May 19, 2011
HELEN WILLIAMSON, PETITIONER-APPELLANT,
CROSSROADS PROGRAMS, INC., RESPONDENT-RESPONDENT.
On appeal from the New Jersey Department of Labor and Workforce Development, Division of Workers' Compensation, Claim Petition No. 2009-23752.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted March 28, 2011
Before Judges Sabatino and Alvarez.
This workers' compensation action arises from injuries sustained by petitioner Helen Williamson when she fell during a foster parent training session presented by respondent Crossroads Programs, Inc., ("Crossroads"). Crossroads filed a motion to dismiss her claim and the compensation judge heard testimony adduced by both parties. Based on those proofs, the judge found that petitioner was not an employee of Crossroads for workers' compensation benefit purposes. Crossroads' motion was therefore granted and petitioner's claim was dismissed. For the reasons that follow, we affirm.
The facts and procedural events relevant to our analysis are summarized as follows.
According to Crossroads' mission statement, the organization "empower[s] youth who are homeless, abandoned, abused, or at-risk to lead healthy, productive lives." To advance that mission, Crossroads contracts with the State to run the Community Care for Kids Therapeutic Foster Care Program. The primary purpose of the therapeutic foster care program is to integrate youths into a family-like setting that promotes "normalized" adolescence.
On October 21, 2008, Crossroads presented a training seminar for licensed foster care providers at the JFK Community Center in Willingboro. Petitioner, a licensed foster care provider, arrived at the seminar. As she ascended the steps to the meeting location, she fell, shattering her left patella and injuring her lower back.
Eleven months later, in September 2009, petitioner filed a workers' compensation claim, contending that her injuries were sustained in an accident at the JFK Community Center, arising out of her alleged employment with Crossroads. Crossroads filed an answer denying the existence of an employment relationship with petitioner.
Crossroads filed a motion to dismiss petitioner's claim. On April 21, 2010, Hon. William Lake, J.W.C., heard testimony from petitioner, as well as testimony from two of Crossroads' employees, Cheryl Conway and Tia Sanders.
Petitioner, a former schoolteacher, testified that she has been a foster parent for approximately eight or ten years. She estimated that she has been a foster parent associated with Crossroads for approximately six years. At the time of her accident in 2008, petitioner had one foster child in her care, a thirteen-year-old daughter. She also indicated that she has an adult daughter who attends school in Georgia.
Petitioner testified that, as a foster parent, she was required to attend the meetings or trainings that were held monthly by Crossroads. She further testified that she was required to get approval from Crossroads for her foster child to attend school trips, overnight trips, and so on. Petitioner explained that each child has a treatment plan that dictates the amount of community time the child is allowed, the child's curfew, and the child's bedtime. She indicated that she did not have the control of the child's medical appointments, e.g., choosing the doctor or the location, although she was sometimes responsible for scheduling.
Petitioner testified that she received $75 per day from Crossroads to defray the extra costs she incurred by having the child in her home. She confirmed that the payments included reimbursement for $100 in clothing expenses and $100 in recreational expenses per month, which included an allowance for the child. Petitioner testified that it was her understanding that "if the child was taken care of and there was anything left over, that was [her] money and [she could] use it for whatever [she] wanted." She asserted that she had extra money left over every month. Petitioner further indicated that, although she receives a state retirement pension and Social Security disability, she substantially relies on the money from Crossroads for her living expenses.
Cheryl Conway, the Chief Executive Officer of Crossroads, confirmed in her testimony that Crossroads is a private, nonprofit organization that contracts with the State to place children with foster parents. Conway explained that Crossroads selects which foster parent to place each child with, although Crossroads does not have the right to remove the child from that home. She clarified that "[u]ltimately, the State has the control over the child."
Conway testified that Crossroads works with a network of foster parents, and that Crossroads monitors the foster parents' ability to maintain the licensing requirements mandated by the State. She explained that the children are wards of the State, and that the State guidelines are very specific with regard to the day-to-day care of the child and the safety of the home the child is placed in. According to Conway, "[o]nce licensing standards are met in terms of care and safety, then [the care of the child is] up to the [foster] parent." She explained that "that's why they're chosen as a foster parent because they've been deemed as having that level of judgment and the ability to care appropriately for a [child]."
According to Conway, the $75 reimbursement paid to each foster parent is intended to cover every aspect of the child's care, including expenses for room and board. She indicated that Crossroads, in turn, receives daily reimbursement from Medicaid for each child. Conway emphasized that foster parents must be financially stable and that they "may not rely on reimbursement [from Crossroads] for their [own] livelihood[.]"
