C. Cassatt v. WCAB (Uninsured Employers Guaranty Fund)

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Christopher Cassatt, :
Petitioner :
:
v. : No. 2278 C.D. 2015
:
Workers’ Compensation Appeal :
Board (Uninsured Employers :
Guaranty Fund), :
Respondent :
Christopher Cassatt, :
Petitioner :
:
v. : No. 2280 C.D. 2015
: Submitted: August 26, 2016
Workers’ Compensation Appeal :
Board (Venue, Inc.), :
Respondent :
BEFORE: HONORABLE P. KEVIN BROBSON, Judge
HONORABLE JULIA K. HEARTHWAY, Judge
HONORABLE DAN PELLEGRINI, Senior Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY
SENIOR JUDGE PELLEGRINI FILED: September 14, 2016
Christopher Cassatt (Claimant) petitions for review of two orders of the
Workers’ Compensation Appeal Board (Board) affirming the Workers’
Compensation Judge’s (WCJ) decisions denying his claim petition for benefits under
the Pennsylvania Workers’ Compensation Act (Act)1 because he was an independent
contractor ineligible for benefits. Because it is undisputed that Claimant was injured
while performing services in the construction industry for remuneration and did not
enter a written contract to perform such services as required by the Construction
Workplace Misclassification Act (CWMA),2 we reverse and remand to the Board to
determine whether Claimant is a casual employee, an alternate basis upon which the
WCJ denied relief.
I.
In January 2013, Claimant filed a claim petition3 alleging that he
shattered his left heel on September 24, 2012, after falling off scaffolding that
collapsed while he was working as a painter for Venue, Inc., c/o Venujopal Jolla
(Jolla) (collectively, Venue).4 Claimant also filed a claim petition for benefits from
the Uninsured Employers Guaranty Fund (Fund) alleging the same disabling injuries.
Venue and the Fund answered denying that Claimant was an employee at the time he
1
Act of June 2, 1915, P.L. 736, as amended, 77 P.S. §§1-1041.4, 2501-2708.
2
Act of October 13, 2010, P.L. 506, 43 P.S. §§933.1–933.17.
3
A claimant must be an employee to be eligible to receive benefits under the Act. See
Sections 103, 104, 301(a) of the Act, 77 P.S. §§21, 22, 431; Universal Am-Can, Ltd. v. Workers’
Compensation Appeal Board (Minteer), 762 A.2d 328, 330 (Pa. 2000). It is a claimant’s burden to
establish an employer/employee relationship to receive benefits. Id.4
While Jolla’s name is consistently spelled “Venugopal Golla” throughout the proceedings
below, we have adopted the spelling he provided through testimony before the WCJ on October 30,
2013: “V-E-N-U-J like jars, O-P, P like Peter, A-L. Last name is . . . J like jars, O-L-L-A.” (N.T.
10/30/13 at 7.)
2
sustained his injuries. The parties then agreed that the threshold issue of whether
Claimant was Venue’s employee at the time of the incident should first be
determined, and the matter proceeded to hearing on that issue only.
Before the WCJ, Claimant testified that he worked as a painter for over
20 years as either an independent contractor or employee. When he worked as an
independent contractor, he purchased his own insurance and was paid by the job. He
stated that he usually received a third of the total payment up front, another third
halfway through, and another third upon the job’s completion.
Regarding the work he was performing when injured, Claimant testified
that during the first week of July 2012, he approached Ken Rohrer (Rohrer), of
Rohrer Construction Company, who was performing renovation work on apartment
buildings located at 2500 and 2502 Broad Avenue, Altoona, Pennsylvania (Buildings)
about his interest in painting the Buildings as a subcontractor. Rohrer told him to go
talk to the Buildings’ owner at a Sunoco gas station he owned in Altoona,
Pennsylvania. He then went to the gas station, introduced himself to Jolla and
inquired about making a bid to paint the Buildings. Jolla informed him that he was
not hiring subcontractors, but offered to employ him as an hourly painter. He was
told he could expect work for the next three years because there were other rental
properties in need of repair. Claimant testified that he accepted the job and started
working a few days later and was initially paid $7.00 an hour, but that after a week or
two he received a $1.00 raise. He stated that he was required to track and submit his
work hours to Jolla and that taxes were not taken out of his pay.
