Use of Staffing Agencies to Provide Temporary Labor Will Not Protect Vessel Owners From Jones Act Liability
A recent decision from the U.S. District Court for the Middle District of Louisiana provides a cautionary reminder that vessel owners cannot avoid Jones Act liability by using temporary staffing agencies for vessel labor: In re: Weeks Marine, Inc. as owner and operator of the BT 229 for Exoneration from or Limitation of Liability. Civil Action No. 13-cv-831, January 26, 2015.
Weeks Marine had a contract with Aerotek, Inc. to provide Weeks with temporary labor. Aerotek provided Randall Harrold to work as a crane operator on the Weeks BT 229, a derrick crane barge. Harrold was injured while performing maintenance on the crane, and he made the typical Jones Act/Unseaworthiness/Maintenance and Cure claims. Aerotek, presumably to avoid the potential for punitive damages now available under the Supreme Court’s decision in Atlantic Sounding v. Townsend, 557 U.S. 404 (2009), began paying maintenance and cure to Harrold. Weeks Marine filed a limitation of liability action. Aerotek filed a claim in the limitation action, seeking reimbursement from Weeks of the amounts it had paid to Harrold for maintenance and cure. Aerotek also sought an order that Harrold was a borrowed servant of Weeks, and Weeks was therefore the Jones Act employer. Aerotek then moved for summary judgment.
Weeks argued that it had no employment contract with Harrold, and that he was the employee of Aerotek. The court had little difficulty finding that the technical niceties of staffing agency contracts notwithstanding, Harrold was in actuality Weeks’ borrowed servant, and Weeks was his Jones Act employer. In reaching this determination, the court considered the following factors:
1. Weeks exercised control over Harrold’s day-to-day work on the barge;
2. The work being performed by Harrold was for Weeks’ benefit, not Aerotek’s;
3. Despite the actual language in the contract between Aerotek and Weeks providing Aerotek was an independent contract with payroll responsibilities for Harrold, the written contract was trumped by “realities of the workplace” showing Harrold believed he was working for Weeks;
4. Harrold’s work in assisting with crane repairs was plainly being done for Weeks’ benefit, not Aerotek’s;
5. Weeks furnished the tools, equipment, and place of employment for Harrold;
6. Harrold himself had no employment contract with Aerotek;
7. The only factor not working in Aerotek’s favor was that Harrold’s employment with Weeks was only for 17 days prior to the injury, and not otherwise for a considerable length of time;
8. Though the contract gave both Weeks and Aerotek the right to terminate Harrold, Weeks could do so at any time while Aerotek was required to provide Weeks with 30 days’ notice;
9. Though Aerotek was required to cover Harrold’s payroll, Weeks was required to reimburse Aerotek for Harrold’s services.
This is a cautionary tale to vessel owners: using labor provided by staffing agencies will likely provide you with absolutely no protection from Jones Act liability. If laborers are doing your work on your vessels under your supervision on what essentially amounts to a full time basis, the courts will likely view them as borrowed servants, and, therefore, members of your crew.