SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
A-3108-95T2
MICHAEL KERTESZ,
Petitioner-Appellant,
v.
BARRY L. KORSH,
Respondent-Appellee.
_________________________________________
Argued December 11, 1996 - Decided December 26, 1996
Before Judges Shebell, P.G. Levy and Braithwaite.
On appeal from Judgment of the State of New Jersey,
Department of Labor, Division of Workers'
Compensation.
Thomas R. Hilberth argued the cause for appellant
(Law Offices of Thomas R. Hilberth, attorney; Mr.
Hilberth, of counsel; R. Michael Mori, on the brief).
Francis T. Giuliano argued the cause for respondent
(Mr. Giuliano, of counsel; Mr. Giuliano and David P.
Kendall, on the brief).
The opinion of the court was delivered by
SHEBELL, P.J.A.D.
Petitioner, Michael Kertesz, appeals from the dismissal of
his workers' compensation claim based on a finding that he was
not an employee of respondent, Barry L. Korsh. Petitioner was
injured while installing sheetrock on November 6, 1990.
Respondent, however, denied that petitioner was an employee. We
reverse.
According to the testimony of petitioner, on November 6,
1990, he fell while working on a job site to which he was
directed by respondent, in Unit 16 of the Kips Ridge Townhouses
in Verona. Petitioner testified that the day before the injury,
respondent requested he go to work at that location to finish a
sheetrocking job. Respondent was to pay petitioner $120 per day.
He told petitioner to bring his tools and truck. There was no
writing or insignia on petitioner's truck. Petitioner worked for
respondent "[a]bout three, four times a month." Petitioner had
an independent business of installing sheetrock and employed
others to work in his unincorporated business, but took this work
with respondent because business was slow.
Petitioner went to the job site with Robert Pastor, another
dry wall worker. Pastor testified: I spoke to "my employer,"
Barry Korsh, and was told to "call up Mikey [petitioner] and go
with him to finish up the job." Petitioner and Pastor were each
paid separately by personal checks from respondent. Petitioner,
who was not fluent in English, testified through an interpreter
that Pastor was considered the foreman and that Pastor told him
what to do. Petitioner also testified that he took the job
himself, rather than sending an employee, because work was slow.
He did not work out of the union hall, nor did he receive a
steady paycheck from any other source. Petitioner had a Workers'
Compensation Insurance policy, naming himself as the insured, not
a corporation or business entity.
Pastor, upon questioning by the judge, stated that
respondent was putting up sheetrock on the whole project and that
"I was working for Barry [respondent] and I was doing this job
and then he needed someone ..., and we gave him [petitioner] a
call." There were five people installing sheetrock at the job.
Pastor stated it was respondent's responsibility to make sure
that there were enough workers at the site to complete the job.
The sheetrock, nails and supplies needed were provided by
respondent. Unit 16 consisted of four levels. Petitioner
explained it was customary for the builder to supply the large
scaffold, the planking and the horses.
The judge, in rendering his decision, stated: petitioner
"is a sheetrocker. He gets a call, puts up sheetrock supplied by
the contractor, he brings his own tools because he's comfortable
with it. You need it. He's in the business." The judge held
I can't make a finding that [petitioner] is
an employee of [respondent]. I can't, since
[the attorney for respondent] didn't produce
[respondent], make any negative findings
about [respondent].
Mr. Pastor ... was less than believable as a witness. I find Mr. Pastor was highlighting certain facts and was testifying to attempt to help [petitioner]. [Petitioner] does not need that type of help. He's a good man. Unfortunately, he's not entitled to Workers' Compensation benefits as being an employee of [respondent].
I find that from [petitioner's] own testimony he was an honest, truthful, and a nice man who was unfortunately injured and is unable to collect Workers' Compensation benefits because he thought more of the employees that he had than he did of himself ....
We gather from the above that the Judge of Compensation made
a determination that petitioner was an independent contractor,
and as such, was not entitled to Workers' Compensation benefits
for his injury. A decision of the Division of Workers'
Compensation is to be reviewed under the standard set forth in
Close v. Kordulak Brothers,
44 N.J. 589 (1965). There, our
Supreme Court stated
we now say the standard to govern appellate
intervention ... is the same as that on an
appeal in any nonjury case, i.e., "whether
the findings made could reasonably have been
reached on sufficient credible evidence
present in the record," considering "the
proofs as a whole," with due regard to the
opportunity of the one who heard the
witnesses to judge of their credibility.