3
Claimant also testified that he never purchased or provided his own
paint, ladders or scaffolding during his time working on the Buildings, and that
although he initially painted the Buildings with his own paint brushes, Rohrer
replaced them after they wore out. He stated that Jolla made decisions regarding
work hours and where work was to be performed. He stated that Jolla preferred
everyone to work seven days a week, but that he normally worked Monday through
Friday. Sometimes Claimant ended his work week on Thursday and other times he
ended his work week on Saturday or Sunday. Although Jolla also wanted everyone at
work from 9:00 a.m. until 5 p.m., because Claimant did not like working until 5:00
p.m., he opted to work from 7:00 a.m. until 3:00 to 4:00 p.m.
Regarding the accident, Claimant testified that on September 24, 2012,
while he was performing work on a ladder that he placed on top of scaffolding, the
scaffolding broke causing him to fall approximately 25 feet. Claimant stated that as a
result of falling, his right foot landed in the dirt and his left foot hit cement shattering
his left heel. Claimant stated that he went to the hospital afterwards and has
undergone several surgeries. Because Claimant developed an infection after one of
these surgeries, he was scheduled to have his foot amputated on August 3, 2013.5
On cross-examination, Claimant admitted that at the time of his fall he
had his own paint bag with him, with his own brushes, tape and his own harness. He
5
During the course of litigation, the surgery was performed and Claimant’s left foot has
since been amputated.
4
admitted that when he initially met with Jolla, he presented a business card listing his
name and identifying his painting business as “CWC Painting.” Claimant admitted
that during this conversation, he presented Jolla with an insurance declaration page
dated April 11, 2012, through April 11, 2013. Claimant stated that the insurance
policy lapsed as of May 6, 2012, but that he would have purchased insurance if he
performed the work as an independent contractor. He denied that he told Jolla that
the insurance policy was in effect, although he acknowledged that no portion of the
declaration sheet stated that the policy was canceled, inactive or lapsed. He denied
offering Jolla a quote for painting the Buildings during this conversation.
In opposition to Claimant’s claim petition Venue’s sole owner, Jolla,
testified that until his retirement in June 2013, he was employed full-time with
Alcatel-Lucent and living in Piscataway, New Jersey. Jolla stated that because he
wanted to invest in a business for his retirement, he purchased the Altoona Sunoco
gas station in 2010 as well as the Buildings in November 2010. Jolla indicated that
Dr. Prakash Potluri (Dr. Potluri), who was exclusively a business partner of the gas
station’s Blimpie Sub Shop, was often at this Sunoco gas station.
When he purchased the Buildings, Jolla stated they were condemned and
needed renovation. He stated that he retained Rohrer Construction Company in June
2012 to complete the Buildings’ renovations and that Rohrer was completely
responsible for the work on the Buildings, including subcontracting work. He stated
that he did not own any other apartment buildings when he was renovating the
5
Buildings, but admitted that in addition to owning the Buildings and the Sunoco gas
station, he currently owns another investment property in Altoona and one in Florida.
Jolla stated that he did not have any firsthand role in enlisting Claimant
and that the first time he met Claimant was when he went to the Buildings in August
2012 in response to an OSHA safety issue. He stated that he received Claimant’s
business card and a copy of his insurance declaration sheet from Rohrer Construction
Company, that it was his understanding that Claimant was fully insured and that
CWC Painting was the subcontracted entity performing the work.
He also testified that Claimant would be paid for his work in a lump sum
based upon the amount of weekly work that he performed as verified by Rohrer
Construction Company. He stated that he went to Claimant’s home after he fell but
denied that he offered to continue paying Claimant, only offering to provide Claimant
with physical help such as mowing his lawn, and denied discussing workers’
compensation insurance with Claimant.
