R. Scott Zuerker, a director in the Fort Smith offices of Cross, Gunter, Witherspoon & Galchus, P.C., achieved a favorable outcome for USA Truck, Inc. on August 28, 2013, in a workers’ compensation claim brought by Joe Watkins on February 3, 2009. In the decision, the Arkansas Court of Appeals affirmed an earlier Arkansas Workers’ Compensation Commission decision, declaring that Watkins failed to prove the existence of an employee-employer relationship.
The appellant, fifty-four-year-old truck driver Watkins, alleged that he suffered a compensable injury to his back on February 3, 2009 while unloading tires from the back of a trailer. Watkins contended that he was entitled to medical and temporary total disability benefits related to the injury. USA Truck controverted the claim in its entirety, contending that Watkins was not a USA employee.
The Arkansas Workers’ Compensation Commission and the Arkansas Appellate Court focused on the ten factors first recited in Cloverleaf Express v. Fouts, 91 Ark. App. 4, 16-17, 207 S.W.3d 576, 583 (2005), to decide the central issue of whether Watkins was considered an employee or an independent contractor:
- The extent of control which, by the agreement, the master may exercise over the details of the work;
- Whether or not the one employed is engaged in a distinct occupation or business;
- The kind of occupation, with reference to whether in the locality, the work is usually done under the direction of the employer or by a specialist without supervision;
- The skill required in the particular occupation;
- Whether the employer or the workman supplies the instrumentalities, tools, and the place of work for the person doing the work;
- The length of time for which the person is employed;
- The method of payment, whether by the time or by the job;
- Whether or not the work is part of the regular business of the employer;
- Whether or not the parties believe they are creating the relation of master and servant; and,
- Whether the principal is or is not in business.
In consideration of these factors, Zuerker convinced the Commission that Watkins’s “ownership of an essential piece of equipment, namely the truck/tractor, in his work activities” tipped the scale in favor of independent contractor status. The Administrative Law Judge, and in turn the Full Worker’s Compensation Commission, found it significant that that Watkins was the legal owner of his truck, did not buy it from USA or make truck payments to USA, and had previously purchased other trucks while working as an independent contractor for different motor carriers.
The Arkansas Court of Appeals went on to note that the foundation of the relationship between USA Truck and Watkins was based upon an Operating Agreement that was signed by both parties. In the document, Watkins and USA stated their intent to “create an independent contractor relationship between the parties and not a master-servant, employer-employee or principal-agent relationship.” Zuerker argued that the present case involved a “legitimate business deal between two competent parties, with each benefiting from the nature of the independent-contractor relationship.” Because he knew what he what he was doing, Watkins ran his truck in such a way as to maximize profit and was successful.
On cross-examination, Zuerker was successful in eliciting testimony from Watkins that he possessed a sophisticated understanding of the differences between the status of an owner operator versus the status of a company driver and that he did not intend to be a company driver. Based upon the evidence presented, the Court of Appeals distinguished this case from earlier cases on the basis that it was not a case of a respondent taking advantage of an employee. It did, in fact, involve a legitimate business deal between two competent parties, with each benefiting from the nature of the independent-contractor relationship.
This matter is captioned Watkins v. USA Trucking, Inc., 2013 Ark. App. 444, ___ S.W.3d ___ (Ark. App. 2013).