Court Opinion

ID: 9743140
Source: CourtListenerOpinion
Date Created: 2023-08-26 21:26:28.179675+00
Date Added: 2024-06-11T07:24:39.624959
License: Public Domain

Levin, J.
(dissenting). Wells, an employee of Muskegon Firestone Auto Supply and Service Stores, was injured in the course of employment by the explosion of a tire rim manufactured by Firestone Tire & Rubber Company. At the time of the accident, Firestone owned all the capital stock of Muskegon Firestone and substantially controlled its management and operations. The Court of Appeals in the application of an "economic reality test” determined that Firestone was Wells’ employer within the meaning of the workers’ compensation act, and that therefore Wells’ products liability claim was barred by the exclusive remedy provision1 of the workers’ compensation act.2
I
We would hold that "economic reality” is not determinative of the question which of the two separate corporations, parent or subsidiary, was Wells’ actual employer for purposes of the exclusive remedy provision of the act. Applying general principles we conclude that Muskegon Firestone, and not Firestone, was Wells’ employer, and therefore the exclusive remedy provision does not bar Wells’ action against Firestone.
A
Prior case law does not support the application *655of an economic reality test in this case. This Court in Tata v Muskovitz, 354 Mich 695; 94 NW2d 71 (1959), and Nichol v Billot, 406 Mich 284; 279 NW2d 761 (1979), did not, by applying a flexible approach to a limited aspect of workers’ compensation law, make "economic reality” the touchstone for other workers’ compensation determinations. In Tata this Court decided that the "control test” was an inappropriate measure for determining whether an injured worker was an independent contractor or an employee, who then would be entitled to workers’ compensation benefits. In reasoning to that conclusion, this Court adopted the dissenting opinion of Justice Talbot Smith in Powell v Employment Security Comm, 345 Mich 455; 75 NW2d 874 (1956), which stated an "economic reality test.”3 In Nichol, a third-party tort action where the question again was whether a worker was an independent contractor or an employee, this Court applied an economic reality test. The Court said that, as compared to the control test, the economic reality test achieved "a freer and more realistic balancing of all the relevant factors in each case to determine which persons are properly denominated employees . . . [and] which persons should be properly denominated independent contractors.”4
In Funk v General Motors Corp, 392 Mich 91; 220 NW2d 641 (1974), and Dagenhardt v Special Machine & Engineering, Inc, 418 Mich 520; 345 NW2d 164 (1984), this Court affirmed the general rule allowing an injured employee of a subcontractor to maintain a third-party action against the employer of the subcontractor. That general rule is not fully consistent with economic reality analy*656sis. An employee of a subcontractor — or the subcontractor himself if there are no other employees —pursues the goals of the employer of the subcontractor, is paid, at least indirectly, by the employer of the subcontractor and, questions of control aside, generally functions as an employee of the employer of the subcontractor.5 On that basis, many states treat the employers of subcontractors as employers of the subcontractor’s employees for purposes of the exclusive remedy provision.6 Neither the Legislature nor this Court, however, has adopted this widely accepted, economically based rule.
The economic reality test is a substitute for the control test.7 The control test is a means of characterizing an employment relationship, of determining whether the employment was of a subcontractor or of a servant. In the instant case, however, there is no employment relationship between Firestone and Muskegon Firestone. The issue here is not whether the control test should be abandoned and an economic reality test adopted. The control test has never been determinative of whether the corporate veil should be pierced or which member of a corporate family is the "actual” employer of a worker. The issue here is whether an economic reality test should be made determinative of whether parent and subsidiary corporations are a *657single entity; more specifically, of whether they are a single entity for the purposes of the exclusive remedy provision of the workers’ compensation act.
B
The vast majority of states do not extend the reach of the exclusive remedy provision of a workers’ compensation act by treating parent and subsidiary corporations as a single entity. Courts in California, Colorado, Connecticut, Florida, Illinois, Kentucky, Maryland, Mississippi, Missouri, New Jersey, New York, North Carolina, Oklahoma, South Carolina, Tennessee, Texas and Washington, refused to treat dominant parent and servient subsidiary corporations as a single entity for this purpose.8 The intermediate Georgia appellate *659courts are split on the question.9 Only in Louisiana is the employee of a subsidiary barred from bringing an action against the parent, but this appears to be mandated by a unique Louisiana statute.10
*660In this state, with the exception of the instant case, the cases uniformly suggest that an employee of a subsidiary corporation may maintain an action against the parent corporation.11 In the similar situation in which an employee brings an action against the sole and individual shareholder of the employer corporation, the courts of this state have refused to extend the bar of the exclusive remedy protection by piercing the corporate veil.12
