{"id":"alj-G905793-2023-08-18","awcc_number":"G905793","decision_date":"2023-08-18","opinion_type":"alj","claimant_name":"Emery Humphries","employer_name":"Fna Group, LLC","title":"HUMPHRIES VS. FNA GROUP, LLC AWCC# G905793 AUGUST 18, 2023","outcome":"denied","outcome_keywords":["granted:1","denied:2"],"injury_keywords":["knee","ankle"],"pdf_url":"https://labor.arkansas.gov/wp-content/uploads/HUMPHRIES_EMERY_G905793_20230818.pdf","source_index_url":"https://labor.arkansas.gov/workers-comp/awcc-opinions/administrative-law-judge-opinions/","filename":"HUMPHRIES_EMERY_G905793_20230818.pdf","text_length":21227,"full_text":"BEFORE THE ARKANSAS WORKERS' COMPENSATION COMMISSION \n \n WCC NO. G905793 \n \nEMERY HUMPHRIES, Employee CLAIMANT \n \nFNA GROUP, LLC, Employer RESPONDENT \n \nAMTRUST NORTH AMERICA, Carrier RESPONDENT \n \n \n OPINION FILED AUGUST 18, 2023 \n \nHearing   before   ADMINISTRATIVE   LAW   JUDGE   ERIC   PAUL   WELLS   in   Springdale, \nWashington County, Arkansas. \n \nClaimant represented by JASON M. HATFIELD, Attorney at Law, Fayetteville, Arkansas. \n \nRespondents   represented   by   WILLIAM   C.   FRYE,   Attorney   at   Law,   North   Little   Rock, \nArkansas. \n \n STATEMENT OF THE CASE \n \n On  May  23,  2023,  the  above  captioned  claim  came  on  for  a  hearing  at  Springdale, \nArkansas.   A pre-hearing conference was conducted on November 14, 2022, and a Pre-hearing \nOrder  was  filed  on  November  15,  2022.  A  copy  of  the  Pre-hearing  Order  has  been  marked \nCommission's Exhibit No. 1 and made a part of the record without objection. \n At the pre-hearing conference the parties agreed to the following stipulations: \n 1.  The  Arkansas  Workers'  Compensation Commission  has  jurisdiction  to  determine \nwhether Respondent No. 2, FNA Group, LLC, was a dual employer of Claimant. \n By agreement of the parties the issues to litigate are limited to the following: \n 1.  Whether  or  not  FNA  Group,  LLC  was  a  dual  employer  of  the  claimant  and  therefore \nprotected under Exclusive Remedy provisions of Arkansas Code Annotated §11-9-105. \n Claimant’s contentions are: \n\nHumphries – G905793 \n \n-2- \n“On    or    about    August    19,    2019,    Claimant    EMERY    R. \nHUMPHRIES,  was  an  employee  with  LABOR  SOLUTIONS. \nClaimant  was  hired  and  paid  by  LABOR  SOLUTIONS.  Claimant \nwas injured while working at the FNA GROUP, INC., facility. \n \nAn  express  contract  exists  between  LABOR  SOLUTIONS  and \nFNA GROUP INC., wherein Claimant is a third-party beneficiary. \nThe  contract  clearly  and  unambiguously  states Claimant  is  not  to \nbe  considered  an   employee  of   FNA   GROUP,  INC.,  for   any \npurpose  and  specifically  states that  LABOR  SOLUTIONS  is  an \nindependent contractor. \n \nFNA HOLDING CO alleges they are a dual employer of Claimant, \ndespite  clear  unambiguous  contract  language  FNA  Group,  INC., \ndrafted  which  states: No  Personnel  of  Labor  Solutions  shall  be \ndeemed  an  employee  of  Customer  for  any  purpose  related  to \nthe   Agreement,   including,   without   limitations,   under   any \ncompensation or benefit plan of the Customer. \n \nThe  three  essential  elements  of  dual  employment  relied  on  under \nthe Arkansas Workers’ Compensation rules are: \nWhen   a   general   employer   lends   an   employee   to   a   special \nemployer,  the  special  employer  becomes  liable  for  workmen’s \ncompensation only if: \n(a) The employee has made a contract for hire, express or implied, \nwith the special employer; \n(b) The work being done is essentially that of the special employer; \nand \n(c) The special  employer has the right to control  the details of the \nwork. \n \nIt  is  clear  that  the  express  contract  in  this  case  unambiguously \nstates  Claimant  is  never  to  be  considered  an  employee  of  FNA \nGROUP, INC., for any purpose. The inquiry stops there. The parol \nevidence   rule   prevents   introduction   of   additional   evidence   in \nattempt to modify or amend the contract. \n \nRespondent   FNA   GROUP,   INC.,   cannot   escape   the   express \ncontract   which   clearly   and   unambiguously   establishes   that \nClaimant   EMERY   R.   