1. Workers' Compensation--employment relationship--jurisdiction--independent
determination by appellate courts
The Industrial Commission did not err in determining plaintiff truck driver was a regular
employee of defendant rather than an independent contractor based on the factors of: (1) method
of payment; (2) furnishing of equipment; and (3) direct evidence of exercise of control by
defendant. Whether an employer-employee relationship exists is a jurisdictional issue requiring
an independent determination by the appellate courts.
2. Workers' Compensation--competent evidence--incapable of earning wages
There was competent evidence to support the Industrial Commission's determination that
plaintiff-employee, a truck driver, was incapable of earning wages as a result of her injury based
on the medical evidence, her complaints of chronic leg and back pain related during each visit to
her physicians, and her continuing pain treatment and doctor visits as of the hearing date.
3. Workers' Compensation--average weekly wage--fluctuating schedule--exceptional
reasons method
The Industrial Commission erred in determining plaintiff-employee's average weekly
wage because plaintiff's fluctuating work schedule qualified her job more as “seasonal” rather
than continuous employment. The plaintiff's average weekly wage should be calculated under
the “exceptional reasons” method. N.C.G.S. § 97-2(5).
Appeal by defendant Going West Transportation, Inc., from
Opinion and Award of the North Carolina Industrial Commission
filed 15 December 1997. Heard in the Court of Appeals 18
February 1999.
Janine W. Dunn, for defendant-appellant.
Brumbaugh, Mu and King, P.A., by Leah D. Lassiter,
for plaintiff-appellee.
JOHN, Judge.
Defendant appeals an Opinion and Award of the North Carolina
Industrial Commission (the Commission) granting plaintiff
temporary total disability compensation. Defendant contends the
Commission erred in 1) classifying plaintiff as an employee
rather than an independent contractor, 2) finding plaintiff was
incapable of earning wages from any employer as result of her
lumbosacral strain, and 3) setting plaintiff's average weekly
wage at $548.94. For reasons set forth herein, we remand to the
Commission for re-calculation of plaintiff's average weekly wage
in compliance with N.C.G.S. § 97-2(5) (Supp. 1998).
Pertinent facts and procedural information include the
following: Defendant is a provider of long haul transportation
services specializing in produce shipment with its home office in
Burgaw, N.C. On 3 February 1996, plaintiff, a tractor trailer
driver operating a truck owned by defendant, was involved in an
out-of-state collision with an automobile. Plaintiff
subsequently sought treatment at the Onslow Family Medical Center
8 February 1996 for pain in her lower back and hips and received
medication.
On 20 February 1996, plaintiff presented to Onslow Memorial
Hospital with numbness in her hands and legs and pain in her
lower back and left buttock and was excused from work pendingexamination by orthopedist Dr. Jeffery L. Gross (Dr. Gross). On
6 March 1996, Dr. Gross diagnosed plaintiff with lumbosacral
strain, referred her to physical therapy for a strengthening
program, and excused her from work based upon her inability to
sit for prolonged periods of time without pain. After months of
unsuccessful treatment, Dr. Gross sought a second opinion from
Dr. Ellis Muther (Dr. Muther). On 18 September 1996, Dr. Muther
concluded plaintiff suffered from a bilateral L5 radiculopathy.
On 7 October 1996, Dr. Gross referred plaintiff to Dr. Scott
Johnston (Dr. Johnston) for pain management. Dr. Johnston began
treating plaintiff with caudal epidural steroid injections which
temporarily reduced her pain symptoms. Following a 7 November
1996 examination, Dr. Johnston reported that plaintiff continued
to experience “chronic low back pain and left lower extremity
pain,” and upon plaintiff's inquiry informed her she could return
to work in a progressive fashion “at her leisure.”
Defendant had no policy of workers' compensation insurance
in effect on 3 February 1996, but agreed to compensate plaintiff
at the rate of $306.15 a week until she was able to resume work.
Defendant paid plaintiff a total of $5,184.55 between 23 February
1996 and 21 June 1996, but discontinued payments upon receiving
plaintiff's demand for additional compensation. Plaintiff
thereupon filed a workers' compensation claim 24 June 1996, whichclaim was heard 21 November 1996 before a Deputy Commissioner.
