Opinion ID: 159796
Heading Depth: 3
Heading Rank: 1

Heading: Canada’s Employee Status

Text: Unfortunately, the Continental policy does not define the term “employee.” As the parties’ arguments on this point demonstrate, this “policy term . . . is reasonably susceptible to more than one meaning” as applied to the circumstances of the present case. Max True Plastering v. United States Fidelity & Guaranty Co., 912 P.2d 861, 869 (Okla. 1996). Accordingly, we conclude that the term, as used in the Continental policy and applied to these facts, is ambiguous as a matter of law. See id. Max True Plastering requires that we construe ambiguous terms in insurance contracts to conform “with the parties’ reasonable expectations.” Id. at 868-69. Based on our review of the Continental policy and the circumstances surrounding Canada’s relationship with Staffing Resources and Air Liquide, and applying the reasonable expectations test, we conclude that Canada was an employee of Staffing Resources for insurance purposes. First, the language of the Continental policy makes no attempt to exclude from coverage certain types of employees, depending on whether Staffing Resources performed the full range of employer functions or merely performed payroll services. Rather, it purports to include any employee. Second, and quite -9- significantly, Staffing Resources’ conduct indicates that it believed it would be responsible for the actions of individuals it dispatched to drive vehicles for other companies. To this end, Staffing Resources’ internal Drivers Policy contained the following statement: When we supply drivers to a client we expose ourselves to automobile liability claims unless we take steps to avoid the exposure. In the event of an accident we could be sued by: any person who was injured or had property damaged, . . . or the client’s insurance companies to recover their loss from us. If the client’s own employee was driving, these actions would not be available. All of the loss would be borne by the client or their insurance companies. Our objective is to return to that position. Failure to follow proper procedures will result in claims being paid under our auto insurance which increases our premium companywide. The procedures set forth included requiring the client to sign a hold-harmless agreement and requesting that the client name Staffing Resources as an insured on the client’s insurance policy. In the present case, these procedures were not followed. Although Staffing Resources’ interpretation of its potential exposure to liability is not necessarily binding on Continental, it is relevant under the reasonable expectations doctrine as to whom Staffing Resources thought the policy covered. This statement by Staffing Resources indicates its belief that drivers it supplied to a client could give rise to liability on the part of Staffing Resources and accordingly that such drivers would be covered employees under the Continental policy. - 10 - Third, the dealings between Staffing Resources and Air Liquide further indicate that Canada was a Staffing Resources employee. The weekly time sheets Air Liquide submitted described Canada as a Staffing Resources employee, and Canada was himself required to sign employment applications in 1992 and 1994, which stated “I understand that my Employer is Blazer Services and not the company where I may be assigned to work.” In addition, Staffing Resources never indicated to Air Liquide that the circumstances of Canada’s hiring altered his status, and Staffing Resources held out Canada as its employee for federal and state governmental purposes. Moreover, Staffing Resources provided Air Liquide a Certificate of Insurance representing that Staffing Resources had the Continental policy. Although the certificate explicitly declares that it is issued as a matter of information only and confers no rights upon the certificate holder, nor does it alter or amend the policies disclosed in the certificate, in light of the surrounding circumstances it likely confirmed Air Liquide’s impression that Canada was Staffing Resources’ employee and covered by Staffing Resources’ insurance policy. Appellants rely primarily on the day-to-day control Air Liquide exercised over Canada. Staffing Resources notes that Air Liquide told Canada when to work, supervised his job performance, and that Staffing Resources only received notice how much Canada worked for Air Liquide during a particular week after - 11 - the fact. However, by the very nature of its business, an employment agency has an atypical employment relationship with the individuals it sends to its clients. Staffing Resources (and Canada) declared time and again that Canada was Staffing Resources’ employee. On this record, it is clear as a matter of law that Canada was an employee of Staffing Resources within the meaning of the Continental policy.