Court Opinion

ID: 7166825
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:22:05.383623+00
Date Added: 2024-06-11T16:15:33.882242
License: Public Domain

DAVID A. NELSON, Circuit Judge,
dissenting.
DAVID A. NELSON, Circuit Judge.
The record of this case, as I read it, leaves no room for doubt that insofar as the GM production line project was concerned, the relationship between MTE Controls and ABB Flexible Automation was that of labor broker/customer. None of the pertinent facts is in dispute — and the facts, in my judgment, compel the conclusion as a matter of law that MTE was acting as a labor broker at the time of plaintiff Auger’s accident.
When Michigan’s “economic reality test” is applied to the undisputed facts, it seems equally clear to me that both MTE (the labor broker) and ABB (the customer) qualified under Michigan law as co-employers of Mr. Auger. If I am correct in this, ABB’s co-employer status meant that the exclusive remedy provision of the Michigan Worker’s Disability Compensation Act, M.C.L. § § 418.131, insulated ABB from liability for Mr. Auger’s injury.1 Accordingly, although my reasoning differs somewhat from that of the district court, I would affirm the judgment entered by the district court in favor of ABB.
I
Under date of March 12, 1998, MTE sent ABB a one-page letter offering to furnish machine tool hydraulic pipefitters and mechanical assemblers for temporary work in ABB’s plant at hourly rates specified in the letter. The rates quoted were to be “valid until December 1, 1998,” the letter stated, based on “2 or more men” and “weekly invoicing.” No subcontract was proposed, and no subcontract was entered into.
MTE’s offer was not tied to any given project, such as the engine block line that ABB was assembling in the spring of 1998 for installation at a General Motors plant in China. ABB found itself behind schedule on the GM project, however, and over the course of 16 consecutive weeks that ended on June 26, 1998, ABB made a series of oral requests to MTE for temporary workers to help on the project. The number of temporary workers to be supplied varied in accordance with ABB’s changing needs.
The hours worked by the temporary employees were accounted for on a daily basis. Pursuant to MTE’s March 12 letter, ABB was invoiced for the workers’ time on a weekly basis. Typical of the 16 invoices issued by MTE in connection with the GM project is Invoice No. 1233, dated June 1, 1998. This invoice shows a total dollar amount of $2,080 due from ABB for “1 lot of labor for 5/18 thru 5/23/98.” Neither in this invoice nor in any of the other 15 invoices contained in the record was ABB charged anything for materials; all of the charges were for temporary labor, pure and simple. The charges ranged from a high of $8,143.75 for the period of 3/16 through 3/21 to a low of $1.000 for the period of 4/13 through 4/17.
The Friday of the week covered by Invoice No. 1233 — May 22, 1998 — was the first day that Mr. Auger was assigned to work at the ABB plant. Unfortunately, it proved to be his last day at the plant as *171well; Mr. Auger was seriously injured only hours after he clocked in that afternoon.
The “working leader” or straw boss who gave Mr. Auger his work assignment on the afternoon in question was an MTE employee named Joseph Seedorf. (Mr. Seedorfs time, like that of other working leaders, was billed to ABB at a higher hourly rate than that charged for workers such as Mr. Auger.) Mr. Seedorf testified that Brian Bordeaux, an ABB supervisor, would tell him on a daily basis what tasks were to be performed by the temporary help; Seedorf, in turn, would “communicate these tasks to the MTE employees.” Brian Bordeaux was free to change his mind about the tasks planned for a given day, and he could tell Seedorf to send men home if a change in plans meant that they were not needed. As Seedorf explained, “he [Bordeaux] could send anybody home he wanted to at any time.”
Mr. Seedorf also testified that employees of ABB had the right to give direct instructions to MTE workers without going through Seedorf. As far as Mr. Seedorf personally was concerned, moreover, he “was to follow all [ABB] instructions, no matter what ... [T]hey could ask me to sweep the floor and I would sweep the floor. I am basically paid by MTE Controls working for ABB as well as everyone else from MTE that was in that building.” (Emphasis supplied.)
MTE supervisor Arthur Boudreau (not to be confused with ABB supervisor Brian Bordeaux) confirmed that the “ABB leaders maintained control over what was going on at the plant concerning the construction of [the General Motors] convey- or.” Arthur Boudreau saw ABB leaders giving directions to temporary workers on the floor “quite often,” in fact.2 And the plaintiff’s own brother, who was also assigned to ABB as a temporary worker, testified that there were many occasions on which ABB supervisor Brian Bordeaux had given him working orders directly, without going through an MTE lead man.
