filed: April 20, 1981.
SHIRLEY KELLER, EXECUTRIX OF THE ESTATE OF HAROLD KELLER, DECEASED, APPELLANT,
OLD LYCOMING TOWNSHIP, APPELLEE
No. 350 Philadelphia 1980, Appeal from the Order of the Court of Common Pleas of Lycoming County, Civil Action Law at No. 76 - 3264.
Clifford A. Rieders, Williamsport, for appellant.
Richard A. Gray, Williamsport, for appellee.
Spaeth, Hester and Cavanaugh, JJ.
[ 286 Pa. Super. Page 342]
This is an appeal from an order granting summary judgment in favor of Old Lycoming Township and against Shirley Keller, executrix of the estate of Harold Keller, deceased. Keller died on September 15, 1975, as a result of injuries sustained when a ditch he was excavating collapsed. At the time of his death, he was working in a program created under the Comprehensive Employment and Training Act (CETA).*fn1 His executrix brought wrongful death and survival actions against the township. The township moved for summary judgment on the theory that it was Keller's employer and thereby immune under the Workmen's Compensation Act.*fn2 Keller's executrix argued that the township was not Keller's employer, but rather that an organization known as "Service, Training and Education Programs"
[ 286 Pa. Super. Page 343]
(STEP) was.*fn3 The lower court concluded that by virtue of the borrowed servant doctrine,*fn4 the township, and not STEP, was Keller's employer. We agree with this conclusion, and shall therefore affirm.
Congress enacted the Comprehensive Employment and Training Act to
provide job training and employment opportunities for the economically disadvantaged, unemployed, and underemployed persons, and to assure that training and other services lead to maximum employment opportunities and enhance self sufficiency by enhancing a flexible and decentralized system of Federal, State and local programs. 29 U.S.C. § 801.
To accomplish these purposes, the Act allows the Secretary of Labor to make financial assistance available to "prime sponsors,"*fn5 so that they may "carry out all or a substantial
[ 286 Pa. Super. Page 344]
part of a comprehensive manpower program." 29 U.S.C. § 812. The prime sponsor in the Old Lycoming Township area was the Lycoming and Clinton Consortium. The consortium subcontracted with STEP to administer certain aspects of the CETA program. See N.T. Michael Wilt at 4; N.T. Richard Hritzko at 3-4. STEP acted as an employment office. R. 108a-110a. It enrolled qualified applicants in the CETA program and referred them to potential employers. If the applicants were hired, STEP paid their wages and their workmen's compensation and medical insurance from CETA funds. R. 53a, 55a, 101-103a. CETA workers were entitled to take advantage of a grievance procedure administered by STEP, and to vacations according to a schedule provided by STEP. R. 103-104a. A STEP coordinator
[ 286 Pa. Super. Page 345]
visited the various worksites to ensure that the CETA workers were satisfied, and tried to resolve any difficulties with respect to CETA workers. R. 145a, 167a.
In December 1974, Old Lycoming Township requested a heavy equipment operator from the Manpower Administrator of CETA. Wilt Exhibit # 1. The request was approved, and a job description and recommended pay rate were sent to STEP. STEP referred Harold Keller to the township, and in January 1975, he was interviewed and offered a position in a road maintenance crew. Wilt Exhibit # 10 and 15. Keller worked with, and was supervised by, township personnel until September 15, 1975, when he died as a result of injuries sustained in the collapse of the ditch he was excavating so that a lateral sewer line could be installed for the township. See Amended Complaint, # 6.
