When is a worker a “subject worker?”

Anderson, Kevin_webThe vast majority of workers in Oregon will be subject to the workers compensation system, with some exceptions. It is important to consider whether an injured worker is a subject worker when investigating the claim. Two recent cases address this important question.

Carpenter hired to remodel apartment on a couple’s farm not a subject worker when the work was unrelated to the day-to-day activities of the farm. Randall Royer v. Touch of Grey Ranch, 276 Or App 909 (2016).

Employer bought, boarded, trained, and sold polo horses. The couple who owned the business hired a carpenter to convert a hay barn into two apartment units. Claimant helped finish the interior of the apartments in exchange for being allowed to stay there. Claimant filed a workers’ compensation claim after injuring his leg with a chainsaw while working on the apartment.

ORS 656.027 provides that all workers are subject to the workers’ compensation statutes, unless they excluded as a non-subject worker. One such exclusion is for a “worker employed to do gardening, maintenance, repair, remodeling, or similar work in or about the private home of the person employing the worker.”

The court explained the primary concern is whether the location and nature of the qualifying work is fundamentally private and noncommercial. Private homeowners were not meant to be swept into the workers’ compensation system. Even major residential remodels and repairs qualify under the exemption, although new construction does not. The court confirmed he was a non-subject worker because the farm owners were not renovating the apartments for commercial use.

Under Oregon business law, claimant was a partner in the business and therefore, a nonsubject worker. Mark Pilling, 68 Van Natta 129 (2016).

Claimant and his wife owned a business specializing in the sales, service, and installation of satellite communication systems. Claimant provided the labor and knowledge and his wife performed administrative and bookkeeping duties. They did not pay themselves wages; instead, proceeds were used to pay expenses and then the remainder was merged into the family’s finances.

The business applied for workers’ compensation coverage in August 2012 to qualify for an installation job and did not identify claimant as a partner, officer, or relative to be included in the coverage. It did not include an endorsement electing coverage of any nonsubject workers. Claimant’s wife intended to obtain coverage for claimant. Claimant was injured in an MVA in December 2012 and the insurer denied the claim.

The ALJ set aside the insurer’s denial. The insurer appealed and the Board reversed. The Board ultimately found claimant to be a ‘partner of the business and therefore a nonsubject worker. Because “partner” is not identified in Chapter 656, it turned to ORS 67.055 which defines partnership. Even though there was testimony claimant and his wife did not intend to run the business as a partnership, the Board found their actions of sharing the profits and never having a payroll a significant factor that “strongly implies the existence of a partnership.”

If you have any questions about whether a worker is subject to the Oregon workers’ compensation system, feel free to contact me at kanderson@sbhlegal.com or 503-595-2130.