HUMPHRIES   is   not   an   employee   of \nRespondent  FNA  GROUP,  INC.,  but  is  instead  an  independent \ncontractor.” \n \n Respondents’ contentions are: \n\nHumphries – G905793 \n \n-3- \n“FNA   entered   into   a   contract   for   Respondent   No.   1,   Labor \nSolutions  of  Arkansas,  LLC,  to  provide  employees  to  work  in \nFNA’s  plant.  The  Claimant  came  to  work  for  FNA  under  said \ncontract. FNA was a special employer in this matter.  \n \nFirst,  there  is  an  implied  contract  of  hire  since  the  Claimant  was \nallowed  to  come  to  work  at  the  FNA  plant  under  this  contract. \nSecondly,  the  work  being  performed  was  essentially  that  of  the \nspecial  employer,  FNA.  Third,  FNA  had  the  right  to  control  the \ndetails  of  the  work.  Therefore,  FNA  is  a  special  employer  and  is \nafforded protection under the provisions of AR. Code Ann. §11-9-\n105.” \n \n The claimant in this matter is a 24-year-old male who suffered a compensable amputation \nof  the  lower  left  extremity  on  August  19,  2019,  while  operating  a  cardboard  crusher.  The \nclaimant  was  employed  by  Labor  Solutions,  a  temporary  employment  service,  at  that  time \nworking  inside  of  an  FNA  Group,  the  respondent,  production  facility.  The  question  before  the \nCommission is  to  determine  the  employment  status  of  the  claimant  as  it  relates  to  FNA  Group. \nOn September 13, 2022, Judge Xollie Duncan in the Circuit Court of Benton County, Arkansas, \nCivil  Division,  signed  an  order  found  at  Joint  Exhibit  1,  referring  this  matter  to  the  Arkansas \nWorkers’  Compensation  Commission  for  determination  of  the  claimant’s  employment  status \nwith FNA Group. \n The  sole  issue  before  the  Commission  is  whether  the  claimant  was  a  dual  employee  of \nLabor  Solutions  and  FNA  Group  on  August  19,  2019,  when  he  sustained  an  amputation  of  the \nleft  lower  extremity  between  the  knee  and  ankle.    The  claimant  contends  he  was  not  a  dual \nemployee  in  that  he  was  an  employee  of  Labor  Solutions,  but  not  an  employee  of  FNA  Group.  \nThe  respondent  contends  that  the  claimant  was  both  an  employee  of  Labor  Solutions  and  FNA \nGroup and thus a dual employee which would provide FNA Group Exclusive Remedy protection \nfrom tort liability under the Arkansas Workers’ Compensation Act. \n\nHumphries – G905793 \n \n-4- \n In Randolph v. Staffmark, 2015 Ark. App. 135, the Arkansas Court of Appeals considers \nthe issue of dual employment and uses the Supreme Court’s decision in Daniels v. Riley’s Health \nand  Fitness  Centers, 310 Ark. 756 (1992) to do so.  The Court of Appeals stated, “...where it \nheld  that  when  a  general  employer  lends  an  employee  to  the  special  employer,  the  special \nemployer becomes liable for workers’ compensation only if three facts are satisfied:  (1) the \nemployee  has  made  a  contract  for  hire,  express  or  implied,  with  the  special  employer;  (2)    the \nwork being done is essentially that of the special employer;  and (3)  the special employer has the \nright to control the details of the work.” \n The first of three facts that must be satisfied in Daniels, supra, is whether “the employee \nmade  a  contract  for  hire,  express  or  implied,  with  the  special  employer.”  