In deciding whether the township was Keller's employer within Section 481 of the Workmen's Compensation Act, any factual discrepancies are for the trier of fact to resolve; whether the facts as they are determined to exist constitute an employment relationship is strictly a question of law. English v. Lehigh County Authority, 286 Pa. Super. 312, 428 A.2d 1343, (1981); McManus v. Kuhn, 194 Pa. Super. 544, 168 A.2d 618 (1961); Potash v. Bonaccurso, 179 Pa. Super. 582, 117 A.2d 803 (1956); See also, Barnett v. Bowser, 176 Pa. Super. 17, 106 A.2d 457 (1954) (whether employment is "casual" is question of law). Accordingly, on the township's motion for summary judgment, all discrepancies in the facts and all reasonable inferences arising from the facts must be resolved in favor of Keller's executrix as the nonmoving party. English v. Lehigh County Authority, supra; Ritmanich v. Jonnel Enterprises, Inc., 219 Pa. Super. 198, 280 A.2d 570; Schacter v. Albert, 212 Pa. Super. 58, 239 A.2d 841 (1968).
Recently, in English v. Lehigh County Authority, 286 Pa. Super. 312, 428 A.2d 1343 (1981), we had occasion to examine the same general issue as is raised here, and concluded that "[t]he test for determining whether a borrowing employer is an employer for workmen's compensation purposes
[ 286 Pa. Super. Page 346]
is whether the employer controlled, or had the right to control, the borrowed employees, 'not only with regard to the work to be done but also with regard to their manner of performing it.'" English v. Lehigh County Authority, supra 286 at 322, 428 A.2d at 1349 quoting Venezia v. Philadelphia Electric Co., 317 Pa. 557, 559, 177 A. 25, 26 (1935), and citing Mature v. Angelo, 373 Pa. 593, 97 A.2d 59 (1953); Walters v. Kaufmann Department Stores, Inc., 334 Pa. 233, 5 A.2d 559 (1939); Hattler v. Wayne County, 320 Pa. 280, 182 A. 526 (1936); Atherholt v. Stoddart Co., 286 Pa. 278, 133 A. 504 (1926); Tarr v. Hecla Coal and Coke Co., 265 Pa. 519, 109 A. 224 (1920); Puhlman v. Excelsior Express & Standard Cab Co., 259 Pa. 393, 103 A. 218 (1918); Walton v. Harold M. Kelly, Inc., 218 Pa. Super. 28, 269 A.2d 347 (1970); Stevens v. Publishers Agency, 170 Pa. Super. 385, 85 A.2d 696 (1952); Fanning v. Apawana Golf Club, 169 Pa. Super. 180, 82 A.2d 584 (1951); Nilsson v. Nepi Brothers, 138 Pa. Super. 107, 9 A.2d 912 (1939); aff'd Nilsson v. Nepi Bros., 338 Pa. 561, 14 A.2d 75 (1940). Frederico Granero Co. v. Workmen's Compensation Appeal Board, 43 Pa. Commw. 308, 402 A.2d 312 (1979); City of Monessen v. Workmen's Compensation Appeal Board, 36 Pa. Commw. 226, 387 A.2d 1000 (1978); Reasner v. Workmen's Compensation Appeal Board, 36 Pa. Commw. 292, 387 A.2d 679 (1978); Grant Builders v. Workmen's Compensation Appeal Board, 33 Pa. Commw. 591, 382 A.2d 783 (1978); Barr v. B&B Camper Sales, 7 Pa. Commw. 323, 300 A.2d 304 (1973).
English v. Lehigh County Authority, supra involved a temporary employment agency, Kelly Labor, which for a fee supplied its customers with laborers. It was argued that Kelly Labor should be considered the deceased workman's employer because:
Kelly Labor hired and initially assigned its workers to various customers; it retained the right to fire or discipline its workers; it had exclusive control over the job assignments undertaken by its workers once assigned to a customer; and it paid its workers' wages and unemployment compensation tax, carried its workers' workmen's
[ 286 Pa. Super. Page 347]
compensation insurance, and withheld federal, state and local taxes from its workers' wages. Id., 286 Pa. Super. at 323, 428 A.2d at 1349.