Economic reality analysis would destabilize workers’ compensation and corporate law. The courts of this state generally respect the separateness of corporate entities, and pierce the corporate veil only to prevent fraud or injustice.13 Total domination by a parent corporation of a subsidiary does not justify piercing the corporate veil. As this Court said in Gledhill v Fisher & Co, 272 Mich 353, 358; 262 NW 371 (1935):
*661"It is not enough that the subsidiary is so organized and controlled as to make it 'merely an instrumentality, conduit or adjunct’ of its stockholders. It must further appear that to recognize their separate entities would aid in the consummation of a wrong.”14
*662The opinion of the Court would disregard the corporate forms of the entities solely because Firestone dominated or controlled its subsidiary.
Respecting the corporate forms in this case would not "aid in the consummation of a wrong.” Rather, we would thereby honor the corporate structure established by Firestone. As the Court of Appeals for the Sixth Circuit said in a similar situation in Boggs v Blue Diamond Coal Co, 590 F2d 655, 662 (CA 6, 1979):
"[A] business enterprise has a range of choice in controlling its own corporate structure. But reciprocal obligations arise as a result of the choice it makes. The owners may take advantage of the benefits of dividing the business into separate corporate parts, but principles of reciprocity require that courts also recognize the separate identities of the enterprises when sued by an injured employee.”15_
*663Economic reality analysis could be viewed as creating a new employment relationship between Wells and Firestone. So viewed, economic reality analysis overturns traditional concepts of consensual employment. In Schulte v American Box Board Co, 358 Mich 21, 24; 99 NW2d 367 (1959), this Court acknowledged that "the relationship of employer and employee, unless created by statute, is a contractual relationship.” As applied until now, the economic reality test has not violated this principle, because the test has been used only to characterize existing contractual relationships. Here, however, the test would determine whether two seemingly separate parties are one entity. Economic reality would be used not to characterize a contractual relationship, but to eliminate a parent subsidiary relationship. It would, in the instant case, create a new, rather than characterize an existent, employment relationship.
In Peterson v Trailways, Inc, 555 F Supp 827, 831-832 (D Colo, 1983), a United States District Court analyzed this aspect of the Court of Appeals decision in this case, and, noting that the economic reality test was developed to decide the independent contractor/employee question in cases implicating coemployee or employer immunity, criticized the extension of the doctrine:
"Inasmuch as analysis of the employee independent contractor distinction assumes the existence of a consensual relationship among the relevant parties, Wells’ extension of the 'economic reality test’ to cases raising this initial question seems unwarranted. Thus adherence to the indicators of 'economic reality,’ may well threaten the economic interests of the 'employee’ since *664his consent or agreement receive no conscious analysis, but are considered at best as a matter of implication.”
The court supported this statement by quoting from Professor Larson’s treatise on workers’ compensation law:
"Compensation law ... is a mutual arrangement between the employer and employee under which both give up and gain certain things. Since the rights to be adjusted are reciprocal rights between employer and employee, it is not only logical but mandatory to resort to the agreement between them to discover their relationship. To thrust upon a worker an employee status to which he has never consented would not ordinarily harm him in a vicarious liability suit by a stranger against his employer, but it might well deprive him of valuable rights under the compensation act, notably the right to sue his own employer for common-law damages.”16
The application of the exclusive remedy provision becomes, under any concept of economic reality, "a matter of implication,” and therefore subject to manipulation. Here, an employer argues that "economic reality” requires that a parent and subsidiary be treated as one entity, with the result that the parent is shielded from suit by the subsidiary’s employee. In Gigax v Ralston Purina Co, 136 Cal App 3d 591; 186 Cal Rptr 395 (1982), in contrast, an employee sued his corporate employer alleging a tort committed by a division of that corporation other than the one for which the plaintiff worked. The court applied an analysis based on "substance” and "hard realities,” and stated that such actions were not necessarily *665barred by the exclusive remedy provision and could be maintained in proper circumstances.17
The abolition of the corporate form "bright line” would unnecessarily complicate the compensation of workers’ injuries. The original application of the economic reality test did not create substantial administrative problems because the test replaced the equally ambiguous control test,18 and because the contracting provision of the workers’ compensation act19 made application of the test unnecessary in some cases. Here, however, a well-established, simple framework would be replaced by an amorphous "test” that provides courts with little guidance.