All this is undisputed. It is also undisputed that ABB had the right to discipline MTE workers for their performance, attitude, and the like, just as it had the right to specify that a particular MTE employee should no longer be assigned to the project. And it is undisputed, finally, that ABB and MTE were working toward a common objective — the timely completion of the assembly line for GM. ABB’s goal was to get paid for performance of its contractual obligations to General Motors, and in this connection both ABB and MTE stood to profit from the efficient matching of temporary workers and temporary work needs in a way that would get the job done on time and in a cost effective manner. Under Michigan law, as I understand it, the facts outlined above clearly made MTE a labor broker insofar as its relationship with ABB on the General Motors project was concerned — and I believe that the economic reality of the situation was such that Michigan law would clearly treat Mr. Auger as having dual employers.
II
The landmark case of Renfroe v. Higgins Rack Coating & Mfg. Co., 17 Mich. App. 259, 169 N.W.2d 326 (1969), was a personal injury case brought against a manufacturer (Higgins Company) by an employee of a labor broker (ETS) who had been hurt in an industrial accident on Hig*172gins’ premises. The injured man had recovered workman’s compensation benefits for his injury, and Wayne County Circuit Court Judge James L. Ryan (now a distinguished member of the United States Court of Appeals for the Sixth Circuit) entered a summary judgment holding as a matter of law that Higgins Company “was an ‘employer’ of [the injured worker] within the meaning of the workmen’s compensation laws so as to make [the worker’s] recovery under those laws exclusive____” 17 Mich.App. at 261, 169 N.W.2d at 327. Judge Ryan’s judgment was unanimously affirmed by the Michigan Court of Appeals.
Analyzing the case under Michigan’s “economic reality” test, the court of appeals expressed itself as follows:
“For ETS, economic reality is based on the fact that a profit can be made by efficiently matching workers with temporary work needs. ETS maintained control of the workers by its practice of daily reassignment and daily payment at its offices. It also maintained the formalities of employment by handling all paper work and payments incident to the employment.
“The Higgins Co., in return for a set fee, received a daily worker who it could and did direct among various tasks in its factory. It also received the services of ETS in handling all the aforementioned paper work incident to the employment, including the making of workmen’s compensation premium payments. However, it is perfectly clear that the money for those payments came directly from the fee which Higgins paid, and was one of the expenses included in calculating that fee. [Footnote omitted.]
“The economic reality of this case is that both ETS and Higgins Co. were employers of Roy Renfroe, each in a different way. It is not necessary to make fine semantic distinctions as to types [or] degrees of control, etc. It is enough to say that either could be liable under the workmen’s compensation act, therefore, both are protected by it.” 17 Mich.App. at 266-67,169 N.W.2d at 329-30.
In Smith v. Martindale, 81 Mich.App. 682, 266 N.W.2d 49 (1978) — a case decided nine years after Renfroe — a different Michigan Court of Appeals held that a general contractor who had rented the use of a crane and its operator from another company did not become the employer of the crane operator under the loaned servant doctrine. There may be some tension between the result reached in Smith and the result reached in Renfroe, but in both cases the identification of the employer was held to be a question of law for decision by the court and not a question of fact for resolution by the jury.
Any tension between Renfroe and Smith appears to have been resolved by the Michigan Supreme Court’s subsequent decision in Farrell v. Dearborn Mfg. Co., 416 Mich. 267, 330 N.W.2d 397 (1982). There, without so much as citing Smith, the Supreme Court explicitly endorsed both the “reasoning” and the “result” of the Renfroe decision. See 416 Mich. at 277, 330 N.W.2d at 400.
Three of the four cases consolidated in Farrell involved a labor broker — described by the Supreme Court as “a company engaged in the business of furnishing employees to others,” 416 Mich. at 272, 330 N.W.2d at 398 — and the Farrell Court saw the economic reality of the labor broker/customer situation in exactly the same way that the Renfroe court had. Accordingly, the Supreme Court held “that the exclusive remedy available to the employee in a labor broker situation is provided by the workers’ compensation statute and that a separate tort action against the customer of the labor broker may not be *173maintained.” 416 Mich. at 278, 330 N.W.2d at 401.