Here,  the  claimant \nbeing the employee and FNA Group, the special employer. It is undisputed that the claimant was \nhired  by  Labor  Solutions  as  an  employee  in  July  of  2019  and  began  work  in  the  FNA  Group \nfacility  that  same  month.  Documentation  of  his  application  to  be  employed  by  Labor  Solutions \nand  work  in  an  FNA  Group  facility is  found  at  Claimant’s  Exhibit  2,  pages  8-20,  including  a \ndocument entitled “Mini Facts” found specifically at Claimant’s Exhibit 2, pages 16-20, which, \namong  other  requirements,  assigns  the  claimant  to  work  for  Labor  Solutions  at  an  FNA  Group \nfacility. There is, however, no express contract for hire between the claimant and FNA Group as \nthere  appears  to  be  no  dispute  as  to  the existence  of  an  express  contract.  Therefore,  in  order  to \nmeet the first “fact” that must be proven to establish dual employment of the claimant between \nLabor  Solutions  and  FNA  Group,  an  implied  contract  for  hire  must  exist  between  FNA  Group \nand the claimant. \n\nHumphries – G905793 \n \n-5- \n Both the claimant and respondent filed post hearing briefs in this matter. Both parties put \nforth  legal  precedent  and  argument  about  Arkansas  law  regarding  implied  contract.  The \nrespondent, in part, stated: \nThe  test  on  implied  contract  of  hire is “control of the employee.” \nIn  fact,  there  have  been  numerous  cases  on  implied  contracts  of \nhire  in  special  employer  cases.  In  the  case  of  Estate  of  Bogar  v. \nWelspun  Pipes,  Inc.,  2014  Ark.  App.  536,  444  S.W.3d  405, \nWelspun   was   determined   to   be   the   special   employer   by   the \nArkansas Workers’ Compensation Commission. In determining the \nimplied   contract,   the   court   said   you   look   at   the   totality   of \ncircumstances surrounding the relationship. They noted as follows: \n \nThe undisputed testimony in this case indicates that \nElite   Services   recruits   employees   for   Welspun. \nHowever,  once  the  employees  go  to  work  at  the \nWelspun  facility,  Welspun  dictates  the  hours  they \nwork,  sets  their  rate  of  pay,  can  discipline  the \nindividuals and can terminate the individuals. Once \nElite  Services  hires  and  supplies  an  employee  to \nWelspun,  Elite  Services’  primary  function  is  to \nprocess payroll.... This examiner can think of no \ngreater   indications   of   an   implied   employment \ncontract  than  the  ability  to  determine  a  worker’s \nweekly hours, his rate of pay, his discipline, and his \ntermination, combined  with  the  right  to  control  the \nwork being performed. \n \nEst.  of  Bogar  v.  Welspun  Pipes,  Inc.,  2014  Ark.  App.  536,  3,  444 \nS.W.3d 405, 407 (2014) (emphasis in original). \n \nThe  Court  went  on  to  say  that  it  is  important  to  look  at  the \nrelationship  between  general  and  special  employer.  Randolph  v. \nStaffmark, 2015 Ark. App. 135, 456 S.W.3d 389. \n \nThe claimant, in part, stated: \nThe only remaining argument for FNA is that there was an implied \ncontract  of  employment  between  FNA  and  Humphries.  Arkansas \nlaw on implied contracts teaches: \n \nThere  are  two  classes  of  implied  contracts,  i.e., \nthose  properly  called  implied  contracts,  where  the \n\nHumphries – G905793 \n \n-6- \ncontract is inferred from the acts of the parties, and \nthose   which   are   more   properly   called   quasi-\ncontracts  or  constructive  contracts,  where  the  law \nimplies  an  obligation. Caldwell  v.  Missouri  State \nLife  Insurance  Co.,  148  Ark.  474,  230  S.W.  566. \nThe  first  type  of  implied  contract  is  sometimes \ncalled a contract implied in fact and it  derives from \nthe “presumed” intention of the parties as indicated \nby  their  conduct. Martin  v.  