The concern expressed in Askew v Macomber, 398 Mich 212, 226; 247 NW2d 288 (1976) (Williams, J., dissenting), is on point:
"There is, however, an inherent difficulty in determining the 'economic realities’ of a given employment relation. As our Court of Appeals aptly stated in McKissic v Bodine, 42 Mich App 203, 208; 201 NW2d 333 (1972), 'the problem with economic reality is that it is a conclusion, and it is not a test in the sense that there are any well-defined criteria upon which an objective determination can be based.’ ”
Justice Talbot Smith, in his influential dissent in Powell, supra, pp 471-474, emphasized the need for a standard with a "definite meaning.” Smith rejected the control test, in large part,20 because it *666"failed to achieve either uniformity or certainty.”' He recognized that "[t]he administration of an act designed to relieve human want should not be made to depend upon our resolution of such verbal antics.” The economic reality test has proved no more certain in its application than the control test, but with its "freer determination,” it may be the lesser of two evils. We are not in this case faced with two evils. The traditional "corporate status” test21 provides a certain, predictable test which permits parties to plan their affairs and courts to resolve disputes.
The workers’ compensation act22 gives no indication that the Legislature intended for the term "employer” to have other than its normal meaning or that the Legislature intended to grant parent corporations exclusive remedy protection. The Legislature could, of course, have done so. Workers’ compensation legislation frequently accords protection to particular parties. In many states, employers of subcontractors are immunized from third-party liability.23 In Louisiana, shareholders of an *667employer corporation are protected by the exclusive remedy provision.24 In this state, the Legislature immunized insurance inspectors.25 There is no reason to suppose that the Legislature intended, but simply neglected, to provide express protection for parent corporations in Firestone’s position.26 We would not infer such an intent and thereby deprive Wells of his common-law action. As stated by Professor Larson:
"[T]here is no strong reason of compensation policy for destroying common law rights . . . [and] every presumption should be on the side of preserving those rights, once basic compensation protection has been assured.”27
C
This Court should not bar Wells from relying on the separate corporate forms of the parent and the subsidiary on the basis that he chose to disregard those forms when applying for workers’ compensation payments. The record does not reveal why Wells listed Firestone as his employer.28 Firestone has not claimed that Wells waived his third-party *668claim by listing Firestone as his employer. The question whether Wells did thereby waive his third-party claim is a question of fact, and not of law, which must first be raised before and decided by the WCAB.
D
We would follow the vast majority of jurisdictions and hold that economic reality is not a basis for piercing the corporate veil. The economic reality test was devised to avoid inappropriate use of the control test, but that concern is not relevant here since control alone is not determinative of whether the corporate veil should be pierced, or which member of a corporate family employs a worker. The question whether there is an employment relationship between Firestone and Wells should be resolved by consent and not by implication. Applying the economic reality test in this context would permit corporations to avoid the reciprocal obligations inherent in their choice of corporate structure and would deny employees of many subsidiary corporations of the right they undoubtedly had, at the time the Legislature authorized third-party actions by employees who had received workers’ compensation benefits, to maintain a third-party action.
II
The disposition which we believe to be correct *669makes it unnecessary to consider the dual capacity question. In this connection we note that the opinion of the Court extends the bar of the exclusive remedy provision by disregarding corporate forms in determining which of two separate entities is the "real” employer, but nevertheless treats the form as unimpeachable for the purpose of deciding whether the bar of the exclusive remedy provision applies where it is alleged that the employer is acting in a dual capacity.
The opinion of this Court may go further than is necessary to preserve the policy of the exclusive remedy provision. In the instant case, a customer of Muskegon Firestone supplied the defective Firestone product. Suppose a Firestone or Muskegon Firestone employee was injured in the course of employment as a consequence of the blowout of a Firestone tire on a rented automobile. It is questionable whether the bar of the exclusive remedy provision should preclude maintenance of a products liability action against Firestone.
This Court has recognized that the bar of the exclusive remedy provision may be superseded by other statutory policies.29 The products liability statute30 provides statutory authority for a products liability action, and suggests an inquiry whether the Legislature intended that a products liability action be barred by the exclusive remedy provision.
Kavanagh and Boyle, JJ., concurred with Levin, J._