Tia Sanders, the Program Director for Community Care of Kids in Second Chance Homes at Crossroads, testified that she gave the orientation for treatment foster parents that petitioner attended in June 2007. During the orientation, Sanders specifically advised the foster parents that they are not employees of Crossroads, and that the reimbursement they receive is not taxable and is not considered income.
As described by Sanders, prior to a foster child being placed in her home, petitioner had to be licensed by the State as a treatment parent. Sanders testified that the State requires that treatment parents attend twelve hours of training each year to maintain their license. Although Crossroads provides such training sessions, foster parents are not required to attend any specific training at any specific location, and the parents may attend community-based or private trainings instead. If a foster parent fails to comply with State requirements, the State could revoke his or her foster parent license.
Having heard the parties' testimony, Judge Lake rendered an oral decision on the record on July 14, 2010. The judge concluded that he was "satisfied that [petitioner] is not an employee of Crossroads." He was "also satisfied that DYFS did not exercise enough control over telling her what to do in making her an employee and she understood she was not going to be an employee." Judge Lake therefore determined that "[petitioner] was not an employee for workers' compensation benefit purposes" and consequently dismissed petitioner's claim. A corresponding written order memorializing his decision was entered that day.
This appeal followed. In essence, petitioner maintains that the compensation judge erred in concluding that she was not an employee of Crossroads for purposes of the statute.
In reviewing Judge Lake's determination, we assess whether, considering the proofs as a whole, the findings the judge made reasonably could have been reached on sufficient credible evidence in the record. Close v. Kordulak Bros., 44 N.J. 589, 599 (1965); see also Brock v. Pub. Serv. Elec. & Gas Co., 149 N.J. 378, 383 (1997); Perez v. Capitol Ornamental, Concrete Specialties, Inc., 288 N.J. Super. 359, 367 (App. Div. 1996). A reviewing court must defer to the findings made by a judge of compensation, given the judge's opportunity to observe and hear the witnesses and to evaluate their credibility, in addition to the judge's expertise in the field of workers' compensation. Kaneh v. Sunshine Biscuits, 321 N.J. Super. 507, 511 (App. Div. 1999); see also Kovach v. Gen. Motors Corp., 151 N.J. Super. 546, 549 (App. Div. 1978) ("It must be kept in mind that judges of compensation are regarded as experts."). In the presence of sufficient credible evidence, a compensation judge's findings of fact are binding on appeal, and those findings must be upheld "even if the court believes that it would have reached a different result." Sager v. O.A. Peterson Constr., Co., 182 N.J. 156, 164 (2004).
We turn to the governing statutory provisions. Under N.J.S.A. 34:15-1, an individual is eligible for workers' compensation benefits if he or she is injured while acting in an employee-capacity. In Section 36, the statute provides that the definition of an employee is: synonymous with servant, and includes all natural persons . . . who perform service for an employer for financial consideration, exclusive of . . . casual employments, which shall be defined, if in connection with the employer's business, as employment the occasion for which arises by chance or is purely accidental; or if not in connection with any business of the employer, as employment not regular, periodic or recurring . . . [.] [N.J.S.A. 34:15-36.]
By contrast, an "independent contractor" not entitled to workers' compensation benefits has been defined as:
'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.' [Lesniewski v. W.B. Furze Corp., 308 N.J. Super. 270, 280 (App. Div. 1998) (quoting Cappadonna v. Passaic Motors, Inc., 136 N.J.L. 299, 300 (Sup. Ct. 1947), aff'd, 137 N.J.L. 661 (E. & A. 1948)).]
In general, courts have applied two distinct legal tests in workers' compensation cases when determining if a petitioner is an eligible employee or, alternatively, an ineligible independent contractor: (1) the "control" test, and (2) the "relative nature of the work" test. Lesniewski, supra, 308 N.J. Super. at 280; see also Sloan v. Luyando, 305 N.J. Super. 140, 148 (App. Div. 1997). Here, the compensation judge appropriately found that petitioner was not an employee of Crossroads under either of these tests.
First, under the "control" test, an employer/employee relationship exists when the employer retains the right to choose not only what is done, but how it is done. Pollack v. Pino's Formal Wear & Tailoring, 253 N.J. Super. 397, 408 (App. Div.), certif. denied, 130 N.J. 6 (1992). The right to control is more determinative than the exercise of control. Ibid. Courts typically consider several factors in assessing the presence or absence of control, including "evidence of the right of control, right of termination, furnishing of equipment, and method of payment." Aetna Ins. Co. v. Trans Am. Trucking Serv., Inc., 261 N.J. Super. 316, 327 (App. Div. 1993). Moreover, even where an agency "has authority to direct the result to be accomplished -- providing foster children with a normal, wholesome home life -- it does not retain control over the means by which this [is] to be done." New Jersey Prop.-Liab. Ins. Guar. Ass'n v. State, 195 N.J. Super. 4, 13 (1984).