Venue also presented the manager of its Sunoco gas station, Jeffrey
Nace (Nace), who testified that in the summer of 2012, he observed Claimant
speaking with Dr. Potluri, who worked at the Sunoco gas station’s Blimpie Sub Shop.
Nace stated that these conversations took place during the week and that he saw
Claimant come inside the Sunoco gas station once or twice on the weekends and that
he does not specifically remember Claimant talking to Jolla.
6
Claimant testified in rebuttal that he cancelled his insurance on May 6,
2012, because he did not have any other subcontractor work.6 He stated that when he
subcontracted, it was his business practice to prepare a bid sheet setting forth the
work to be performed, the type of paint to be used and the price of his service.
Claimant stated that he did not have a written contract with Venue.
II.
The WCJ found that Claimant’s testimony was not credible and rejected
it “in its entirety” because it was replete with inconsistences. (WCJ’s Opinion at 8.)
The WCJ accepted as credible Jolla’s testimony, noting that it was substantiated by
documentary evidence. The WCJ also accepted as credible the testimony of Nace.
The WCJ then denied Claimant’s claim petition finding that Claimant was an
independent contractor at the time of his injury. While the WCJ acknowledged that
the CWMA requires an individual in the construction7 industry to sign a written
contract in order to be considered an independent contractor, the WCJ nonetheless
reasoned:
6
Claimant’s rebuttal testimony took place at a hearing on December 11, 2013. In addition
to rebuttal testimony by Claimant, this hearing was also held for the potential testimony of Dr.
Potluri as well as Rohrer. At the outset of the hearing, it was confirmed that Claimant was not
pursuing testimony from Dr. Potluri and that Rohrer was not testifying.
7
Section 2 of the CWMA additionally defines “[c]onstruction” as the “[e]rection,
reconstruction, demolition, alteration, modification, custom fabrication, building, assembling, site
preparation and repair work done on any real property or premises under contract, whether or not
the work is for a public body and paid for from public funds.” 43 P.S. §933.2.
7
In reviewing the provisions of this [CWMA], it is noted that
based upon the present circumstances, that [Claimant]
satisfies all the provisions, with the exception that there is
no clear written contract. In reviewing the historical and
statutory notes associated with this Act, it is noted that it is
an Act providing for the criteria for independent contractors
in the construction industry and for the powers and duties of
the Department of Labor & Industry and the Secretary of
Labor & Industry in imposing penalties. It is noted that
although there is no clear, as of yet, judicial precedent
addressing this matter, it is logical to infer that the intent of
this Legislation was to address the miscarriages of justice
when general contractors in the construction industry would
retain individuals to perform work within the general
contractor[’]s regular business, control and treat those
individuals as employees in virtually all aspects, with the
exception of contending that they were subcontractors or
independent contractors for Workers’ Compensation,
Unemployment Compensation, overtime wages or FICA
contributions. It is clear in the present circumstances that
[Venue] is not a general contractor, and has not been
engaged in the construction industry on his own behalf.
During the original portions of the project, he had
consistently retained other general contractors to perform
all aspects of the work to be performed and perform all
aspects of the work to be completed. As such, it is difficult
to believe that the Legislature intended this Act to be
applicable to a common property owner who retains a
contractor to perform painting for him, whether he contracts
or holds himself out as a contractor, and provides proof of
insurance, as constituting an employer for purposes of
Workers’ Compensation.
(WCJ’s Opinion at 8.)
8
The WCJ also found, in the alternative, that Claimant did not constitute
8, 9
an employee under the CWMA because he was a “casual employee.” Claimant
8
“[P]ersons whose employment is casual in character and not in the regular course of the
business of the employer” are not covered by the Act. 77 P.S. §22. Employment is casual in nature
“where it is occasional, irregular, or incidental as distinguished from regular and continuous.”
Brookhaven Baptist Church v. Workers’ Compensation Appeal Board (Halvorson), 912 A.2d 770,
777 (Pa. 2006) (quoting Williams v. Baptist Church, 186 A. 168, 170 (Pa. Super. 1936)).
9
Venue contends that Claimant waived his appeal regarding the “casual employee” issue
because he failed to challenge the WCJ’s alternative determination in his petition for review.