 MCL 418.131; MSA 17.237(131).

 Wells v Firestone Tire & Rubber Co, 97 Mich App 790; 296 NW2d 174 (1980).

 The term "economic reality test” was, apparently, first used in Solakis v Roberts, 395 Mich 13, 25; 233 NW2d 1 (1975).

 Nichol, supra, p 298.

 See, generally, Dagenhardt, supra, fn 47, p 559 (dissenting opinion of Levin, J.).

 See Dagenhardt, supra, p 557 (dissenting opinion of Levin, J.), citing 2A Larson, Workmen’s Compensation Law, § 72.31(a), pp 14-111 if.

 See Tata, supra (employee/independent contractor); Schulte v American Box Board Co, 358 Mich 21; 99 NW2d 367 (1959) (employee/independent contractor; Smith, J., concurring, applied economic reality test); Goodchild v Erickson, 375 Mich 289; 134 NW2d 191 (1965) (employer/broker); Solakis, fn 3 supra (dual employer); Askew v Macomber, 398 Mich 212; 247 NW2d 288 (1976) (employer/ broker); Nichol, supra (employee/independent contractor); Farrell v Dearborn Mfg Co, 416 Mich 267; 330 NW2d 397 (1982) (dual employer/broker).

 California: Gigax v Ralston Purina Co, 136 Cal App 3d 591; 186 Cal Rptr 395 (1982). (The facts were disputed, it being unclear whether the plaintiff was an employee of a division of the defendant or of a subsidiary of the defendant. The court stated that the employee of a dominated subsidiary could sue the parent corporation on a products liability theory. The court also stated that an employee, injured while working for one division of a corporation could maintain an action based on a tort committed by a separate corporate division that was engaged in a separate enterprise. The court adopted an enterprise liability standard based on the "hard realities” of intracorporation organization. See Davis, Workmen’s compensation — Using an enterprise theory of employment to determine who is a third Party tort-feasor, 32 U Pitt L R 289 [1971]).
Colorado: Peterson v Trailways, Inc, 555 F Supp 827 (D Colo, 1983). (Employees of wholly owned subsidiary sued parent for failure to provide safe workplace. This case contains a thorough discussion of the issue.) See also Gaber v Franchise Service, Inc, 680 P2d 1345 (Colo App, 1984).
Connecticut: Gregory v Garrett Corp, 578 F Supp 871 (SD NY, 1983). (Employee of parent sued subsidiary on products liability and negligence theories.)
Florida: Gulfstream Land & Development Corp v Wilkerson, 420 So 2d 587 (Fla, 1982). (Employee of wholly owned subsidiary sued parent as a property owner. Parent and subsidiary were insured under the same workers’ compensation insurance policy.) Gulfstream overruled Goldberg v Context Industries, Inc, 362 So 2d 974 (Fla App, 1978).
Illinois: McDaniel v Johns-Manville Sales Corp, 487 F Supp 714 *658(ND Ill, 1978). (Employees of "various related companies” sued other related companies for injuries arising out of exposure to asbestos.)
