Court Opinion

ID: 3199193
Source: CourtListenerOpinion
Date Created: 2016-04-29 17:12:32.450289+00
Date Added: 2024-06-11T14:50:25.835765
License: Public Domain

IN THE
                        TENTH COURT OF APPEALS

                               No. 10-14-00132-CV

TRACTOR SUPPLY CO. OF TEXAS, L.P.,
                                                        Appellant
v.

KENNETH EDD MCGOWAN,
                                                        Appellee

                         From the 170th District Court
                           McLennan County, Texas
                          Trial Court No. 2012-2652-4

                         MEMORANDUM OPINION

      Kenneth Edd McGowan brought a personal injury suit against Tractor Supply

Company, Tractor Supply Company of Texas, L.P., and Dwight Bledsoe. The parties filed

cross-motions for summary judgment on an affirmative defense. The trial court granted

McGowan’s motion, and denied the defendants’ motion. This Court declined to accept

jurisdiction on the interlocutory appeal on the affirmative defense.   Prior to trial,

McGowan settled with Tractor Supply Company. After a trial, the jury found Tractor

Supply 100 percent negligent, and Bledsoe not negligent.     The trial court entered
judgment ordering Tractor Supply Company of Texas, L.P. to pay McGowan

$8,767,375.81 in damages. We reverse and render.

                                        Background Facts

       Job Link Personnel Services, Inc., is a temporary staffing company in Waco, Texas.

Tractor Supply Company of Texas, L.P. 1 operates a distribution center in Waco, and is a

client of Job Link. Job Link assigned McGowan to work in the Tractor Supply distribution

center. Tractor Supply employees trained, supervised, and instructed McGowan in his

job duties at Tractor Supply.

       On May 21, 2012, McGowan was working as a “picker” at the Tractor Supply

distribution center. Dwight Bledsoe, an employee of Tractor Supply, was loading a pallet

onto a high, gravity-flow rack, and he pushed another pallet loaded with a thousand

pounds of dog food off of the rack. The pallet landed on McGowan causing severe

injuries.

                                  Exclusive Remedy Defense

       In the first issue, Tractor Supply argues that the trial court erred when it deprived

Tractor Supply of the exclusive remedy defense of the Texas Workers’ Compensation Act

that bars McGowan’s recovery as a matter of law. The Texas Workers’ Compensation

Act provides that, “Recovery of workers' compensation benefits is the exclusive remedy

of an employee covered by workers' compensation insurance coverage or a legal

beneficiary against the employer or an agent or employee of the employer for the death

1We will refer to Tractor Supply Company of Texas, L.P. as Tractor Supply throughout the remainder of
this opinion.
Tractor Supply Co. of Texas, L.P. v. McGowan                                                  Page 2
of or a work-related injury sustained by the employee.” TEX. LAB. CODE ANN. § 408.001

(a) (West 2015).     Therefore, recovery of workers’ compensation benefits would be

McGowan’s exclusive remedy if Tractor Supply can show that it is McGowan’s employer

and that it is covered by workers’ compensation insurance. See Garza v. Exel Logistics,

Inc., 161 S.W.3d 473, 475 (Tex.2005). Tractor Supply argues that at the time of the injury

McGowan was a Tractor Supply temporary employee and that Tractor Supply had

workers’ compensation coverage with respect to temporary employees assigned by Job

Link.

        An employee may have more than one employer within the meaning of the Texas

Workers’ Compensation Act, and each employer who subscribes to workers'

compensation insurance may raise the exclusive-remedy provision as a bar to claims

about the injury. Port Elevator-Brownsville v. Casados, 358 S.W.3d 238, 242 (Tex. 2012);

Garza v. Exel Logistics, Inc., 161 S.W.3d 473, 475-76 (Tex.2005) (stating that client company

could assert exclusive-remedy defense to claims by a temporary employee if it was

covered by workers' compensation insurance). An employee of a temporary employment

agency who is "injured while working under the direct supervision of a client company

is conducting the business of both the general employer [the temporary employment

agency] and that employer's client." Garza v. Exel Logistics, Inc., 161 S.W.3d at 475 (quoting

Wingfoot Enterprises v. Alvarado, 111 S.W.3d 134, 143 (Tex. 2003). In determining if a

general employee of a temporary employment agency is also an employee of a client

company for purposes of the Workers’ Compensation Act, we consider traditional

Tractor Supply Co. of Texas, L.P. v. McGowan                                            Page 3
indicia, such as the exercise of actual control over the details of the work that gave rise to

the injury. Garza v. Exel Logistics, Inc., 161 S.W.3d at 477.

       The Workers’ Compensation Act states that “an ‘employee’ means each person in

the service of another under a contract of hire, whether express or implied, or oral or

written.” TEX. LAB. CODE ANN. § 401.012 (a) (West 2015). In Garza, the Court noted that

the undisputed evidence establishes that at the time of the injury, the temporary

employee was working on the client company’s premises, in the furtherance of the client

company’s day-to-day business, and the details of his work that caused his injury were

specifically directed by the client company.          The Court found that for workers’

compensation purposes, the employee was an employee of the client company within the

meaning of Section 401.012 (a). Garza v. Exel Logistics, Inc., 161 S.W.3d at 477.

