Opinion
Docket No. 83631.
Decided February 11, 1986.
Thomas D. Ready, for plaintiff.
Walter J. Zotter, for defendant.
Plaintiffs appeal as of right from an order entered on February 28, 1985, granting defendants' motion for summary judgment pursuant to GCR 1963, 117.2(3).
Plaintiff Richard A. White was injured in an accident which occurred on June 8, 1982, while he was driving a tractor-trailer rig owned by defendant Central Transport. At the time of the accident, plaintiff was employed by L.R.P.D., Inc., which leased the services of White to Central Transport. Central Transport and L.R.P.D. entered into a written agreement whereby L.R.P.D. provided Central with temporary truck drivers, who were considered to be employees of L.R.P.D. and independent contractors with respect to Central Transport. Despite that arrangement, the trial court concluded that Central Transport was to be regarded as plaintiff's employer for purposes of the Worker's Disability Compensation Act under the "economic realities" test. Lombard v Saga Food Service, Inc, 127 Mich. App. 262; 338 N.W.2d 207 (1983). The court then held that plaintiff's claim was barred by the exclusive remedy provision of the WDCA, MCL 418.131; MSA 17.237(131). Plaintiffs appeal as of right.
Since the Supreme Court decision in Tata v Muskovitz, 354 Mich. 695; 94 N.W.2d 71 (1959), the existence of an employer-employee relationship for purposes of the Worker's Disability Compensation Act has been determined by examining the economic realities of the situation. Nichol v Billot, 406 Mich. 284, 293-294; 279 N.W.2d 761 (1979); Lombard, supra, p 269. Four factors have been recognized as relevant in analyzing the nature of the relationship: (1) control of the worker's duties; (2) payment of wages; (3) right to hire, fire, and discipline; and (4) performance of the duties as an integral part of the employer's business toward the accomplishment of a common goal. Askew v Macomber, 398 Mich. 212, 217-218; 247 N.W.2d 288 (1976).
According to the testimony of George Chambers, the president and sole stockholder of L.R.P.D., persons employed at Central Transport contacted him regarding the establishment of a company to lease drivers to their company. A business relationship evolved whereby L.R.P.D. recruited, tested, hired and certified licensed truck drivers to operate equipment at the pleasure and dispatch of Central Transport, which was the only customer of L.R.P.D. Central Transport was in control of the drivers' daily assignments, routes, and scheduling through its dispatch office in Morenci, Michigan. Plaintiff also testified that Central Transport's dispatchers were in control of his day-to-day activities and his immediate boss was Central Transport's terminal manager. Based upon this evidence, the first "economic realities" factor, i.e., control, clearly supports the finding of an employer-employee relationship.
The same conclusion must be drawn as to the second factor. For instance, plaintiff and the other truck drivers turned their log books over to Central Transport for accounting and payroll calculations. Although L.R.P.D. actually paid the truck drivers, it was reimbursed by Central Transport for the payroll cost, including withholding taxes and health and pension fund contributions. L.R.P.D. maintained workers' compensation insurance, but was also reimbursed for this cost, as well as for the cost of pre-employment physical examinations for the truck drivers. L.R.P.D. received a percentage of the gross payroll as its compensation for providing the truck drivers.
Regarding the third factor, ability to hire, fire and discipline employees, we believe that Central Transport's retention of the power to designate any driver as unacceptable was tantamount to total control over this aspect of employment since L.R.P.D. had no other customers.
The final factor also strongly supports the conclusion of the trial court. Since L.R.P.D.'s entire existence is dependent upon the needs of Central Transport, we must conclude that the two companies were "so integrally related that their common objectives [were] only realized by a combined business effort". Farrell v Dearborn Manufacturing Co, 416 Mich. 267, 277; 330 N.W.2d 397 (1982). In fact, L.R.P.D.'s relationship to Central Transport was so entirely parasitic that it is unlikely any distinct goals or objectives could be identified. We conclude that the evidence overwhelmingly supports the conclusion that Central Transport was the employer of this plaintiff, under the economic realities test. By application of the exclusive remedy provision of the WDCA, defendants' motion for summary judgment was properly granted by the trial court.
Affirmed.