Emery Humphries v. Fna Group, LLC; And Amtrust North America
2025 Ark. App. 304 (2025)
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Rule of Law:
Under the dual-employment doctrine, a special employer can only claim immunity from tort claims under the Workers' Compensation Act if the employee had an express or implied contract for hire with the special employer, which requires mutual assent and a meeting of the minds between the employee and the special employer, not merely the special employer's control over the work.
Facts:
- In July 2019, Emery Humphries was hired by Labor Solutions, a temporary staffing agency.
- Labor Solutions assigned Humphries to work at FNA Group, LLC (FNA), a manufacturer of pressure washers and outdoor power equipment.
- The contract between Labor Solutions and FNA explicitly stated that Labor Solutions' personnel would not be deemed employees of FNA for any purpose relating to the agreement.
- Humphries's W-4 listed Labor Solutions as his employer, and Labor Solutions provided his paychecks, set his pay, withheld taxes, set his hours, and conducted his orientation.
- In August 2019, Humphries sustained a partial leg amputation in an accident involving a box-baling machine at FNA's facility.
- Humphries testified that Labor Solutions controlled where he worked, provided all instruction and training (through a Labor Solutions employee), and that he never signed any agreement with FNA or desired to work for FNA.
- FNA's senior vice president, Tom Moffett, conceded that FNA would reserve the right to deny Humphries was its employee in any litigation context other than workers’ compensation, based on their contract.
Procedural Posture:
- Emery Humphries filed a tort suit against FNA Group, LLC (FNA) and others in the Circuit Court of Benton County after sustaining a work-related injury.
- The circuit court stayed Humphries’s claims against FNA to allow the parties to litigate the issue of Humphries’s employment status in a proceeding before the Arkansas Workers’ Compensation Commission.
- An administrative law judge (ALJ) held a hearing and issued an opinion finding that Humphries was not a 'dual employee' of Labor Solutions and FNA.
- FNA timely appealed the ALJ’s decision to the full Arkansas Workers’ Compensation Commission.
- The Commission, in a 2-1 decision, reversed the ALJ, concluding that FNA was a dual employer of Humphries at the time of his injury.
- Humphries filed a timely notice of appeal to the Arkansas Court of Appeals.
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Issue:
Does a temporary employee have an implied contract for hire with a special employer, thereby making the special employer immune from a tort suit under the Workers' Compensation Act’s exclusive-remedy provision, when the staffing agency's contract with the special employer explicitly disclaims an employment relationship, and the temporary employee denies intending to be employed by the special employer?
Opinions:
Majority - Cindy Grace Thyer
No, a temporary employee does not have an implied contract for hire with a special employer, and therefore the special employer is not immune from a tort suit under the Workers' Compensation Act's exclusive-remedy provision, when there is no mutual assent to an employment contract. The court reiterated the three-part Daniels test for dual employment, which requires: (a) an express or implied contract for hire, (b) the work being done is essentially that of the special employer, and (c) the special employer has the right to control the details of the work. All three conditions must be satisfied. The Commission erred by focusing solely on FNA's control over the work in determining an implied contract. An implied contract, like an express one, requires "mutual assent" and a "meeting of the minds," which is derived from the presumed intention of the parties as indicated by their conduct, citing K.C. Properties and Steed. Humphries explicitly testified that he never intended or desired to work for FNA. Furthermore, FNA's own contract with Labor Solutions explicitly disclaimed an employment relationship with Labor Solutions' personnel. FNA's senior vice president also admitted FNA would deny an employment relationship with Humphries in other litigation contexts due to this contract. While FNA exercised control over the work environment, these specific facts failed to demonstrate the mutual intent necessary for an implied contract between Humphries and FNA. Therefore, the first prong of the Daniels test was not satisfied, meaning FNA could not be considered a dual employer entitled to exclusive remedy protection.
Analysis:
This case significantly clarifies the first prong of the dual-employment doctrine, emphasizing that mere control over a temporary employee's work is insufficient to establish an implied contract for hire. It establishes that mutual assent and a meeting of the minds are crucial, and a special employer cannot selectively claim an employment relationship for workers' compensation immunity while contractually disclaiming it for other purposes. This ruling provides greater protection for temporary employees, ensuring they retain their right to pursue tort claims against special employers who attempt to avoid full employer responsibilities.