We concluded, however, that because the Lehigh County Authority controlled the activity at the worksite, it was the employer. Id., 286 Pa. Super. at 323, 428 A.2d at 1349-1350. Here, Keller's executrix argues that while Keller worked with and under the supervision of township personnel, see Amended Complaint # 6, he was nevertheless an employee of STEP because of the degree of control that STEP had over a CETA program. In particular, she cites these facts: that STEP paid the CETA workers' wages and medical and workmen's compensation insurance from CETA funds; that it required that its grievance procedures be followed before a CETA worker could be fired; that a representative of STEP visited the worksites to check on problems the CETA workers might be having; and that STEP could terminate a worksite as a place where CETA workers worked. To quote the executrix's brief, "C.E.T.A. has the power to control the method or detail of the work . . . ." Appellant's Brief at 28.
We agree that STEP did indeed retain considerable control over its CETA funded workers, and we note that the federal government had the power to increase STEP's control over the CETA funded workers to an even greater extent. We remain persuaded, however, that the lower court was correct in its conclusion that the township was Keller's employer. The dispositive fact is that the township controlled the activities at the worksite and directed the conduct of Keller and his fellow employees while they were there.
We are aware that in Pennsylvania Manufacturers' Association Insurance Company v. Workman's Compensation Appeal Board, 52 Pa. Commw. 588, 418 A.2d 780 (1980), the Commonwealth Court held that a prime sponsor under CETA was the employer for workmen's compensation purposes of a worker injured at a worksite to which the worker had been assigned. The court recognized that "the most important factor in determining the existence of an employer-employee
[ 286 Pa. Super. Page 348]
relationship is evidence of control or of the right to control the work to be done and the manner of its performance." Id., 52 Pa. Commw. at 590, 418 A.2d at 781, quoting Frederico Granero Co. v. Workmen's Compensation Appeal Board, 43 Pa. Commw. 308, 311, 402 A.2d 312, 314 (1979). It nevertheless held the prime sponsor to be the employer because the sponsor retained principal control over the funds received under CETA. Id. 52 Pa. Commw. at 591, 418 A.2d at 781. Although the court did not elaborate upon its reasons for this conclusion, it evidently viewed control over the existence of an employment relationship as equivalent to control over "the work to be done and the manner of its performance." We believe that this view is too broad, and while we do not necessarily disagree with the result reached by the Commonwealth Court in the case before it, which did not involve a common law action, we find ourselves unpersuaded by its reasoning.
Workmen's compensation laws were enacted in response to the common law's failure to meet the needs of workers in an industrial society.*fn6 Prior to their enactment, an employee
[ 286 Pa. Super. Page 349]
was forced to resort to an action at common law to recover compensation for work-related injuries, see, Larson, Workmen's Compensation Law, v. 1, §§ 4.30-4.50, but such an action was rarely successful, given the common law defenses of the fellow servant doctrine, contributory negligence, and assumption of the risk. See, Larson, Workmen's Compensation Law, v. 1. § 4.30, Prosser, Law of Torts, § 80 (4th ed. 1971); see e. g., Lehigh Valley Coal Co. v. Jones, 86 (5 Norris) Pa. 432 (1878) (employees assume ordinary risks of employment including negligence of fellow servants); Ryan v. The Cumberland Valley Railroad, 23 (11 Harris) Pa. 384 (1854) (no duty on master to protect servants from carelessness of fellow workers).*fn7 The states responded to this problem by enacting workmen's compensation laws.*fn8 The laws represent a compromise: the employee gives up his right to maintain an action at common law; in return, he
[ 286 Pa. Super. Page 350]
recovers for work-related injuries without regard to his own or his employer's fault; the amount of recovery, however, is below that which he might expect if he could obtain an award of damages in an action at common law. See, Prosser, Law of Torts, § 80 (4th ed. 1971); Larson, Workmen's Compensation Law, § 2.10.