During the hearing, plaintiff testified she was unable to
work and that her doctors had not yet released her to return to
work. As of the hearing date, plaintiff was continuing to see
Dr. Gross and receive treatments from Dr. Johnston.
Subsequently, on 14 January 1997, Dr. Gross determined plaintiff
had reached maximum medical improvement, but indicated she was to
return upon any increase in symptoms and that Dr. Johnston would
continue treatments for her chronic back pain.
On 26 March 1997, the Deputy Commissioner filed an Opinion
and Award ruling, inter alia, that plaintiff was “a regular
employee of defendant” and entitled to temporary total disability
compensation at the rate of $365.97 per week from 4 February 1996
until otherwise ordered by the Commission, as well as payment of
all medical expenses. Defendant appealed to the Full Commission
which filed an Opinion and Award 15 December 1997 adopting the
Deputy Commissioner's findings, conclusions, and award, but
remanding in regards to imposition of a penalty in consequence of
defendant's failure to maintain a policy of workers' compensation
insurance.
[1]On appeal to this Court, defendant first contends the
Commission erred in determining plaintiff was a regular employee
of defendant. The latter argues plaintiff was an independentcontractor not subject to the North Carolina Workers'
Compensation Act, N.C.G.S. § 97-1 (1991 & Supp. 1998) (the Act).
We do not agree.
A workers' compensation claimant “must be, in fact and in
law, an employee of the party from whom compensation is claimed.”
Youngblood v. North State Ford Truck Sales, 321 N.C. 380, 383,
364 S.E.2d 433, 437 (1988). Whether an employer-employee
relationship exists is a jurisdictional issue, Lucas v. Stores,
289 N.C. 212, 218, 221 S.E.2d 257, 261 (1976), and unlike most
findings by the Commission, “findings of jurisdictional fact . .
. are not conclusive, even when supported by competent evidence,”
Youngblood, 321 N.C. at 383, 364 S.E.2d at 437. This Court thus
must “review the evidence of record” and make an independent
determination of plaintiff's employment status, id., guided “by
the application of ordinary common law tests,” Richards v.
Nationwide Homes, 263 N.C. 295, 302, 139 S.E.2d 645, 650 (1965).
An independent contractor is one who
contracts to do a piece of work according to
his own judgment and methods, and without
being subject to his employer except as to
the result of the work.
Hayes v. Elon College, 224 N.C. 11, 15, 29 S.E.2d 137, 140(1944). On the other hand, an employment relationship exists
where the employer retains the right to control and direct the
manner in which details of the work are to be executed and what
shall be done as the work progresses. Id.
While not conclusive individually, certain factors
ordinarily indicative of whether control incident to an
employment relationship has been retained include: 1) method of
payment, 2) furnishing of equipment, and 3) direct evidence of
exercise of control. Youngblood, 321 N.C. at 384-85, 364 S.E.2d
at 437-38. Upon review of the instant record in light of the
foregoing factors, we conclude an employment relationship existed
between plaintiff and defendant.
Notably, the “Contract Driver Handbook” (the Handbook),
furnished by defendant to each driver, reflects plaintiff and her
husband, as team drivers, were paid each Friday in an amount
equal to 26% of that week's haul. Generally, payment according
to units of time, i.e., per week, is considered an emolument of
employment, see 3 Arthur Larson, The Law of Workmen's
Compensation § 61.06(1) (1999), whereas an independent contractor
is customarily paid a fixed contract price or lump sum, Hayes,
224 N.C. at 16, 29 S.E.2d at 140. Although plaintiff had entered
into a “Non-Exclusive Contract” with defendant's predecessor on 8
August 1994, which agreement had expired, no similar contractswere subsequently signed. However, plaintiff generally agreed to
the weekly pay method provided in the Handbook by signing an
acknowledgment and pledge of adherence to the Handbook rules on 8
April 1995.
The treatment and classification of drivers for taxation
purposes is related to method of payment. In January 1995,
defendant began deducting federal and state taxes and health
insurance and social security costs from drivers' checks
following an IRS demand that it classify alleged “contract”
drivers as “employees” and withhold taxes. Archie McGirt
(McGirt), CEO and president of defendant, informed drivers of
their new taxable employee status. According to McGirt, although
plaintiff continued to drive, many others quit as a result.
