Court Rejects Exclusive Remedy Defense of Temporary Employment Services Client
The Fourth Court of Appeals has reversed the decision of a trial court that granted summary judgment to the client of a temporary employment service. The court ruled that the client company was not entitled to assert the exclusive remedy defense in a lawsuit filed by an injured employee of the TES. The decision in Rodriguez v. Panther Expedited Services, Inc., et al., No. 04-17-00291-CV, July 31, 2018 construed the provisions of Chapter 93 of the Texas Labor Code, which extends the exclusive remedy defense to temporary employment services as well as their client companies.
Rodriguez was employed as a forklift operator by Amigo Staffing, a temporary employment service. Rodriguez was assigned to operate a forklift at Dicex, which operated a freight and cargo warehouse and distribution center. The assignment was made pursuant to an agreement for temporary employment services between Amigo Staffing and Dicex. Rodriguez claimed that while he was backing a forklift onto a loading dock, the forklift fell into a gap that was created as the result of Amigo’s negligence.
After he was injured Rodriguez accepted benefits based on a workers’ compensation insurance policy maintained by Amigo Staffing. Nevertheless, he filed suit against Amigo Staffing, Dicex, Panther, Ellis, and Daly for negligence, seeking to recover damages for his injuries. Rodriguez later filed a notice of nonsuit with regard to Amigo Staffing, and the trial court signed an order granting the nonsuit. Thereafter, Dicex filed a third-party petition against Amigo Staffing, bringing Amigo Staffing back into the lawsuit. Ultimately, Dicex, Panther, and Amigo Staffing filed motions for summary judgment. Rodriguez filed responses to the motions filed by Dicex and Panther, and Dicex filed a response to the motion filed by Amigo Staffing.
In its motion for summary judgment Dicex asserted Rodriguez’s claims were barred under the exclusive remedy provision in the Workers’ Compensation Act. Specifically, Dicex argued it produced summary judgment evidence showing that at the time of the injury, Amigo Staffing was a TES that carried workers’ compensation insurance covering Rodriguez, and Dicex was Amigo Staffing’s client pursuant to a temporary services employment agreement. Therefore, under Chapter 93 of the Texas Labor Code, the workers’ compensation policy held by Amigo Staffing covered any injuries sustained by Rodriguez during his assignment with Dicex, and any action pursued against Dicex was barred by the exclusive remedy provision of the TWCA.
After a Hearing, the trial court rendered summary judgment in favor of Dicex and Panther and, as noted above, dismissed as moot Dicex’s third-party claim against Amigo Staffing. Thereafter, Rodriguez perfected his appeal. With respect to Dicex’ motion for summary judgment, the Court of Appeals explained:
The exclusive remedy provision is an affirmative defense. Rodriguez, 499 S.W.3d at 53 (citing Rico, 404 S.W.3d at 765). If proven, the provision protects employers from certain common law claims of their employees, including negligence — the claim brought by Rodriguez against Dicex. Id. Employees are covered by workers’ compensation insurance — and therefore subject to the exclusive remedy provision — if their employers have approved insurance policies covering the payment of workers’ compensation benefits to their employees. See Casados, 358 S.W.3d at 242; Rodriguez, 499 S.W.3d at 53.
An employee may also be covered by workers’ compensation insurance — and therefore subject to the exclusive remedy provision of the TWCA — if he enters employment with a TES that has elected to obtain workers’ compensation insurance coverage. See TEX. LAB. CODE ANN. § 93.004(a). Section 93.004(a) of the Labor Code specifically states that a certificate of insurance showing a TES has workers’ compensation insurance “constitutes proof of workers’ compensation insurance coverage for the temporary employment service and the client of the temporary employment service with respect to all employees of the temporary employment service assigned to the client. Id. (emphasis added). Section 93.004(b) goes on to state that if a TES has elected to carry workers’ compensation insurance, both the TES and a client of the TES are subject to the exclusive remedy provision found in section 408.001(a) of the TWCA. Id. § 93.004(b); see also id. § 408.001(a).
The Court of Appeals rejected Dicex’ exclusive remedy defense argument, however, writing:
We hold section 93.004 is not applicable here. The section was added during the 83rd session of the Texas Legislature. Prior to its enactment, there was no specific statutory provision governing application of workers’ compensation insurance to clients of a TES. When it enacted section 93.004, the Legislature specifically stated:
The change in law made by this Act applies only to a claim based on a work-related injury that occurs on or after the effective date of this Act. A claim based on a worker-related injury that occurs before the effective date of this Act is governed by the law in effect on the date the injury occurred, and the former law is continued in effect for that purpose.
Act of May 16, 2013, 83rd Leg. R.S., ch. 321, 2013 Tex. Gen Laws 1082, § 2 (current version at TEX. LAB. CODE ANN. § 93.004) (emphasis added).
It is undisputed — based on the appellate record and in statements contained in the briefs of all parties — that the work-related injury upon which Rodriguez’s claims are based occurred on May 19, 2013, almost four months before the effective date of section 93.004. Thus, section 93.004(b) was not effective at the time of the injury, and therefore, is inapplicable to this case.
Under the court’s opinion, had Rodriguez been injured on or after the effective date of § 93.004, Dicex would, presumably, have been protected. Because the accident occurred before the effective date of the provision, the exclusive remedy defense did not apply.
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