If one bears in mind that the evil the legislature was addressing by the Workmen's Compensation Act was uncompensated work-related injuries, it is apparent that the employer under the Act is the employer who controls the operations at the work site. It is this employer who can, by the exercise of his power over the operations at the work site, reduce the risk of accidents; it is he who directs the fellow servants of the injured workman, and who would, prior to the Act, have enjoyed the benefits of the defenses of the fellow servant doctrine, contributory negligence, and assumption of risk; and it is the product produced at the worksite that will "bear the blood" of the injured workman, and should therefore reflect the cost of that injury.
Here, it was the township, and not the federal government or any agency managing CETA programs, such as STEP, that directed the installation of the sewer line and controlled the operations at the worksite where Harold Keller was injured.*fn9 The township could most directly affect
[ 286 Pa. Super. Page 351]
the risks of accidents at the worksite. While STEP also assumed an interest in the safety and other work conditions of CETA workers, it had neither the power nor the responsibility to direct the installation of the sewer line. It could not, for instance, tell Keller's co-workers what ditches to dig, or how to dig them. What it could do was to impose limited sanctions on employers for not complying with its requests. Thus, if an employer did not comply with its directives, it could terminate the worksite as a place where CETA workers could work. This control, however, was too remote and indirect to place STEP in the position of Keller's employer.
It is true that the federal government, through its CETA program, bore the cost of purchasing workmen's compensation insurance for Keller. The fact that the federal government chose to assume this cost does not mean, however, that it had to assume it. Had the federal government not assumed the cost, the township would have had to.*fn10
Finally, we note that our decision is consistent with accomplishing the purposes of CETA, namely, to "provide job training and employment opportunities for the economically disadvantaged, unemployed, and underemployed persons." 29 U.S.C. § 801. The obvious reason the federal government undertook to pay the wages and other costs -- including the cost of workmen's compensation insurance -- was to make it inexpensive for potential employers, such as Old Lycoming Township, to hire a CETA worker. We agree with the lower court that subjecting such employers to actions at
[ 286 Pa. Super. Page 352]
common law would inhibit the CETA workers' employment opportunities. In this regard, we may note an incongruity. Were we to hold that the township was not Keller's employer within the meaning of the Workmen's Compensation Act, and so was subject to an action at common law, the result would be that CETA workers, such as Keller, would be in an entirely different legal position than those with whom they were working side by side. We can see no reason why Congress should have intended such a result.*fn11
The executrix has also argued that the township, as a matter of law, may not take advantage of the Pennsylvania Workmen's Compensation Act because the federal government has pre-empted the field. Brief for Appellant at 57. This argument is without merit. Nothing suggests that the federal government, through CETA or any other legislation, intended to regulate the field of providing injured workmen compensation. See New York Telephone Co. v. New York Department of Labor, 440 U.S. 519, 99 S.Ct. 1328, 59 L.Ed.2d 553 (1979); Exxon v. Government of Maryland, et al., 437 U.S. 117, 98 S.Ct. 2207, 57 L.Ed.2d 91 (1978); DeCanas v. Bica, 424 U.S. 351, 96 S.Ct. 933, 47 L.Ed.2d 43 (1976). The executrix's argument seems to be that because a federal regulation states that "[o]utstationed participants are still to be considered employees of the employing agency and shall be assured of the same working conditions and
[ 286 Pa. Super. Page 353]
benefits" as similarly situated CETA workers, we must accept the "employing agency" as Keller's employer for workmen's compensation purposes. 29 C.F.R. § 96.23(a)(6). However, just as the characterization of a claimant by an alleged employer does not control our determination of whether an employment relationship existed, Stevens v. Publishers Agency, 170 Pa. Super. 385, 85 A.2d 696 (1952), so the characterization in the federal regulation does not control. As we held in English v. Lehigh County Authority, supra, the meaning of "employer" under the Act is controlled by the legal interpretation of the Act, as reflected in our past cases, English v. Lehigh County Authority, supra, 286 Pa. Super. at 333, 428 A.2d at 1354, and not by the definitions that others care to give to that term.*fn12