[Id. at 599 (quoting State v. Johnson, 42 N.J.
146, 162 (1964)).]
The Court further explained that when reviewing an agency
determination, "due regard [should be given] to the agency's
expertise where such expertise is a pertinent factor." Id. at
599. We will reverse, however, when the finding and conclusions
of the judge are inconsistent with the evidence and offend the
interests of justice. Perez v. Monmouth Cable Vision,
278 N.J.
Super. 275, 282 (App. Div. 1994), certif. denied,
140 N.J. 277
(1995).
Petitioner has the burden of proving this claim by a
preponderance of the evidence. Marcus v. Eastern Agricultural
Ass'n, Inc.,
58 N.J. Super. 584, 587-88 (App. Div. 1959), rev'd
on dissent,
32 N.J. 460 (1960). Under N.J.S.A. 34:15-36, an
employee "is synonymous with servant, and includes all natural
persons ... who perform service for an employer for financial
consideration ...." The meaning of "employee" and "independent
contractor" were explained in Capadonna v. Passaic Motors, Inc.,
136 N.J.L. 299 (Sup. Ct. 1947), aff'd,
137 N.J.L. 661 (E. & A.
1948).
An independent contractor is one who,
carrying on an independent business,
contracts to do a piece of work according to
his own methods, and without being subject to
the control of his employer as to the means
by which the result is to be accomplished,
but only as to the result of the work.
The relation of master and servant exists
whenever the employer retains the right to
direct the manner in which the business shall
be done, as well as the result to be
accomplished, or in other words, not only
what shall be done, but how it shall be done.
[Id. at 300 (quoting Errickson v. F.W.
Schwiers, Jr., Co.,
108 N.J.L. 481, 483 (E. &
A. 1932)).]
The function of Workers' Compensation legislation is to
require the consumer to ultimately bear the cost of injuries to
workers through the cost of the service or product. Marcus,
supra, 58 N.J. Super. at 603 (Conford, J.A.D., dissenting).
Thus, whether a worker is an employee or an independent
contractor is crucial to the determination of whether the worker
should receive benefits and is to be determined through the
application of two tests: the "control test" and the "relative
nature of the work test." See Tofani v. Lo Biondo Brothers Motor
Express, Inc.,
83 N.J. Super. 480, 484-92 (App. Div.), aff'd.
o.b.,
43 N.J. 494 (1964).
In this case, it is the application of both the "control
test" and the "relative nature of the work test" that leads us to
the conclusion that petitioner is an employee, and thus entitled
to receive Workers' Compensation benefits from respondent. The
control test was the first test used by our courts to determine
whether a worker was an employee or an independent contractor.
Brower v. Rossmy,
63 N.J. Super. 395, 404 (App. Div. 1960),
certif. denied,
34 N.J. 65 (1961). The test is whether or not
the employer had "control" over the worker, i.e., whether the
employer had "the right to direct the manner in which the
business or work shall be done, as well as the results to be
accomplished." Id. at 404-05. It is significant that the
"control test" is fulfilled so long as the employer has the right
of control, even though the employer need not exercise actual
control over the worker. Id. at 405.
After being called by respondent, petitioner went to the job
site and with other workers undertook to complete the last unit
on the project. Although petitioner had thirty years experience
in sheetrocking and did not need instruction as to what needed to
be done, there is no indication that respondent did not have the
right to control petitioner. Pastor, who petitioner regarded as
the foreman, testified that he worked for respondent. This
testimony was unrebutted. Thus, respondent, through Pastor,
appeared to exercise the right to control petitioner's
activities.
In any event, the absence of control does not preclude a
finding that petitioner is an employee.
A clear showing of control leads easily to
the affirmative conclusion that an employer-employee relationship existed. But absence
of control of details of the work, where not
appropriate in the light of the skill of the
employee in the circumstances under which the
work is done, is not necessarily significant.
[Brower, supra, 63 N.J. Super. at 404.]
