Opinion ID: 1767316
Heading Depth: 1
Heading Rank: 6

Heading: Substantial Connection

Text: The remaining issue to be decided is whether there is a substantial connection between the Tennessee resident employee and the employer/employee relationship as required by Tennessee Code Annotated section 50-6-115(3). Madden argues that the trial court erred in dismissing her claim because she is a Tennessee citizen and that there was a substantial connection between her relationship with Holland and the State of Tennessee. She emphasizes that Holland's corporate office is located in Murfreesboro, Tennessee, that her paycheck was generated and issued at the Tennessee corporate office, and that Holland's policies and procedures affecting her employment were also formed at the corporate office. Holland argues that the employer-employee relationship was established in Kentucky, that Madden was interviewed and accepted the position in Kentucky, and that Madden worked and was injured in Kentucky. Holland further argues that issuing paychecks from its central billing system in Murfreesboro was not enough to establish a substantial connection between Madden and Tennessee. As noted above, Tennessee Code Annotated section 50-6-115(3) states that an employee who is injured outside of Tennessee is eligible for benefits [i]f at the time of the injury the injured worker was a Tennessee resident and there existed a substantial connection between this state and the particular employer and employee relationship. Id. The plain language of the statute contains two requirements: the first requirement is that at the time of the injury the injured worker was a Tennessee resident; and the second requirement is that at the time of injury there existed a substantial connection between this state and the particular employer and employee relationship. In our view, the plain language of the statute makes it very unlikely that the legislature intended for the second requirement to be met in all cases where the employer is a Tennessee resident; indeed, had that been the intent, the only requirement in § 50-6-115(3) would be that the employer was a Tennessee resident. Id. The plain language of the statute requires that there also be a substantial connection between this state and the particular employer and employee relationship. Likewise, given the legislature's inclusion of the word substantial, it is clear that the legislature did not intend for any connection between this state and the employee and employer relationship to be sufficient. Accordingly, the key interpretative question is what is meant by a substantial connection. Since that term is undefined in the statute, we turn to our prior cases for guidance. In Bryant v. Seward, 490 S.W.2d 497, 499 (Tenn.1973), this Court concluded that a substantial connection existed where the employer and employee were residents of Tennessee, the employee performed some of his work in Tennessee, a portion of the employer's business premises was located in Tennessee, and the employment included work to be performed in Tennessee. Id. at 499. In that case, the employee worked as a cave guide at a tourist attraction located on the Tennessee-Virginia state line; the attraction consisted of a cave, which was located in Virginia, and a souvenir shop which was located in Virginia but included property in Tennessee. The employee was seriously injured when he was struck by a car while taking a tour from the cave to the souvenir stand in Virginia. This Court explained: There is much in this record, ... to warrant Tennessee's interest in this employment relation and these parties. The employment relationship of this employer and employee involved the performance of some work in Tennessee, the location of a portion of the business premises within Tennessee, and possibly some contract negotiations within Tennessee. Id. The Court in Bryant observed that both the employer and the employee were Tennessee residents and that the application of Tennessee law would simply be an adjudication of rights between two persons who, for all material time periods, have been Tennessee residents. Id. (citing A. Larson, Workmen's Compensation Law § 86.34 (1971)). However, the Court emphasized that the additional category of cases ... determined to be within the statute's coverage ... is necessarily limited to those few cases presenting unique factual situations wherein the involvement of Tennessee is very substantial despite the fact that the contract and the injury were elsewhere. Bryant, 490 S.W.2d at 499 ([I]t seems most equitable to allow the employee the option to pursue his claim in Tennessee under these facts.). One year later, in Ray v. Aetna Casualty & Surety Co., 517 S.W.2d 194, 196 (Tenn.1974), this Court held that Tennessee workers' compensation law did not apply where the employee, a Tennessee resident, formed the contract for employment in Missouri, worked in Missouri, and was injured in Missouri. Although the Court cited Bryant , it clarified that the place of the employee's residence, although having a very real interest as the community which might have to support a disabled and uncompensated workman, has never been deemed controlling. Ray, 517 S.W.2d at 196 (quoting A. Larson, Workmen's Compensation Law § 87.60 (1972)). As a result, the Court concluded: In the present case it is undisputed that the only contacts which the State of Tennessee has with the workmen's compensation claim in question are that the disabled workman is a resident of the state and that he was notified of the job opportunity through his local union. It is true that the employer has workman's compensation insurance coverage sufficient to satisfy the requirements of the law of this state as well as of other states in which it operates.... We hold, however, that these are insufficient contacts with the state to justify the application of the local workmen's compensation law to the claim, since the contract of employment, the performance of the work and the injury all occurred in another state. Ray, 517 S.W.2d at 197 (emphasis added); see also 99 C.J.S. Workers' Compensation § 84 (1908) ([T]he sole fact that an employer is headquartered in the forum state is insufficient to warrant application of the forum state workers' compensation law to a worker who has suffered a debilitating injury outside of the state....). In our view, Ray and Bryant demonstrate that a substantial connection between the State of Tennessee and the employee-employer relationship requires much more than just an employee's residence in Tennessee and that the reviewing court must consider all relevant factors. Here, although Madden and Holland are residents of Tennessee, none of the other factors referred to in Ray and Bryant are present: Madden traveled to Kentucky to apply for the job with Holland; she was interviewed and hired in Kentucky; she worked exclusively in Kentucky; and she was injured in Kentucky. Although Madden emphasizes that Holland printed paychecks and formulated work-policies in Tennessee, the same is true for all of Holland's employees throughout nine states; moreover, these acts, even if considered a connection to Tennessee, are not the substantial connection the statute requires. Accordingly, we hold that Madden is not entitled to workers' compensation benefits under the provisions of Tennessee Code Annotated section 50-6-115(3).