Moreover, the Handbook provided regulations and rules
governing the operation and maintenance of defendant's trucks by
drivers. Handbook provisions included: 1) instructions both on
the location and timing of the reporting by drivers for
deliveries and pick-up and on the preparation and submission of
log books and other paper work; 2) a directive to travel approved
routes without deviation; 3) a mandate to submit required mileage
reports each Monday; 4) orders to call defendant twice a day
between 8:00 a.m. and 10:00 a.m. and between 4:00 p.m. and 6:00
p.m., and upon reaching pick-up or delivery destinations; and 5)guidelines for truck maintenance including oil, fuel and water
changes, washing and waxing, and tire monitoring. Failure to
call in as directed or to observe paperwork completion schedules
could result in imposition of a $25.00 fine. In addition,
drivers were subject to random drug testing, the cost of which
was deducted from their pay, and positive drug test results
constituted cause for immediate termination.
Regulations such as the foregoing, mandating that drivers
perform in a certain manner and “conform to a particular
schedule,” Youngblood, 321 N.C. at 385, 364 S.E.2d at 438, are
indicative of employee status as opposed to that of an
independent contractor who may choose the time and manner of
performance, id.
Additionally, the trucks operated by the drivers were owned,
insured and maintained by defendant, and drivers were issued
Comcash and Comcheck cards in defendant's name for fuel
purchases. When valuable equipment is furnished for use of a
worker, an employee relationship almost “invariably” is
established. Id.
In short, we conclude the record reflects an employer-
employee relationship between defendant and plaintiff.
Notwithstanding, defendant argues drivers such as plaintiff
furnished specialized skills and knowledge necessary to obtainand deliver loads, thereby indicating they functioned as
independent contractors. However, although defendant's drivers
may have possessed specialized skills and required little
supervision, such circumstance alone is not determinative of
independent contractor status, Durham v. McLamb, 59 N.C. App.
165, 168-69, 296 S.E.2d 3, 6 (1982) (citing Lloyd v. Jenkins
Context Co., 46 N.C. App. 817, 819, 266 S.E.2d 35, 37 (1980)),
and is in any event outweighed in the case sub judice by the
evidence of other factors, see Youngblood, 321 N.C. at 384-85,
364 S.E.2d at 437-38.
[2]Defendant next argues that no competent evidence in the
record supports the Commission's finding that plaintiff was
incapable of earning wages as a result of her lumbosacral strain.
This contention is unfounded.
The Commission rendered the following pertinent findings of
fact:
10. On Saturday, 3 February 1996, plaintiff
. . . w[as] involved in a collision with
another vehicle. . . . Initially, plaintiff
did not believe that she was injured in the
collision. However, she began to experience
pain the following day.
11. On 8 February 1996, plaintiff presented
to Onslow Family Medical Center. On that
date, plaintiff had pain in her low back and
hips. Plaintiff was prescribed medications
and referred to physical therapy beginning 13
February 1996.
12. On 20 February 1996, plaintiff presented
to Onslow Memorial Hospital . . . [with]
numbness in her hands and legs and pain in
her lower back and left buttock. Plaintiff's
medications were changed and she was excused
from work until she attended an appointment
that was scheduled with Dr. Gross on 6 March
1996. When plaintiff presented to Dr. Gross,
she had a lumbosacral strain, with no
neurological deficits. Dr. Gross referred
plaintiff to physical therapy for a
strengthening program and excused plaintiff
from work due to her inability to sit for
prolonged periods of time. Dr. Gross
continued to excuse plaintiff from work
through 23 July 1996.
13. On 18 September 1996, plaintiff
presented to Dr. Muther who performed EMG and
NCV testing. These studies revealed that
plaintiff had a bilateral L5 radiculopathy,
left greater than right. Thereafter,
plaintiff continued under the care of Dr.
Gross, who eventually referred her to Dr.
Johnston for pain management. Dr. Johnston
treated plaintiff with epidural steroid
injections which diminished plaintiff's
symptoms, at least temporarily. Dr. Johnston
continued to treat plaintiff through the date
of the hearing in this case.
14. Plaintiff reached maximum medical
improvement on [1]4 [sic] January 1997.