Kentucky: Boggs v Blue Diamond Coal Co, 590 F2d 655 (CA 6, 1979) . (Employees of wholly owned subsidiary sued parent for negligent performance of a safety maintenance contract. This is the most influential case on the issue.)
Maryland: Thomas v Hycon, Inc, 244 F Supp 151 (DC, 1965). (Employee of wholly owned subsidiary sued parent truck-owner for injuries occasioned by defective brakes. Parent and subsidiary had a joint workers’ compensation insurance policy.) See also Heinrich v Goodyear Tire & Rubber Co, 532 F Supp 1348 (D Md, 1982).
Mississippi: Index Drilling Co v Williams, 242 Miss 775; 137 So 2d 525 (1962). (Employee of first wholly owned subsidiary brought action for negligence against second wholly owned subsidiary that was engaged in same line of work. Employee had received workers’ compensation from a third wholly owned subsidiary, probably under a borrowed servant theory.)
Missouri: Boswell v May Centers, Inc, 669 SW2d 585 (Mo App, 1984). (Employee of parent sued subsidiary.)
New Jersey: Mingin v Continental Can Co, 171 NJ Super 148; 408 A2d 146 (1979). (Employee of one wholly owned subsidiary sued parent and second wholly owned subsidiary under a products liability theory. All corporations were insured under the same workers’ compensation insurance policy.) See also Lyon v Barrett, 89 NJ 294; 445 A2d 1153 (1982).
New York: Samaras v Gatx Leasing Corp, 75 AD2d 890; 428 NYS2d 48 (1980). (Employee of subsidiary brought products liability action against parent.) See also Thomas v Maigo Corp, 37 AD2d 754; 323 NYS2d 106 (1971); Daisernia v Co-Op GLF Holding Corp, 26 AD2d 594; 270 NYS2d 542 (1966); Foley v New York City Omnibus Corp, 112 NYS2d 217 (1952).
North Carolina: Phillips v Stowe Mills, Inc, 5 NC App 150; 167 SE2d 817 (1969). (Employee of wholly owned subsidiary sued parent as building owner.)
Oklahoma: Love v Flour Mills of America, 647 F2d 1058 (CA 10, 1981). (Employee of wholly owned subsidiary sued parent. Court appeared ready to allow action, but held parent had violated no duty to this employee.)
South Carolina: Brown v Moorhead Oil Co, 239 SC 604; 124 SE2d 47 (1962). (Employee of uninsured, wholly owned subsidiary was not allowed to collect workers’ compensation benefits from insured wholly owned subsidiary that was engaged in same work.)
Tennessee: Latham v Technar, Inc, 390 F Supp 1031 (ED Tenn, 1974). (Employee of wholly owned subsidiary sued parent for breach of a nondelegable duty concerning dangerous objects. Parent and subsidiary were insured by the same workers’ compensation policy.)
Texas: Stoddard v Ling-Temco-Vought, Inc, 513 F Supp 314 (CD Cal, 1980) . (Employee of subsidiary brought products liability and negligence actions against parent. Parent and subsidiary were covered by same workers’ compensation policy.)
Washington: Peterick v State, 22 Wash App 163; 589 P2d 250 *659(1977). (Employee of 92%-owned subsidiary brought action against parent. Held: parent had violated no duty owed to this employee.)