Claimant did not waive this issue because his petition for review was correctly limited to issues
being appealed from the Board’s determination, which explicitly refused to determine whether or
not Claimant was a “casual employee.”
In any event, Pa. R.A.P. 1513 (d) provides:
An appellate jurisdiction petition for review shall contain:
1. a statement of the basis for the jurisdiction of the court;
2. the name of the party or person seeking review;
3. the name of the government unit that made the order or
other determination sought to be reviewed;
4. reference to the order or other determination sought to be
reviewed, including the date the order or other determination was
entered;
5. a general statement of the objections to the order or
other determination, but the omission of an issue from the
statement shall not be the basis for a finding of waiver if the court
is able to address the issue based on the certified record;
6. a short statement of the relief sought; and
(Footnote continued on next page…)
9
appealed and the Board affirmed solely on the grounds that Claimant was an
independent contractor, explicitly noting that it was not reaching the issue of whether
Claimant was a “casual employee” ineligible for benefits. Claimant filed petitions for
rehearing with the Board, which were denied. Claimant then filed these petitions for
review.10
(continued…)
7. a copy of the order or other determination to be reviewed,
which shall be attached to the petition for review as an exhibit.
Id. (emphasis added.)
The Official Note to Rule 1513 clarifies the amendment to the provision dealing with the
general statement of objections, commenting:
The 2014 amendments to Pa. R.A.P. 1513(d) relating to the general
statement of objections in an appellate jurisdiction petition for review
are intended to preclude a finding of waiver if the court is able, based
on the certified record, to address an issue not within the issues stated
in the petition for review but included in the statement of questions
involved and argued in a brief. The amendment neither expands the
scope of issues that may be addressed in an appellate jurisdiction
petition for review beyond those permitted in Pa. R.A.P. 1551(a) nor
affects Pa. R.A.P. 2116’s requirement that “[n]o question will be
considered unless it is stated in the statement of questions involved [in
petitioner’s brief] or is fairly suggested thereby.”
10
Our scope of review of the Board’s decision is limited to determining whether an error of
law was committed, whether constitutional rights were violated, or whether the necessary findings
of fact are supported by substantial evidence. Lehigh County Vo-Tech School v. Workmen’s
Compensation Appeal Board (Wolfe), 652 A.2d 797, 799 (Pa. 1995).
10
III.
On appeal,11 Claimant contends that the Board erred when determining
that he was an independent contractor because it is undisputed that he did not enter
into a written contract with Venue to perform painting services on the Buildings for
remuneration. In response, Venue contends that Claimant must be deemed an
independent contractor ineligible for benefits under the Act because, as the WCJ
reasoned, the written contract requirement established under Section 3(a) of the
CWMA, 43 P.S. §933.3(a), only pertains to agreements between contractors and
subcontractors.
However, since the WCJ’s decision was issued, we have had the
opportunity to review the written contract requirement under Section 3(a) of the
CWMA. 43 P.S. §933.3(a). In Staron v. Workers’ Compensation Appeal Board
(Farrier), 121 A.3d 564 (Pa. Cmwlth. 2015), appeal denied, 132 A.3d 460 (Pa.
2016), we held that a painter constituted an “employee” under the CWMA where the
claimant worked for a putative employer for several days in exchange for
remuneration and did not sign an independent contractor agreement until after he was
injured.
Rejecting the putative employer’s assertion that the claimant should be
deemed an independent contractor because he signed a written contract after the
injury and purportedly commemorated a prior oral agreement, we explained:
11
By Order dated January 11, 2016, we consolidated these matters on appeal.
11
A claimant seeking workers’ compensation benefits
must establish that he sustained an injury in the course of
his employment and that the injury resulted in a loss of
earning power. Cruz v. Workers’ Compensation Appeal
Board (Kennett Square Specialties), 99 A.3d 397, 407 (Pa.
2014). “Employment status is a critical threshold
determination for liability.” American Road Lines v.