There is no evidence of record whether
plaintiff retained any permanent impairment
as a result of the incident on 3 February
1996.
. . . .
16. As a result of her lumbosacral strain,
plaintiff was incapable of earning wages from
defendant, or any other employer from 4
February 1996 through the date of the hearing
in this case.
Pertinent conclusions of law include:
3. On 3 February 1996, plaintiff sustained
an injury by accident arising out of and in
the course of her employment with defendant.
4. Plaintiff is entitled to payment of
temporary total disability compensation at
the rate of $365.97 per week from 4 February
1996 and continuing until order of the
[Commission] allowing defendant to cease
payment. . . .
In reviewing an Opinion and Award of the Commission, this
Court must determine whether there is any competent evidence in
the record to support its findings of fact and whether those
findings support the conclusions of law. Pittman v. Thomas &
Howard, 122 N.C. App. 124, 129, 468 S.E.2d 283, 286, disc. review
denied, 343 N.C. 513, 472 S.E.2d 18 (1996). The Commission has
the “exclusive authority to find facts necessary to determine
workers' compensation awards,” Matthews v. Petroleum Tank
Service, Inc., 108 N.C. App. 259, 264, 423 S.E.2d 532, 535
(1992), and its findings are conclusive on appeal if supported by
any competent evidence, even though there may be evidence which
would support contrary findings, id. Further, the Commission, as
sole judge of the credibility of witnesses and the weight to be
given their testimony, may reject the testimony of any witness.
Anderson v. Northwestern Motor Co., 233 N.C. 372, 376, 64 S.E.2d
265, 268 (1951). To qualify as “disabled” under N.C.G.S. § 97-2(9) (Supp.
1998), an employee must show the inability to earn the same wages
earned prior to injury, either in the same employment or in any
other employment. G.S. § 97-2(9). Disability, consisting of
impairment of the injured employee's earning capacity rather than
physical disablement, Peoples v. Cone Mills Corp., 316 N.C. 426,
434, 342 S.E.2d 798, 804 (1986), may be proven by production of
medical evidence that the employee is, as a consequence of the
work related injury, physically or mentally incapable of work in
any employment, id. at 444, 342 S.E.2d at 809. If an employee
presents substantial evidence he or she is incapable of earning
wages, the employer must then
come forward with evidence to show not only
that suitable jobs are available, but also
that the plaintiff is capable of getting one,
taking into account both physical and
vocational limitations.
Kennedy v. Duke Univ. Med. Center, 101 N.C. App. 24, 33, 398
S.E.2d 677, 682 (1990).
Thorough review of the record reflects substantial competent
evidence supporting the Commission's determination plaintiff was
incapable of earning her previous wages in any employment. For
example, Dr. Gross diagnosed plaintiff with lumbosacral strain on
6 March 1996 and excused her from work based upon her inability
to sit for prolonged periods of time without pain. Dr. Gross saw plaintiff every few weeks following her injury and extended the
work exemption through plaintiff's 23 July 1996 appointment
because of her continued pain. On 3 September 1996, Dr. Gross
reported plaintiff had “chronic pain in the back and it
bother[ed] her to sit,” and decided, “because of her continued
difficulty[, to] get a second opinion” from Dr. Muther, who later
diagnosed plaintiff with bilateral L5 radiculopathy and suggested
epidural steroid injections.
On 7 October 1996, Dr. Gross noted Dr. Muther's diagnosis,
but determined he had nothing further to offer plaintiff
“orthopedically” and that she should be seen by Dr. Johnston for
pain management. On 17 October 1996, Dr. Johnston diagnosed
plaintiff with “chronic sacral and lower extremity pain, status
post motor vehicle accident” and began caudal epidural steroid
injections to reduce her sacral and coccygeal pain, but cautioned
he did “not expect a great deal of benefit for her lower
extremity pain.” On 7 November 1996, upon plaintiff's inquiry,
Dr. Johnston indicated she could “return to work at her leisure,”
but only in a “progressive fashion” and not full scale.
On 14 January 1997, examination of plaintiff by Dr. Gross
revealed she continued to complain of chronic back pain and could
remain seated only ten to fifteen minutes. He concluded
plaintiff had reached maximum medical improvement, observing sheshould return to him upon any increase in symptoms and that she
would continue pain treatments with Dr. Johnston. Plaintiff
testified that she was prevented from returning to work following
her injury due to pain, and that she was still “receiving steroid
injection shots” from Dr. Johnston and continuing to see Dr.