Campanaro,  156  F.2d \n127 (2d Cir., 1946). See also, Gray v. Kirkland, 550 \nS.W.2d   410   (Tex.Civ.App.,   1977); Johnson   v. \nWhitman,  supra; United  States  v.  O.  Frank  Heinz \nConstruction Co., 300 F.Supp. 396 (S.D.III., 1969). \nIn determining whether a “tacit” but actual contract \nexists,  the  prior  course  of  dealing  between  the \nparties  is  to  be  considered. Jones  v.  Donovan,  255 \nArk.  474,  426  S.W.2d  390.  An  implied  contract  is \nproven   by   circumstances   showing   the   parties \nintended  to  contract  or  by  circumstances  showing \nthe general course of dealing between the parties. \n \nBoth parties provided relevant, legal precedent regarding implied contract. The respondent points \nout the need to consider the totality of the circumstances surrounding the relationship while also \npointing  out  the  importance of  looking  at  the  relationship  between  the  general  and  special \nemployer.  Here,  the  general  employer  being  Labor  Solutions  and  the  special  employer  being \nFNA Group.  \n FNA  Group  and  Labor  Solutions entered  into  an  express  contract  on  July  2,  2019.  That \nagreement was titled “Agreement for Temporary Personnel.” It was signed by the Vice President \nof  Operations  for  Labor  Solutions  and  Senior  Vice  President  of  FNA  Group,  Thomas  Moffett, \nwho testified at the hearing in this matter. That document can be found at Claimant’s Exhibit 2, \npages 1-4. That document references an Exhibit A titled “Statement of Work” which is found at \nClaimant’s  Exhibit  2,  pages  5-6.  It  is  undisputed  that  this  is  the  express  contract  that  was  in \neffect  on  August  19,  2019,  when  the  claimant’s  compensable  lower  left  extremity  amputation \n\nHumphries – G905793 \n \n-7- \noccurred, between Labor Solutions, the general employer, and FNA Group, the special employer. \nIt should be noted that FNA Group is termed “customer” in this agreement. \n In   review   of   the “Agreement   for   Temporary   Personnel,”   I   find   section   5   titled \n“Personnel,” which states as follows: \n5. Personnel.  Labor  Solutions,  at  its  cost,  shall  provide  personnel \n(the “Personnel”) to perform the Services. Labor Solutions shall be \nsolely responsible for the full payment of all compensation due the \nPersonnel,   including,   without   limitation,   all   wages,   benefits, \nwithholdings,  payroll  taxes  and  contributions. No  Personnel  of \nLabor Solutions shall be deemed an employee of Customer for \nany  purpose  relating  to  this  Agreement,  including,  without \nlimitation,   under   any   compensation   of   benefit   plan   of \nCustomer. (Emphasis added) \n \n The  existence  of  an  implied  contract  between  a  claimant  and  a  special  employer  relies \nheavily  on  the  amount  of  control  the  special  employer  has  over  the  general  employer’s \nemployee.  Testimony  and  evidence  from  both  parties  varies  in  an  effort  to  show  a  high  or  low \nlevel of control over the claimant. However, in this particular case, I do not believe the level of \ncontrol  over  the  claimant  is  the  primary  issue.  The  special  employer,  FNA  Group,  contracted \naway their ability to engage in an express or implied contract for hire with the claimant on July \n2,  2019,  when  they  entered  into  the “Agreement  for  Temporary  Personnel”  as  it  states: “No \nPersonnel of Labor Solutions shall be deemed an employee of Customer for any purpose relating \nto  this  Agreement,  including,  without  limitation,  under  any  compensation  of  benefit  plan  of \nCustomer.”  