Workers’ Compensation Appeal Board (Royal), 39 A.3d
603, 610 (Pa. Cmwlth. 2012). A claimant must prove an
employer/employee relationship in order to receive benefits.
Id.Section 2 of the CWMA, 43 P.S. §933.2, provides
that for purposes of workers’ compensation, the term
“employee” shall have the same meaning as in section 104
of the Workers’ Compensation Act, which states that the
term “employe” includes “[a]ll natural persons who perform
services for another for a valuable consideration.” 77 P.S.
§22. Section 3(a) of the CWMA provides:
For purposes of workers’ compensation . . . an individual
who performs services in the construction industry for
remuneration is an independent contractor only if:
(1) The individual has a written contract to perform
such services.
(2) The individual is free from control or direction
over performance of such services both under the contract
of service and in fact.
(3) As to such services, the individual is customarily
engaged in an independently established trade, occupation,
profession or business.
43 P.S. §933.3(a) (emphases added). “When the words of a
statute are clear and free from all ambiguity, the letter of it
is not to be disregarded under the pretext of pursuing its
spirit.” Section 1921(b) of the Statutory Construction Act
12
of 1972, 1 Pa. C.S. §1921(b). “‘[A]n agreement of the
parties to a designation of their relationship that is contrary
to the employer/employee relationship established
otherwise is unavailing to effect a change.’” Nevin
Trucking v. Workmen’s Compensation Appeal Board
(Murdock), 667 A.2d 262, 267 (Pa. Cmwlth. 1995) (citation
omitted).
Here, Claimant worked for Employer for several days
in exchange for remuneration and did not sign the
Agreement until after he was injured. Section 3(a)(1) of the
CWMA is unambiguous: “[A]n individual who performs
services in the construction industry for remuneration is an
independent contractor only if . . . [he] has a written
contract to perform such services.” 43 P.S. §933.3(a)(1)
(emphases added). No written contract existed between
Claimant and Employer at any point during Claimant’s
work for Employer and, thus, Claimant could not be
considered an independent contractor under the CWMA.
Farrier, 121 A.3d at 567-68 (emphases in original) (footnote omitted).
Contrary to Venue’s assertion, nothing in the CWMA’s language
indicates that the written contract requirement is limited to contractors and
subcontractors. Section 2 of the CWMA, 43 P.S. §933.2, defines the terms
“employee” and “employer” as having the same meaning given to them in sections
103 and 104 of the Act, 77 P.S. §§21, 22. Further, Section 3(a) of the CWMA, 43
P.S. §933.3(a), broadly applies to any “individual who performs services in the
construction industry for remuneration. . . .” Id.
13
Accordingly, because it is undisputed that Claimant did not enter into a
written contract with Venue and that he was injured while performing services in the
construction industry for remuneration, we reverse and remand this matter to the
Board to decide whether or not Claimant constituted a “casual employee” ineligible
for benefits under the Act.12
_________________________________
DAN PELLEGRINI, Senior Judge
12
Claimant further contends that the Board erred as a matter of law in denying his petition
for rehearing for consideration of after-discovered evidence that purportedly demonstrates his
employment to Venue. Because we have already determined that Claimant was an employee
because he did not enter a written contract as required by Section 3(a) of the CWMA, 43 P.S.
§933.3(a), we do not reach this issue on appeal.
14
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Christopher Cassatt, :
Petitioner :
:
v. : No. 2278 C.D. 2015
:
Workers’ Compensation Appeal :
Board (Uninsured Employers :
Guaranty Fund), :
Respondent :
Christopher Cassatt, :
Petitioner :
:
v. : No. 2280 C.D. 2015
:
Workers’ Compensation Appeal :
Board (Venue, Inc.), :
Respondent :
ORDER
AND NOW, this 14th day of September, 2016, it is hereby ordered that
the orders of the Workers’ Compensation Appeal Board dated October 22, 2015, at
Nos. A14-0634 and A14-0635, are reversed and these matters are remanded to the
Workers’ Compensation Appeal Board for further proceedings consistent with this
opinion.
Jurisdiction relinquished.
_________________________________
DAN PELLEGRINI, Senior Judge