As noted in Marcus, "there are various situations in which the
control test does not emerge as the dispositive factor." Marcus,
supra, 58 N.J. Super. at 597 (Conford, J.A.D., dissenting). In
fact, this court has acknowledged that "[t]he courts have placed
greater reliance upon the relative nature of the work test."
Pollack v. Pino's Formal Wear,
253 N.J. Super. 397, 407 (App.
Div.), certif. denied,
130 N.J. 6 (1992).
[W]here it is not in the nature of the work
for the manner of its performance to be
within the hiring party's direct control, the
factor of control can obviously not be the
critical one in the resolution of the case,
but takes its place as only one of the
various potential indicia of the relationship
which must be balanced and weighed in
determining what, under the totality of the
circumstances, the character of that
relationship really is. Thus, the
requirement of control is sufficiently met
where its extent is commensurate with that
degree of supervision which is necessary and
appropriate, considering the type of work to
be done and the capabilities of the
particular person doing it. Patently, where
the type of work requires little supervision
over details for its proper prosecution and
the person performing it is so experienced
that instructions concerning such details
would be superfluous, a degree of supervision
no greater than that which is held to be
normally consistent with an independent
contractor status might be equally consistent
with an employment relationship.
[Marcus, supra, 597 (Conford, J.A.D.,
dissenting)(citations omitted).]
Where the control test is not accepted as the "dispositive
factor," the focus then turns to the "relative nature of the work
test" in deciding whether petitioner is an employee or an
independent contractor. In Hannigan v. Goldfarb,
53 N.J. Super. 190 (App. Div. 1958), we recognized that "[t]he right to control
is not `the underlying principle that really tips the scales in
close situations.'" Id. at 204 (quoting 1C Arthur Larson,
Workmen's Compensation Law § 43.30 at 8-10). Rather, "`what
actually influences the decision ...' is `the nature of the
claimant's work in relation to the regular business of the
employer.'" Id. at 204-05 (quoting Larson, supra, §43.50). This
"test [is] more realistic to the objects and purposes of
workmen's compensation and relevant in [certain] circumstances"
and although the control factor is still utilized in the test, it
"is minimized when certain fact patterns appear." Brower, supra,
63 N.J. Super. at 404.
The "relative nature of the work test" was characterized by
this court in Marcus, supra, as follows:
The test ... [is] essentially an economic and
functional one, and the determinative
criteria not the inconclusive details of the
arrangement between the parties, but rather
the extent of the economic dependence of the
worker upon the business he serves and the
relationship of the nature of his work to the
operation of that business.
[Marcus, supra, 58 N.J. Super. at 603
(Conford, J.A.D., dissenting.]
The "relative nature of the work test," was thereafter adopted by
our Supreme Court in Caicco v. Toto Brothers, Inc.,
62 N.J. 305,
310 (1973). Under this test it is necessary to analyze the
nature of the employer's business and decide whether "`the work
done by the petitioner was an integral part of the regular
business of respondent,'" as well as whether the worker is
economically dependent upon the employer. Smith v. E.T.L.
Enterprises,
155 N.J. Super. 343, 352 (App. Div. 1978)(quoting
Rossnagle v. Capra and Shell Oil Co.,
127 N.J. Super. 507, 517
(App. Div. 1973), aff'd o.b.,
64 N.J. 549 (1974)).
In the present case, perhaps because respondent did not
testify, the judge did not analyze the nature of respondent's
business. However, the facts regarding respondent's business may
be gleaned from the testimony of both petitioner and Pastor.
Respondent contracted to sheetrock the entire project, and
petitioner was hired to work from time to time with others to do
the sheetrocking work. Both Pastor and petitioner worked for
respondent whenever he needed them. Pastor had been working on
the job on and off since its inception and was considered by
petitioner to be the foreman on the job. Petitioner worked for
respondent about three to four times a month. It was
respondent's responsibility to ensure that enough workers were on
the job. Both petitioner and Pastor were paid separately by
check for the time that they themselves worked.
The judge should also have considered the nature of
respondent's business and whether petitioner was an integral part
of that business. Respondent obtained the job and required
additional workers to finish the work that he had contracted to
perform. Thus, he enlisted petitioner to be a worker.