 In Harvey v Fine Products Co, Inc, 156 Ga App 649; 275 SE2d 732 (1980), and Beck v Flint Construction Co, 154 Ga App 490; 268 SE2d 739 (1980), the Georgia appellate court barred actions against parent corporations brought by employees of subsidiaries. The court reasoned that the parent owed no duty to the employee unless the subsidiary was an "alter ego” of the parent. And if the subsidiary was an alter ego, then the parent was entitled to immunity to the same extent as the subsidiary.
Beck cites three cases to support its argument that the parent of an "alter ego” subsidiary enjoys immunity, but all are inapposite. In Yancey v Green, 129 Ga App 705; 201 SE2d 162 (1973), an employee of the board of education was barred from suing board members individually. In Mull v Aetna Casualty & Surety Co, 120 Ga App 791; 172 SE2d 147 (1969), an employee’s action based on negligent inspection by the defendant insurer was barred because a Georgia statute protected insurers from such suits. The court stated that the insurer was the "alter ego” of the employer. In Southern Wire & Iron, Inc v Fowler, 217 Ga 727; 124 SE2d 738 (1962), the court would not allow an employee to sue his employer’s president.
The cases rely on an alter ego theory that is not followed in Michigan. See fn 14.
A United States District Court applying Georgia law had reached a contrary result prior to Beck and Harvey. In O’Brien v Grumman Corp, 475 F Supp 284 (SD NY, 1979), the court rejected the defendant parent corporation’s claim that the immunity of its subsidiary should protect it from suit by an employee of the subsidiary.

 In Louisiana, the employee of a subsidiary may not sue the parent corporation. This result, however, is mandated by statute. In Braud v Dixie Machine Welding & Metal Works, Inc, 423 So 2d 1243, 1245 (La App, 1982), the court noted that a statute prohibited an employee from suing a stockholder of his employer. That statute, La Rev Stat Ann, § 23:1032, provides:
"The rights and remedies herein granted to an employee or his dependent on account of an injury or compensable sickness or disease for which he is entitled to compensation under this Chapter, shall be exclusive of all other rights and remedies of such employee . . . against his employer, or any principal, or any officer, director, stockholder, partner or employee of such employer or principal.” (Emphasis added.)
In Coco v Winston Industries, Inc, 330 So 2d 649 (La App, 1975), an employee of a subsidiary was injured while he arguably was pursuing the business of the parent corporation. The employee sued the parent as principal. The court discussed "alter ego” immunity, but the decision rests on the above-mentioned statute. The discussion of alter *660ego status was necessary because, under the Louisiana statute, the defendant, as principal, would be immune only if it was engaged in the same business as the employer of the injured employee. By showing that the employee’s employer (i.e., the subsidiary) was merely the alter ego of the defendant principal (i.e., the parent), the court proved that the defendant principal necessarily was engaged in the same business as the employee’s employer. Therefore, the defendant principal was immune from suit by the employee. See also Nichols v Uniroyal, Inc, 399 So 2d 751 (La App, 1981).

 Choate v Landis Tool Co, 486 F Supp 774 (ED Mich, 1980) (parent corporation does not obtain immunity based on its subsidiary’s immunity); Rick v R L C Corp, 535 F Supp 39 (ED Mich, 1981) (court suggests that parent does not obtain subsidiary’s immunity, but court held that parent did not owe a duty to this particular employee); Oliver v St Clair Metal Products Co, 45 Mich App 242; 206 NW2d 444 (1973) (court treats parent and subsidiary as distinct entities).

 Robards v Estate of Kantzler, 98 Mich App 414; 296 NW2d 265 (1980) (court refuses to give shareholder the immunity of his wholly owned corporation); Elliott v Smith, 47 Mich App 236; 209 NW2d 425 (1973) (employee’s survivors may not obtain workers’ compensation benefits from sole proprietorship owned by sole shareholder of uninsured employer corporation).