While  that  contract  is  not  between  the  claimant  and FNA Group,  it  is  between  the \nclaimant’s  general  employer,  Labor  Solutions,  and  FNA  Group  and  that  agreement  affected  the \nclaimant   when   he   became   an   employee   of   Labor   Solutions   during   the “Agreement   for \nTemporary Personnel” contract period. Even if the claimant and FNA Group had wanted to enter \ninto an express or implied contract for hire during that period they would contractually have not \n\nHumphries – G905793 \n \n-8- \nbeen  able  to  do  so  under  the “Agreement  for  Temporary  Personnel”  with  Labor  Solutions.  It  is \ncontractually  impossible  for  a  Labor  Solutions  employee,  here  the  claimant,  to  be “deemed  an \nemployee  of  customer  (FNA  Group)  for  any  purpose  relating  to  this  agreement,  including, \nwithout limitation,  under any compensation or benefit plan of customer.”  Thus, it is impossible \nfor  the  first  of  the  three “facts”  that  must  be  satisfied  to  prove  dual  employment  and  provide \nFNA  Group  protection  under  the  Exclusive  Remedy  of  Workers’  Compensation  Act  to  exist. \nThat “fact”  states, “The  employee  has  made  a  contract  for  hire,  express  or  implied,  with  the \nspecial employer.” \n Thomas Moffett, the Senior Vice President of FNA Group, was called as a witness by the \nrespondent  in  this  matter.  It  was  Mr.  Moffett  who  signed  the “Agreement  for  Temporary \nPersonnel” for  FNA Group. On cross-examination, Mr. Moffett was  asked about the  agreement \nand the status of the claimant under different scenarios as follows: \nQ I asked you some questions and I don’t think you knew the \nanswer, but if Emery  were to say, hey,  I am an  employee of FNA \nand I want to make a sexual harassment claim against FNA, would \nyou guys accept him as your employee? \n \nA We  would  accept  and  investigate  the  allegation,  but  we \nwould do it jointly with Labor Solutions. \n \nQ You  would  reserve  your  right  to  allege  he  is  not  our \nemployee, he is an independent contractor; right? \n \nA We  would  not  necessarily  technically  say  that.  We  would \njust   say,   hey,   look,   there   is   an   allegation   and   our   two   HR \ndepartments  for  both  companies  would interact. I don’t think we \nwould ever think for a moment that we’re making a declaration in \nterms of their employment status, but rather investigate the claim. \n \nQ Other than the declaration you made in the contract of what \nthe employment status is? \n \nA That is fair, yes. \n\nHumphries – G905793 \n \n-9- \n \nQ Okay. And I could ask you about the whole slew of things: \nAlleged  discrimination,  FMLA  violations,  EEOC,  ADA,  ERISA, \nall of those you would reserve your right to say he can’t make that \nclaim against us because he is not our employee; correct? \n \nA That is correct. \n \nQ Based on the contract you signed? \n \nA Yes, sir. \n \nQ And you agree that FNA did not provide workers’ comp for \nEmery Humphries? \n \nA That is correct. \n \nQ And   FNA   did   not   even   list   Emery   Humphries   as   an \nemployee when you were applying for workers’ comp insurance? \n \nA I was not involved in the intricacies with that. I don’t know \nwhat was involved with that. \n \nQ But during your monthly trips to Arkansas, if they were to \nask you, would you say, no, do not list the Labor Solutions’ 140 \nemployees as people that we have to pay workers’ comp premiums \non? \n \nA In that example, correct, yes, sir. \n \nQ You  guys  didn’t  offer  any  type  of  health  benefits  or \nretirement benefits, anything like that? \n \nA Not that I am aware of. \n \nQ You did not pay his Social Security or Medicare taxes? \n \nA No, sir. \n \nQ You did not withhold any taxes? \n \nA No, sir. \n \n\nHumphries – G905793 \n \n-10- \nQ Your contract that you signed provides no evidence of what \nyou  negotiated  with  Labor  Solutions  in  terms  of  pay;  is  that \ncorrect? \n \nA In terms of the wages? \n \nQ Correct. \n \nA No. \n \n It is clear that FNA Group had no desire or belief that the claimant would be an employee \nof  FNA  Group  until  such  time  as  his  employment  might  grant  civil  liability  protection.  