Case Name: WALKER v. DEPARTMENT OF SOCIAL SERVICES
Court: Michigan Supreme Court
Jurisdiction: Michigan
Decision Date: 1987-08-04
Citations: 428 Mich. 389
Docket Number: Docket No. 78249
Parties: WALKER v DEPARTMENT OF SOCIAL SERVICES
Judges: Levin, J., concurred with Archer, J.
Reporter: Michigan Reports
Volume: 428
Pages: 389–407

Head Matter:
WALKER v DEPARTMENT OF SOCIAL SERVICES
Docket No. 78249.
Argued April 7, 1987
(Calendar No. 1).
Decided August 4, 1987.
Cassie Walker sought workers’ compensation benefits, alleging disability because of a back injury which arose in the course of her employment as a chore-service provider for an invalid welfare recipient. A hearing referee granted benefits, finding that the Department of Social Services was the plaintiffs employer for purposes of the workers’ compensation act and that benefits were payable solely on the basis of the plaintiffs back condition. The Workers’ Compensation Appeal Board affirmed. The Court of Appeals, Gribbs, P.J., and Hood and Davis, JJ., affirmed in an opinion per curiam (Docket No. 81963). The defendant appeals.
In an opinion by Justice Archer, joined by Justice Levin, with Justices Boyle, Cavanagh, and Griffin concurring in parts ii and m only, the Supreme Court held:
On the basis of the undisputed underlying facts, the Department of Social Services was the plaintiffs employer for purposes of the workers’ compensation act.
The Workers’ Compensation Appeal Board is exclusively empowered to make factual determinations in workers’ compensation cases. While the question whether the dss was the plaintiffs employer is an issue of law, properly left to determination by the Supreme Court, the Court lacks authority to make the determination on the basis of insufficient factfinding. Rather, the determination must be made on the basis of facts agreed upon. In this case, upon completion of a review of the undisputed facts, the board concluded that the dss was the plaintiffs employer.
Affirmed.
Chief Justice Riley, joined by Justice Brickley, dissenting, stated that upon application of the economic-reality test to the findings of fact of the Workers’ Compensation Appeal Board, there is insufficient evidence to establish the existence of an employment relationship between the plaintiff and the defendant so as to entitle the plaintiff to workers’ compensation benefits.
An employee-employer relationship must exist before benefits or other rights accrue to a claimant under the Workers’ Disability Compensation Act. In determining whether such a relationship exists, the economic-reality test is utilized. The test is a broad approach which looks to the totality of the circumstances surrounding the employment situation and provides a rational framework within which the existence of an employer-employee relationship may be determined in a manner consistent with the act. A claimant must establish entitlement to such benefits by a preponderance of the evidence. Four key factors are considered: control of the worker’s duties; payment of wages; the right to hire, fire, and discipline; and whether performance of the duties is an integral part of the employer’s business toward the accomplishment of a common goal. The factors are viewed in their entirety, with no single factor being assigned primacy. Application of the test necessarily requires a subjective determination.
The scope of review of a decision of the Workers’ Compensation Appeal Board is limited, and a reviewing court is bound by the wcab’s findings of fact. In this case, upon reviewing the totality of the circumstances in light of the economic-reality factors, it must be concluded that the plaintiff failed to establish, by a preponderance of the evidence, the existence of an employment relationship with the dss for purposes of the workers’ compensation act, and thus has not established a right to benefits.
149 Mich App 436; 386 NW2d 205 (1986) affirmed.
Pianin & Pauli, PC. (by Michael R. Sugar), for the plaintiff
Vandeveer, Garzia, Tonkin, Kerr, Heaphy, Moore, Sills & Poling, P.C. (by James A. Sullivan and David P. Grünewald), for the defendants.

Opinion:
Archer, J.
i
Every employer, public and private, shall be subject to the provisions of Michigan's Workers' Disability Compensation Act. MCL 418.111, 418.171; MSA 17.237(111), 17.237(171).
Typically, a private person who desires to follow the Workers' Disability Compensation Act will purchase a workers' compensation insurance policy to protect against personal liability in the event an employee becomes injured on the job and is entitled to workers' compensation disability benefits.
