Holten v. Syncreon North America, Inc.
129 N.E.3d 728
Ill. App. Ct.2019Background
- Holten (temp employee of Staff on Site) was assigned to Android as a forklift operator and was injured on Android premises; he recovered workers’ compensation benefits from Staff on Site.
- Holten sued Android in tort; Android pleaded the Workers’ Compensation Act (Act) exclusive-remedy defense as a borrowing employer under section 1(a)(4).
- Contract between Android and Staff on Site required Staff on Site to provide temporary employees and maintain payroll and workers’ compensation; Staff on Site carried coverage for Holten.
- Evidence (depositions and affidavit) showed Android set hours, supervised Holten, provided equipment, held shift startup meetings, and could remove a temp from its facility on direction to the staffing agency.
- Trial court granted summary judgment to Android and denied Holten’s motion to reconsider; Holten appealed, arguing (1) Android cannot invoke exclusivity because it did not pay premiums/benefits or promise reimbursement, and (2) disputed facts exist as to a borrowed-employee relationship.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether payment/obligation to reimburse workers’ compensation is a prerequisite to invoke Act exclusivity as a borrowing employer | Holten: exclusivity requires borrowing employer to pay or be obligated to reimburse premiums/benefits | Android: section 1(a)(4) contemplates loaning employer may pay benefits; liability is joint and several and statute supplies reimbursement right absent agreement otherwise | Rejected Holten’s threshold rule; payment by borrower not required under section 1(a)(4); statute contemplates loaning employer paying and joint immunity applies |
| Whether undisputed facts establish Android had right to direct/control work (element of borrowed-employee) | Holten: disputes about control, termination power, and who paid wages create issues of fact | Android: factual record shows Android set hours, supervised and instructed Holten, provided equipment, and could end assignment at its facility | Android entitled to summary judgment; no genuine issue on direction/control element |
| Whether there was an express or implied contract of hire between Holten and Android | Holten: points to employer agreement and contends no express contract with Android | Android: implied contract of hire arises from Holten’s acceptance of temporary assignment and work at Android | Court found implied contract for hire; Holten accepted assignment and therefore impliedly contracted with Android |
| Ultimate question: Was Android a borrowing employer entitled to exclusive remedy? | Holten: combination of above arguments shows triable issues so exclusivity improper | Android: statute, contract, and record establish Borrowing employer status and entitlement to immunity | Court affirmed summary judgment for Android — borrowing-employee relationship existed and exclusivity applied |
Key Cases Cited
- A.J. Johnson Paving Co. v. Industrial Comm’n, 82 Ill.2d 341 (Illinois Supreme Court) (sets borrowed-employee test: control and contract of hire)
- Meerbrey v. Marshall Field & Co., 139 Ill.2d 455 (Illinois Supreme Court) (describes Act’s quid pro quo and purpose)
- Ioerger v. Halverson Constr. Co., 232 Ill.2d 196 (Illinois Supreme Court) (exclusive remedy for agents/joint venturers and policy metaphors)
- Chaney v. Yetter Mfg. Co., 315 Ill. App. 3d 823 (App. Ct.) (temp-agency placement; loaning/borrowing employers joint liability and exclusivity applies despite agency promise to indemnify)
- Williams v. Manchester, 228 Ill.2d 404 (Illinois Supreme Court) (summary judgment standard)