 See Klager v Robert Meyer Co, 415 Mich 402; 329 NW2d 721 (1982); Gledhill v Fisher & Co, 272 Mich 353; 262 NW 371 (1935); Belen v Dawson, 52 Mich App 670; 217 NW2d 910 (1974).

 See also Klager, fn 13 supra, p 411, and Gottlieb v Arrow Door Co, 364 Mich 450, 452; 110 NW2d 767 (1961). Three Michigan cases suggest that "domination” alone justifies piercing the corporate veil. But on close reading, it is clear that more than domination is necessary. In People ex rel Attorney General v Michigan Bell Telephone Co, 246 Mich 198, 204-205; 224 NW 438 (1929), the Court held that a Michigan corporation had been established by American Telephone and Telegraph Company "to avoid full investigation and control by the public utilities commission of the State to the injury of the public.” The Court also observed that the Michigan corporation was no more separate from AT&T in "carrying on a telephone business than is the ordinary station agent engaged in conducting and carrying on the railroad business of his employer.” The Court concluded: "Where a corporation is so organized and controlled and its affairs so conducted as to make it a mere instrumentality or agent or adjunct of another corporation, its separate existence as a distinct corporate entity will be ignored and the two corporations will be regarded in legal contemplation as one unit.”
The only question presented in that case, however, was whether the Michigan company could claim a credit for the sum of money paid to AT&T for certain services, or whether the credit would be granted only according to AT&T’s actual cost of providing the services. AT&T’s domination over the Michigan company made the contract between them appear to be less than an arm’s length transaction and, therefore, an inadequate way to determine the actual "costs” of providing the services and the resulting credit.
The controversy did not present the question of whether AT&T would be held liable for all the legal obligations of the Michigan corporation, and the opinion gives no indication that AT&T would be held liable.
In Western Casualty & Surety Co v Birmingham Contracting Co, 74 F Supp 200 (ED Mich, 1947), the court held that the corporation was not dominated by an individual shareholder as his alter ego, without explaining what type of domination would have been required to hold the shareholder personally liable for the corporation’s debts. All the court said was that "[w]here, as here, a plaintiff claims an individual defendant [is] personally liable on an alter ego theory for debts of a corporation and partnership of which he is a stockholder and partner, and plaintiff does not prove that such defendant was the real recipient of the assets or income of either entity, nor that either entity was dominated or operated by him as his alter ego, such individual defendant is not personally liable for such debts.” Id., p 208 (emphasis added).
In Shirley v Drackett Products Co, 26 Mich App 644; 182 NW2d 726 *662(1970), the plaintiff was injured by a defective product manufactured by the defendant’s parent corporation. Because the defendant subsidiary corporation distributed only the parent’s products, and had no separate identity of its own, the Court of Appeals held that the subsidiary was liable for the parent’s tort. In reaching this conclusion, the Court relied on Bathory v Procter & Gamble Distributing Co, 306 F2d 22 (CA 6, 1962), another case involving the distribution of a parent’s products by a wholly owned and dominated subsidiary. In both cases, however, the courts were considering the retailers’ immunity rule which protected distributors from liability for negligent manufacture in cases in which the distributors acquired the product for resale from a responsible manufacturer without knowledge of its danger. The Bathory court did not couch the issue in terms of piercing the corporate veil. Rather, the court argued that "[t]he reasons for the rule protecting a retailer or distributor from liability for negligence ... do not exist in this case.” Id., p 29 (emphasis added). The Bathory court did not pierce the corporate veil; it merely held that in certain cases involving dominated corporations, the retailers’ immunity rule would not apply. Shirley and Bathory applied an exception to the retailers’ immunity rule and did not create a novel ground for piercing the corporate veil.
Significantly, no court has cited Shirley as authority for the proposition that the corporate veil can be pierced without a finding of misconduct. To the extent that Shirley does stand for this proposition, the case has been criticized. See Petrella, Comment: Piercing the corporate veil in Michigan, 61 U Det J Urb L 81 (1983).