Summary judgments against labor broker employees who had brought tort actions against the brokers’ customers were likewise affirmed by the Michigan Supreme Court in Kidder v. Miller-Davis Co., 455 Mich. 25, 564 N.W.2d 872 (1997). Although the Court there stopped short of holding that a labor broker/customer relationship will always establish dual employer status as a matter of law, see 455 Mich. at 40 n. 7, 564 N.W.2d at 879 n. 7, the extent of the relationship between the two companies in Kidder and the economic realities of the situation in that case were such that the Court had no hesitancy in concluding — as a matter of law — “that a dual or coemployer relationship was formed, precluding a separate tort action against the customer of the labor broker.” 455 Mich. at 40, 564 N.W.2d at 879.
The similarities between the facts in Kidder and the facts in the case at bar are striking. In Kidder, as here, no bids were solicited or received on a subcontract. The labor broker’s customer did not relinquish its ultimate supervision or control of the work site, and the broker provided temporary workers pursuant to job description requests that the customer furnished from time to time. Billing for the temporary workers was on a weekly basis. The customer furnished appropriate tools, controlled the hours on the job, and told the workers each day where they would be working. Although the customer could not directly hire or fire any of the temporary workers, it was undisputed that the broker would remove any personnel the customer deemed unsatisfactory. In these and other respects, the undisputed facts in Kidder are indistinguishable from the undisputed facts of the case before us now. And against this factual background, Kidder reiterated Renfroe’s observation that “[i]t is not necessary to make fine semantic distinctions as to type [or] degrees of control, et cetera.” 455 Mich. at 44, 564 N.W.2d at 880.
Clark v. United Technologies Automotive, Inc., 459 Mich. 681, 594 N.W.2d 447 (1999), on which my colleagues rely heavily, was not a labor broker case at all. It was hard to say, in Clark, which of two closely related businesses had hired the plaintiff, just as it was uncertain who paid him and who had the right to supervise him, fire him, or otherwise discipline him. The opinion in Clark cites both Farrell and Kidder with evident approval, and it does not purport to modify either decision in any way. I have rather more difficulty than my colleagues do in seeing how Clark has much relevance to the case at bar.
It is true that Clark can be read as suggesting that summary judgment is inappropriate, under Michigan law, where, although the facts are undisputed, conflicting inferences can be drawn from those facts. This used to be the rule in our court too. See S.J. Groves & Sons Co. v. Ohio Turnpike Commission, 315 F.2d 235 (6th Cir.), cert. denied, 375 U.S. 824, 84 S.Ct. 65, 11 L.Ed.2d 57 (1963). But a subsequent amendment to Fed.R.Civ.P. 56(e) and the sea change in federal summary judgment jurisprudence wrought by Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986), Anderson v. Liberty Lobby, 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986), and Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986), now make it crystal clear’ that where the relevant facts are not in dispute, the existence of room for disagreement as to the inferences to be drawn from such facts does “not demonstrate a genuine issue of material evidentiary fact, but instead illumi*174nate[s] the ultímate legal issues to be resolved.” Cincinnati Newspaper Guild, Local 9 v. Cincinnati Enquirer, Inc., 863 F.2d 439, 443 (6th Cir.1988) (quoting Chauffeurs Teamsters and Helpers v. C.R.S.T., Inc., 780 F.2d 379, 381 (8th Cir. 1985)).
In the case at bar the facts regarding plaintiff Auger’s employment status are clear and undisputed. Clark may suggest that the potential for drawing conflicting inferences from those facts would preclude summary judgment under Michigan law, but the standard to be applied here is one of federal law: “When there is a motion for summary judgment in a diversity case, the provisions of Rule 56 [of the Federal Rules of Civil Procedure] control its determination.” Gafford v. General Electric Co., 997 F.2d 150, 166 (6th Cir.1993) (quoting Reid v. Sears Roebuck and Co., 790 F.2d 453, 459 (6th Cir.1986)).
For these and other reasons on which I might have expanded had time permitted,3 I would affirm the judgment in favor of ABB. My colleagues on the panel having taken a different view of the matter, I respectfully dissent.

. MCL § 418.131(1) provides in pertinent part that "[t]he right to the recovery of benefits as provided in this act shall be the employee's exclusive remedy against the employer for a personal injury....”

. Arthur Boudreau also testified that ABB specified the number of MTE workers needed from time to time, the number of hours these workers would be used on a particular job, the type of shift, and when and how the work would be done. "Brian [Bordeaux] would have ultimate control over my people,” Arthur Boudreau said.

. Judge Jones circulated his proposed majority opinion to the other members of the panel on March 26, 2002, and he has announced his resignation from the office of circuit judge with an effective date that makes it incumbent on the panel to decide this case no later than March 29, 2002.