Here, petitioner argues that her alleged status as an employee of Crossroads is supported by the fact that she did not have total control over her day-to-day role as a foster parent. Petitioner asserts that she was responsible for implementing the treatment plan for the child, a plan which was prepared and approved by Crossroads. She further contends that she was only obligated to account for a portion of the remuneration she received for the child, and that the remaining funds were available to be used at her discretion. Additionally, petitioner asserts that Crossroads received a direct benefit from her State licensure as a foster parent, and that Crossroads assisted her both in securing and in maintaining that license.
Crossroads, on the other hand, maintains that it did not provide petitioner with any earnings. In support of its contention, Crossroads cites to Section 131 of the Internal Revenue Code, stating that payments to foster care parents are not taxable. Crossroads asserts that the money petitioner received was intended to provide for the child's direct expenses and to offset the additional costs incurred by petitioner in having the child in her home.
Furthermore, Crossroads contends that petitioner maintained autonomy in exercising her day-to-day responsibilities as a foster parent. It also emphasizes that the State, not Crossroads, has the power of termination; the State, not Crossroads, has the power to revoke petitioner's license; and the State, not Crossroads, has the power to remove the child from petitioner's foster home.
The record manifestly supports the compensation judge's conclusion that petitioner was not an employee of Crossroads. Petitioner maintained control over the day-to-day care of the foster child. She did not receive compensation beyond reimbursement for the expenses that she was expected to incur in providing foster care; any surplus amounts were incidental and not earnings. Crossroads did not furnish any equipment to petitioner to be used for providing foster care. Moreover, Crossroads did not itself have the right to terminate petitioner's status as a foster care provider. Viewing the proofs as a whole, there is ample credible evidence in the record to conclude that petitioner was not an employee under the control test.
Petitioner fares no better under the alternative construct of the "relative nature of the work" test. Under that second test, an employer-employee relationship exists if a "substantial economic dependence" upon the employer is proven and it is also demonstrated that there is a "functional integration" of their respective operations. Caicco v. Toto Bros., Inc., 62 N.J. 305, 310 (1973); see also Luyando, supra, 305 N.J. Super. at 148; Rossnagle v. Capra, 127 N.J. Super. 507, 517 (App. Div. 1973), aff'd o.b., 64 N.J. 549 (1974). As part of this assessment, the court must consider whether the work done by the petitioner was an "integral part of the regular business" of the respondent. Pollack, supra, 253 N.J. Super. at 408 (quoting Rossnagle, supra, 127 N.J. Super. at 517).
Here, petitioner argues that, as a foster parent, she provides a service for Crossroads that is "an integral and vital part of the company." She contends that she is substantially economically dependent on the funds she receives from Crossroads and that "it would [be] a financial hardship [for her] if she did not have access to the money she receives [from Crossroads] for being a 'professional parent'[.]"
As we have already noted, the testimony of Crossroads' CEO and Program Director made clear that the money provided to petitioner was not income, but instead was intended to offset her expenses in providing foster care. Petitioner's own testimony revealed that she was able to show financial independence, as was required for her to be approved as a foster parent.
Again, looking at the record as a whole, the proofs are more than adequate under the "relative nature of the work" test to support the compensation judge's conclusion that petitioner was not an employee of Crossroads. Although petitioner's "work" theoretically could be considered an "integral part of the regular business" of Crossroads, the criteria that qualified her to do that so-called "work" prevent her from being substantially economically dependent on Crossroads. As we have noted, petitioner's financial independence was required in order for her to receive a foster child into her home. Thus, petitioner's contention that she was financially dependent upon those funds directly contravenes the objectives of foster care placement. If anything, although the licensure issue is not before us, her contention of dependency would suggest that she should no longer qualify as a foster care provider. We need not make such a finding, but rather will sustain the judge's own finding that, despite petitioner's characterization of her status, the objective proofs show that she was not, in fact, a Crossroads employee.
In sum, the compensation judge's ruling that petitioner was not an employee of Crossroads when she sustained her injury at the October 2008 seminar is supported by sufficient credible evidence in the record, and is also consonant with the applicable law.
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