Respondent involved himself in the sheetrocking business by
contracting to sheetrock the project. Respondent supplied the
workers with the necessary materials, including the sheetrock and
nails which he purchased, and the scaffolding and planking from
which petitioner fell. Respondent was dependent on workers such
as petitioner to be available when needed to fulfill the
contract. Moreover, he employed petitioner three to four times a
month.
Mounting sheetrock is an occupation that requires experience
and expertise. Since petitioner had been in the trade for many
years, he did not need substantial direction as he was familiar
with what to do. Therefore, the nature of petitioner's work,
given his background in mounting sheetrock, corresponded with the
nature of the business undertaken by respondent. These factors
all add up to the conclusion that petitioner was in the employ of
respondent at the time of his accident and injury.
Nonetheless, respondent argues that because petitioner
characterized himself as "an independent" and was in the business
of sheetrocking for himself that it prevents a determination that
petitioner was an employee. However, upon application of the
facts to the "relative nature of the work test," the factors
respondent cites are not sufficient to support a finding that
petitioner was an independent contractor.
A review of the facts in Pollack, supra is illustrative.
After setting out the factors in the "relative nature of the work
test," we then applied those factors to the facts in that case.
We stated:
Furthermore, Pollack was Polgardy's employee
even under the relative nature of the work
test. Petitioner established Pollack's
dependency on Polgardy. Pollack asked
Polgardy about the availability of work
because his own business was floundering.
Pollack was in need of money and Polgardy
hired Pollack at the rate of $15 per hour.
Furthermore, the work that Pollack performed
was an integral part of Polgardy's business.
Polgardy's business involved the installation
of dry-cleaning machinery and Pollack
installed a gas-fired burner, which was a
necessary component of the dry-cleaning
machinery.
[Pollack, supra, 253 N.J. Super. at 409).]
Here, as in Pollack, supra, petitioner needed the work since
business was slow; respondent hired petitioner at the rate of
$120 per day; he worked for respondent three to four times that
month; and petitioner was performing an integral part of the
business respondent was under contract to perform. A finding of
employment is compelled considering the facts presented to the
Judge of Compensation.
N.J.S.A. 34:15-36 barring casual employees from receiving
Worker's Compensation benefits does not apply here. The extent
or duration of petitioner's employment is irrelevant. Graham v.
Green,
54 N.J. Super. 397, 402 (App. Div.), rev'd on other
grounds,
31 N.J. 207 (1959). Whether the work arose by chance or
was purely accidental is the relevant inquiry. Ibid. The
Supreme Court, in Graham, supra, stated that N.J.S.A. 34:15-36
"does not exclude all casual business employments merely because
they are brief and passing, but rather excludes only such brief
employments as result from an occasion arising by chance or pure
accident." Graham, supra, 31 N.J. at 211 (emphasis omitted).
Here, petitioner's employment cannot be considered accidental as
it was in the regular course of respondent's business. In
addition, respondent not only specifically requested that
petitioner work on the day of the accident, but petitioner worked
for respondent three to four times a month.
Our conclusion also finds support in the objectives of the
Workers' Compensation legislation and the liberal construction
that it commands. As stated, a purpose of the legislation is to
place the cost of injuries to workers on the ultimate consumer
through the price of the goods or services. Marcus, supra, 58
N.J. Super. at 603 (Conford, J.A.D., dissenting). This
legislation should be construed liberally, "in order to bring as
many cases as possible within the coverage of the act." Smith,
supra, 155 N.J. Super. at 349. Therefore, since petitioner's
work fell within the regular and continuing course of
respondent's business, and because petitioner's unincorporated
business was not a "separate route through which his own costs of
industrial accident can be channelled," our determination, that
petitioner was an employee and thus deserving of benefits,
fosters the objective of passing on the cost of the worker's
injury to the ultimate consumer. Marcus, supra, 58 N.J. Super.
at 603 (Conford, J.A.D., dissenting)(quotation omitted).
We, therefore, reverse and remand. Petitioner has
established that he was an employee of respondent at the time of
his injury and thus, is eligible for Workers' Compensation
benefits. An appropriate judgment in that regard shall be
entered by the Judge of Compensation, and the matter shall be
promptly scheduled for a hearing to determine benefits.
Reversed and remanded.