Here, \nFNA Group wants to have its cake and eat it too. \n The  parties  in  this  matter  have  apparently  done  voluminous  research  but  have  not \nprovided the Commission with a case to consider where a  contract  between a general employer \nand a special employer forbids the general employer’s employee, here the claimant,  from being \nconsidered  an  employee  of  the  special employer “for  any  purpose.”  I,  too,  have  failed  to  find \nsuch  a  case  on  which  to  rely.  However,  in  considering  the  relationship  between  the  general \nemployer and the special employer, along with the totality of the circumstances, I find that FNA \nGroup has contracted away its ability to meet the first of the three “facts” that must be satisfied \nin Randolph v. Staffmark, 2015 Ark. App. 135, which relied upon the Supreme Court’s decision \nin Daniels v. Riley’s Health and Fitness Centers,  310  Ark.  756  (1992).  The  respondent,  FNA \nGroup, has failed to prove that the claimant was a dual employee of the general employer, Labor \nSolutions, and the respondent, FNA Group. \n From a review of the record as a whole, to include medical reports, documents, and other \nmatters properly before the Commission, and having had an opportunity to hear the testimony of \nthe  witnesses  and  to  observe  their  demeanor,  the  following  findings  of  fact  and  conclusions  of \nlaw are made in accordance with A.C.A. §11-9-704: \n\nHumphries – G905793 \n \n-11- \n FINDINGS OF FACT & CONCLUSIONS OF LAW \n 1.  The  stipulations  agreed  to  by  the  parties  at  the  pre-hearing  conference  conducted  on \nNovember 14, 2022, and contained in a Pre-hearing Order filed November 15, 2022, are hereby \naccepted as fact. \n 2. FNA Group, LLC has failed to prove by a preponderance of the evidence that it was a \ndual employer of the claimant and entitled to protection under the Exclusive Remedy provisions \nof Arkansas Code Annotated §11-9-105. \n ORDER \nPursuant  to  the  above  findings  and  conclusions,  I  find  that  the  respondent  has  failed  to \nprove  by  a  preponderance  of  the  evidence  that  it  was  a  dual  employer  of  the  claimant  and  is, \ntherefore,  not  entitled  to  protection  under  the  Exclusive  Remedy  provisions  of  Arkansas  Code \nAnnotated §11-9-105. \nIf  they  have  not  already  done  so,  the  respondents  are  directed  to  pay  the  court  reporter, \nVeronica Lane, fees and expenses within thirty (30) days of receipt of the invoice. \n IT IS SO ORDERED. \n \n \n \n                                ____________________________                                    \n       HONORABLE ERIC PAUL WELLS \n       ADMINISTRATIVE LAW JUDGE","preview":"BEFORE THE ARKANSAS WORKERS' COMPENSATION COMMISSION WCC NO. G905793 EMERY HUMPHRIES, Employee CLAIMANT FNA GROUP, LLC, Employer RESPONDENT AMTRUST NORTH AMERICA, Carrier RESPONDENT OPINION FILED AUGUST 18, 2023 Hearing before ADMINISTRATIVE LAW JUDGE ERIC PAUL WELLS in Springdale, Washington County, Arkansas. Claimant...","fetched_at":"2026-05-19T23:04:03.390Z","links":{"html":"/opinions/alj-G905793-2023-08-18","pdf":"https://labor.arkansas.gov/wp-content/uploads/HUMPHRIES_EMERY_G905793_20230818.pdf","source_publisher":"https://labor.arkansas.gov/workers-comp/awcc-opinions/administrative-law-judge-opinions/"}}