In this case, Mrs. Willie L. Johnson is a welfare recipient. One of her legs was amputated, she is blind in one eye and uses a wheelchair. Mrs. Johnson received public assistance from the Department of Social Services. The dss knew the status of Mrs. Johnson's finances and would know if she had the ability to pay for a workers' compensation insurance policy. Moreover, the department was in a superior position to know the laws of the State of Michigan and, in particular, the Workers' Disability Compensation Act. The department could advise Mrs. Johnson to purchase insurance, could provide funds for her to pay for the insurance, or could provide benefits when needed from other sources. The dss did not advise Mrs. Johnson to purchase insurance or provide funds for her to purchase insurance.
I would hold that the dss is estopped from denying liability. See also 1C Larson, Workmen's Compensation Law, § 46.45-46.47, pp 8-274 to 8-283.
ii
I find it unnecessary, however, to reach the estoppel remedy because I believe that the hearing referee, the Workers' Compensation Appeal Board, and the Court of Appeals were correct and that their decisions should be affirmed. They held that Cassie Walker was an employee of the dss.
Plaintiff, Cassie Walker, had known Mrs. Johnson as a neighbor. On occasion, Mrs. Walker had run errands for Mrs. Johnson. Subsequently, Mr. Emberg from the dss, at Mrs. Johnson's request, interviewed Mrs. Walker and asked if she would accept the job of caring for Mrs. Johnson. Mrs. Walker accepted and signed payroll papers the same day.
Mrs. Walker's job responsibilities involved lifting, going up and down stairs to do laundry, mopping, walking to the doctor's office on behalf of Mrs. Johnson, and helping her in and out of the wheelchair.
Although Mrs. Walker's day-to-day schedule was under the direction of Mrs. Johnson, the general directives were set by the department. Mrs. Walker had direct contact with Mr. Emberg or Mr. Solomon, a supervisor at the dss. She was paid monthly by checks made payable to both Mrs. Walker and Mrs. Johnson, which were sent to the latter's home.
During the course of her employment, Mrs. Walker fell down the basement stairs and injured her back. Subsequently, she filed a petition for hearing with the Bureau of Workers' Disability Compensation, naming the Department of Social Services as her employer.
In ordering the dss to pay benefits to Mrs. Walker, the hearing referee held:
It is found that the State of Michigan, Department of Social Services, was plaintiffs employer for Workers' Compensation purposes. Askew v Macomber, 398 Mich 212 [247 NW2d 288] (1976). Indicia to substantiate this finding are: (1) no explicit agency agreement has been shown to exist between defendant and Mrs. Johnson. (2) Plaintiff received her wages by means of a check drawn on defendant and payable to her and Mrs. Johnson. (3) Prior to employment plaintiff was interviewed by defendant's agent who also explained the job duties. (4) Defendant's agents would observe plaintiffs job performance monthly and if any problem arose plaintiff would contact defendant.
Finally, benefits are payable solely on the basis of plaintiff's back condition. It has not been demonstrated that any other alleged condition was work related or aggravated by employment.
The defendants subsequently appealed to the Workers' Compensation Appeal Board. While affirming the hearing referee's decision, the wcab also declared, in pertinent part:
Although not raised by appellant, we take note of the recent case of Morin v Dep't of Social Services, 134 Mich App 834 [352 NW2d 325] (1984) and find that it is distinguishable from the case at bar.
In the instant case, the Department of Social Services played a more direct role in the selection of the plaintiff. Ms. Walker was not selected from a list provided by the Department of Social Services. Mr. Emberg, a Department of Social Services caseworker, hired the plaintiff for the position and instructed her about her duties.
. . . [I]n the instant case, there is no evidence that plaintiff held herself out to the public as a nurse's aide or housekeeper or that she performed such services for others .
. . . [T]he Department of Sociál Services exerted . . . control over [Mrs. Walker's] duties .
Finally, we must note that this Board and the Court of Appeals in Morin attached some significance to the manner of payment, which was identical to the method of payment in the case at bar. However, we do not believe that this single factor ought to be controlling. As noted in Askew, supra, citing payment of wages as one factor to be considered, the economic reality test views these ele merits as a whole, assigning primacy to no single one. [3]98 Mich 217-218.
In conclusion, our review of the facts of this case, even in the light of Morin, supra, compels us to conclude that defendant was plaintiffs employer for workers' compensation purposes.