       As in Garza, the record shows that at the time of his injury, McGowan was working

on Tractor Supply’s premises, in furtherance of Tractor Supply’s day-to-day business,

and the details of his work that caused his injury were specifically directed by Tractor

Supply. The record shows that McGowan worked at all times under the supervision of

Tractor Supply employees. McGowan was trained by Tractor Supply employees and

given his daily assignments by Tractor Supply employees. As in Garza, the evidence

shows that for worker’s compensation purposes, McGowan was an employee of Tractor

Supply within the meaning of Section 401.012 (a). See Garza v. Exel Logistics, Inc., 161
S.W.3d at 477.      We turn to whether Tractor Supply was covered by a workers’

compensation insurance policy.

Tractor Supply Co. of Texas, L.P. v. McGowan                                            Page 4
        Tractor Supply is a “non-subscriber” to Texas workers’ compensation insurance

for its permanent, full-time employees. Tractor Supply provides an accident and injury

occupational benefits plan for its permanent, full-time employees. Tractor Supply argues

that it is covered by the workers’ compensation policy obtained by Job Link for its

temporary employees.

       In Garza, the client company’s contract with the temporary employment agency

included a “markup” that was paid to the employment agency to purchase worker’s

compensation insurance. Garza v. Exel Logistics, Inc., 161 S.W.3d at 478. The temporary

employment agency did purchase workers’ compensation insurance; however, the Court

found that the evidence did not indicate that coverage was extended to the client

company. Id. The Court stated that the Worker’s Compensation Act does not permit a

temporary employment agency to obtain coverage for a client simply by obtaining

coverage for itself. Id. There must be explicit coverage for the client company. Id.

       The agreement between Tractor Supply and Job Link provided that Tractor Supply

would pay a “markup” of 29.50 percent to include payroll taxes, general liability,

workers’ compensation insurance, drug screens, employment eligibility, and criminal

background checks. The agreement indicated a workers’ compensation code of “8107”

for Tractor Supply.

       Job Link maintained a workers’ compensation policy issued by Texas Mutual. The

policy included an Alternate Employer Endorsement.             The Alternate Employer

Endorsement provides:

Tractor Supply Co. of Texas, L.P. v. McGowan                                           Page 5
       This endorsement applies only with respect to injury to your employees
       while in the course of special or temporary employment by the alternate
       employer in the state named in the Schedule. Part One (Workers
       Compensation insurance) and Part Two (Employers Liability Insurance)
       will apply as though the alternate employer is insured.

The Alternate Employer Endorsement lists the alternate employer as “Blanket” and the

address as “Various Locations in Texas Only”.

       The record shows that Job Link submitted a “Temp Employee Data Worksheet for

Temp Services” to the Texas Mutual Underwriting Department. The document listed the

client companies of temporary service for Job Link and the zip codes for those companies.

That list of client companies provided to Texas Mutual states that there would be 40

employees at Tractor Supply and gives the description of operations as “warehouse order

pickers”. The “8107” classification code for workers’ compensation insurance referenced

in the agreement between Tractor Supply and Job Link is included in the workers’

compensation policy issued by Texas Mutual. The “8107” classification code refers to

“forklift sales, service and repair & drivers”.

       The Court in Garza held that there must be explicit coverage for the client

company. Garza v. Exel Logistics, Inc., 161 S.W.3d at 478. In Garza, the agreement between

the client company and the temporary employment agency provided that the client

company would be named as an additional insured in only the categories of “Commercial

General Liability”, “Automobile Liability”, and “Commercial Blanket Bond”. Garza v.

Exel Logistics, Inc., 161 S.W.3d at 481. The agreement excluded workers’ compensation as

a category in which the client company was to be named as an additional insured. The

Court found that the client company did not show it was “covered by workers’

Tractor Supply Co. of Texas, L.P. v. McGowan                                        Page 6
compensation insurance coverage” for a “work-related injury sustained by the

employee.” Id.

       Unlike Garza, the record before us shows that the workers’ compensation

insurance policy obtained by Job Link includes an Alternate Employer Endorsement. The

Alternate Employer Endorsement specifically provides coverage for bodily injury in the

course of special or temporary employment by the alternate employer. Although Tractor

Supply is not named in the policy as an alternate employer, the policy refers to the

alternate employer as “blanket” and Job Link provided Texas Mutual with a list of client

companies and their respective job descriptions. The agreement between Tractor Supply

and Job Link is distinguishable from that in Garza where the Court found that two

employers cannot agree that one workers' compensation policy will name only one

employer but cover both. Garza v. Exel Logistics, Inc., 161 S.W.3d at 479. We find that

Tractor Supply established that it is covered by workers’ compensation insurance

coverage for the injury sustained by McGowan.

       Tractor Supply was entitled to the exclusive remedy defense set out in TEX. LAB.

CODE ANN. § 408.001 (a) (West 2015). Section 408.001 (a) bars McGowan’s recovery from

Tractor Supply. We sustain the first issue. Because of our disposition of the first issue,

we need not address the second and third issues. TEX.R.APP.P. 47.1.

                                           Conclusion

       Having sustained Tractor Supply’s first issue on appeal, we reverse the trial court’s

judgment and render judgment that Kenneth Edd McGowan take nothing by this suit.

TEX.R.APP.P. 43.3.

Tractor Supply Co. of Texas, L.P. v. McGowan                                          Page 7
                                               AL SCOGGINS
                                               Justice

Before Chief Justice Gray,
       Justice Davis, and
       Justice Scoggins
Reversed and rendered
Opinion delivered and filed April 28, 2016
[CV06]

Tractor Supply Co. of Texas, L.P. v. McGowan                 Page 8