 At least seven courts either cite or quote Boggs on this point. See *663Gigax, fn 8 supra, p 604; Peterson, fn 8 supra, p 833; Gregory, fn 8 supra, pp 886-887; Gulfstream, fn 8 supra, p 589; Love, fn 8 supra, p 1062; Stoddard, fn 8 supra, p 326; Choate, fn 11 supra, p 776. See also Daisernia, fn 8 supra, p 594.

 1C Larson, fn 6 supra, § 47.10, p 8-233. Larson is also cited for this proposition in Gregory, fn 8 supra, p 876.

 Gigax, supra, p 607. See also fn 8.

 See Powell, supra, pp 471-474 (dissenting opinion of Smith, J.).

 MCL 418.171; MSA 17.237(171).

 The control test, which originally limited an employer’s vicarious liability, was also inappropriate because workers’ compensation involves different issues than tort law. Professor Larson explains:
"This tort liability arose out of detailed activities carried on by the servant, resulting in some kind of harm to a third person. The extent to which the employer had a right to control these detailed activities *666was thus highly relevant to the question whether the employer ought to be legally liable for them.” 1C Larson, fn 6 supra, § 43.42.
Workers’ compensation, however, involves separate issues that make control irrelevant.
"[Workers’] compensation law is concerned not with injuries by the employee in his detailed activities, but with injuries to him as a result not only of his own activities (controlled by the employer as to details) but of those of co-employees, independent contractors and other third persons (some controlled by the employer, and others not). To this issue, the right of control of details of his work has no such direct relation as it has to the issue of vicarious tort liability.” 1C Larson, fn 6 supra, § 43.42.
See also Nichol, supra, p 296; Powell, supra, pp 467-469 (dissenting opinion of Smith, J.).

 See Peterson, supra, p 832.

 The 1952 amendment that provides the basis for this third-party action (1952 PA 155, now MCL 418.827; MSA 17.237[827]) and the exclusive remedy provision (MCL 418.131; MSA 17.237[131]) are of central importance to this analysis.

 See fn 6.

 See fn 8.

 1969 PA 317, amending MCL 418.131; MSA 17.237(131).

 Unlike the independent contractor/employee and employer/broker questions which have been considered by this Court on numerous occasions (see fn 7), there are no inherent ambiguities in the determination involved in this case. The Legislature could readily have extended exclusive remedy protection to the parent of a wholly owned subsidiary insured under the same workers’ compensation policy as the parent.

 Larson, fn 6 supra, § 72.50, p 14-95. Larson is quoted on this point by Boggs, fn 8 supra, p 660, and Choate, fn 11 supra, p 776.

 Wells may have been urged to so file his claim by Muskegon Firestone, or he simply may have erred. Muskegon Firestone also listed Firestone as Wells’ employer. Muskegon Firestone may have done so because Firestone carried the workers’ compensation insurance for both corporations and was therefore more likely to be involved in the administration of compensation payments. Wells and Muskegon Firestone may both have been more concerned with com*668pleting the paperwork and with initiating payment than with observing the formalities.
At any rate, these representations are not necessarily controlling. At the time of the accident, Wells was an employee of Muskegon Firestone. The subsequent representations would not operate retroactively to eliminate this employment relationship or to create a new one with Firestone. It does not appear that Wells’ representation misled Firestone in such a manner that it is now necessary to disregard the corporate form to secure justice. Firestone has not alleged that Wells acted in bad faith.

 See Mathis v Interstate Motor Freight System, 408 Mich 164; 289 NW2d 708 (1980) (no-fault automobile insurance benefits); Boscaglia v Michigan Bell Telephone Co, 420 Mich 308; 362 NW2d 642 (1984) (sexual/ethnic discrimination). See also 2 Larson, supra, § 68.10, p 13-1 (intentional torts).

 MCL 600.2945 et seq.; MSA 27A.2945 et seq.