The defendants then appealed to the Court of Appeals. The Court of Appeals agreed with the wcab's distinction between. Morin and the case at bar. In addition to affirming the Morin distinction, the Court of Appeals cited other factors which helped it conclude that Mrs. Walker was employed by the defendant for purposes of the Workers' Disability Compensation Act:
In the case at bar, Mrs. Johnson did not hire plaintiff. Although plaintiff was interviewed at Mrs. Johnson's suggestion, she was hired by dss who informed her that her responsibility was to care for Mrs. Johnson's needs. Also, while plaintiffs day-to-day duties were supervised by Mrs. Johnson, a caseworker visited the Johnson household at least once a month and reviewed plaintiffs performance. Further, after plaintiff was injured, her hours were shortened by the dss, not by Mrs. Johnson. Moreover, plaintiff informed the dss that her injury prevented her from continuing her employment.
Concerning the manner in which plaintiff was paid, we note that the "reality" was that plaintiff was compensated by defendant. See Morin, supra, p 846 (Cynar, J., concurring). We also believe that the services plaintiff performed are part of the social welfare system's broader goal of promoting client self-sufficiency. Therefore, we are compelled to find that plaintiffs services were an integral part of dss business. Id.
Viewing the facts of this case as a whole, we conclude that the plaintiff herein was employed by defendant for purposes of the Workers' Disability Compensation Act. [149 Mich App 436, 442-443; 386 NW2d 205 (1986).]
Despite these reasons cited by the hearing referee, the wcab, and the Court of Appeals, the dissent concludes that there is insufficient evidence to establish the existence of an employment relationship between plaintiff and defendant. Nowhere in its opinion does the dissent conclude that the wcab applied an erroneous legal standard in making its decision. In fact, the dissent's conclusion appears to be exclusively based upon its perception that there was insufficient factfinding on the part of the wcab. For example, it states in pertinent part:
The board's findings which are relevant to this factor [control of the worker's duties] are limited and indicate that a DSS caseworker, Mr. Emberg, explained to plaintiff what her duties would be when she was interviewed for the job, but there is no evidence indicating that Mr. Emberg, or any other dss employee, subsequently supervised the plaintiff in performing those duties. A dss caseworker would visit Mrs. Johnson's home once a month during plaintiff's tenure as Mrs. Johnson's chore-service provider, but the purpose of those visits is unexplained.
Although the dss caseworker may have initially informed plaintiff what her job responsibilities would entail, there is no evidence that any dss agent subsequently exercised any supervisory authority over plaintiff.
Although Mr. Emberg was present and asked plaintiff if she would take the job, it is not at all clear whether that decision was solely his or to what extent Mrs. Johnson was involved in that decision. . . . The record does not indicate what authority, if any, Mr. Emberg had to refuse plaintiff the job had only Mrs. Johnson been inclined to hire her, or whether he could have hired her over Mrs. Johnson's objection.
The evidence is insufficient to permit us to find the existence of such a relationship [an employee-employer relationship for workers' compensation purposes]. [Post, pp 404-406. Emphasis added.]
While the question whether the dss is the plaintiffs employer for purposes of workers' compensation is an issue of law properly left to our determination, we lack the authority to make such a determination on the basis of insufficient factfinding. Instead, the determination of whether the defendant should be labeled an "employer" within the meaning of the workers' compensation law is to be made on the basis of the agreed facts. See Renfroe v Higgins Rack Coating & Mfg Co, Inc, 17 Mich App 259, 262; 169 NW2d 326 (1969); Askew, supra, 217, n 6. In the case at bar, there is no dispute as to any of the underlying facts.
As noted by Justice Ryan in Williams v Lang (After Remand), 415 Mich 179, 183; 327 NW2d 240 (1982):
The Michigan Constitution makes it clear that the Workers' Compensation Appeal Board is exclusively empowered to make factual determinations in workers' compensation cases and that this Court is absolutely without authority to do so. Const 1963, art 6, § 28. Hlady v Wolverine Bolt Co, 393 Mich 368; 224 NW2d 856 (1975).
While it may be efficient and convenient for the Court to do the wcab's factfinding in this case, it is unconstitutional to do so.
Ill
Accordingly, I would affirm the decisions of the hearing referee, the Workers' Compensation Appeal Board, and the Court of Appeals.
Levin, J., concurred with Archer, J.
Askew v Macomber, 398 Mich 212; 247 NW2d 288 (1976).