Gross as of the date of hearing. She further testified that
neither had released her to return to work.
The medical evidence, plaintiff's complaints of chronic leg
and back pain related during each visit to her physicians, and
plaintiff's continuing pain treatment and doctor visits as of
the hearing date provide competent evidence supporting the
Commission's determination that plaintiff was incapable of
earning the same wages from defendant or another employer as a
result of lumbosacral strain. Defendant failed to come forward
with rebuttal evidence, and the Commission did not err. See Cone
Mills Corp., 316 N.C. at 443, 342 S.E.2d at 809; see also
Kennedy, 101 N.C. App. at 33, 398 S.E.2d at 682.
[3]In its third assignment of error, defendant contends the
Commission's finding that plaintiff's “average weekly wage was
$548.94,” is not supported by the evidence. We agree.
Pursuant to G.S. § 97-2(5), an injured employee's average
weekly wage is:
the earnings of the injured employee in theemployment in which he was working at the
time of the injury during the period of 52
weeks immediately preceding the date of the
injury . . . , divided by 52. . . .
But where for exceptional reasons the
foregoing would be unfair, either to the
employer or employee, such other method of
computing average weekly wages may be
resorted to as will most nearly approximate
the amount which the injured employee would
be earning were it not for the injury.
G.S. § 97-2(5).
The parties stipulated in a Form 22 Wage Chart to the days
and weeks plaintiff worked in 1995 and 1996 and to the earnings
she received. Upon review of the Wage Chart, we note plaintiff
did not work during 1995 in February, March, August, September or
November, and reported working only eleven days in April, six
days in July and seven days in December. In consequence of a
fluctuating work schedule dependent in the main upon the produce
season, plaintiff's job more properly qualified as “seasonal”
rather than continuous employment. See Joyner v. Oil Co., 266
N.C. 519, 522-23, 146 S.E.2d 447, 450 (1966).
In Joyner, our Supreme Court reviewed the circumstance of a
relief truck driver who worked only on an as-needed basis during
the fifty-two weeks prior to injury. Id. The court described
the driver's employment as “part-time and intermittent” and held
it was “[un]fair[] to the employer . . . [not to] take intoconsideration both peak and slack periods” in calculating average
weekly wage because “it gives plaintiff the advantage of wages
earned in . . . peak . . . season without taking into account the
slack periods” during which he did not work. Id. at 521, 146
S.E.2d at 450. Therefore, the court concluded, the driver's
average weekly wage was to be calculated under the “exceptional
reasons” method set forth in G.S. § 97-2(5). Id. at 522, 146
S.E.2d at 450.
In determining the driver's average wage, the Joyner Court
took the total wages earned during the twelve month period prior
to injury, noting that without the injury the driver “himself
would not be earning more than this sum in a normal year,” id.,
and divided that amount by 52, representing the number of weeks
in a year, id. Utilizing the same methodology herein, we observe
plaintiff's total wages earned between February 1995 and February
1996 would equal a sum of $9,333.05, $7,178.12 earned in 1995 and
$2,154.93 earned in 1996. Dividing that sum by 52 weeks results
in an average weekly wage of $179.48, well below the figure of
$548.94 per week or $28,544.88 annually calculated by the
Commission.
The Commission's determination of plaintiff's average weekly
wage is not supported by the evidence and its award contains no
findings indicating how the amount of $548.94 was derived. Thematter therefore must be remanded to the Commission for
recalculation of plaintiff's average weekly wage and entry of
related findings. The Commission shall rely on the existing
record and receive additional evidence and argument from the
parties in its sole discretion. See Smith v. Smith, 111 N.C.
App. 460, 517, 433 S.E.2d 196, 230 (1993), rev'd on other
grounds, 336 N.C. 575, 444 S.E.2d 420 (1994) (on remand, trial
court to “rely on the existing record, . . . but may hear
additional arguments from the parties and take such additional
evidence as the court finds necessary to correct the errors
identified herein”).
Remanded with instructions.
Judges WALKER and McGEE concur.
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