Marcum v. State Agency of Human Servs.

• Decision Date: 06 January 2012
• Docket Number: No. 10–472.,10–472.
• Parties: Melissa MARCUM v. STATE OF VERMONT AGENCY OF HUMAN SERVICES.
• Court: Vermont Supreme Court

2012 VT 3

38 A.3d 1177

Melissa MARCUM

v.STATE OF VERMONT AGENCY OF HUMAN SERVICES.

No. 10–472.

Supreme Court of Vermont.

Jan. 6, 2012.

Present: REIBER, C.J., DOOLEY, JOHNSON, SKOGLUND and BURGESS, JJ.

ENTRY ORDER

¶ 1. Nurse Melissa Marcum appeals from the trial court's grant of summary judgment to the Vermont Agency of Human Services denying her status as a state employee entitled to workers' compensation benefits for a workplace injury. Nurse argues that based on her job of carrying out the Agency's business and the Agency's control of her work, the court erred in treating her like an independent contractor and in not deeming the Agency to be her employer. We disagree and affirm.

¶ 2. The following facts were found by the trial court and are not disputed. Nurse is a licensed practical nurse who worked both at Dartmouth Hitchcock Medical Center and as a home-caregiver for a young boy afflicted by a congenital respiratory condition. Nurse began providing home nursing services to the child in late 2006 after being approached by the patient's mother. The mother had applied, but had not yet been determined eligible, for services under the Family Managed Nursing Initiative Program (FMNI)—a Medicaid-funded program administered by the Agency. Her application was pending when nurse began caring for the child at his home.

¶ 3. When nurse began her at-home services, she did so as a Personal Care Attendant (PCA). This allowed the Agency to fund services to the child through another program known as the Children's Personal Care Services Program. Coincidentally, the Legislature extended state workers' compensation coverage to PCAs paid by that program, while specifying that PCAs were not to be considered state employees for any other purpose. 33 V.S.A. § 6321(h). ^*

¶ 4. In January 2007, after nurse worked with the child for about three months, the child's family was eligible to receive Medicaid-funded services under the FMNI program. Nurse's status changed from a PCA paid through the Children's Personal Care Services Program to a Medicaid provider paid at a higher rate under FMNI. No longer a paid PCA, nurse was no longer covered by the statutory extension of workers' compensation insurance for PCAs. To receive FMNI Medicaid payments, nurse signed a Provider Enrollment Agreement specifying that she would be paid by, and would bill for her services directly to, the Medicaid payment agent. According to the FMNI program specifications, nurses in the program were “self employed,” “responsible for handling their own tax payments,” and “not eligible to receive employment benefits (insurance benefits, paid vacations, etc.).” The Enrollment Agreement further set forth the Agency's role as facilitating “payment for the provision of health services and items to eligible beneficiaries” in the program.

¶ 5. Six months later, in June 2007, nurse injured her arm while working in the child's home. In January 2008, she filed a workers' compensation claim against the Agency with the Department of Labor. Finding nurse was not a state employee, and therefore ineligible for workers' compensation benefits, the Labor Commissioner granted the State's motion for summary judgment. Upon nurse's appeal, the commissioner certified the following two questions to the trial court: “(1) Was claimant an employee of [the Agency] at the time of her June 5, 2007 injury?; (2) If yes, is claimant's current claim time-barred under the provisions of 21 V.S.A. §§ 656 and 660(a)?” The court found nurse was not a state employee at the time of her injury, and granted the State's motion for summary judgment without addressing the timeliness question.

¶ 6. The case before us is an appeal from that decision. We apply the same standard as the trial court. Namely, “[s]ummary judgment should be granted when, taking all allegations made by the nonmoving party as true, there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law.” Madden v. Omega Optical, Inc., 165 Vt. 306, 309, 683 A.2d 386, 389 (1996).

¶ 7. The Vermont Workers' Compensation Act replaced employers' common law liability for workers' injuries with a schedule of specified compensation to be paid injured employees, generally regardless of fault. 21 V.S.A. § 618. As this Court has noted, “[w]orkers' compensation law represents a public policy compromise in which the employee gives up the right to sue the employer in tort in return for which the employer assumes strict liability and the obligation to provide a speedy and certain remedy for work-related injuries.” Gerrish v. Savard, 169 Vt. 468, 470, 739 A.2d 1195, 1197–98 (1999) (quotation omitted). Section 618 would entitle nurse to compensation if she received “a personal injury by accident arising out of and in the course of employment by an employer subject to this chapter.” 21 V.S.A. § 618(a)(1). Thus, the operative question is whether the Agency was her employer at the time of injury.

¶ 8. The Act defines “employer,” in pertinent part, as:

any body of persons, corporate or unincorporated, public or private ... and includes the owner or lessee of premises or other person who is virtually the proprietor or operator of the business there carried on, but who, by reason of there being an independent contractor or for any other reason, is not the direct employer of the workers there employed.

Id. § 601(3). This definition expands upon the common law concept of “employer” to include business operators who purport to hire, as contractors, minions to carry out the proprietor's own “regular trade or business” in an attempt to avoid workers' compensation liability for employees. King v. Snide, 144 Vt. 395, 400–01, 479 A.2d 752, 754 (1984). The legislative intent in designating these individuals as “statutory employers” was “to impose liability only upon the owner or proprietor of a regular trade or business ... where an uninsured independent contractor is carrying out some phase of the owner's or operator's business.” Id. at 401, 479 A.2d at 754.

¶ 9. Thus understood, the statutory definition of “employer” does not encompass the Agency-nurse relationship here. Statutory employer status is determined by the nature of the putative employer's business. In re Chatham Woods Holdings, LLC, 2008 VT 70, ¶ 11, 184 Vt. 163, 955 A.2d 1183. Specifically, this “nature-of-the-business” test asks “whether the work contracted for [by the owner or proprietor with the independent contractor] is a part of, or process in, the trade, business or occupation of the owner [or proprietor.]” Id. (quotations omitted); King, 144 Vt. at 401, 479 A.2d at 755. Shared commonality of interest with associated businesses is insufficient to render a proprietor a statutory employer of the associate's employees. See, e.g., Vella v. Hartford Vt. Acquisitions, Inc., 2003 VT 108, ¶ 15, 176 Vt. 151, 838 A.2d 126 (holding that lessor of a commercial garage was not statutory employer of leasing bus company employee who was injured there); King, 144 Vt. at 401, 479 A.2d at 755 (holding that unofficial manager of a wood lot was not statutory employer of an independent logger's employee injured on the premises); Packett v. Moretown Creamery Co., 91 Vt. 97, 99–101, 99 A. 638 (1917) (holding that a creamery was not statutory employer of a contractor hired to build a new structure). In contrast, and like in In re Chatham Woods Holdings, LLC, 2008 VT 70, ¶ 11, 184 Vt. 163, 955 A.2d 1183, where framing and roofing subcontractors were hired by a real estate developer turned builder, an owner will be deemed a statutory employer where a worker is carrying out a business owner's “trade, business or occupation.”

¶ 10. From the uncontested facts before the court, it was evident that the Agency's sole function in this case was to administer a public welfare Medicaid program while nurse's business was actual provision of nursing care in return for Medicaid payments. Nurse was an independent contractor, but was not hired to carry on the Agency's business. She performed no service that was otherwise available from, or could be delivered by, the Agency. The Agency was not a nursing service and, except for billing, in no...