., No. 20-30278, 2020 U.S. App. LEXIS 29514 (5th Cir. filed Sept. 16, 2020).
By: Caleb Bertrand
The Fifth Circuit Court of Appeals affirmed the decision of the District Court for the Eastern District of Louisiana granting partial summary judgment in favor of defendants A&M Dockside Repair, Inc. and Helix Resources, L.L.C.[1] The plaintiff, whose services were provided to A&M on behalf of his actual employer Helix, was injured in a fall while working on a barge in A&M’s shipyard.[2] The plaintiff brought a negligence action against A&M, which then third-partied Helix as a co-defendant.[3] The district court determined that A&M, upon raising the affirmative “borrowed servant” defense, was the plaintiff’s “borrowing employer for the purposes of the Longshore and Harbor Workers’ Compensation Act. . . .”[4] Thus, a partial summary judgment was granted in favor of the defendants, thereby limiting the plaintiff’s recovery to compensation and medical payments.[5]
The plaintiff appealed the judgement to the fifth circuit on two assignments of error: First, that “[the defendants] waived the borrowed servant defense.”[6] Second, if the defense was not waived, there is a genuine dispute of the facts whether A&M was acting as his borrowing employer.[7] The appellate court, applying de novo review, found both claims to be meritless.[8]
1) Had the defendants waived the borrowed servant defense by not explicitly raising it in their answer?
The appellate court upheld the lower court’s determination that the defendants both timely and adequately raised the defense via their actions so as not to have prejudiced the plaintiff.[9] The court considered three reasons as to why the defense was not waived.[10]First, Helix had “made various assertions in its answer that implicated the borrowed servant defense.”[11] Second, the defendants had explicitly raised the defense in a partial summary judgment motion filed months before trial.[12] And third, the plaintiff had responded to the defense without requesting additional time for discovery on the issue.[13] Therefore, the borrowed employee defense was not waived.[14]
2) Should the nine-factor test have weighed in favor of the plaintiff being classified as a borrowed employee?
After re-analyzing the nine factors, the appellate court affirmed that the plaintiff was a borrowed employee of A&M at the time of the incident.[15] The factors can either be in favor of, opposed to, or neutral towards classification.[16] They are as follows: (1) which employer has control over the employee’s immediate work; (2) which employer’s work is being performed by the employee; (3) did the employee agree to work for the borrowing employer; (4) Did the original employer terminate the relationship with the employee; (5) who provided the tools and location for the performance; (6) who could discharge the employer from that work; (7) which employer is obligated to pay the employee; (8) did the new employment occur over a considerable length of time; and (9) was there an agreement between the original and borrowing employers as to the employee’s status while working for the hiring employee?[17]
The appellate court held that factors one through seven favored classifying the plaintiff as a borrowed employee hired by A&M to perform their work.[18] First, the plaintiff only took orders from an A&M supervisor on the jobsite.[19] Second, the plaintiff repaired and cleaned the barges for A&M’s benefit.[20] Third, the plaintiff raised no issue with working for A&M.[21] Fourth, the plaintiff had little, if any, communication with Helix while working for A&M.[22] Fifth, “the majority of the tools were provided by A&M, and the place of performance was A&M’s shipyard.[23] Sixth, A&M had the authority to discharge the plaintiff at any time.[24] Seventh, the plaintiff was paid by Helix from money they received from A&M for the job.[25]
As to the remaining two factors, the court held that the length of employment is only significant when the relationship exists for an extended period of time; otherwise, the factor is neutral.[26] The only factor that the appellate court held to favor the plaintiff’s claim was agreement between the employers as to the plaintiff’s status, because the contract contained a clause labelling him as a private contractor.[27] However, this was but one factor, and borrowed employee status had been found in spite of such clauses in the past.[28] Therefore, with seven factors weighing in favor of classifying A&M as the plaintiff’s borrowing employee, there was no genuine dispute as to a material fact that would preclude summary judgment.[29]
In conclusion, A&M, as a borrowing employer, is exempt from tort liability. Thus, plaintiff is limited in recovery to compensation and medical expenses paid by his direct employer, Helix.
[1] Skipper v. A&M Dockside Repair, Inc., No. 20-30278, 2020 WL 5550997, at *1 (5th Cir. filed Sept. 16, 2020).
[2] Id.
[3] Id.
[4] Id. (internal punctuation omitted).
[5] Id. (citing 33 U.S.C. § 933(i)).
[6] Skipper, 2020 WL 5550997 at *1.
[7] Id. at *2.
[8] Id. at *1, *4.
[9] Id. at *2.
[10] Id.
[11] Skipper, 2020 WL 5550997 at *2.
[12] Id.
[13] Id.
[14] Id.
[15] Id. at *4.
[16] Skipper, 2020 WL 5550997 at *2 - 4.
[17] Id.
[18] Id.
[19] Id. at *2.
[20] Id.
[21] Skipper, 2020 WL 5550997 at *3.
[22] Id. at *3.
[23] Id.
[24] Id.
[25] Id. at *4.
[26]Skipper, 2020 WL 5550997 at *2 - 4(citing Capps v. N.L. Baroid-NL Indus., Inc., 784 F.2d 615, 618 (5th Cir. 1986) (internal citations omitted)).
[27] Id. at *2 – 3.
[28] Id. (citing Gaudet v. Exxon Corp., 562 F.2d 351, 358 (5th Cir. 1977).
[29] Id. at *4.
