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Opt-in to Texas workers’ comp to cut liability

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Good news if you’ve opted into the Texas workers’ compensation system and you sometimes rely on temporary staffing agencies to supply workers.

If one of those workers gets hurt on your premises—and if you control crucial elements of the worker’s day, such as telling him when to work and take breaks, and supply tools or equipment—you may be saved from direct liability for the injury. Workers’ comp will cover the injury.

That can save you a lot of money. Otherwise the worker could sue your company for negligence and collect a potentially huge jury award.

Recent case: Leonard Phillips worked for a staffing company, which handled most aspects of his employment, such as paychecks and benefits. Phillips was assigned to work at American Elastomer Products, which told Phillips when to come to work, when to go on break and what work to perform. It also provided training, tools and equipment.

At one point, the company put an autoclave device outside the main building and left it there for over a year. It then moved the device back inside and started it up again. The device exploded, and workers in the building panicked. Phillips ran toward the exit and fell in the chaos.

Phillips said the fall caused herniated discs in his back and post-traumatic stress disorder. He sued American Elastomer directly, alleging it had been negligent in handling the autoclave, causing the explosion that made him run and fall.

The company said the case should be covered by its workers’ compensation policy and the court agreed. It reasoned that Phillips was an American Elastomer employee for workers’ compensation purposes because the company controlled so many aspects of his workday. (Phillips v. American Elastomer Products, No. 14-09-00164, Court of Appeals of Texas, 14th District, 2010)

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