Temps raise issues with workers comp
Published 8/20/98

New Hampshire employers are often in a position of using temporary employment agencies to Aborrow@ employees to fill a short term employment need, whether for seasonal work, a one-time project, or for coverage while an employee is on vacation or other leave of absence. It is common for those employers to place the burden of paying for the worker=s compensation premium for the temporary employees on the temporary employment agency. The employer needs to specify this in the agency contract. Under New Hampshire law the employer has the obligation to provide payment of worker=s compensation benefits for borrowed employees that satisfy the criteria of employees under the worker=s compensation statute. When the employer is obligated to pay worker=s compensation benefits to the borrowed employee, that employee is subject to the statutory bar from employee tort suits for work-related injuries. A borrowing employer=s immunity from a borrowed employee=s tort suit remains even if the borrowing employer delegates the duty to provide worker=s compensation benefits to the lending employer.

The New Hampshire Supreme Court has also found in the case of Benoit v. Test Systems, decided on May 28, 1997, that where a Massachusetts temporary employment agency referred a New Hampshire resident to a New Hampshire employer, and the agency provided worker=s compensation coverage, the borrowing employer was protected under the worker=s compensation statute. The Court made that ruling notwithstanding the fact that under Massachusetts law, a borrowed employee may have been able to pursue the borrowing employer for a tort claim relating to a work-related injury.

It is also important to note that the worker=s compensation bar as to tort suits against employers only applies to employees, not independent contractors who would neither receive the benefits of the worker=s compensation statutory requirement of payment of a limited benefit by the employer for work-related injuries without proof of the employer=s negligence nor the prohibition against seeking a personal injury award outside of the worker compensation benefit scheme. Therefore, independent contractors, unlike employees, can sue for work-related injuries caused by the person they work for, but will not receive an award without proving the employer=s legal fault.

The article is merely a general overview of the borrowed servant doctrine in worker=s compensation law as it relates when the employee is Aborrowed@ from a temporary employment agency. Employers, temporary employers, and independent contractors obtaining jobs through a temporary placement agency, should consider obtaining legal counsel for advice as to their legal rights under their specific circumstances.

J. Daniel Marr is a director and shareholder at Hamblett & Kerrigan, PA whose legal practice includes counseling businesses and business persons on a variety of legal issues and advocating on their behalf. Attorney Marr is also an adjunct professor at Daniel Webster College where he teaches business law. You can reach Attorney Marr by e-mail at: dmarr@hamker.com

This information is general information and may not reflect the most current legal developments, verdicts or settlements. The information provided should not be relied upon as an indication of the actual state of the law or of future developments. The information contained on the Hamblett & Kerrigan website is for informational purposes only and does not constitute legal advice. If the information referenced may be of legal importance to you, you should consult with an attorney to provide you with legal guidance and opinion as the the effect of the current law upon your situation.